Chattels and Fixures Flashcards
Apart from s.62 of the Law of Property Act 1925, all guidance about chattels and fixures comes from case law and the 2 stage test to determine whether its a fixure or chattel derives from case law.
What is a fixure?
Fixtures are those goods which belong as part of the land. A fixture is any item that is included as part of a conveyance of land (that is, where land is given from one party to another, and such an exchange includes all of the rights and obligations over that land) according to s.62 of the Law of Property Act 1925. This means that when a portion of land is sold and there is something defined as a fixture within the confines of that land, then that fixture will be owned by the person who takes ownership of the land as a whole.
What is a chattel?
Chattels are the personal effects of their owner. A chattel can be removed at any time by their owners. It is a physical object which is separate from the land, and thus its ownership is independent of who owns the land. It does not change hands upon a conveyance of land.
The two stage test devised in Hellawell v Eastwood (1851)
This test helps determine whether an object is a fixure or a chattel
1) The degree of annexation: the extent to which the item has been attached or annexed to the property, and
2) The purpose of annexation: the purpose for which the item was attached to the property.
Which case was the test reiterated in?
Elitestone Ltd v Morris [1997]
Stage 1: Degree of annexation
In looking at stage 1), we can say that the greater the degree of attachment or annexing is to the property, the more likely the item is considered to be a fixture.
Another way of expressing this point, as was made clear in Elitestone Ltd v Morris [1997], is that the physical object is a fixture if it merges with the land.
This merging is determined by either:
the physical bond of the object with the existing land or
(more rarely) its juxtaposition with the land, such that it is so close to the land that it was intended to be part of the land.
Elitestone ltd v Morris (1997) case
In the case of Elitestone Ltd v Morris [1997] the predecessor of Morris had constructed a wooden bungalow. It rested on concrete pillars, and the pillars were attached to Elitestone’s land. The structure could only be used when on the land; removing the bungalow would have required demolition and reconstruction of the structure. The House of Lords held, unanimously, that the structure was not a fixture per se, however it must be intended to form part of the land, to have become ‘part and parcel’ of the land, because of the difficulty of its removal and the magnitude of its affixing to the land. The main judgment came from Lord Lloyd.
Key points from Elitestone v Morris:
How is the structure affixed to the land? Is it, for example, placed on top of the land, is there something (pillars, for example) between them?
Is the structure difficult to remove? Would its removal involve damaging the item or the surrounding land?
If the structure is affixed to the land in such a way that removing the item would damage it or the land means it is a fixture.
Stage 2: Purpose of annexation
Despite everything that is said above, it is not necessarily the case that an item which is bolted down is intended to be a fixture, and depending on the intention, it may be that the item was not intended to be a fixture, and such a lack of intention would mean the item was not a fixture (Potton Developments Ltd v Thompson [1998] NPC 49, ChD). Intention will usually be gauged by inference, and communication between the parties.
What is clear is that this intention must be made known between the parties. Lord Cockburn observed in Dixon v Fisher(1843) 5 D 775 that no person ‘can make his property real [ie belonging to the land] or personal [belonging to himself] by merely thinking it so.’ The question is whether the installation of the object would in ordinary circumstances have been intended to be a permanent accretion to, or improvement of, the land or if it is only a temporary addition to the building or landscape (Botham v TSB Bank plc).
Overriding Purpose
We have seen that an object can be deemed to be a fixture, despite it not being affixed to a surface, if there is an intention to have the object function as a permanent improvement to the land. Equally, intentions can render an object a chattel: if an item is affixed to a surface, yet the intention of the party who installed it was merely to facilitate enjoyment of the object (rather than to have the object provide value to the land). If use of the object was unnecessary for the use of the land, and the use of the object was simply to enjoy using the object, then the item may be deemed a chattel (Elitestone Ltd v Morris).
Who has the right to remove fixures?
1) Owner of the freehold land
2) Tenant of the land
If a lease is intended to restrict the right of a tenant to remove the tenant’s fixtures, then the lease must make that intention clear: the court must be confident that the language of the lease is unambiguous and express about that intention, otherwise the court will not uphold a term which excludes the right to remove fixtures (Peel Land and Property (Ports No 3) Ltd v TS Sheemess Steel Ltd [2014] EWCA Civ 100).
