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16 October 2019

174: What are fixtures and chattels?

Fixtures – whether something is considered a fixture will come down to whether there is sufficient annexation of that thing to the land. There is no ‘one size fits all’ approach to be taken here and whether there is sufficient annexation is a question of fact and will depend upon the circumstances. However, the two key questions are:

  1. to what extent is the item annexed to the land – in other words, how is it annexed and how firmly?
  2. why was the item brought onto the land and annexed to it?

Chattels – this is simple enough as chattels are basically things which are not fixtures.

Background

Borwick Development Solutions Ltd (B) owned a commercial fishery used by anglers for sport, including nine man-made lakes and pools. Clear Water Fisheries Ltd (CW) bought the land from B, acting by an LPA receiver. As well as fish stocks in the lakes which anglers paid to fish for sport or recreational purposes only, there were also solar panels at the site used to power equipment at the on-site restaurant with any surplus uploaded to the National Grid. When sunlight was insufficient, the equipment drew the electricity from the National Grid.

The sale contract between B and CW did not address either the solar panels or the fish stocks. B subsequently made a conversion claim against CW in respect of the solar panels and the fish stocks which remained at the site post-completion, on the basis that they had been withheld by CW without lawful justification.

At law, in the absence of any express provision in the sale contract, fixtures will pass with the property on a sale (as they form an integral part of the land), whereas chattels are personal property and so will not pass.

The Court held that B had no right to bring a conversion claim against CW as the solar panels and the associated equipment were fixtures and passed to CW on the sale based on the following:

  • the method and degree of the annexation – the panels were fixed to a metal frame, bolted onto a wooden frame which was then set into the ground in concrete. The entire structure of the concrete, frame and panels had to be looked at as a whole and therefore, the degree of attachment to the land, meant that the panels themselves were fixtures; and
  • the object and purpose of the annexation – the solar panels were converting the sunlight into electricity and the electricity being used to power the restaurant’s equipment. Therefore, the use of the panels was not independent of the land but was being used as an integral part of the land itself (ie the operation of the restaurant).

This was the first case in which the Court has had to decide on the legal nature of fish stocks in a commercial fishery. The Court held that there was no absolute property in a living wild animal. However, B had qualified property in the fish in the sense of diligence or hard work, applying the findings of a 2006 case Cresswell V DPP.

B had introduced the fish into and isolated them in a closed water system to present a challenge to anglers who cast them for recreation and/or sport, rather than food. As the sale contract did not expressly deal with the title to the fish, they did not pass to CW on completion.

Why this case is important and what can we learn?

It highlights the importance of making sure that both parties think very carefully about what they intend to be included in the transaction and ensuring that these intentions are documented properly.

CW has a commercial fishery which has the benefit of solar panels to operate equipment in a restaurant, but no fish!

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