Trends in Real Property Law

Acquisition of Prescriptive Easements for Public Utilities

by Justine Bedasse and Sarah Spitz

When the government or its agents must acquire private land without the consent of the owner, the typical process is to acquire or expropriate the lands under the Expropriations Act, RSO 1990, c. E.26. This typically involves compensating the property owner for the use of land for the public good.

The Court of Appeal’s decisions in Paleshi Motors Limited v Woolwich (Township) [1] and most recently in Hydro One Networks v Shiner suggest an emerging trend that may allow the continued operation of public utilities over private lands without agreement or expropriation where the authority responsible for the utility can establish a prescriptive easement.

This post explores the test and policy rationale underlying the concept of easements by prescription in law and provides insight into emerging trends with respect to acquisition of utility easements by prescription.

Legal Foundation for Prescriptive Easements

Easements are a right of way that allows one party (known as the dominant tenement) to legally cross over the property of another party (the servient tenement) for a specified purpose. There are a number of methods to create easements at law, one such method is easement by prescription.

The rights to easements by prescription arise where a party (the dominant tenement) can prove historical use of another party’s property over a requisite period of time. The rights of prescriptive easements have been recognized in common law since 10th century England where claimants had to prove that their use had been taking place since beyond “living memory”. Today, under the doctrine of lost modern grant, historical use need only be proven for a period of 20 years directly preceding the claim, or for a period of 20 or 40 years under section 31 of the Real Property Limitations Act, R.S.O. 1990, c. L.15.

In Hunsinger v Carter, the Court of Appeal for Ontario established that a prescriptive easement requires the person claiming the easement to establish the following four criteria:

i)                 a dominant tenement that enjoys the benefit of the easement and a servient tenement whose owner suffers some use of its land;

ii)                the properties cannot be owned by the same person;

iii)              the benefit of the easement must be reasonably necessary for the enjoyment of the dominant tenement; and

iv)              20 or 40 years’ continuous, uninterrupted, open, and peaceful use enjoyed without obtaining the permission of the servient tenement owner (i.e., use “as of right”).

Prescriptive easements come with several policy justifications.

The first is that society benefits when landowners are prudent and make productive use of their property. Prescriptive easements are a way to reward a party who has made productive use of a landowner’s property. This also has the effect of punishing landowners who “sleep” on their property rights.

Another policy objective justifying prescriptive easements is known as the “quieting of title”. Where two parties are asserting rights to the same property, it is thought that the creation of prescriptive easements makes the process of determining property rights more certain, and increased certainty encourages market activity.

Despite the long-standing history of possessory title claims such as easements by prescription in law, modern day property rights in Ontario are moving away from the above policy objectives and towards guaranteeing stronger title protections for landowners.  As such, easements by prescription have effectively been extinguished in Ontario since the Land Titles Act, R.S.O. 1990, c. L.5 came into effect. However, prescriptive easements are still recognized where the requisite time period for use was satisfied before the subject lands were converted to the Land Titles system. These are the circumstances under which a party may successfully claim an easement by prescription in the present day.

This trend towards stronger protections for private property owners is interesting when compared with the rights afforded to property owners under the Expropriations Act. The purpose of the Expropriations Act is to ensure that landowners are fully and fairly compensated when a public body takes interest in their land without consent (See: Dell Holdings at paras 5, 20).

However, two recent Court of Appeal decisions have considered both prescriptive easements and expropriation and found that a public body, though technically empowered to expropriate, can acquire land rights over private land by prescription when the requisite legal criteria are met.  

Paleshi Motors Limited v Woolwich (Township)

In Paleshi Motors Limited v Woolwich (Township), the Court of Appeal upheld a decision finding that the respondent Township had established entitlement to a prescriptive easement for a waterline running across the Appellant’s lands.

The watermain was installed in or around 1979, and there was some evidence that the Township had entered the lands from time to time since then to maintain the watermain without seeking permission from the former property owner. The dispute over the lands and the watermain arose in 2015 when a new owner acquired the property. Paleshi Motors sought a permanent injunction that the watermain be removed, or a declaration that the Township expropriate the land for the watermain and pay compensation in accordance with the Expropriations Act. The Township, in response, asserted that it had a prescriptive easement over the lands in question.

The Application judge ruled in the Township’s favour and found that the legal test for establishment of prescriptive easement had been met. There was no evidence that the property owners during the requisite 20 year period had knowledge of the watermain or that they had an agreement with the Township for use of the watermain. The Application judge also determined that the former owner of the property had actual or constructive knowledge of the watermain, fulfilling the requirement for the use of the land to be open and notorious such that the owner had acquiesced to the use.

On appeal, Paleshi Motors argued, among other things, that allowing a municipality to establish an easement by prescription was inconsistent with established policy. It argued that prescriptive easements must be given a special meaning when they accommodate a public authority as the dominant tenement, particularly when engaging in the analysis of whether the benefit of the easement must be reasonably necessary for the enjoyment of the dominant tenement.

The appellant argued that the easement was not reasonably necessary because another avenue was available to Woolwich to acquire the interest in Paleshi’s land: Expropriation. The Appellant further argued that a prescriptive easement should never be necessary in the case of a public body with the power to compulsorily acquire the necessary easement while protecting private property rights.

The Court of Appeal disagreed. It held that the policy underlying the common law’s recognition of prescriptive easements applies equally to all property owners, whether private or public, and that the question of whether it should apply differently to public authorities was a question for the legislature, not the courts (para 22).

Hydro One Networks v Shiner

The Court of Appeal recently heard a similar case, and again found that a public or quasi-public body with expropriation powers was permitted to acquire an easement by prescription.

In Hydro One Networks v Shiner, Hydro One claimed prescriptive easement over a roadway used to access transmission lines and towers after the respondent objected to the use on the portion of the roadway that was on his property. Though technically not a public authority, Hydro One may apply to the Ontario Energy Board for authority to expropriate land for the purpose of constructing, expanding or reinforcing electricity transmission lines pursuant to section 99(1) of the Ontario Energy Board Act, 1998, S.O. 1998, c. 15, Sched B.

At first instance, the property owner was successful in resisting Hydro One’s claim to a prescriptive easement for maintenance of a transmission line. The Court of Appeal overturned the Application Judge’s decision and found that the test for a prescriptive easement had been made out by Hydro One. It found that the use claimed was continuous and “as of right”, even though it was intermittent. This is consistent with the Court of Appeal’s finding in Paleshi that time to time maintenance of the watermain was sufficient to meet the test required for continuous, open and notorious use as of right.  

In Shiner, the Court of Appeal held that the Application Judge had misapprehended the evidence by concluding Hydro One conceded to only accessing the site every one to three years for foot patrol and every six to eight years for brush clearing This, in the Court of Appeal’s view, contradicted evidence from a witness who had observed Hydro One vehicles accessing the site twice a year since 1966 and a former Hydro One employee who stated that Hydro One undertook spraying operations at the site daily in the spring and summer from 1997 to 2008. to the Court of Appeal found sufficient evidence to support a pattern of use and ultimately found that the use was continuous within the meaning of the test for a prescriptive easement.

Takeaways

The Court of Appeal’s decisions in Paleshi and Shiner are notable for two reasons. First, the law seems not to distinguish between public and private interests for the purpose of prescriptive easements. Second, when easements are sought for the maintenance of water or power lines, seasonal or annual maintenance is often sufficient to establish the “continuous use” criteria under the test for a prescriptive easement.

In light of these decisions, it is important for property owners to carefully take note of public utility placements and ensure that agreements are in place if any public utilities run over private property. It is not possible for public authorities to obtain easements by prescription for new utility lines or corridors. However, when there are existing utilities that pre-date the property’s conversation to Land Titles, it is important to ensure that such utilities are properly accounted for and documented.

Note 1: Shane Rayman, Conner Harris and Sarah Spitz were counsel for the Appellant, Paleshi Motors Limited in Paleshi Motors Limited v Woolwich (Township)