Untitled

• Doctrine of Fixtures and Encroachment and Mistake of Title are legal concepts

Doctrine of Fixtures

• "Quicquid plantatur solo, solo cedit" translates to "What is attached to the land becomes part of the land."
• Fixtures are physical objects or artificial structures attached to land or buildings, legally considered part of the land.
• Under the doctrine of fixtures, a chattel becomes realty due to its annexation.
• The distinction between real and personal property lies in the joint nature of the land.

Fixtures and Land Ownership

• All fixtures become part of the landowner's realty.
• Removing a fixture requires the landowner's consent, except for "tenant's fixtures".

Fixture Claim Conflicts

• Conflicting claims can arise regarding fixture ownership.
• These conflicts can involve vendors, purchasers, mortgagees, mortgagors, life tenants, remainder persons, devisees, personal representatives, lessors, lessees, landlords, tenants and assessment of stamp duty on land transfers.

Holland v Hodgson Case (1872)

• Issue in the case: Whether machinery (looms) were fixtures to the land.
• The main rule for determining a fixture relies on its physical attachment to the land and the purpose of that attachment.
• Factors to consider include the degree of annexation and connection with the land.

Presumptions Regarding Attachment

• Items not attached to land, other than by their own weight, are initially considered chattels. The burden of proof lies on those claiming they are fixtures.
• Items attached to land are initially considered fixtures and the onus of proving otherwise lies on those asserting they are chattels.
• These presumptions can be challenged.

Annexation Mode and Object/Purpose

• Annexation's object means the purpose for something being on the land
• Court will consider intention behind affixing item, including intended annexation duration and status of installer.
• Whether the annexation improves the object as an object or improves the land.
• Asses the function and the nature of the item.
• Economic impacts of classifying a chattel as a fixture

Blackburn J on Annexation

• General legal principle states that whatever is attached to land becomes part of it.
• What qualifies as sufficient annexation is a difficult determination
• Assessing annexation depends on circumstances, primarily annexation degree and object.

Objective Intention Test

• The test of intention uses an objective standard, based on how things appear to others.
• Objectively, if an item appears intended as a fixture or chattel to a reasonable observer is considered
• Affirmed in Hobson v Gorringe, which highlights that an objective test is used to determine intention.

Hobson v Gorringe Case (1897)

• Issues:
  • Was the engine a fixture?
  • Priority among competing interests.
• Hobson, the engine owner, possessed an equitable right to remove it, subject to a hire purchase agreement.
• King, the original fee simple owner.
• Gorringe: mortgagee and holder of a legal interest in fee simple, under old system title.

Priority Issue

• A prior equitable interest is defeated by a bona fide legal estate holder for value without notice.
• Hobson's equitable right to remove the engine was defeated, since Gorringe was the mortgagee

Fixture Issue

• Engine was fixture given annexation's degree/object.
• Engine was subject to mortgage.
• Rejection of agreement allowing engine to remain chattel.
• Deciding intention requires objective assessment based on the facts.

Lord Blackburn on Intention

• Referring to circumstances displaying annexation degree along with annexation object which are evident to everyone rather than circumstances from a chance agreement between chattel and hirer.

Relevance of Subjective Intention

• Some suggest subjective intention reveals time period and purpose of annexation.
• This view is not generally accepted

Better View on Subjective Intention

• Recourse to subjective intention would not be permitted to prejudice the rights of third parties who would be unaware of such intentions

Deciding What Test to Use

• Originally, the extent of chattel annexation to land was most important
• Now, placing emphasis on with the item is placed upon land.

Australian Provincial Assurance Company v Coroneo

• If an item is fixed by any means other than its own weight, then prima facie it is a fixture
• The burden of proof is on anyone who asserts otherwise to establish that it is not a fixture.
• If an item is not affixed, then prima facie it is not a fixture and the burden of proof is on anyone who asserts that it is.
• If an item is affixed, the test of whether or not it is a fixture is whether it has been fixed with the intention that it remain in position permanently or for an indefinite or substantial period of time or only for some temporary purpose.

Jordan CJ (1907)

• If it is fixed with the former intention it is a fixture whether it is fixed for the better enjoyment of the land or building or fixed merely to steady the thing itself or for the better use or enjoyment of the thing affixed.
• On the other hand if it is fixed for a temporary purpose it is not a fixture
• The intention of the parties affixing the object must be gathered from the purpose for which and the time during which user in the fixed position is contemplated.
• If the item is securely affixed and, in particular, if so affixed that it cannot be detached without doing substantial damage, there is strong evidence that a permanent fixture was intended.
• Light fixing helps to support an inference that it was not intended to be permanent. However, each case depends on its own facts.

National Australia Bank v Blacker (2000)

• Conti J: "There is no single test which is sufficient to determine whether an item of property is a chattel or a fixture. It is clear that the court ought to have regard to all the circumstances of the case in making its determination... No particular factor has primacy and each case depends on its own facts."

Key Considerations for Determining Intention

• Both annexation degree and object must be examined to determine intention.
• Single test is adequate

Cases on Fixture Tests

• Reid v Smith
• Belgrave Nominees v Barlin-Scott Air-conditioning
• Hawkins v Farley
• Palumberi v Palumberi
• AG Cth v RT Co
• Anthony v Cth
• Wellsmore v Ratford
• D'Enycourt v Gregory
• Cancer Care Institute of Australia
• Pan Australia Credits v Kolim
• Kay's Leasing v CSR Provident
• Leigh v Taylor

Reid v Smith (1905)

• The case involved a dwelling (stood upon stilts). This case is noticeable as the High Court held that it was a fixture.

Summary of Fixture Texts

• All the facts and circumstances of the case including should be considered;
  • Annexation degree
  • Object and purpose of annexation
• Connection with land and Mode of annexation should also be considered (Reflexive test)

Determining Fixture Intention

• Examine item's intended purpose
• Examine if permanent or temporary improvement?
• Ascertain annexation’s purpose to building
• Consider prevailing community standards.

Removal of Tenant's Fixtures

• General Rule: Tenant attached fixtures become landlord's realty.
• Exception: "tenant's fixtures" may be removed

Tenant's Removal Rights

• Lease terms dictate contractual rights.
• Tenants can remove fixtures attached for trade, ornament or domestic purposes.
• Removal enforceable against landowner.

Removal Timing

• Removal of tenant's fixture must occur before the lease's end, as long as tenant remains lawfully in possession.
• Periodic tenants have reasonable time for removal after term
• Case examples: Spyer v Phillipson; Leigh v Taylor.

Non-Removable Fixtures

• Exception: lessor fixtures" may not be removed (Sebea v Territory of Papua) such as tenant's fixtures which become part of the structure
• General exceptions to the above: Agricultural tenants, retail shop tenants, residential tenants.

Mistake of Title and Encroachment of Buildings

Common Law & Title Disputes

• Typically, there is no legal recourse for construction on the wrong land lot.
• This situation falls under the law of fixtures
• Brand v Chris Building Society

S 123 PLA

• If someone builds on the wrong land due to boundary mistake
• Court can grant relief:
  • Vesting the land wrongly built upon
  • Allowing building removal
  • Requiring compensation
  • Granting possession rights to builder

PLA Section 123

• Covers parties applying order
• Every building possessor/interest holder from land, or any party under mortgage, lease agreement along with local government concerned is entitled to order.

Encroachment of Buildings

S 122 PLA: Court’s Power

Where a building encroaches on adjoining land:

• Either encroaching or adjoining owner applies for order
• If unintentional, relief may be granted

Court Orders for Encroachment

• Vest ownership of encroached land.
• Create an easement over encroached area.
• Allow encroaching owner to retain possession.

Terms and Conditions

• Court can impose terms on orders, including payments and execution of legal documents.
• Parties involved are entitled to apply for the order or be heard