LTA Fact Sheet Conservation Easement v. Deed Restriction Since we are a nonprofit with a words, a land trust cannot transfer a n permanent existence, is there simple deed restriction to another land any difference between our receiv- trust or public agency. ing a restriction on land by deed Another disadvantage to simple deed covenant and a restriction on land restrictions is that the case law of most by conservation easement? states require the courts to resolve any Deed restrictions and conservation ambiguity in the interpretation of a com- ^ easements are essentially the same mon law deed restriction in favor of the thing... legally binding restrictions on less restricted use. Moreover, deed the use of land in the form of a written restrictions can be terminated by a court instrument that affects the title to the based on economic hardship or impracti- land and is generally recorded where cability, without regard to public benefit. deeds are recorded. The only significant None of these impediments are applied difference is that the conservation ease- to properly written conservation ease- ment, if written properly and granted to ments. In fact, some state laws instruct an eligible grantee, is entitled to many courts not to consider financial hardship more protections of the law under most in evaluating whether to terminate or states' statutes. It is generally accorded modify an easement for "changed circum- greater deference by courts in the event stances." Even in the absence of such of a dispute. Another major difference is specific protection, courts are apt to give that conservation easements that meet greater deference to conservation ease- certain qualifications are eligible for ments because of the public benefit they income tax treatment as a charitable serve. gift. Because of these added benefits, If a full-blown easement is unappeal- there is no reason why a qualified ing to a landowner and he or she doesn't grantee should ever take a simple deed care about tax deductions, in many restriction. states it is possible to draft a very simple Deed restrictions are a creature of document that more resembles a deed "common law," the law we inherited from restrictions,but which meets the require- England, as interpreted by court deci- ments of the easement statute, and sions. Those decisions have resulted in therefore qualifies for all of its protec- some significant drawbacks for deed tions. In Maine, for instance, the follow- restrictions that the state conservation ing language added to short and simple easement statutes were designed to elim- deed restriction language will make it a inate. While it may differ from state to permanent conservation easement, with- state, a deed restriction is not perma- out even mentioning the easement nent unless it is "appurtenant" to nearby statute. land. It must benefit that nearby land, This covenant is for conservation and run with the title to both properties. purposes and shall run with and Otherwise, it is enforceable only during burden the premises in perpetuity, the lifetime of the grantor. Neither is it and The Land Trust, its successors assignable by the grantee-in other and assigns, shall have the right to Land Trust Alliance | 1331 H St., NW Suite 400 | Washington, DC 20009 | 202-6638-44725 | www.LTA.org | www.LTAnet.org LTA Fact Sheet enforce the same at law or in equity, and the right to enter the premises at a reasonable time and in a rea- sonable manner in order to monitor compliance herewith. This kind of clause can also be used to turn a deed restriction in a deed from the land trust to another organization or person into a conservation easement. In fact, with just a few more sentences, an abbreviated version of the boilerplate language required by the IRS for income and estate tax recognition can turn the otherwise qualified restriction into a qualifed conservation contribution under the tax code. The assistance of experi- enced counsel is essential, of course. Karin F. Marchetti Ponte, General Counsel Maine Coast Heritage Trust Excerpt from "Ask an Expert", Exchange, Spring 2001 This document is one of a series of fact sheets and reference materials produced by the Land Trust Alliance. Please contact us for additional information or to order materials.