Q: We own an undeveloped acreage that used to be farmland. The previous owner allowed a natural gas line to go across the land. As a result, we can’t build in the spot we like. Also, the gas company wants to charge us the same price it charges anyone else to hook up to the gas line, even though the line runs through our property. Can we challenge the agreement the previous owner made? Also, are we stuck paying the same price for hook-up as everyone else?
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A: You’re likely not in a strong legal position, but I cannot be sure due to a lack of information. A lawyer would need to know what province you’re in and need to search the title and any registrations against it and read the original agreement between the gas company and the previous owner. You should definitely consult a local lawyer, and provide this information.
I can give you some general answers.
Utility companies often approach landowners and seek permission to run lines over their land.
They generally offer the landowner some payment or compensation in exchange for the rights to put the gas, hydro or phone lines across the property.
This is a matter of pure contract between the utility company and the farmer. At the time that agreement was entered into, the previous owner of your land had every right to bargain with the gas company before signing an agreement.
In all likelihood, in exchange for some money, he gave the gas company an ongoing right to maintain its line over the property.
The gas company probably registered an easement or other encumbrance against title, thereby protecting its ability to install and maintain the line.
That registration should have been known to you, or to your lawyer, when you purchased this land.
As a potential buyer, it is expected you will fully inspect the land, get a copy of title and investigate any encumbrances against it.
Easements “run with” the land; that is, they stick to the land and not just to a particular owner.
So if you buy land that is already subject to an easement, you are usually stuck with the terms and conditions of that easement.
You should have been able to determine exactly where the gas line was before buying the land.
You could have staked it out or at least made approximate measurements to see where the line crossed your land. If you failed to do that, it’s unlikely a judge will be moved by your argument. A judge would likely rule that you should have checked this before making your purchase.
I doubt that you will be able to successfully challenge the agreement, assuming the contract was registered and protected by an easement and is properly drafted.
Your second question was whether you had to pay what everyone else is paying for a natural gas service connection.
Unless the agreement between the previous landowner and the gas company provided for some right to a free or discounted gas hook-up and unless that right pertained to the land, and not the individual, I highly doubt you have any leverage.
Like all other consumers, you will most likely be required to pay the going rate.
Your case highlights the need for caution when buying anything, especially land, and to exercise due diligence and make all required searches and inquiries before buying.
Otherwise, you may be stuck with the terms of a deal you didn’t make.
Rick Danyliuk is a practising lawyer in Saskatoon with McDougall Gauley LLP. He also has experience in teaching and writing about legal issues. His columns are intended as general advice only. Individuals are encouraged to seek other opinions and/or personal counsel when dealing with legal matters.
