Private Road Primer
Planes, boats, and roads can all be private and they can all be expensive, though arguably the first two should be more fun but the later could be more necessary. It's certainly obvious to most that the first two need to be insured but what is becoming apparent is that private roads and their caregivers need insurance too. Now when it comes to law, I'll be the first to admit it can be confusing and I don't profess to have it all perfectly clear. I just know that consideration, at the very least, must be given to being on the careful side. The only people that, I hope, have it all perfectly clear are the judges and I very much prefer not to have need of hearing their opinion.
There is a good deal of information on the topic of insuring private roads on the FOCA website and I recently attended a workshop devoted to the subject. We were fortunate to have Roger Young, a retired lawyer, as the keynote speaker. The workshop was oversubscribed and the room was filled to capacity with people concerned about the liabilities they may be exposed to by either having a private road cross their property, crossing a number of properties on a private road with a group of other property owners or, as often is the case, volunteering their help in some form of caring for a road.
Much of what was discussed confirmed the need for insurance protection and what was done by Silverwood Cottagers Road Association Inc. on Canning Lake by first forming a non profit corporation and then obtaining insurance as the proper way to proceed for the best interests of everyone. The forming of a corporation does not require a lawyer as the process is not insurmountable and can be done by almost anyone with a little care to save on costs.
Roger explained that the user of a right of way is termed the "Dominant Tenant" who owns the right of way and is responsible for the upkeep for its entire length and is also legally liable for its entire length. The "Subservient Tenant" is the land owner over which the Dominant Tenant travels. (At first these terms sound odd but I took careful note). This arrangement is the same whether the right of way is deeded or just presumed so because of a long time precedent.
It was explained that volunteers that do any work, physical or otherwise, on a private road need to be covered by insurance no differently than volunteers of lake associations do as they are very vulnerable. In addition to insurance covering the road, separate directors of the corporation liability insurance is needed and usually is part of the insurance package.
The lawyer pointed out that all Dominant Tenants are named in a lawsuit in court cases. As they say, everyone is invited to the party (court case) if there is one. It was also pointed out that everyone who has a cottage these days has a substantial asset which should not be put at risk. For a relatively small amount, it only makes sense to add an extra layer of protection to our valuable asset.
One of the benefits of insurance is that the insurance companies provide defence lawyers of their own on your behalf. They are experienced and have numbers and clout in their favour. Clout is good.
Non contributers to the payment of road upkeep and insurance would be excluded from the coverage benefits, leaving them very vulnerable. Roger Young pointed out that the cheque made out to any lawyer (he should know) would have many more zeroes on it than the cheque for insurance. More zeroes are bad. An audience member gave an analogy of the reluctant payer probably being the same person who wants a discount for his coffee at Tim's because he forgoes the cream in his black coffee.
Insurance companies may deny fire claims if emergency trucks cannot get in, highlighting the need for making the roads as emergency vehicle "friendly" as possible and conforming to the recently new government standards. By snow plowing the road, members have done their absolute best to make access possible for emergency vehicles and fire trucks in order to keep their insurance valid in the winter. For any "doubters", it would be wise to get certain confirmation of having coverage to a building that is not accesible in the winter months. At the very least, there could be a rate adjustment. Besides the financial benefits of having winter access, there is also the even more valuable benefit of having good access for health emergencies. They happen.
Another hot topic at the workshop was the collection of road maintanence dues. Even though payment of road dues can be enforced and collected by using small claims court, it was said that the majority of people pay with gratitude and the rest pay without going to court often by just hearing that is a possibility. Courts will rule that the defendant would have received "Unjust Enrichment". This includes well kept year round access, associated benefits, including any financial discount benefit on a property owner's personal insurance. Courts have ruled in favour of road associations. As an example, Point Abino Association vs Stewart Lee on Lake Erie has set a legal president. According to law, you can legally go back 7 years for payments due as long as there are good records. Of course, having a corporation and good records would be beneficial in the event of coming before a judge.
Given the unpleasantness of talking to judges and the time and expense of talking with lawyers, it seems wise to me that a little work and expense as well as some kind courtesy to ones' neighbours and volunteers ahead of time is a wise investment. Time is our most valuable asset, count the days, we don't want to waste them.