The benefits of an accurate and professionally written shared well agreement are endless. A well written (pun intended) well share agreement decreases the odds of disputes and give you peace of mind. It provides certain assurances that their interests will be protected.
Over the years, I have spoken to literally hundreds of Arizonians with some type of dispute regarding a shared well. A common variable in this situation is a poorly written shared well agreement or none at all.
Every situation is different, every property is different, every well is different, and this is why we create custom agreements for each client. In addition to providing advice on the general issues we also provide advice on more nuanced issues. For instance, what about swimming pools? Will they be allowed? Must each property owner install an individual water flow meter to track their usage? Will a joint bank account be established to pay the well utilities and save for major repairs? Should vacant land-owners still pay for costs and repairs even when not drawing water from the well? What about someone who no longer wants to draw water from the well? Must they continue paying for repairs?
Sharing water wells with neighbors can be complex and lead to potentially messy relationships. In Humphries v. Becker, the parties entered into a Shared Well Agreement, but did not properly identify the well. The property was conveyed to a purchaser who, based on representations of the seller, believed that the well subject to the Shared Well Agreement would be sufficient to provide water to both the house and their irrigation system. In reality, the well serving the irrigation system was on a farmer’s adjacent property and was only used with his permission. The farmer cut off the irrigation water usage when a conflict arose between the purchaser and the farmer. As a result, the purchaser sued the seller for misrepresentation. The original parties’ failure to sufficiently identify the well in the Shared Well Agreement caused the seller to incur the expense of costly litigation that could have been avoided. Humphries v. Becker, 159 Idaho 728, 366 P.3d 1088 (2016).
benefits to the well owner- “grantor”
It gives the well owner an enforceable contract against the Grantees that they pay their portion of the maintenance, repairs, water and electricity. Grantors have an enforceable contract that requires the Grantees to pay their equal share of well maintenance, repairs, water and electricity.
benefits to the recipients- “grantees”
Shared well agreements provide Grantees–those receiving the water–with a legal right to draw water from the well. Without a written shared well agreement, a well owner could deny access to a Grantee. The Agreement is the only assurance Grantees have with a legal right provided in the agreement.
A Grantee might think, “I do not need a formal or accurate shared well share agreement because I’m friendly with my neighbors and we all get along.” But what if those friendly neighbors move? Will you still have a legal right to the water? Remember, without a shared well agreement, the well owner has no legal obligation to share the well water with you.
inacurrate well ownership information
Well ownership must be updated with the Arizona Department of Water Resources each time the land containing the Well has a new owner. The well ownership records must be updated with the ADWR by submitting forms and paying a fee. Often a property will be sold many times without the new ownership information being submitted to the ADWR.
A PERSON TO WHOM A WELL IS REGISTERED MUST NOTIFY THE ARIZONA DEPARTMENT OF WATER RESOURCES (ADWR) OF A CHANGE IN OWNERSHIP OF THE WELL AND THE NEW OWNER MUST FURNISH INFORMATION AS REQUIRED BY ADWR TO KEEP WELL REGISTRATION RECORDS CURRENT AND ACCURATE.A.R.S. 45-593(C)
Verify Well and Parcel Information
The first step in creating an excellent well share agreement is to verify the accuracy of all the relevant information. I’m amazed at how many errors we find when amending or re-drafting an Agreement and it is full of errors. If the information in an Agreement is incorrect, then it can create real headaches for everyone involved.
Verify Well Ownership Records with the ADWR
The Arizona Department of Water Resources (ADWR) requires that each Well is registered in the name of the current owner. Often, this information is outdated, as properties are sold but the ADWR is not notified. Simply purchasing a property and recording the deed with the county recorder does not notify ADWR that the Well ownership has been transferred. The new owner must take the overt steps of registering the Well in their name. We verify that the well ownership information is correct.
Verify the Assessor’s Parcel Number (APN)
An Assessor’s Parcel Number, abbreviated as APN, is a unique descriptor used by each county to identify assessed real property. The APN includes information about the ownership, characteristics, and valuation of each piece of land that is reordered and tracked by parcel number.
While a property can only have one APN at a time, APNs change on a fairly regular basis as parcels are merged, split, or subdivided. We make sure that the correct APNs are used.
Verify the Legal Descriptions.
Occasionally we find errors in the legal descriptions used to have create a former/current shared well agreement. We verify that the legal descriptions are correct.
The Agreement is Reviewed and Recorded
Once the Agreement has been approved and signed by all Parties, we record it with the county recorder. Recording the Agreement reduces the odds of someone later challenging the veracity or accuracy of a shared well agreement. We then take a copy of the recorded agreement and provide it to the ADWR to save in the Well’s permanent file.
latecomers to the shared well agreement
Occasionally, when a new home is built on a previously empty lot the shared well agreement is not updated to reflect the new user. Ideally, when a parcel is sold, the original shared well agreement is re-written. Some of the benefits of rewriting the shared well agreement.
First, the buyer’s names are actually written into the agreement and their signatures reflect their personal acceptance of the WSA. Additionally, there is a psychological benefit to drafting the latecomers into the agreement. This way, they are personally committing themselves to the agreement versus just referencing something that someone else agreed to.
Second, when re-drafting the agreement, you can make adjustments to it. For instance, maybe you want to prohibit certain actions like filling a swimming pool or watering fruit trees. Maybe the property owner wants to increase or decrease the amount of money paid into the reserve bank account.
WATER WELL maintenance schedule
Create a maintenance schedule. Proper maintenance of the well and its components will make it last longer and ultimately save the Parties money.
If you need help from an experienced shared well attorney, then contact the Dunaway Law Group at 480-702-1608 or message us HERE.
* The information provided is informational only, does not constitute legal advice, and will not create an attorney-client or attorney-prospective client relationship. Additionally, the Dunaway Law Group, limits its practice to the State of Arizona.