When Virginia acquires land it already holds a conservation easement on, does the easement disappear?

Plain-English summary

In August 2012, Delegate Thomas Davis Rust asked the AG a deceptively technical real-property question with real conservation stakes. The Virginia Department of Conservation and Recreation (DCR) was considering buying land for a public park. Some of that land was already encumbered by conservation easements. If DCR, which already held the easement, bought the fee, would the common-law doctrine of merger of estates wipe out the easement? The AG said no. Conservation easements are different from ordinary easements, and the merger doctrine does not extinguish them.

In Virginia real property law, the general rule has been that an easement is extinguished by operation of law when the easement holder acquires fee simple title to the encumbered land. As the opinion put it, "the [easement] right must necessarily cease to be an easement, for it becomes one of the rights of property to which all owners of land are entitled." One cannot have an easement in one's own land. The rationale is straightforward for conventional easements (right-of-way, recreational): once the holder owns the land too, the easement no longer serves its purpose, so the law collapses it.

Conservation easements are different. They are not private agreements for the exclusive benefit of one grantee; they are public-interest restrictions created under OSLA and VCEA to facilitate conservation and historic preservation in furtherance of the Commonwealth's policy to protect its natural resources and historic sites. The Code establishes their special and public nature: their acquisition and stewardship are supported by public moneys through general fund appropriations and public grants, tax exemptions and benefits, and tax incentives to grantors who make charitable gifts of conservation easements. Only certain public and nonprofit entities may hold them, and VCEA expressly gives the Attorney General and specific agencies and localities standing to act on matters affecting them.

The statutes also limit easement-holder discretion to extinguish or release. OSLA holders are forbidden from releasing the easement unless statutory criteria are met and substitute like-kind land is provided; disposing of "open-space land" outside those parameters would cause a net loss of open space. VCEA provides as a default that a "conservation easement shall be perpetual in nature unless the instrument creating it otherwise provides a specific time."

Applying merger to extinguish a conservation easement would let holders strip those restrictions outside the statutory release process, contrary to the manifest intent of the statutes. The AG noted that a 2010 circuit court decision supported the same conclusion, finding that conservation easements "are not subject to the typical common law analysis of merger as would be appropriate to rights of way between two adjoining tracts," because the holder of a conservation easement is "not the sole party receiving the benefit." That court looked to the parties' intent to create a permanent conservation easement and the extensive statutory framework facilitating it.

The practical upshot for DCR: if it acquired the fee, the conservation easement would continue to encumber the land, held by the Commonwealth subject to OSLA's transfer and release limitations. The fee, if not similarly restricted, could be sold or transferred at the discretion of DCR's director.

Currency note

This opinion was issued in 2012. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Background and statutory framework

Conventional merger doctrine. Merger is the "annihilation of one estate in another." Under contemporary Virginia jurisprudence, an existing easement is extinguished by operation of law when the holder acquires fee simple title to the encumbered land, because the easement no longer serves its purpose once the two estates unite in one owner. This is the rule for conventional easements such as rights-of-way and recreational easements.

Open-Space Land Act (OSLA) and Virginia Conservation Easement Act (VCEA). Both authorize only certain public and nonprofit entities to hold conservation easements, and both exist to facilitate conservation and historic preservation in furtherance of state policy. OSLA holders may not release an easement unless statutory criteria are met and like-kind substitute land is provided. VCEA provides that a conservation easement is perpetual unless the instrument creating it specifies otherwise.

Public funding and enforcement. Conservation easements are supported by public moneys through general fund appropriations and public grants, tax exemptions and benefits, and tax incentives to grantors who make charitable gifts. VCEA gives the Attorney General and specific agencies and localities standing to act on matters affecting these easements.

Common questions

Q: If a land trust buys land it already holds an easement on, does the easement disappear under Virginia law?
A: Per this opinion, no. Conservation easements under VCEA or OSLA survive the merger of fee and easement in the same holder, because the easement serves a public conservation purpose that does not vanish when the holder takes title.

Q: Why is a conservation easement different from a right-of-way?
A: A right-of-way exists for the benefit of a specific landowner or successor. When the same person owns both estates, the right-of-way no longer serves any purpose. A conservation easement, by contrast, exists for the public's benefit (clean air, open space, historic preservation), not just the holder's. The holder cannot eliminate it just by owning the land.

Q: Can a public body or a land trust ever release a conservation easement?
A: Yes, but only through the statutory process. OSLA requires like-kind substitution and other criteria before a release. VCEA easements are perpetual by default unless the instrument provides otherwise.

Q: What about a private land trust that buys property it holds an easement on?
A: Same answer. The opinion's logic, that public-purpose easements survive merger, applies whether the holder is a public body under OSLA or a qualifying nonprofit under VCEA.

Q: Does Virginia case law support this conclusion?
A: The opinion relied on a 2010 circuit court decision holding that conservation easements are not subject to the typical common-law merger analysis, together with the statutory framework. Both pointed in the same direction.

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/Opinions/2012/11-140_Rust.pdf

Original opinion text

COMMONWEALTH of VIRGINIA
Office of the Attorney General
Kenneth T. Cuccinelli, II
Attorney General

August 31, 2012

900 East Main Street
Richmond, Virginia 23219
804-786-2071
FAX 804-786-1991
Virginia Relay Services
800-828-1120
7-1-1

The Honorable Thomas Davis Rust
Member, House of Delegates
Herndon Town Hall
730 Elden Street
Herndon, Virginia 20170

Dear Delegate Rust:

I am responding to your request for an official advisory opinion in accordance with § 2.2-505 of the Code of Virginia.

Issue Presented

You ask whether a conservation easement is extinguished by application of the common law doctrine of merger when the holder of the conservation easement under the Virginia Conservation Easement Act or the Open-Space Land Act acquires the fee simple interest in the same land.

Response

It is my opinion that a conservation easement obtained under the Virginia Conservation Easement Act ("VCEA") or the Open-Space Land Act ("OSLA") is not extinguished by application of the common law doctrine of merger of estates when the easement holder acquires fee simple title to the encumbered land.

Background

You relate that the Commonwealth, through its Department of Conservation and Recreation ("DCR"), is considering the acquisition of certain real property to be used as a public park. You also relate that some of the subject property is encumbered by existing conservation easements.

Applicable Law and Discussion

Merger is described as the "annihilation of one estate in another" and under contemporary Virginia jurisprudence, it is the general rule that existing easements are extinguished by operation of law when the easement holder acquires the fee simple title to the encumbered land. Upon unity of ownership, "the [easement] right must necessarily cease to be an easement, for it becomes one of the rights of property to which all owners of land are entitled." In other words, one cannot have an easement in his own land. As recently explained by one Virginia trial court, it is generally the case that when the easement holder becomes the owner of the encumbered land, the need or purpose of the easement is eliminated. Nevertheless, as noted by that same trial court and discussed herein, conservation easements are not typical easements whose purposes are necessarily obviated when ownership of the two estates, the easement and fee, become united in the same person or entity.

Conservation easements, which are a recent creation of the law, stand in sharp contrast to conventional easements, such as right-of-way or recreational easements. Conventional easements are private agreements entered into for the exclusive benefit of the grantee or similarly situated future owners of that property. In the case of a right-of-way easement, it follows that the easement would merge into the fee upon unity of ownership because the easement, as a separate, independent encumbrance, is no longer necessary; the right ceases to be an easement because it becomes one of the rights to which all owners of land are entitled. The formation of conservation easements, on the other hand, are authorized under OSLA and VCEA in order to facilitate conservation and historic preservation in furtherance of the Commonwealth's policy to protect its natural resources and historic sites. As the statutory framework of OSLA and VCEA demonstrate, conservation easements serve a much more public function than conventional easements.

The Code establishes the special and public nature of conservation easements. Acquisition and stewardship of these easements are supported by public moneys through general fund appropriations and public grants, tax exemptions and benefits and tax incentives to grantors in cases of charitable gifts of conservation easements. Further, under OSLA and VCEA, only certain public and nonprofit entities are authorized to hold conservation easements. Additionally, VCEA expressly provides standing to the Attorney General and specific government agencies and localities for actions affecting conservation easements.

The terms of OSLA and VCEA clearly evince a strong policy preference favoring the continuation of conservation easements. Specifically, holders of easements authorized under OSLA are prohibited from releasing the easement unless certain statutory criteria are met and upon the substitution of like-kind land for the released easement-encumbered land. Applying the doctrine of merger to extinguish the easement would circumvent these requirements. "Open-space land" could be disposed of beyond the parameters of the statute and without substitute land, resulting in a net-loss of open-space. Additionally, VCEA provides as a default that a "conservation easement shall be perpetual in nature unless the instrument creating it otherwise provides a specific time." Thus, the thrust of the statutory scheme is to promote and continue conservation efforts. Using merger to extinguish such easements therefore, would permit easement holders to extinguish them outside of the stated terms of the deed or in contravention of the stated public interest, which clearly runs contrary to the manifest intent of the statutes.

Based on the foregoing public policy objectives and regulation of these easements, it can be concluded that conservation easements are held and administered by the easement holders not for themselves, but on behalf of the public and in furtherance of state policy. A 2010 circuit court decision supports this conclusion. In that case, the court found that conservation easements "are not subject to the typical common law analysis of merger as would be appropriate to rights of way between two adjoining tracts[;]" for, as the court found, the holder of a conservation easement is "not the sole party receiving the benefit of th[e] easement." The court looked to the intent of the parties to create a permanent conservation easement and the extensive statutory framework to facilitate the same in determining that merger would not apply to extinguish the subject conservation easement.

In the proposed transaction you describe, DCR would acquire land that is encumbered by a conservation easement. Assuming the encumbered land is covered by a conservation easement under the OSLA, both estates (the easement and the fee) would be owned by the Commonwealth (or one of its agencies). Nevertheless, mere ownership of the estates by the Commonwealth would not necessarily obviate the purpose of or need for the conservation easement: that is, the easement would continue to provide natural or historic resource protection in accordance with its stated terms and in furtherance of state policy. This stands in sharp contrast to a conventional easement, such as a right-of-way or recreational easement, whose purpose or necessity is obviated when the easement holder becomes the owner of the encumbered land. Moreover, allowing merger to extinguish the conservation easement in this instance would put DCR, a public actor, in the peculiar position of obstructing state policy in contravention to its stated mission to conserve the Commonwealth's natural resources. In my view, such an inapposite result cannot be supported by invoking a doctrine developed at common law for the sole purpose of simplifying the land records and without reference to the policies or statutes authorizing conservation easements in Virginia.

Therefore, in light of the various statutory limitations on extinguishment of a conservation easement, and because the preservation of a conservation easement would continue to provide natural and historic resource protection in furtherance of state policy, it is my opinion that the doctrine of merger would not apply to extinguish a conservation easement when the easement holder acquires fee simple title to the encumbered land. If the proposed transaction is completed so that the Commonwealth acquires the fee interest to land for which it already holds a conservation easement, the conservation easement would continue to be held by the Commonwealth subject to the limitations on its transfer and release imposed by the OSLA, while the fee, if not similarly restricted, could be sold or otherwise transferred in the discretion of DCR's director.

Conclusion

Accordingly, it is my opinion that a conservation easement obtained under the Virginia Conservation Easement Act or the Open-Space Land Act is not extinguished by application of the common law doctrine of merger of estates when the easement holder acquires fee simple title to the encumbered land.

With kindest regards, I am,

Very truly yours,

Kenneth T. Cuccinelli, II
Attorney General