E-Newsletter – Real Estate
Licenses in Land
A property owner creates a license in his or her land by granting permission to another to conduct a particular activity on the property. A license does not grant any ownership interest in the property to the licensee, and the licensee cannot transfer or devise the license to anyone else. Licenses in land can be created informally, even orally, and do not generally require a written agreement, although the use of a writing is optional.
Significantly, a license does not grant exclusive use of the property to the licensee. The licensor still has the right to use the land at the same time as the licensee.
The licensee is free to fully utilize the acts granted by the terms of the license, but he or she must take care to remain within the permitted activity. The permission granted by a license is modifiable or revocable by the landowner at will, at any time – no advance notice is required. A land sale also terminates associated licenses. Once a license has been revoked or extinguished, the licensee must cease the licensed activity and leave the property in order not to become a trespasser.
Types of Licenses
- Social license – when an invitation is extended to guests and visitors for nonbusiness reasons
- Gratuitous license – when a free license is granted with no expectation of remuneration
- Implied license – when the conduct of the parties creates a license even if no explicit oral or written license was granted
- Contractual license – when the licensee gives money or other items of value in exchange for the permission granted by the license
Examples of Licenses
Here are some typical examples of permission granted by licenses in land:
- To graze animals
- To farm
- To attend a sporting or entertainment event
- To extract resources, such as timber or water
- To post a sign
- To use a pool or other recreational equipment
- To run a concession stand
- To park a vehicle
- To rent a hotel room
A license in land is not the only vehicle that allows another person to conduct activity legally on your property. Similar concepts include:
- Easement – differs from a license because it is generally irrevocable, creates an actual property interest and must be in writing
- Lease – differs from a license because it grants the right to exclusively occupy the land or to earn profits from it
- Invitation – differs from a license because it involves mutual business interests of the landowner and invitee
Because these concepts are closely related, sometimes distinguishing among them is difficult. In addition, if the features of a particular license change, it could be converted into another one of these vehicles, significantly changing the legal relationship of the parties. If you are a licensor or licensee in land and are faced with a legal issue about the status of the license, a knowledgeable real estate attorney can help you sort out your rights, interests and liabilities.
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