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Tuesday, Jan. 24, 2012
Tepco pole position may scupper land buy
By YUICHI KAWAMOTO
Mr. A writes: "We are seriously considering buying a property (house and land) in a residential neighborhood. On a corner of and inside the property, Tepco installed a light pole several years ago, apparently under an agreement with the current owner. It is believed that a nominal payment from Tepco to the property owner for the installed light pole is included in the agreement.
"As we would be the new owners of the property, a new agreement must be discussed and made with Tepco. In that respect, we kindly solicit opinions on the following items to be discussed with Tepco."
Mr. A goes on to list two options. The first is for "Tepco to remove and relocate the existing light pole at their expense, including site restorations, in a timely manner without disrupting the lives of local residents."
The second option is to allow Tepco to keep the light pole on the property under certain conditions, namely: a) "Tepco pays an increased 'rental' fee"; b) "Tepco provides insurance coverage for any bodily harm or property damage caused by . . . the light pole"; and c) Because "it is said that overhead power lines emit magnetic fields which could be harmful to humans, Tepco should provide additional insurance."
Mr. A signs off by saying that he "intends to keep an open mind when discussing this with Tepco," despite the fact that "our impression of Tepco is heavily influenced and perhaps biased" bearing in mind "their public remarks related to the Fukushima (No. 1 nuclear) incident, etc."
Before answering Mr. A's question, first I'd like to explain the two different legal ways you can rent a piece of land.
The first is by concluding a rental agreement. The rights of the renter under a deal like this vary depending on whether the renter pays for use of the land and the purpose of the rental, but in most cases the deal only binds the owner and the renter. It means that when the owner changes, the renter loses the right to use the land unless a new agreement is made with the new owner (though there are exceptions).
The other way to rent is by establishing "surface rights" (chijouken) over the land, meaning the right to use the surface of the land for a certain purpose. Although the surface rights are decided by an agreement between the owner and renter, once they are registered at the Legal Affairs Bureau, the rights the renter receives as a result will stand regardless of who the owner is.
According to publicly available information sources, it seems that in most (if not all) cases, Tepco rents land under basic rental agreements, which means that when Mr. A purchases the land, Tepco will need to sign another contract with him. The question is whether the content of this contract is negotiable.
For telephone poles, the rental fee paid to landowners is set by the government by the Order for Enforcement of the Telecommunications Business Act. For land classified as residential (all land has a classification), the payment is ¥1,500 per month. For other utility poles, there seems to be no such government order, but they have a predetermined list of rental fees that seem to be the same as those for telephone poles.
So can the price be negotiated, or other conditions added to the rental agreement?
Legally it is of course possible, as there is no law or regulation prohibiting it. However, it can be very difficult in practice, especially if you want to buy land with the pole in situ.
When power companies want to install a new utility pole on a private piece of land, they have to ask the landowner to allow them to do so. The owner of course has the right to refuse if they are not happy to host the pole, or the proposed rental fee. In theory it is also possible to ask the power firm for a higher rental fee, but in practice it is unlikely that the company would agree to even begin negotiating over price.
Things can be even less flexible when buying land that already has a utility pole on it. In such a case, the previous landowner must have concluded a contract with a power firm when the pole was initially set up, including an agreement on the rental fee. Moreover, it is very likely that this agreement has a clause that prohibits the transfer of the land unless the new owner agrees to keep the pole under the same conditions.
For public land, there is a government policy stating that such a clause must be included when concluding a rental agreement for utility poles, and it is not hard to imagine that for private land, too, any such agreement would have a similar clause. In short, you may not be able to buy this land unless you agree to sign up to the existing conditions regarding the light pole.
It would also be difficult to force the power firm to agree to new conditions like those Mr. A is proposing. After all, these conditions are not in the existing contract, and, as explained above, there may not be much chance to change the contents of the agreement.
So what can you do if the pole is stopping you doing what you would like to with the land? First, you can ask the power firm to relocate the pole within your own land. This will not affect the rights of anyone else, so it can be done solely by agreement between you and the company. In most cases the company would cover the cost of relocation.
It would be much harder to relocate the pole out of your land, whether it be to public or private space. The government is not likely to agree to erect a new pole on public land when one already exists on your land, and neither is your neighbor!
One final word of advice: Be sure to look into the exact conditions regarding the light pole if you decide to buy that piece of land. If you are unhappy about the mere presence of the pole or the rental fee paid by Tepco, and if the contract requires that you put up with it under the same conditions, you may want to steer clear of the land altogether. Real estate agents should tell you what you can do about the pole, but make sure to go over the details with a fine-tooth comb.
Yuichi Kawamoto is a lawyer at the Section of Legal Assistance for Foreigners at Tokyo Public Law Office, which handles a wide range of cases involving foreigners in the Tokyo area. TPLO lawyers address readers' legal concerns on the second Tuesday of the month. Web: www.t-pblo.jp/slaf. Phone: (03) 5979-2880. Send all your questions to email@example.com