In Holland v Hodgson (1872) the owner of a mill purchased some looms to be used in his mill and the looms were affixed to the floor with nails, giving them some degree of permanency. The owner then mortgaged the land and defaulted on the repayments. The mortgagee (the lender in a mortgage) sought to repossess the land and sought to take control of not only the mill, but also of the looms. The mortgagee could do so if the looms were a fixture and the question before the court was whether the looms were a fixture or a chattel.
The general rule is that what is annexed (affixed) to the land becomes part of the land and because the looms were attached to the land, they had become part of the land and were regarded as fixtures. Therefore, the mortgagee was entitled to them.
Any item that is affixed to the land is to be regarded as a permanent feature of the land unless it has been regarded all along as a chattel and was never intended to become a permanent feature of the land.
Whether an item is to be regarded as a fixture or a chattel depends on the facts of each case, and in deciding whether an item is a fixture or a chattel, we have to take into account two factors: –
1) The degree of annexation
2) The object of annexation
An item that is attached to the land by no more than its own weight is normally regarded as a chattel say for example a block of stone that has just been left in the backyard as opposed to an item that is affixed to the land by some devise or mechanism, i.e. if the same block of stone was cemented to the land in the backyard than it would become a fixture but even then it is difficult to say with any degree of certainty without looking into the facts of the case if an item is a fixture or a chattel and we also have to take into account the intentions of the mortgagor when the item was first brought on to the land.
If the mortgagor intended the item to be a chattel it is best that he maintains that intention from the start and conveys that intention to the mortgagee.
Copyright © 2019 by Dyarne Jessica Ward