A fixture is a tangible personal property (chattel) that is attached to real property in such a manner that it is treated as part of the real estate property when determining ownership. Intent is the most important factor in addressing whether an item is a trade fixture.
Structures and Items Incorporated Into Structures
Structures built on real property (i.e.: walls) and materials incorporated into a structure (i.e.: bricks used to form the wall) become part of the realty. The owner of the real property is generally also the owner of the structure on the real property (i.e.: an improvement), including any materials used in constructing the structure. Once incorporated into the structure, such materials become an integral part of the real property and are not subject to a separate security interest.
When chattel is attached to real property, it is typically intended for the chattel to become a fixture. Such an intent is judged by applying an objective, reasonable person standard that examines such factors as
For our purposes, California Civil Code Section § 658 provides that Real or immovable property consists of:
2. That which is affixed to land;
3. That which is incidental or appurtenant to land;
4. That which is immovable by law; except that for the purposes of sale, emblements, industrial growing crops and things attached to or forming part of the land, which are agreed to be severed before sale or under the contract of sale, shall be treated as goods and be governed by the provisions of the title of this code regulating the sales of goods.
California Civil Code Section § 1013 provides the statutory test on determining whether an item is a fixture in stating that:
when a person affixes his property to the land of another, without an agreement permitting him to remove it, the thing affixed, except as otherwise provided in this chapter, belongs to the owner of the land, unless he chooses to require the former to remove it or the former elects to exercise the right of removal provided for in California Civil Code Section § 1013.5.
This means that things affixed onto the land thus become a part of the land.
Further, California Civil Code Section § 1025 provides that when things belonging to different owners have been united so as to form a single thing, and cannot be separated without injury, the whole belongs to the owner of the thing which forms the principal part; who must, however, reimburse the value of the residue to the other owner, or surrender the whole to him.
California courts will look at factors such as the intention of the party who has made the annexation (as to whether the item was intended to remain attached permanently or temporarily). Courts will also consider whether the item has adapted into the normal use of the property and the amount of damage removal of that item will cause to the property.
If an item was brought onto the property by a tenant and removal of such item will not significantly damage the property, (and was not included in the normal use of the property), a tenant may remove it before the ending of a lease term. Moreover, a tenant may also enter into a written agreement to protect items from becoming fixtures into a rental property. Such an agreement will demonstrate that the intent of the item's use was not to be permanent or annexed into the rental property.
If you need assistance with determining whether you property is a fixture it is beneficial to retain experienced and professional attorneys to assist you with this matter. Please call Aziz Legal by phone at (408) 203-4627 or email us at email@example.com.
This article is merely informational and is not intended to be used as legal advice. Use of any information from this article is for general information only and does not represent personal legal or tax advice, either express or implied. Readers are encouraged to consult Aziz Legal, or another attorney, for any specific legal matters.