James R. Balmforth: Real Estate Lawyer North Salt Lake Utah

If you are intending to lease a property for business use, consult an experienced North Salt Lake Utah real estate lawyer.

Prior to leasing or purchasing an existing building or facility, a physical security survey should be conducted to assess security needs commensurate with facility use. All door locks should be changed prior to occupying the facility. This could be a problem if inferior hardware has been used in the original construction; however, the expense of converting to a heavy duty system is worth the cost. Consideration must also be given to crash-out doors, windows, roof hatches, outside ladders, utilities, skylights, ventilators, manholes, subterranean ducts, storm drains, lighting, fencing, and parking garages. The security of most of these items should be covered in the lease agreement.

The lessor writes the lease and thus controls the leasing situation. Assuming that you have competent legal counsel, there should be few problems, but some areas require special attention if you are the lessor:

• The increasing use of technology and mobility require that leases address the hours of operation and the cost of substantial electrical and HVAC (heating, ventilation, and air conditioning) systems.

• The lease should specify proper installation and apportioning of costs for supplemental HVAC.

• The lease should certify that the space is free of PCBs, asbestos, lead in the drinking water, and common air pollutants.

• The agreement should be clear about special-purpose space, which varies substantially from common use of the facilities. An example could be file rooms (high floor loads) and computer rooms (high HVAC, fire safety, and electrical loads).

• There must be adequate access and egress for material and debris, particularly for facilities that do not have freight elevators or loading docks.

• The lease must specify the use of tenant material handling devices inside the facilities.

Lacking a standardized lease, anyone entering into a lease should be particularly concerned with the following:

• Escalation clauses

• The building standard or “work letter”

• Tenant allowance and their applicability against extra work

• Signage

• Subleases

• Approval of tenant’s extra work

• Access by lessee’s contractor

• Weekend HVAC

• Appurtenances (parking, toilets, storage space, etc.)

• Rules

• Renewal options

• Division of costs for:

— Operations

— Major building alteration

— Landlord repairs

— Building services

Leasing can be worrisome because it is fraught with legalism and seeming bias toward the landlord.

Homeowners Associations

Homeowners associations (as well as property-owners associations or landowners associations) are a special kind of residential association created by the covenants, conditions, and restrictions of a common interest development. Elected boards oversee the common property, and each home is purchased with the CC&Rs as part of the deed. An extensive set of rules and regulations are mandated by the CC&Rs, and homeowners associations as private entities also can make their own rules. In an overwhelming number of cases, particularly when racial discrimination is not an issue, covenants are treated as private agreements that need not comply with the constitutional standards that apply to the laws adopted by public local governments.

Homeowners association boards make decisions that affect every aspect of community life. These decisions and the functioning of the board are monitored constantly by residents and evaluated in terms of how decisions resonate with the values and preferences of individual households.
The difference between co-ops and condos lies not only in the structure of ownership, but also in the degree of control residents have in selecting prospective tenants. In cooperatives, residents become members of a corporation or limited partnership that collectively owns a building or group of houses. You become a shareholder and purchase shares that entitle you to a long-term “proprietary lease.” Individual shareholders do not actually “own” their units, but own a percentage of shares within the cooperative. Condominiums, on the other hand, are real property, usually with individual ownership of the house or apartment, and common ownership of facilities, land, or buildings. Fees covering maintenance, taxes, and improvements are distributed to all residents in both organizations, but in a condo arrangement, an individual can often sell or rent his or her apartment without the approval of the other residents or the condo board. In the cooperative, however, the co-op board must approve every buyer or renter and has broad powers to grant or withhold approval.

Local government can use zoning ordinances and enact design review standards to regulate the landscape, but to be enforceable the standards must be objective, allow for due process, and serve the public’s health, safety, and welfare needs. Property owners are entitled to a hearing on any government decision to restrict the use of private property, and if the restriction creates a hardship, property owners can apply for a variance. Further, if the zoning ordinance or design standards are deemed excessive, they can be considered a “taking, ” and the property owner must be compensated for any financial loss. These same protections are not available to a property owner living in a private, gated community because “these constitutional and statutory limitations do not apply to private agreements.”

Private governance enhances the ability of residents to keep inter-personal and neighborhood conflict at a minimum. The complex CC&Rs guarantee that most problems are resolved before they start. Another aspect of private governance is the complexity of setting up the board as well as staffing it to maintain the properties and enforce the rules and regulations.
Upon the purchase of his/her unit, the new owner automatically becomes a member of the residential association. The problem of the legitimacy of imposed rules varies according to whether such rules are explicitly included in the declaration of covenants, conditions and restrictions or in the regulations imposed by the board of the residential association.
Restrictions contained in the declaration: scope and limits of the original contract

From a purely “contractual/consent” point of view the question is fairly simple. The contract that entails the acceptance of the declaration is voluntarily signed by the owners, and accordingly the restrictions contained therein are largely legitimate even if they curtail certain individual rights such as free speech. The original membership in a homeowners association is more voluntary than the original membership in a city; therefore, an association’s (private) constitutive contract should be allowed to include certain substantive restrictions usually not allowed in a city charter.11 Inasmuch as it is an explicit contract, knowingly and voluntarily entered upon, one can reasonably hold that the declaration must be honored by all residents— and actually the US courts tend to ensure that the obligations contained in the declaration are respected.

Restrictions made by the board of the homeowners association

Further problems arise regarding decisions later made by the homeowners association’s board, that is, the elective management body. Owners are under an obligation to abide by the decisions made by the board since the purchase agreement includes membership in the residential association and the obligation to respect the board’s decisions. In this respect, the homeowners association functions like a private government. All the owners are part of it and may stand for election to the board. The board decides, for example, on the use of collective spaces, on certain activities conducted in private spaces, and on the buildings’ architectural features.
If you having problems with your homeowners association, an experienced North Salt Lake Utah real estate lawyer can help you.

Easements

If a man gives an easement on part of his property, he can enter the value of it as a charitable deduction on his income tax. More important is the local property tax. If a man gives an easement, he will not necessarily get a reduction in his present taxes; in all likelihood, the assessor has been valuing the land only at its open-space value. What the easement does is ensure that he will keep on valuing it that way and not raise the assessment on the basis of the development potential. Some states have passed laws to that effect, but in principle they should be unnecessary. In most state constitutions, there are guarantees against assessment at more than fair market value. If a man gives an easement on certain portions of his land, the assessor should recognize this in computing market value. He cannot rightly value it as developable land if there is a binding agreement that it is not developable.

Most easements are for perpetuity. Some people blanch at the thought of such a commitment and would like to see short-term easements. But the sale of the fee simple, or of most anything else, for that matter, is for perpetuity, and there are practical reasons why easements should be too. If they are not, the landowner is likely to have trouble persuading the assessor to overlook the development potential. Nor will the landowner be able to get capital gains treatment. If the payments are for a lesser period they will be taxed as income, just as lease payments are.

Short term easements can also create problems for the purchaser. Public agencies have found that it is as much trouble to renegotiate an easement that is about to expire as to negotiate one in perpetuity and be done with it, and agencies that used to secure short-term easements are now switching to the long term. They find that it costs them no more to do so.

Perpetuity does not last forever. In almost every easement deed there will be a reverter clause to the effect that if the purpose for which the easement was acquired is abandoned, the easement will then automatically be voided and all rights will return to the owner of the fee simple. Many of the old interurban trolley lines were laid down on easements; now that the trolleys have gone, the easements have long since reverted. The people who own the land are often unaware of this, and in many areas these ghostly traces can still be found, weedy and unused.

Easements are worth what the landowner is giving up. Sometimes this is a good bit; sometimes it is very little.

The rule of thumb for estimating the value of an easement is to figure the “before and after” value of the property; the difference between what the property is worth without the restrictions and what it is worth with them is the value of the easement. This depends on time and place. If you want an easement forbidding development on a piece of prime land in an area that is ripe for development, the owner is giving up a major part of the value of his property, or thinks he is, and you could pay through the nose.
People who want to use easements can be similarly imprecise. The most frequent error is a failure to distinguish between a scenic easement and an easement that grants public access. The two rights can be combined in an easement deed for a particular tract, but the two can’t be had for the price of one.

Easements are very binding indeed, and there should be no sugarcoating the fact. This is why they work. The deed forms must be explicit as to what is granted and what is not, and there can be no open-end clause by which the purchaser can make up new conditions for the landowner as time goes by. Such flexibility would appeal to administrators; it would not to the landowner or to the courts. They frown on loosely drawn easements, particularly those so loose that it is difficult to determine how much the landowner is letting himself in for and, thus, how much he is entitled to be paid.

Easements “run with the land,” and their conditions apply to subsequent owners of the property. Unlike covenants, they are held by someone with a truly proprietary interest in seeing that they are enforced.

Speak to an experienced North Salt Lake Utah real estate lawyer if you have any questions regarding easements in your land. You may entitled to an easement. An experienced North Salt Lake Utah real estate lawyer can review your circumstance and advise you if you can seek an easement.