Fixtures and sale of land

Why does chattel v part of land matter?

Not a chattel → part of the land and passes with it | Chattel → goods rules apply (nemo dat, conversion, detinue).

Holland v Hodgson – ELEMENTS + onus?

(1) Degree of annexation – importance varies with the type of chattel (2) Purpose of annexation – intention crucial but measured objectively | Not attached → presumed chattel (onus on claimant to prove land) | Attached → presumed land (onus on claimant to prove chattel).

CASE: Elitestone v Morris – facts + held?

Tenants built a bungalow resting by its own weight on concrete piles | Degree: for a house, common sense not precise analysis | Purpose: objective – couldn't intend a chattel if it would be destroyed on removal | Held: part of the land.

Elitestone v Morris – three categories?

Chattel | fixture | part and parcel of the land (the bungalow) – both fixtures and part-and-parcel are treated as part of the land; ask: is it part and parcel of the land?

CASE: Melluish v BMI – facts + principle?

BMI leased boilers, heating, lifts, pool equipment, cremators installed in council houses; agreements said they stayed BMI's | Part of the land – a private agreement can't stop a chattel becoming part of the land; it only governs contractual rights (e.g. removal) between the parties.

CASE: Lockwood Buildings v Trust Bank – facts + held?

Kitset show-home on a franchisee's mortgaged land, later removed by Lockwood; mortgagee sued in trespass | Nailed to foundations, connected to power and water; court considered background and common subjective intent (builder, bank, average buyer) | Part of the land – Cooke P did not discount the parties' subjective common intention.

CASE: Tower Hamlets – facts + held?

Henry Moore sculpture bought to adorn a housing estate, resting by its own weight, removed several times for loans | Purpose more important: removable without damage; value not dependent on location → chattel.

CASE: Potton Developments v Thompson – facts + held?

Large furnished box units made off-site, delivered by crane, nailed down and 'touched up' to look permanent | Touch-ups cosmetic; designed for easy delivery and removal (business model as background) → chattels.

CASE: Queenstown Central v March Construction – facts + held?

Fill spread on adjacent land, topsoiled and grassed like a paddock, under a resource consent to 'store' it | Chattel – informed-observer common-sense test: the consent showed the land was storing fill; it never added to the land's value or utility.

CASE: Ratana – facts + held?

House built on MFL funded via Housing Corp; deed said the house stays a chattel (Corp's property on default); loan repaid; owners died | Fixture – a later will didn't change that.

CASE: Lake Edge Developments v Kawarau Village?

Rock anchors built into the ground to support hotel infrastructure (needed for resource consent) – clearly part of the land.

Two stages of a land sale + the statutes?

Stage 1 contract – s 24 PLA: unenforceable by action unless in writing and signed by the party charged (not void); s 26 PLA: part performance can save it | Stage 2 transfer – s 24 LTA: no effect to pass the estate until registered; then P gets legal title.

Unconditional contract – P's interest + CASE: Re Richards?

Both legally bound; either could get specific performance → equity treats the property as sold (P has equitable interest) | Re Richards: vendor willed his house to Ms McTague, then contracted to sell and died before settlement → gift adeemed; his interest was only the right to the price.

Vendor's duty in the in-between period (Clarke v Ramuz; Englewood v Patel)?

Vendor holds as a 'trustee' – central duty: reasonable care to preserve the property in its state at contract | Englewood: keep land cultivated; reasonable state; stop trespassers removing soil; not deteriorate; not dump rubbish; not let a sold business lapse.

Limits on the vendor-as-trustee idea?

Chang v Registrar of Titles – not all trust law applies | Jerome v Kelly – vendor keeps enjoyment or rent | Re Hamilton-Snowball – vendor keeps money made from the property (rent) | Batchelar Centre v Westpac – no fiduciary duty of good faith where commercial party agreed a 'better-off' clause.

CASE: Bevin v Smith – conditional contracts?

Condition precedent → no contract yet, no equitable interest | Condition subsequent / solely for P (waivable) → equitable interest can pass | Contract conditional on routine third-party consent → P had an equitable interest | Test: will equity restrain the vendor from dealing inconsistently? Contingent interest can support a caveat and fiduciary duties.

Options and rights of first refusal (Sahade, Motor Works, Palm Gardens)?

Option → equitable interest – P chooses when to invoke (Sahade v BP) | Bare ROFR → none; vendor decides if/when to sell; interest only once vendor actually makes an offer (Motor Works) | Palm Gardens: weigh whole transaction – 'true condition precedent' meant the option never arose.

ADLS clause 5 – risk?

Property at vendor's risk until possession | Damage not made good by settlement: minor → P completes at price less repair cost; 'untenantable' at settlement → P may cancel or complete less vendor's insurance money.

CASE: Du v Youn – untenantable?

Applying Bahramitash v Kumar: property as a whole unfit for occupation and use by someone wanting it for the purchaser's purposes, assessed at settlement date | Red placard after a storm → untenantable → P could cancel and get the deposit back.

s 13 Insurance Law Reform Act 1985?

Overrides Rayner v Preston – P can claim the vendor's insurance payout for damage between contract and possession or settlement (whichever first) | Parties can expressly exclude s 13.

CASE: Cousins v Wilson – facts + held?

Trees damaged by a trespasser before settlement | P couldn't sue in trespass – no possession, and P's contractual right isn't a reversion | Vendors in possession got nominal ($25) + exemplary ($2,500) | Law unclear – argue (Lockwood) whether P should get a practical reversionary remedy.

APPROACH to a sale-of-land risk question?

(1) Valid contract – ss 24, 26 PLA (2) ADLS? cl 5 – risk with vendor (3) else defaults: unconditional – equitable title passes, risk with P but V owes preservation duties; conditional – depends on condition, if no interest risk with V (4) either way – s 13 ILRA claim; trespass by whoever can sue.