“Let It Snow, Let It Snow, Let It Snow…But Should Someone Else Be Clearing it?”

Winners, shopping in Calgary

Winter has made its early debut. The snow has begun falling and the salt trucks are already covering the roads (and our cars), and it’s not even December! Despite the bleak forecasts, people are out and about in large numbers, especially in light of the approaching holidays. With the snow comes the ice, and shopkeepers and property owners alike are getting their own shovels and salt stashes ready to clear their walkways and sidewalks for their customers and tenants. Along with the bad weather also come the questions regarding a property owner’s or lessee’s obligations to a tenant or customer to create a safe, and ice or snow free, place to come and go. It’s best to have a plan of action with regard to your property before the bad weather hits and understand your duties to those visiting your property during the winter season. If you’re a landlord, business owner or retail lessee, consider the following:

Landlord/Tenant Obligations

Generally, a landlord has a duty to exercise reasonable care to keep common areas held in the landlord’s control in a safe condition for their tenants, as well as recognize changing conditions and remedy them as they arise. This is especially an issue when the weather turns for the worse. Landlords need to be aware of potential issues as the snow and ice starts to accumulate, keeping on hand the proper materials to keep the walkways clear and safe and be cognizant of problems as they arise so they are fixed in a reasonable manner and within reasonable time.

Business Owners/Lessees

For tenants leasing a retail space, it is important to first look to your retail lease to determine exactly who is obligated, if anyone, to clear and salt the walkways and storefront in bad weather such as snow and ice. If your business or property sits on a municipality owned walkway or roadway, look to your city ordinances to determine whose obligation this may be in inclement weather. Determining whose responsibility it is to take action when winter hits is the first step in preventing injuries on your premises as well as liability for yourself or your business. Whether you’re a retail landlord or tenant, consider whether you need to incorporate language into your lease that speaks to duties with regard to snow and ice if these obligations are not clear.

If your business, like many others, clears and salts its sidewalks and parking lots to encourage people to come in despite the wintery conditions, it is important to have a consistent policy in keeping your premises clear and as safe as possible. With a change in Kentucky law over the last 5 years, even if it is obvious to your customers that weather is poor and the sidewalks slick, the entity occupying the property could still face liability if it doesn’t ensure the care towards its premises is reasonable under the circumstances.

By addressing these potential issues early, landlords, business owners and lessee’s can reduce the possibility of incidents on their premises and injuries to their customers or tenants during the winter season. If you are a landlord, retail owner or tenant and have questions about your obligations, contact the attorneys at McBrayer today.

BMacGregor

Brittany MacGregor is an associate attorney practicing in the Lexington office of McBrayer, McGinnis, Leslie & Kirkland, PLLC. She is a graduate of Transylvania University and the University of Kentucky College of Law. Ms. MacGregor’s practice focuses on real estate law, including title examination, title insurance, clearing title issues, deeds, settlement statements, preparation of loan documentation, contract negotiation and preparation, and lease negotiation and preparation. She may be reached at bmacgregor@mmlk.com or at (859) 231-8780.

This article is intended as a summary of federal and state law activities and does not constitute legal advice.

Pipeline Still Pushing Through, But Without Eminent Domain Power

According to a ruling issued last week by Judge Phillip Shepherd from Franklin Circuit Court, The Bluegrass Pipeline Co. cannot use eminent domain and condemnation to take private property for construction of a natural gas liquid (“NGL”) pipeline through Kentucky. Details about the Bluegrass Pipeline and the company’s efforts to secure easements were shared earlier on this blog.

Kentuckians United to Restrain Eminent Domain, or “KURE”, is a private citizens group that asked the Franklin Circuit court last year to clarify the scope of Bluegrass Pipeline’s power and whether the private company could use the right of eminent domain to take property by condemnation and without a landowner’s consent. KURE’s lawsuit was spurred by Franklin County resident Penny Greathouse after a representative of the Bluegrass Pipeline told her the company had the legal right to exercise eminent domain while attempting to secure an easement for the pipeline through her property.

Many other landowners have reported that the company’s representatives threatened the use of eminent domain during their negotiations for pipeline easements. Judge Shepherd stated in his ruling, “Bluegrass remains free to build its pipeline by acquiring easements from willing property owners . . . [H]owever, Bluegrass cannot invoke the sovereign power of eminent domain to threaten or intimidate, or even suggest to landowners who have no desire to sell, that Bluegrass has the right to take their property without their consent.”

The legal concept of “condemnation” under Kentucky law allows land to be “taken” for public use, such as for utility lines or highways. Judge Shepherd however found that, “Bluegrass is a private, for-profit unregulated entity . . . not acting ‘in public service,’ and therefore, it falls outside the scope of KRS Chapter 278.” He further stated that the proposed pipeline does not have any impact on the energy needs of Kentuckians, but rather results in “NGLs, a mixture of highly dangerous chemicals, running through Kentucky farmland and forests, and near rural communities.”

Judge Shepherd’s order makes it clear that Bluegrass cannot invoke eminent domain to threaten or intimidate landowners, but the company does remain free to build its pipeline by acquiring easements from willing property owners. Tom Droege, a company spokesman, said in a statement following the ruling that the company will immediately appeal the decision and continue to purchase easements through face-to-face negotiations with landowners. Droege said Bluegrass Pipeline already has nearly 70% of the route it needs in Kentucky. Regardless, the Bluegrass Pipeline has been significantly delayed. Industry insiders believe that the pipeline is certain to come through Kentucky; however, it may take up to another year to complete the easement negotiation process before construction.

In his order, Judge Shepherd acknowledged the “immediate effect on bargaining power” that his decision would carry with it. Shepherd’s ruling is certainly a win for opponents of the proposed pipeline; however, the conflict is far from over. Landowners must remain vigilant to protect their property rights, carefully weigh their options, and contact an attorney before negotiating a pipeline easement.

The attorneys at McBrayer remain dedicated to ensuring that Kentucky landowners receive just compensation for their land should they choose to allow the pipeline on their property. If you or someone you know is considering allowing the pipeline through their property, contact the attorneys at McBrayer today.

 

JMorgan

Jason S. Morgan is an Associate of McBrayer, McGinnis, Leslie & Kirkland, PLLC. Mr. Morgan actively represents large, small, established, and new real estate developers and homeowners beginning with the planning phase of a proposed development through zoning changes, development plan approval, financing and the land acquisition processes.  He also has extensive experience with residential and commercial construction and insurance litigation. He is located in the firm’s Lexington office and can be reached at  jmorgan@mmlk.com or at (859) 231-8780.

This article is intended as a summary of  federal and state law and does not constitute legal advice.

 

 

Is the Bluegrass Pipeline Selling Pipe Dreams to KY Landowners?

Are you a Kentucky landowner in the path of the proposed Bluegrass Pipeline? If so, you need to read this before agreeing to allow the pipeline on your land. Residents in thirteen counties will be affected by the proposed pipeline and a lot is at stake. As a landowner, you need to understand your legal rights and the potential risks associated with the pipeline so you can make an informed decision as to whether or not you are going to allow the pipeline on YOUR property.

Background

The pipeline project is a joint venture between two companies, Williams Co. and Boardwalk Pipeline Partners (“the Companies”). The project calls for a high pressure, 24-inch diameter underground pipeline to be installed. The pipeline will connect to an existing pipeline in Breckenridge County. The pipeline’s purpose is to transport natural gas liquids from the Marcellus and Utica shale regions in the Northeast to Louisiana. Natural gas liquids are used for a variety of purposes in several industries – including petrochemical and plastics.

Before the pipeline can be installed, the Companies must obtain “easements” from all landowners whose property is located in the proposed route.  An easement is a legal right to use the property of another. Easements can be temporary or permanent in nature. For the proposed pipeline, both permanent and temporary easements are necessary.  A permanent easement “runs with the land,” which means that anyone who owns the land after the easement is granted will have to comply with the terms of the easement.  A temporary easement is limited in time.  Once an easement is granted for the pipeline project, the Companies can prohibit and/or require certain actions of a landowner. For instance, Bluegrass Pipeline prohibits the construction of any above-ground structures within the easement.  Additionally, landowners are charged with the responsibility of ensuring that pipeline markers remain in place on the property (and must individually pay for lost or damaged markers).

Knock, Knock

Company representatives, also known as “Right-of-Way Agents” or “Land Agents,” are out in full force contacting landowners in the pipeline’s proposed path promising big payments and little to no risk. But, is it too good to be true?

The Right-of-Way Agent’s first request is to survey the land. The survey process outlines the pipeline’s proposed route and results in stakes and/or ribbons being tied to fences and trees.  Commonly, survey ribbons are pink. The surveyors mark the center line of the pipeline, but do not mark the boundaries of the permanent and temporary easements.

The land required for the proposed easement will vary for each parcel; however, the Companies have generally represented that a 50-foot wide permanent easement, along with another 50-foot temporary easement for workspace is necessary to construct and install the pipeline. For perspective, most four-lane highways are 48 feet wide.

Fair Compensation

A Right-of-Way Agent may use high-pressure tactics in order to obtain an easement. Some landowners have reported that they were promised a 30% payment upfront in exchange for signing the easement, with the remaining balance to be paid if the easement is “extended” to allow the pipeline to be constructed.  Similarly, some landowners have reported being offered an additional 10% signing bonus.  Many landowners fear that if they do not agree, they will be taken to court and lose their property to the power of eminent domain (also known as “condemnation”).

Regardless, the Companies are required to compensate landowners for three things:

  • Fair value for the privilege of establishing a permanent easement across the land;
  • Fair rental value for the temporary easement to construct and install the pipeline; and,
  • Fair compensation for damage to crops, grazing lands, timber or any structures directly caused by construction and installation of the pipeline.

Right-of-Way Agents work for the Companies and do not have landowners’ best interest in mind; instead, their goal is to acquire all the necessary easements for the pipeline’s proposed route, for as little money as possible.

The attorneys at McBrayer, on the other hand, do have the landowner’s best interest in mind and are ready to help landowners get maximum value should they choose to allow the pipeline on their property.

McBrayer understands that every negotiation is different.  That is why we account for not only the land, but its unique characteristics (such as natural springs), loss of use/enjoyment, loss of production, and rent for the temporary workspace. We can review the terms of a proposed easement and include provisions that will further protect a landowner’s interest and future rights. We can work with the Companies to ensure the location of the pipeline is appropriate.  We can review mortgages and insurance polices to ensure that the easement is not prohibited.  We also can work to minimize a landowner’s tax consequences and locate industry experts who can assist in providing property valuation.

Don’t let a Right-of-Way Agent pull the wool over your eyes. The Bluegrass Pipeline is a major undertaking and requires careful consideration.  Landowners who agree to allow the pipeline on their property deserve to have their rights protected and to be fairly compensated.

JMorgan

 

Jason S. Morgan is an Associate of McBrayer, McGinnis, Leslie & Kirkland, PLLC. Mr. Morgan actively represents large, small, established, and new real estate developers and homeowners beginning with the planning phase of a proposed development through zoning changes, development plan approval, financing and the land acquisition processes.  He also has extensive experience with residential and commercial construction and insurance litigation. He is located in the firm’s Lexington office and can be reached at  jmorgan@mmlk.com or at (859) 231-8780.

This article is intended as a summary of  federal and state law and does not constitute legal advice.