Status of Legal Protection
The real estate under the protection of the private land conservation community, either as fee simple lands or conservation agreements, is found primarily across Canada’s southern landscape, a region that reflects a high degree of fragmentation due to settlement and industrialization patterns over the last few hundred years. These lands play a significant role in helping to protect biodiversity and ecosystem services as they have been secured by the land conservation organization due to their high conservation value. From an ecological perspective, these lands are irreplaceable.
Legal defence was mentioned as a priority by every private land conservation organization consulted, but their capacity to protect their properties effectively reflects a wide range of experiences. The urgency felt to address organizational challenges related to legal defence varied, with some feeling the pressure of specific issues, such as the growth of residential land development, more acutely than others.
Further, advice from the Environmental Law Centre and Miistakis Institute reinforces the unique context for legal protection of a conservation agreement. “Knowing that conservation easements are perpetual and likely to face a challenge at some point, conservation easements should be drafted with the expectation that they will have to be defended at some point in the future.”(35)
The main areas of discussion during the consultations focused on protecting conservation agreements and covered:
- the importance of deterrence – all private land conservation organizations need to be backed by strong legal defence support
- the vulnerability of conservation agreements – the impact of change of ownership and the organizational expertise needed to foster positive landowner relationships
- the key elements of best management practices to ensure prevention of legal issues
- the impact on the organization of the settlement or claims process
- the need for knowledgeable legal professionals and a legal defence fund
- the benefits and challenges of a collective insurance program to support all private land conservation organizations
A number of private land conservation organizations reported that they had yet to deal with any significant legal issues, because their conservation agreements are still with the original grantor of the agreement. Legal costs for their regular operations relate to title transfer and due diligence for fee simple lands, as well as reviews of conservation agreements. They anticipate issues arising in the future when their properties start to change hands, and most have identified the need to increase their legal defence resources. This ranges from increasing their restricted funds to adding staff trained in landowner outreach and compliance monitoring to having access to legal expertise with a solid knowledge of regional issues and how land conservation organizations operate. One organization, for example, described taking a proactive approach when one of their easement properties went on the market. They provided the local realtors with information about the meaning of the conservation agreement, so prospective buyers could be well informed before making an offer.
The private land conservation sector is exposed to unique legal risks that do not lend themselves to coverage in the general insurance sector. The insurance instruments available to them include commercial general liability insurance that protects “against claims for bodily or personal injuries, advertising liability, as well as property damage to third parties arising from your operations or products or occurring on your business premises”(36) and title insurance that covers issues that may affect, for example, clear title to the property, existing liens, encroachment on an adjoining property, title fraud and mistakes in the public record or land survey.(37)
Larger or older private land conservation organizations have dealt with issues with conservation agreements and fee simple lands, such as:
- enforcing agreements
- damage from activities on adjacent lands, such as drainage alteration from residential construction
- dealing with formal challenges, such as expropriation for road or pipeline construction
- encroachment activities by neighbouring landowners, such as tree cutting
- general property damage
- property management liabilities that impact neighbours
- assessed value of property with conservation agreement
- enforcement of provincial or federal rules at the municipal level
Another area of risk identified related to the misalignment of policies and/or programs between different levels and departments of government. While beyond the scope of this report, additional research is needed, for example, to clarify the significance that mismatches between high-level conservation goals and provincial planning law or municipal plans have at the site level and on private land conservation organizations. These mismatches can have implications for legal defence of conservation lands. Similarly, how does a conservation agreement impact the assessed value of a property and does this hinder or support long term protection?
The capacity of every private land conservation organization to defend its agreements and properties is the litmus test for the entire sector. The goal is to settle issues through mediation and avoid litigation. A poor outcome for an organization in court can set a legal precedent that could impact every private land conservation organization in Canada.
The focus on building a strong relationship with the landowner for a conservation agreement is central to every organization’s legal protection strategy. Nonetheless, challenges in maintaining this practice at the level needed persist and leave the organization feeling vulnerable.
Private land conservation organizations recognize the need to maintain an internally restricted fund for legal defence. Raising funds for this purpose is a challenge as most donors prefer to fund activities rather than give to a restricted fund. As outlined in the Status of Stewardship section of this report, private land conservation organizations spend significant time raising annual funds to cover their core operations, special projects, stewardship activities and their investment targets for long term stewardship. However, these funds are mainly applied to stewardship activities rather than set aside in a restricted fund for a legal defence action that may not occur for many years. Consequently, organizations feel that their legal defence fund is too low. It is common practice to use one restricted fund to cover both stewardship and legal defence, although some organizations keep separate funds.
In the case of a dispute or non-compliance with a conservation agreement, direct costs related to the settlement process include legal as well as other professionals needed to evaluate damages and provide estimates and plans for restitution. Private land conservation organizations reported a range of costs related to settlements between $3,000-$90,000. For cases elevated to the courts, the costs were much higher.
A couple of examples that were shared in the consultations with private land conservation organizations highlight the range of issues that organizations can face. In the first example, a landowner with a conservation agreement was impacted by actions of a neighbour that constituted a boundary infraction and resulted in significant damage to the property. The onus was on the landowner to pursue the neighbour for damages, and the private land conservation organization supported the landowner in the settlement process by paying costs for reports and legal fees. Another case involved the drainage of wetlands covered under a conservation agreement that resulted in serious long-term damage to the property. The case was resolved through a ‘judicially assisted dispute resolution’ process and included the removal of the easement from the damaged lands to other healthy wetlands with additional habitat included as part of the settlement.
The impact on an organization goes beyond direct costs, however, as staff time is diverted from their regular role to support the legal process. For organizations with a small staff component, this has the potential to impact other areas of organizational activity significantly over a long period of time. One private land conservation organization reported, for example, that the settlement process related to compliance issues with a conservation agreement had taken over 18 months to resolve, and another has been engaged in court for a few years over boundary issues connected with their fee simple lands. While a successful settlement will cover direct costs incurred by the private land conservation organization, it was pointed out that costs associated with staff time usually are not unless a specific contractor was hired to support the process. The potential for legal issues arising also increases as the organization’s portfolio of properties grows. It is not surprising that an organization with numerous properties could always have a few legal issues in play.
The value of experience in dealing with legal defence issues was summed up well in one discussion during the consultations as “prevention is better than a cure.” Resources that outline best practices for private land conservation organizations to minimize the potential for legal issues are available on-line through the Land Trust Alliance BC(38), the Environmental Law Centre and Miistakis Institute(39) in Alberta, the Ontario Land Trust Alliance(40) and les Réseaux de Milieux Naturels Protégés(41) in Quebec, to name a few.
The intent of these best practices is to support the passion that inspires a private land conservation organization with rigorous systems that will safeguard special natural areas in perpetuity. They are designed to anticipate future problems and ensure that a private land conservation organization is challenge ready. Best practices address a suite of needs including:
- due diligence in designing the terms of a conservation agreement and/or land donation as an exercise in risk management and prevention—to clarify the limitations of the landowner’s wishes, achieve maximum conservation value and minimize superfluous restrictions that could become contentious
- professional and accurate recordkeeping to meet standards of evidence
- establishing and maintaining a regular frequency of compliance monitoring
- separating the roles of ecological monitoring from compliance monitoring at the staff level
- engaging in a process of mediation first as a follow-up to compliance issues
- sufficient contact with new landowners assuming title of property with a conservation agreement
All private land conservation organizations consulted for this report recognized that a collaborative approach is needed and welcomed the idea of a collective fund or shared mechanisms to backstop their potential legal defence needs and create the best possible conditions for private land conservation organizations to fulfil their mandate of protecting their lands in perpetuity.
The potential benefits include:
- giving equitable access to significant levels of legal support that will deter legal action against all organizations
- addressing organizational capacity issues through training in best management and legal defence practices
- building a portfolio of experts at the regional level to support organizational resource needs (e.g., access to lawyers familiar with land conservation)
- backing legal claims with sufficient funds
- coordinating research to better understand the potential liabilities that organizations may face in different situations or regions
The mindset of legal defence is not, however, the motivating purpose behind a private land conservation organization. Relationship building around a shared set of values related to conserving the natural world is what drives a private land conservation organization forward. Consequently, a collective fund or shared mechanism would take the pressure off private land conservation organizations to grow and manage their own restricted funds for legal defence, thereby keeping their fundraising efforts focused on raising money for operations, special projects, acquisition and implementing best practices associated with prevention and stewardship.
35. Environmental Law Centre and Miistakis Institute, Creating Robust Conservation Easements
36. Intact Insurance, Liability Insurance
37. Financial Services Commission of Ontario (2008), Understanding Title Insurance
38. Land Trust Alliance of BC, Legal Education
39. Environmental Law Centre and Miistakis Institute, Conservation Easements in Alberta
40. Ontario Land Trust Alliance, Resources
41. Réseau de milieu naturels protégés, Formations