The 15 Rules for Chattels and Fixtures
Is it a chattel or a fixture? For both real estate agents and lawyers, this is often a puzzling question. There are some basic rules, that is, legal tests that Courts will apply to figure this out.
Let me give you two statements from real estate vernacular which aren’t true:
- If it takes a tool to remove it…… then, it must be a fixture.
Turn the house upside down and shake it…… all the chattels will fall out.
If you used these two statements as your guidelines, you probably would be right 60% of the time. No Court has ever used that!
Don’t you want a better batting average than that?
Here are the 15 Rules that you will find drawn from common law legal principles:
Rule #1 – if it is not attached, then it’s a chattel,
Rule #2 – unless the intention shows otherwise (fixture),
Rule #3 – if it is attached, then it’s a fixture,
Rule #4 – unless the intention shows otherwise (chattel),
Rule #5 – Rules 1 and 3 create rebuttable presumptions,
Rule #6 – The presumption may be rebutted by the degree of annexation,
Rule #7 – The presumption may be rebutted by object or purpose of annexation,
Rule #8 – the evidence required to rebut a presumption must be patent,
Rule #9 – intention is to be determined according to an objective test,
Rule # 10 - First items resting on their own weight or merely plugged in would be chattels,
Rule # 11 - unless appreciable damage would result from their removal,
Rule # 12 - Items otherwise attached would be fixtures,
Rule # 13 - When equipment is attached to a structure, all of its components are to be regarded as fixtures,
Rule # 14 - even a part that can be removed easily, if the removal of that part would render the machine/fixture inoperative,
Rule # 15 - Only in exceptional circumstances would one resort to the purpose test, as in the case of mobile homes or other expensive and large items.
There are probably at least, another half dozen basic rules.
You also need to be able to employ the intention-purpose test effectively on an objective basis.
Also, if the chattel can be considered to be part of a set, and the set itself is a fixture then the additional item, otherwise a chattel will be a fixture.
So, let me ask a simple question: “there are two picture hooks on a wall, both identical, from the same 29 cent package, one is a chattel and the other is a fixture. Do you know how to tell the difference?
Brian Madigan LL.B., Broker