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If you’re dealing with real property (or even some kinds of intellectual property) you may be confused by some of the terms that pop up. You may have seen an “easement" on the deed for the house you’re about to buy, which lets the power company access your backyard. You might have been told, when moving into a shared office space, that you’ll have to sign a license agreement. Or you may be wondering just what you get when you lease an apartment.
This (short) guide provides a brief overview of the three kinds of property contracts: leases, licenses, and easements.
What They Are
Summary of Basic Characteristics While these may not apply to every single lease, license, or easement under the sun, this is a layman's guide to recognizing them on the fly. - Leases are between two parties and convey an interest in real property that is usually not revocable, usually transferrable, and give the lessee/tenant an exclusive right to that property. - Licenses are from the property owner to the licensee, convey no interest in the property, are usually revocable, are usually not transferrable, and may or may not give an exclusive right. - Easements are from the property owner to the easement holder, convey an interest in real property, usually are not revocable, usually are transferrable, and may or may not give an exclusive right.
Which One Should I Choose? If the right to use the property will belong solely and exclusively to the user, even against the property owner, you have a landlord/tenant arrangement and a LEASE is proper. If the use or occupancy of the property will be shared by more than one person or entity, then a LICENSE or an EASEMENT is proper. If the use is long term, like a sewer, cable, flower garden or access road, an EASEMENT is the way to go. If the use is short term, like using a meeting room three times a week from 3-4 PM, a LICENSE is proper. If your neighbor wants a guarantee that there will never be a giant redwood grown on your property, blocking his sunlight, this should be shown by an EASEMENT. (This is also called a NEGATIVE EASEMENT, because the property owner is agreeing NOT to do something on his/her own land).