Managing Conservation Easements in Perpetuity - Environmental ...

destroying too many records or destroying them too soon. If your land
trust retains records for too long or retains records that have no value,
it will waste money and possibly expose itself to unnecessary litigation
risks. For example, if an easement ends up in court, in the course of
the portion of the pre-trial actions referred to as “discovery,” your land
trust will be required to share with opposing counsel the entire file
(with the exception of letters from your attorney) relating to the easement
and the property. So if your land trust retains extraneous, ambiguous
material in the file, opposing counsel may use such documents
to create doubt about your land trust’s actions and credibility in court.
In 2002, Congress passed the Sarbanes-Oxley Act in response to the
scandals and economic catastrophes caused by the financial misdeeds
and accounting inaccuracies of some major corporations. This law
prohibits your land trust from destroying any document once you have
notice of, or suspect, that a particular case will be litigated. If your land
trust is caught destroying documents in anticipation of specific litigation
or investigation, you and your organization may be subject to
severe penalties, including, in some cases, criminal sanctions. If caught,
the fallout from the government and public over destroying the documents
may be far worse than the consequences of the file being made
public.
The Dangers of Discovery
Dickson Mountain Land Trust (a fictional land trust with a “keep everything”
records policy) receives notice that a successor landowner is challenging the
organization’s interpretation of a reserved right allowing another house on
the easement-protected land.
The land trust believes the integrity of the easement demands that the orga-
nization uphold its version of the clause and goes to court. The successor
owner’s attorney demands and receives through discovery the land trust’s
entire project file, including all drafts of the easement. Because the land trust
keeps everything, it still possesses every draft of this conservation easement,
all e-mails and all correspondence with the landowner and her attorney about
this clause. The land trust spends hundreds of dollars and hours of time to
copy and deliver the files to the opposing attorney.
The reserved right clause was contentious and highly negotiated during the
creation of the conservation easement. The land trust and landowner spent
months and completed eight drafts of the easement before agreeing on the
Recordkeeping 37
Keeping too much information
is as much of a risk as destroying
too many records or destroying
them too soon.
Federal law prohibits the destruction
of documents once you
receive notice or suspect a particular
case will be litigated.
Discovery: The court-required
process used by each side in a
lawsuit to obtain from the other
side any relevant facts, information,
documents, statements, images
and other material about the case
to assist each other with trial
preparation.
Example