103: Is it a chattel? Or is it land? Why does it matter?
What is land and why does it matter? The first part of this question ought to be easy to answer. Unsurprisingly lawyers have spent much time trying to answer the question, because the answer does matter to lawyers’ clients.
The distinction between chattels and land matters in several ways, most obviously when a house is bought or sold: which of the seller’s possessions are included in the transaction. Most conveyancing solicitors are familiar with the panic telephone call from a client asking whether they must leave a treasured item behind. Few clients, happily, pursue a dispute over paving stones all the way to the Court of Appeal as took place in Taylor v Hamer. In this case the stones were seen by the purchaser in situ in the garden, but before exchange of contracts they were removed and piled up separately at the property, and then totally removed by the seller before completion of the transaction.
Similar disputes arise over items brought to a property by a tenant: have they become part of the land, are they fixtures (a special category of ’land‘) and can they be removed by the tenant at the end of a tenancy? Who is entitled to items given as ’property‘ or ’land‘ or ’chattels‘ or ’fixtures‘ by a Will? Do items at a property subject to a trust belong to the trustees or to the beneficiary entitled to occupy the property from time to time and their heirs after their death, or must they pass with the property to the next entitled beneficiary?
Sometimes the question of whether something is ’land‘ or not determines whether statutory law applies: in Chelsea Yacht & Boat Co Ltd v Pope the occupant of a houseboat was denied security of tenure because the houseboat – although certainly a dwelling, was not ‘land’ and therefore could not be the subject of a lease of ‘land’. Sometimes the distinction can result in criminal liability: in Dill v SoS for Housing, Communities and Local Government the authorities took action against a landowner for removal of urns from a listed building on the basis that the urns were ’buildings‘ and therefore land for the purposes of the Planning (Listed Buildings and Conservation Areas) Act 1990.
Clearly the distinction can be important, so how do you tell the difference between something that is land, something that is a fixture (the special category of ‘land’), and something that is a chattel (something that is not ‘land’ at all)?
To state the obvious, ’land‘ includes buildings erected on it and embedded in it with foundations. It also includes trees and other plants growing in it, and minerals within it. Chattels that lose their original identity by being incorporated into land, such as bricks that have been built into a wall with concrete, become ‘land’. So far so straightforward.
The question becomes more difficult when an item is attached to a wall or to the ground but retains its identity. Such items may become fixtures – part of the land – or may remain chattels. Many Victorian disputes over this distinction concerned works of art and whether they should pass with land or as personal possessions on the death of the person who brought them to a house. These cases established complex tests of ‘extent of annexation’ and ‘purpose of annexation’ but happily matters are simpler today. Broadly speaking, if an item can be easily removed without it being damaged or losing its identity, and the wall or ground itself is not damaged, then the item is a chattel. The houseboat in Chelsea Yacht was attached to the pontoon by pipes and wires to pass water and electricity, and mooring ropes. These could be easily severed without material damage, so the houseboat had not become attached to or part of the land and was a chattel.
An important qualification to this simplification arises when an item forms part of the design of a house and grounds: statues, figures, vases and stone garden seats have all been held to be ’fixtures‘ (and thus ’land’) in this context even when they rest on the ground only by their own weight. To adopt the old test, the ‘purpose of the annexation’ for such items was permanently to improve the appearance and value of the land. If the purpose had been to enjoy the item for itself, it would remain a chattel. Typically therefore, pictures will be chattels unless they form some part of a scheme of decoration or are so firmly fixed they cannot be removed without violence to the walls, in which case they become fixtures. Today, the technical skills of attaching and removing objects to and from land are so great that it is rare that physical attachment becomes the dominant test.
What are the consequences of an item being a fixture or a chattel? The answer depends on the exact legal relationship between the parties disputing the nature of the item, but the starting point is that a chattel is and remains in the ownership of the person who brought it onto the land while a fixture passes with land whoever first brought the item to the land.
For example in Re Whaley a testator by his will gave his house and land to his trustees, and his chattels to his widow. The court decided that a tapestry fixed so as to improve the premises (and thus a fixture) went to the trustees. The same rules apply where there is a mortgage so that fixtures are part of the lender’s security, and the borrower may not even remove items he has attached after the mortgage is granted.
Similar rules apply so that fixtures may not be removed by a tenant during or at the end of a lease. It would be unfair to a landlord if a tenant could remove fixtures present at the property before a tenant moved in. However the same rule originally also applied to items brought by a tenant. Because this is unfair to tenants, exceptions arose so that trade fixtures (including heavy duty steel furnace machinery) and domestic and ornamental fixtures (such as looking glasses, panelling, window blinds and bells) can be removed by tenants, but only during the lease and not after it has ended. By an historical quirk agricultural tenants cannot remove their trade fixtures, so their position is governed by statute.
Happily the position for buyers and sellers is straightforward: if the item is land or a fixture at the date of the contract, then it is included in the sale; if it is a chattel the seller must remove it to give vacant possession. In Taylor v Hamer the paving stones were chattels.
All of these rules (except for those in statute governing agricultural tenancies) can be overcome by clear direction in the relevant documents or agreement between the parties before an item is attached. In Re Whatley the testator could have specifically directed the tapestry to be given to the widow and tenants will be wise to agree with a landlord that a valuable picture can be removed at any time before it is attached to a leased property. When houses are bought and sold, lists of contents to be included and excluded are normal. In Taylor v Hamer the paving stones were not included on such a list. However, and despite being chattels, the seller was, exceptionally, not entitled to keep them. She had represented to the buyer that the paving stones were to be included in the transaction, and surreptitiously dug them up before contracts were exchanged!
To discover more, please reach out to our Agriculture, Estates and Rural Business team.