Real v Personal
Cases
Savoye And Savoye Ltd v Spicers Ltd
[2014] EWHC 4195 [2015] Bus LR 242, [2015] BLR 151, 159 Con LR 120, [2015] WLR(D) 17, [2015] BUS LR 242, [2014] EWHC 4195 (TCC)
Akenhead J
The word “structure” also has as its Latin origin the verb “struere” and means something which has been placed, built, arranged or prepared; in common parlance, it has a connotation as having a function of supporting or servicing something else; thus, steelwork for a building is structural and a structure. A house or office building is a structure; Nelson’s Column is a structure. Things within a building may be a separate structure such as a mezzanine floor or steelwork to support heavy machinery. Lord Denning LJ as he then was, said in a rating case, Cardiff Reading Authority and Cardiff Assessment Committee v Guest Keen Baldwin’s Iron and Steel Company Ltd [1949] 1 KB 385, when considering whether heavy but movable tilting furnaces were in the nature of a structure, at Page 395-6:
“The tilting furnaces come within “furnaces” and the mains come within “flues” and “flumes and conduits” [as referred to in a statutory instrument]; but nevertheless, in order to be rateable each must be “a building or a structure” or “in the nature of a building structure”. The learned recorder has held that they are not structures, or in the nature of structures, and [Counsel] says that his finding is a finding of fact with which an appellate court should not interfere…
In this case the learned recorder seems to have thought that these were not structures or in the nature of structures because they were movable. In my opinion, that was a misdirection. A structure is something which is constructed, but not everything which is constructed is a structure. A ship, for instance, is constructed, but it is not a structure. A structure is something of substantial size which is built up from component parts and intended to remain permanently on a permanent foundation; but it is still a structure even though some of the parts may be movable, as, instance, about a pivot. Thus, a windmill or a turntable is a structure. A thing which is not permanently in one place is not a structure, but it may be “in the nature of a structure” if it has a permanent site and has all the qualities of the structure, say that it is on occasion moved on or from its site. Thus, a floating pontoon, which is permanently in position as a landing stage beside a pier, is “in the nature of a structure,” even though it moves up and down with the tide and is occasionally removed for repairs or cleaning. It has, in substance, all the qualities of a landing stage built on piles so, also a transporter gantry is “in the nature of a structure,” even though it is moved along its site. It has the same qualities as a fixed gantry, save that it moves on its site.”
Jenkins J as he then was said in the same case:
“It would be undesirable to attempt, and indeed, I think impossible to achieve, any exhaustive definition of what is meant by the word “is or is in the nature of a building or structure”. They do, however, indicate certain main characteristics. The general range of things in view consists of things built or constructed. I think, in addition to coming within this general range, the things in question must, in relation to the hereditament, answer the description of buildings or structures, or, at all events, be in the nature of buildings or structures. That suggests built or constructed things of substantial size: I think of such size that they either have been in fact, or would normally be, built or constructed on the hereditament as opposed to being brought onto the hereditament ready-made. It further suggests some degree of permanence in relation to hereditament, i.e., things which once installed on the hereditament would normally remain in situ and only be removed by a process amounting to pulling down or taking to pieces. I do not, however, mean to suggest that size is necessarily a conclusive test in all cases, or that a thing is necessarily removed from the category of buildings or structures or things in the nature of buildings or structures, because by some feat of engineering or navigation it is brought to the hereditament in one piece…”
Whilst this case related to whether particular equipment fell to be considered for rating purposes, it does provide some assistance as to what the meaning of the word “structure” means. Like Jenkins J, I do not consider that it would be possible let alone helpful to produce some supposedly exhaustive definition of what the word “structure” means because in almost every case, and this one is no exception, it should be possible to determine with relative ease whether a particular installation within a factory or warehouse is a “structure”. The fact however that the equipment, said to be a “structure”, can move or has moving parts does not mean that the equipment, as installed, can not be considered to be a structure. Equipment can be a structure although, of course, not all equipment is a structure.
Sections 105(a) to (c) each mention “forming part of the land” as a facet of the construction operations being defined, although Sections 105(a) and (b) talk about “forming, or to form, part of the land” which presumably recognises a stage in the works in question before they actually form part of the land and a mutual intention that they will form part of the land. Mr. Justice Dyson, as he then was, said in Nottingham Community Housing Association Ltd v Power Minster Ltd [2000] BLR 309:
“In my judgment, still leaving (c) on one side, there is no warrant in paragraph (a) for distinguishing between different types of operations carried out in relation to a building or structure. Take the construction of the building. Paragraph (a) applies as much to the installation of a demountable wall partition as it does to the installation of a central heating, air conditioning, sanitation system or any other of the fittings mentioned in paragraph (c). There is no distinction in property law: once installed, they all become part of the land. Nor is there any other basis, whether technical or founded on the ordinary use of words, for saying that the installation of a demountable wall partition is, but the installation of heating systems etc is not, part of the construction of a ‘building’. Such systems are often complex; they are usually integrated into the structure of the building; they may be very difficult to disconnect and remove from the building. It may be far easier to remove and replace, say, a demountable wall partition or cladding panels that have been fixed to the exterior of the building, than to remove one of the systems described in paragraph (c). The same applies to the other operations mentioned in paragraph 9(a)…”
It is clear from Section 105(1)(b) that works can include the provision of industrial plant. It is a corollary of Section 105(2) that the installation of plant and machinery can be considered to be construction operations, provided that they are not simply being manufactured or delivered to site and that there is a contract for their installation. Put another way, it is not simply the concrete or brick foundations, the walls and/or steel or other columns and the roof which are to be considered as construction operations; it is also the case that much of what is to go into a building or structure is to be considered as being within the definition of construction operations. The unifying factor is the need for the items of work, materials, plant, equipment and the like to form part of the land.
It is and remains, rightly in my judgment, common ground between Counsel that the question of whether an item, element of work or equipment “forms part of” the land in question is not only a matter of fact and degree but it is also determinable at least in the general context of the numerous authorities about fixtures arising under land or real property law. An adjudication case which considered what the expression “forming part of the land” meant was Gibson Lea Retail Interiors Ltd v Makro Service Wholesalers Ltd [2001] BLR 407 where the contract in question related to shop-fitting work. The evidence before the court was that much of the equipment such as gondolas and book and food display units, albeit in some respects screwed or bolted to walls or floor, did not form part of the land as the central and important characteristic was that it was movable equipment which could be moved “as goods come and go and the seasons change”. The Judge, HHJ Seymour QC, was referred to several authorities on fixtures, for instance Horwich v Symond [1915] 84 LJKB 1083, where Buckley LJ said at page 1087:
“The question whether these articles were so fixed that they ought to be treated as annexed to the freehold, or were merely chattels, is, as I have said, a dual question of fact. The mere fact of some annexation to the freehold is not enough to convert a chattel into realty. That is shown by the case of carpets, which are certainly not fixtures; and the same principle seems to apply to a shop counter which stands on the floor not as a fixture, but as a chattel with a certain amount of fixing to keep it steady.”
HHJ Seymour QC went on at Paragraph 20 in his judgment:
“…Nonetheless it does appear that the intention of Parliament was to introduce into the Act by means of the words “forming part of the land” the existing law as to fixtures. There is no other “general rule of law” dealing with the effect of attaching chattels to real property…”
He went on at Paragraph 22 to consider the impact in Section 105(1)(a) of the HGCRA:
“I am satisfied that the proper construction of section 105(1)(a) of the Act is that the words “construction…of…structures forming, or to form, part of the land (whether permanent or not)” is clear and not ambiguous. Although [Counsel] submitted that the words “whether permanent or not)” indicated that the formation of part of the land need not be permanent, so that temporary attachment was sufficient, in my judgment [the other Counsel] was correct in his submission that the word “permanent”, being an adjective, not an adverb, must qualify a noun and so could not qualify the temporal connotations of “forming, or to form, part of the land”. It seems to me that it is the structures which need not be permanent. I have already indicated my view that the effect of referring to “forming, or to form, part of the land” is to import into section 105(1)(a) of the Act the concepts and tests of the law relating to fixtures. I cannot see to what else it could refer…In my judgment it is clear that the words in section 105(3) of the Act “fittings forming part of the land” [are] a reference to fixtures.”
I am not as certain as HHJ Seymour QC was that the law relating to fixtures was incorporated lock, stock and barrel by the reference to the words “forming part of the land”. It seems to me much more likely that Parliament was simply setting a factual test as to whether the building, structure, works and fittings were forming or to form part of the land. I have formed the view therefore that, whilst the law relating to fixtures casts useful light on the test, it is not some sort of pre-condition that the test or threshold of “forming part of the land” can only be “passed” if the item of work etc is a fixture as understood in the law of real property. This is because it is not necessary to read the words used as requiring that, the word “fixture” is not used and there are some hints in the wording that the full fixture test is not required, not least of which are the words in Section 105(1)(a) that buildings and structures need not be “permanent”, in Section 105(1)(b) the words “industrial plant” (not apparently limited only to large plant) and in Section 105(2)(d) the words “building or engineering components or equipment, …materials, plant or machinery” (again without limitation). As will be seen by the following cases dealing with fixtures, the law relating to “fixtures” is not particularly simple and, if Parliament had intended to incorporate the law relating to fixtures, it could and would have done so rather than use some sort of verbalcode form which some but not all might infer that the law relating to fixtures was to be applied.
In this view, I am fortified by what Lord Lucas said in the parliamentary debate on the HGCRA at bill stage:
“…As to the meaning of the phrase “fittings forming part of the land”, the general rule of law is that whatever becomes attached to the land becomes part of it. An object which was attached to the land or which was attached to something which was itself attached to the land would be covered by the provisions. It does not matter whether it is easy to remove, such as something merely screwed to the wall, or whether the attachment is more substantial. Examples of fittings “forming part of the land” would include a fireplace, panelling, a conservatory on a brick foundation or radiators bracketed to a wall. The dividing line between things which are fixed and not fixed might be the telephone on one’s desk which is not fixed to the land and the socket in the wall which is. That is the sort of dividing line I would think of, but of course it is something that would be determined in each individual case” (see Hansard for 22 April 1996 at Page 18 where he answered queries about the meaning of the phrase “fittings forming part of the land”)
I hasten to say that I do not consider that the meaning of the words is ambiguous such as to engage the application of Pepper v Hart [1993] AC 593.
I address now some of the cases which relate to fixtures and the ownership of buildings and the like. As a number of them indicate, the objective purpose or intention (judged objectively) of those involved in placing or attaching items of work or equipment on to or in to land or structure can be relevant. Halsbury’s Laws of England (2012), by reference to various authorities, says as follows at Para. 174:
“Whether an object that has been brought onto the land has become affixed to the premises and so has become a fixture (or a permanent part of the land) is a question of fact which principally depends first on the mode and extent of the annexation, and especially on whether the object can easily be removed without injury to itself or to the premises; and secondly on the purpose of the annexation, that is to say, whether it was for the permanent and substantial improvement of the premises or merely a temporary purpose for the more complete enjoyment and use of the object as a chattel. The mode of annexation is, therefore, only one of the circumstances to be considered, and it may not be the most important consideration.
An object which is attached to the premises only by its own weight will not in general be regarded as a fixture (or part and parcel of the land), unless circumstances showed that it was intended to become part of the premises, and the onus of proving that there was such an intention rests on the party asserting that the object has become a fixture or part of the land. If, however, an object is to some extent attached to the premises, it will be considered to be a fixture or part of the land unless the circumstances show that it was intended all along to remain a chattel, and in such a case the onus of proof is on the party asserting that it is still a chattel. Framed paintings displayed on a room’s walls do not usually constitute fixtures or fittings; they usually remain chattels.”
In Holland v Hodgson [1872] LR CP 328, the owner of a mill mortgaged it to the plaintiff and on his bankrupt assigned all his property to the defendant as trustee for the benefit of his creditors. The Defendants seized looms which had been attached to the stone floors of rooms in the mill by means of nails driven through holes in the feet of the looms and in some cases into beams built into the stone of the building and in other cases into plugs of wood driven into holes drilled in the stone for the purpose. This was necessary to steady the looms and keep them pointing in the right direction; the looms could not be removed without drawing the nails albeit that that could be done easily and without serious damage to the flooring. It was held that they were to be treated as part of the building. Blackburn J delivered the judgment of the appellate court, affirming the lower court’s findings and referring to various authorities, saying at page 339:
“Walmsley v Milne…was decided in 1859. This case and that of Wiltshear v Cotterill…seem authorities for this principle, that where an article is a fixed by the owner of the fee [simple], though only affixed by bolts and screws, it is to be considered as part of the land, at all events where the object of setting up the articles is to enhance the value of the premises to which it is annexed for the purposes to which those premises are applied. The threshing machine in Wiltshear v Cotterill was affixed by the owner of the fee to the barn as an adjunct to the barn, and to improve its usefulness as a barn, in much the same sense as the hay-cutter in Walmsley v Milne was affixed to the stable as an adjunct to it, and to improve its usefulness as a stable…”
Hobson v Gorringe [1897] 1 Ch 182 is a case which has been followed and approved in later decisions. It related to a gas engine let out on a hire purchase arrangement which provided that it should not become the property of the hirer until the payment of all the instalments and that it should be removable by the owner if there was a failure to pay hire instalments. The engine was fixed to the land by bolts and screws to prevent it from rocking and it was used for the purposes of the hirer’s sawmill trade. Meanwhile, the owner mortgaged his land without the mortgagee having notice of the hire purchase arrangements. The hirer defaulted and the engine was claimed back by the owner and also by the mortgagee. AL Smith LJ, giving the judgment of the court, referred to previous cases such as Wiltshear v Cottrell (1853) 1 E&B 674 (threshing machine fixed by bolts and screws to those which were let into the ground), Mather v Frazer (1856) 2 K&J 536 (machinery fixed to the land by screws, solder or other permanent means), Climie v Wood (1868) LR 4 Ex 328 (engine screwed down to planks upon the ground and a boiler being fixed into the brickwork) and Longbottom v Berry (1869) LR 5 QB 123 (machinery annexed to the floor of a building in a quasi-permanent manner by means of bolts and screws) where these items of equipment formed part of the land or passed with the land. He held that the gas engine had become a fixture and that the terms of the contract between the owner and the hirer did not prevent that (see page 192). In relation to intention, he referred with approval to Holland v Hodgson saying that:
“…Lord Backburn, when dealing with the “circumstances to shew intention,” was contemplating and referring to circumstances which showed the degree of annexation and the object of such annexation which were paid and for all to see, and not to the circumstances of a chance agreement that might or might not exist between an owner of a chattel and a hirer thereof. This is made clear by the examples that Lord Blackburn alludes to to shew his meaning. He takes as instances (a) blocks of stone placed in position as a dry stone wall or stacked in a builder’s yard; (b) a ship’s anchor affixed to the soil, whether to hold a ship riding thereto or to hold a suspension bridge. In each of these instances it will be seen that the circumstances to show intention are the degree and object of the annexation which is in itself apparent, and thus manifest the intention” (page 193)
In Crossley Brothers Ltd v Lee [1908] 1 KB 86, the issue revolved around whether a gas engine fixed to the floor of the basement by bolts and screws was a fixture. The Divisional Court decided that it had become a fixture. Walton J referred to the case of Hobson v Gorringe saying at page 93:
“The facts that were very similar to those of Hellawell v Eastwood…and it was contended that the machine was a mere chattel, and that there was no intention that it should form part of the freehold. That case, like the present, was the case of a hire purchase agreement, with power reserved to the vendorto resume possession of the article in certain circumstances. Notwithstanding the decision in Hellawell v Eastwood…and that the method of attachment was practically the same as in that case, the Court of Appeal held that the article, a gas engine, was a fixture on the part of the freehold, and that it therefore passed to the mortgagee under the mortgage. The court, in giving judgement, pointed out that it did not, and could not, pass as a chattel, but as part of the land, removable, no doubt, as a tenant’s fixture, but still a fixture. The effect of that decision is, it seems to me, that it must now be taken that the law was not correctly applied in Hellawell v Eastwood. The decision in Hobson v Gorringe…is binding on us, and we must follow it by holding that the engine in the present case was a fixture and part of the freehold, and therefore not distrainable.”
Pole-Carew v Western Counties and General Manure Company Ltd [1920] 2 Ch 97 was a Court of Appeal case concerned with the ownership of various towers and chambers erected by long-term tenants of premises over a 50 year period in connection with their business. Following a fire, the lease was determined and the lessee removed what was left of the materials of the chambers and towers. The chambers were mostly large (140 feet long, 20 feet wide and 14 feet high) and used in the manufacture of sulphuric acid and with the towers and other elements were part of a single apparatus for those purpose. The chambers were supported by wooden framework which rested on but were not mechanically fixed to stone walls and pillars; one chamber rested primarily on unfixed iron columns. The towers were upright chambers enclosed in a wooden framework supported by four wooden posts resting by their own weight on a foundation. Sargant J at first instance found that the chambers and towers were to be regarded as integral portions of one composite building permanently annexed to the freehold and not as chattels or tenant’s fixtures. The Court of Appeal agreed. Lord Sterndale MR said at pages 116-7:
“Many cases were cited to us…I agree with [a text book on Landlord and Tenant law] that “in as much as the whole question is in each case one of fact depending on its own circumstances, the decision in one case can seldom be a guide to a solution in another.”
I think they decide generally that attachment or non-attachment to the freehold or to something which is attached to it, is the most important matter to be considered but not absolutely conclusive, but where the articles claimed to be chattels are not so attached, the onus lies heavily on those who deny them to be chattels.
The first point, therefore, for decision is whether these chambers were chattels. It was contended that though they were of great size (140 feet long, 20 feet wide and 13 or 14 feet high) and of great weight (about 20 tons when empty), they each constituted an independent structure which was completely severable from the walls and underlying structure, and, apart from the difficulty arising from their great size and weight, could be lifted up from the sub-structure, leaving it intact and undisturbed. I do not think this contention is sound. As a great deal of argument was addressed to us on the subject of the mortar, I think it better not to pass it without observation. I do not think it is of any importance. I think the object was probably to make an even bed for the beam or wall plates, although some slight adhesion might take place. The beams seem to me to have been placed as they are in ordinary building, except that the walls were not carried above their level, and therefore there was no necessity for brickwork above them, and they were kept in their place by the weight of the superstructure…I wish to adopt the language of Sargent J on this point: “If you look at the size and permanence and the general character of the structure and the absence of any definite line of demarcation or division, the absence of any unity in the upper structure as distinguished from the lower structure, I think one is driven to the conclusion that the whole structure forms one single unit and is of the nature of a building, that it is not a chattel, that it is a fixture, and that the lower portion of this unit being embedded in the land by ordinary foundations, it cannot be considered a tenant’s fixture, and must be considered from the beginning as being something permanently annexed to the freehold of the nature of the building.” The towers present more difficulty. From their construction, which I have already described, there would be some reasonable ground, if they stood alone and unconnected with anything else, for contending that they were chattels, but they were not isolated or unconnected. They were connected by pipes, as I have described, with the burners and chambers, and were a necessary and integral part of a sulphuric acid plant, and in my opinion they must be considered as a part of the whole structure, in the same way that movable parts of an engine are considered as an integral part of the engine…[references quoted]”
Warrington LJ broadly agreed saying at page 120:
“…I think the entire series of structures must, for the purposes of this case, be regarded as one composite building, composed of four parts, each of which is also a building, and if that composite building or any of the minor buildings composing it (treating the building in each case as a single whole) is attached to the inheritance then the whole of such building is so attached…
So far I have said nothing about the towers. Each of these stands on four legs and each leg is dropped into an iron shoe standing on a stone foundation fixed in the ground, each shoe is kept in position by a projecting boss dropped into a hole in the stone foundation. The shoes are in no way affixed to the stone. Looked at by themselves apart from the chambers and from the purposes which they are intended to serve, these towers would, I think, be properly held to be chattels. Like the barn and the granary on staddles, the mill resting on the ground, and the other mill resting on but not attached to a brick foundation they are in no way affixed, and would be capable of being moved without disturbing the soil. But I think they cannot properly be regarded by themselves. They are an essential part of the apparatus, the chambers constituting the bulk of it would be useless without the towers, and the towers would be useless without them. The chambers and the towers are and must be connected together, and if, as I think is the case, the chambers have been so constructed that they cannot be regarded as chattels the same result must, in my opinion, follow in respect of the towers which are an accessory to the rest of the apparatus…”
In Melluish v BMI (No.3) Ltd [1996] 1 AC 454, the House of Lords considered, in the context of a tax case involving capital allowances for plant and machinery installed by BMI through leasing arrangements in local authority housing, whether equipment must be considered as part of the land, in circumstances in which BMI retained a right to remove equipment at the expiry of the term of the lease or on determination of the lease in the event of default. Lord Browne-Wilkinson gave the leading judgement saying at pages 72-3:
“The Court of Appeal… unanimously allowed an appeal…in relation to the plant fixed to the property of which the local authority retained possession…They held that the concept of a fixture which remains personal or removable property was a contradiction in terms and an impossibility in law. The future right to remove equipment at the expiry of the term or in the event of a default by the local authority did not mean that the equipment “belongs” to the taxpayer company so long as it remains attached to the realty.
I agree with the conclusion and reasoning of the Court of Appeal. The equipment in these cases was attached to the land in such a manner that, to all outward appearance, they formed part of the land and were intended so to do. Such fixtures are, in law, owned by the owner of the land. It was suggested in argument that this result did not follow if it could be demonstrated that, as between the owner of the land and the person fixing the chattel to it, there was a common intention that the chattel should not belong to the owner of the land. It was said that clause 3.10 of the master lease disclose such an intention in the present cases. In support of this argument reliance was placed on the decision in Simmons v Midford where Buckley J held that even where the outward and visible signs were only consistent with the chattels (in that case an underground drain) having become part of the land, the circumstances and language used in the grant of the right to lay the drain showed an intention that the ownership of the drain should not be vested in the owner of the soil. He held that in consequence the drain was not owned by the owner of the soil in which had been laid.
Unfortunately, the decision in Hobson v Gorringe…was not cited to Buckley J. That case (which was approved by the House in Reynolds v. Ashby and Son Ltd [1904] AC 466) demonstrates that the intention of the parties as to the ownership of the chattel fixed of the land is only material so far as such intention can be presumed from the degree an object of the annexation. The terms expressly or implicitly agreed between the fixer of the chattel and the owner of the land cannot affect the determination of the question whether, in law, the chattel has become a fixture and therefore in law belongs to the owner of the soil…The terms of such agreements will regulate the contractual rights to sever the chattel from the land as between the parties to that contract and, where an equitable right is conferred by the contract, as against third parties. But such agreement cannot prevent the chattel, once fixed, becoming in law part of the land and as such owned by the owner of the land so long as it remains fixed. To the extent that Simmons v Midford decides otherwise it was wrongly decided.
Another House of Lords case was Elitestone Ltd v Morris [1997] 2 All ER 513 in which consideration was given to whether a chalet bungalow which simply rested by its own weight on concrete pillars attached to the ground was to be considered as part of the land. Lord Lloyd of Berwick gave the first reasoned judgment; Lords Nolan, Nicholls and Browne-Wilkinson agreed with him and Lord Clyde. As observed by Lord Lloyd (page 516b), the chalet bungalow was “not like a Portakabin, or mobile home [and that the] nature of the structure is such that it could not be taken down and re-erected elsewhere [and it] could only be removed by a process of demolition.” He went on:
“Thus, the sole remaining issue for your Lordships is whether Mr Morris’s bungalow did indeed become part of the land, or whether it has remained a chattel ever since it was first constructed before 1945.
It will be notice that in framing the issue for decision I have avoided the use of the word ‘fixture’. There are two reasons for this. The first is that ‘fixture’, though a hallowed term in this branch of the law, does not always bear the same meaning in law as it does in every day life. In ordinary language one thinks of a fixture as being something fixed to a building. One would not ordinary think of the building itself is a fixture. Thus in Boswell v Crucible Steel Co [1925] 1 KB 119…the question was whether plate glass windows which formed part of the wall of a warehouse were landlord’s fixtures within the meaning of repairing covenants. Atkin J said at [page]123…:
‘…I am quite satisfied that they are not landlord’s fixtures, and for the simple reason that they are not fixtures at all in the sense in which the term is generally understood. A fixture, as that term is used in connection with the house, mean something which has been affixed to the freehold as accessory to the house. It does not include things which were made part of the house itself in the course of its construction.’
Yet in Billing v Pill…[1954] 1 QB 70 at 75 Lord Goddard CJ said:
‘What is a fixture? First, the commonest fixture is a house. The house is built into the land, so the house, in law, is regarded as part of the land; the house and the land are one thing.’
There is another reason. The term fixture is apt to be a source of misunderstanding owing to the existence of the category of so-called ‘tenants’ fixtures’…which are fixtures in the full sense of the word (and therefore part of the realty) but which may nevertheless be removed by the tenant in the course of or at the end of his tenants it is. Such fixtures are sometimes confused with chattels which have never become fixtures at all. Indeed, the confusion arose in this very case. In the course of his judgement Aldous LJ quoted at length from the judgement of Scott LJ in Webb v Frank Bevis Ltd [1940] 1 All ER 247. The case concerned a shed which was 135 ft long and 50 ft wide. The shed was built on a concrete floor to which it was attached by iron straps. Having referred to Webb v Frank Bevis Ltd and a decision of Hirst J in Deen v Andrews [1986] 1 EGLR 262 Aldous LJ continued:
‘In the present case we are concerned with a chalet which rests on concrete pillars and I believe falls to be considered as a unit which is not annexed to the land. It was no more annexed to the land than the greenhouse in Deen v Andrews or the large shed in Webb v Bevis. Prima facie, the chalet is a chattel and not a fixture.’
But when one looks at Scott LJ’s judgement in Webb v Frank Bevis it is clear that the shed in question was not a chattel. It was annexed to the land, and was held to form part of the realty. But it could be severed from the land and removed by the tenant at the end of his tenancy because it was in the nature of a tenant’s fixture, having been erected by the tenant for use in his trade….
For my part, I find it better in the present case to avoid the traditional twofold distinction between chattels and fixtures, and to adopt the threefold classification set out in Woodfall Landlord and Tenant release 36 (1994) vol 1, p13/83, para 13.131:
‘An object which is brought onto land may be classified under one of three broad heads. It may be (a) a chattel; (b) a fixture; or (c) part and parcel of the land itself. Objects in categories (b) and (c) are treated as being part of the land’
So the question in the present appeal is whether, when the bungalow was built, it became part and parcel of the land itself. The materials out of which the bungalow was constructed, that is to say that the timber frame walls, the feather boarding, the suspended timber floors, the chipboard ceilings and so on, were all, of course, chattels when they were brought onto the site. Did they cease to be chattels when they were built into the composite structure? The answer to the question, as Blackburn J pointed out in Holland v Hodgson (1872) LR 7 CP 328 at 334…depends on the circumstances of each case, but mainly on two factors, the degree of annexation to the land and the object of the annexation.
Degree of annexation
The importance of the degree of annexation will vary from object to object. In the case of a large object, such as a house, the question does not often arise. Annexation goes without saying…
Purpose of annexation
Many different tests have been suggested, such as whether the object which has been fixed to the property has been so fixed for the better enjoyment of the object as a chattel, or whether it has been fixed with a view to effecting a permanent improvement of the freehold. This and similar tests are useful when one is considering an object such as a tapestry, which may or may not be fixed to a house so as to become part of the freehold…These tests are less useful when one is considering the house itself. In the case of the house, the answer is as much a matter of common sense as precise analysis. A house which is constructed in such a way so as to be removable, whether as a unit or in sections, may well remain a chattel, even though it is connected temporarily to mains services such as water and electricity. But a house which is constructed in such a way that it cannot be removed at all, save by destruction, cannot have been intended to remain as a chattel. It must have been intended to form part of the realty. I know of no better analogy than the example given by Blackburn J in Holland v Hodgson…at 242:
‘Thus blocks of stone placed one on top of one another without any water also meant that the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on top of each other in the form of a wall, would remain chattels.’
Applying that analogy to the present case, I do not doubt that when Mr Morris’s bungalow was built, and as each of the timber frame walls were placed in position, they all became part of the structure, which was itself part and parcel of the land. The object of bringing the individual bits of wood onto the site seems to be so clear that the absence of any attachment in the soil (save by gravity) becomes an irrelevance.”
Lord Clyde gave the only other reasoned judgment. Starting at page 520g, he said:
“It is necessary at the outset to define what the bungalow comprises. It seems from the facts in the present case is if some form of actual attachment of the bungalow to realty might exist, in the connection with the main electric supply cable and certain drain pipes. But these matters have not been explored in the facts and we are required to proceed on the basis that the bungalow is not physically attached to the land. The next consideration is whether the foundations form part of the bungalow. These are sunk into the ground and, if they were to be treated as part of the bungalow, would clearly be an element of physical connection with the ground. But it does not appear that there is any particular adaptation of the foundations to the structure above or any adaptation of the structure to suit the foundations. The main structural elements of the bungalow simply rest on the concrete blocks. The bungalow and the foundations are separable from each other and it is not appropriate to treat the whole as a unum quid so as to conclude that the bungalow is built into the ground. It is with the wooden structure alone that the case is concerned…
The question posed by the parties in their agreed statement of facts and issues is: whether the bungalow…was a chattel or a fixture? I entirely share the unease which has been expressed by…Lord Lloyd…on the use of the word ‘fixture’…
As the law has developed it has become easy to neglect the original principle from which the consequences of attachment of a chattel to realty derived. That is the principle of accession…A clear distinction has to be drawn between the principle of accession and the rules of removability…
If the problem is approached as one of accession it has to be noted that in the present case the bungalow is not attached or secured to any realty. It is not joined by any physical link which would require to be severed for it to be detached. But accession can operate even where there is only a juxtaposition without any physical bond between the article and the freehold. Thus the sculptures in D’Eyncourt v Gregory (1866) LR 3 Eq 382 which simply rested by their own weight were held to form part of the architectural design for the hall in which they were placed and so fell to be treated as part of the freehold. The reasoning in such a case where there is no physical attachment was identified by Blackburn J in Holland v Hodgson…at 242: ‘But even in such a case, if the intention is apparent to make the articles part of the land, they do become part of the land’…
It is important to observe that intention in this context is to be assessed objectively and not subjectively. Indeed it may be that the use of the word intention is misleading. It is the purpose which the object is serving which has to be regarded, not the purpose of the person who put it there. The question is whether the object is designed for the use or enjoyment of the land or for the more complete or convenient use or enjoyment of the thing itself. As the foregoing passage from the judgement of Blackburn J makes clear, the intention has to be shown from the circumstances. That point was taken up by AL Smith LJ in Hobson v Gorringe at 193…a decision approved by this House in Reynolds v Ashby & Son [1904] AC 466, where he observes that Blackburn J:
‘was contemplating and referring to circumstances which showed a degree of annexation and the object of such annexation which were patent for all to see, and not to the circumstances of a chance agreement that might or might not exist between an owner of a chattel and a hirer thereof.’
Regard may not be paid to the actual intention of the person who has caused the annexation to be made…
Accession also involves a degree of permanence, as opposed to some merely temporary provision. This is not simply a matter of counting the years for which the structure has stood where it is, but again of appraising the whole circumstances. The bungalow has been standing on its site for about half a century and has been used for many years as the residence of Mr Morris and his family. That the bungalow was constructed where it is for the purpose of residence and that it cannot be removed and re-erected elsewhere point in my view to the conclusion that it is intended to serve a permanent purpose. If it was designed and constructed in a way that would enable it to be taken down and rebuilt elsewhere, that might well point to the possibility that it still retained its character of a chattel. That the integrity of this chalet depends upon its remaining where it is provides that element of permanence which points to its having acceded to the ground. The Court of Appeal took the view that the bungalow was no more annexed to the land and just as much a chattel as the greenhouse in Deen v Andrews…But there is a critical distinction between Deen v Andrews and the present case in the fact that the greenhouse was demountable while the bungalow is not. I prefer the conclusion reached by the learned assistant recorder after hearing the evidence and visiting the site to form his own impression of the situation. As he observed towards the end of his judgment…
‘…it seems to me clear that by 1985 and probably before, it would have been clear to anybody that this was a structure which was not meant to be enjoyed as a chattel to be picked up and moved in due course but that it should be a long-term feature of the realty albeit that, because of its construction, it would plainly need more regular maintenance.'”
An element of logic and common sense, if not history, must also come into play. There is no building or structure built by humankind which cannot be removed by humankind. Of the Seven Wonders of the World, only the Great Pyramid has largely survived, albeit even that structure has had significant elements (the outer facings) removed by humans. The fact that elements of or within a building or structure can physically or even theoretically be removed can not in itself be determinative of whether something forms or is to form part of land. One also has to bear in mind that all building materials and pieces of equipment are chattels until they become incorporated into or installed in a building or structure
Drawing all these threads together, and in the context of Sections 105(1) and (2) of the HGCRA, the law and practice can be said to be as follows (the following not intending necessarily to be an exhaustive definition of all requirements):
(a) “Construction operations” under Section 105(1)(a) to (c) of the HGCRA involve the various types of work set out in those paragraphs (construction, alterations, repair, maintenance, extension, demolition or dismantling or installation in any building or structure of fittings) forming or to form part of the land. Other provisions such as Section 105(1)(d) to (f) provide that other ancillary operations (cleaning during construction, scaffolding and decoration) also fall within the definition, whether or not it can be said that such work was or was to be “part of the land”.
(b) One must remember that HGCRA is engaged by a construction contract for the carrying out of “construction operations”; therefore the Act is engaged even if the construction operations are not completed, properly or at all.
(c) Whether something forms or is to form part of land is ultimately a question of fact and this involves fact and degree.
(d) The factual test of whether something forms or is to form part of the land is informed by but not circumscribed by principles to be found in the law of real property and fixtures. Something which is or is to become a “fixture” will, almost invariably, “form part of the land” for the purposes of the HGCRA.
(e) There is some distinction to be drawn between fixtures, that is, things which are attached to buildings or land, and the land itself. In Elitestone, Lords Lloyd and Clyde recognised that distinction between the land and the building itself on the one hand (effectively the same thing) and fixtures fixed to or within a building on the other.
(f) To be a fixture or to be part of the land, an object must be annexed or affixed to the land, actually or in effect. An object which rests on the land under its own weight without mechanical or similar fixings can still be a fixture or form part of the land. It is primarily a question of fact and degree.
(g) In relation to objects or installations forming part of the land, one can and should have regard to the purpose of the object or installation in question being in or on the land or building. Purpose is to be determined objectively and not by reference simply to what one or other party to the contract, by which the object was brought to or installation brought about at the site, thought or thinks. Primarily, one looks at the nature and type of object or installation and considers how it would be or would be intended to be installed and used. One needs to consider the context, objectively established. If the object or system in question was installed to enhance the value and utility of the premises to and in which it was annexed, that is a strong pointer to it forming part of the land.
(h) Where machinery or equipment is placed or installed on land or within buildings, particularly if it is all part of one system, one should have regard to the installation as a whole, rather than each individual element on its own. The fact that even some substantial and heavy pieces are more readily removable than others is not in itself determinative that the installation as a whole does not form part of the land. Machinery and plant can be structures, works (including industrial plant) and fittings within the context of Sections 105(1)(a) to (c) of the HGCRA.
(i) Simply because something is installed in a building or structure does not mean that it necessarily becomes a fixture or part of the land. Mr Justice Dyson in the Nottingham Community Housing case was not saying otherwise. A standing refrigerator or washing machine can be installed in a building but nobody, thinking rationally, would suggest that they had become fixtures or part of the land.
(j) The fixing with screws and bolts of an object to or within a building or structure is a strong pointer to the object becoming a fixture and part of the land but it is not absolutely determinative. Many of the old cases referred to above demonstrate that such fixings did point towards the object so affixed being part of the land. However, the Gibson Lea case produced a different answer, even though some items were affixed by nails and screws.
(k) Ease of removability of the object or installation in question is a factor which is a pointer to whether it is to be treated as not forming part of the land. One can have regard however to the purpose which the object or installation is serving, that purpose being determined objectively. The fact that the fixing can not be removed save by destroying or seriously damaging it or the attachment is a pointer to what it is attaching being part of the land. A significant degree of permanence of the object or installation can point to it being considered as part of the land.
Facts
In the result, there was eventually little difference between the witnesses as to the basic facts and in the light of that I find:
(a) Savoye was engaged contractually to and did provide a conveyor system which comprised an extensive roller conveyor system; this was powered by ele
ctricity and at important stages by compressed air and it was to be an “intelligent” system controlled and regulated by IT systems, installed throughout. In addition Savoye was to provide mostly new but some refurbished and re-used racking over, under and around the conveyor system. In addition, Savoye was to provide and install other equipment which was to be provided new except for the PAC 600 which was to be returned substantially refurbished.
(b) The racking ran all along the conveyor lines in the picking and replenishment zones. The racking was of a dexxion type (called “Prodex”), with the new
Walker Trustees v. Lord Advocate and Others
[1911] UKHL 73 49 SLR 73
The Treaty of Union, article 20, enacts “That all heritable offices, superiorities, heritable jurisdictions, offices for life, and jurisdictions for life, be reserved to the owners thereof as rights of property, in the same manner as they are now enjoyed by the laws of Scotland notwithstanding this Treaty.”
The Usher of the White Rod at the time of the Union was entitled to receive certain fees from the recipients of honours conferred by the King as Sovereign of Scotland, and could recover these fees from a Scotsman in whatever part of the King’s dominions he, the grantee, might be in, and from an Englishman if he, the grantee, received the honour while in Scotland. From 1766 to 1904 the holders of the office claimed and received fees from the grantees of titles and dignities of the United Kingdom.
Held ( rev. judgment of the Second Division) that although the effect might be to deprive the Usher of valuable emoluments, the terms of article 20 of the Treaty of Union were too unambiguous to be open to interpretation by any custom or practice which had grown up since, that by it the rights effeiring to the office of Usher were as before the Union, and consequently fees were only payable by a grantee of a Scottish honour or dignity, not by the grantees of honours or dignities of the United Kingdom.
Headnote:
The case is reported ante ut supra.
The Lord Advocate and others appealed to the House of Lords.
At delivering judgment—
Judgment:
Earl of Halsbury—I have had the opportunity of reading my noble and learned friend Lord Atkinson’s judgment. I agree with every word of it, and I do not think I can add anything to his reasons.
Lord Atkinson—This is an appeal against a judgment of the Second Division of the Court of Session whereby it was declared that the respondents, a body of trustees incorporated by a private Act styled the Walker Trust Act 1877, and admittedly the proprietors and holders of the heritable office of His Majesty’s sole and principal Usher within the Kingdom of Scotland, are, as such, entitled to recover certain fees and dues, claimed to appertain to this office, from the recipients from the Crown of the following honours, titles, and dignities of the United Kingdom, namely, upon the creation of a duke, £21, 13s. 4d.; of a marquis, £18, 6s. 8d.; of an earl, £15; of a viscount, £10; of a baron, £6, 13s. 4d.; of a knight baronet, £5; and of a knight, £3, 6s. 8d.
The action out of which the appeal has arisen was instituted by the Walker Trustees to try their right to recover these fees on the creation by the Crown of honours, titles, and dignities of this character. The defendants, other than the Lord Advocate, who represents the Crown and the Lords Commissioners of His Majesty’s Treasury, are all persons resident in Scotland whose titles are titles of the United Kingdom of Great Britain and Ireland. Two of them—Sir Charles Cayzer, Bart., and Sir Arthur Bignold—are Englishmen, and three—Lord Leith of Fyvie, Sir John Wilson, Bart., and Sir Henry Cook—are Scotsmen. The last-named appellant and Sir Arthur Bignold were created knights by Acolade at Buckingham Palace in the year 1904. The titles of all the others were conferred in or about the same year by letters-patent under the Great Seal of the United Kingdom. The right of the respondent to recover these fees is the sole question for decision.
This office of Usher or White Rod, as he is styled, is a very ancient one. It existed for centuries before the Union of the Crowns of England and Scotland on the accession of James VIof Scotland to the English Throne as James I of England in the year 1603. It admittedly was and has never ceased to be a Scottish office. Its duties, such as they were, were performed in Scotland, and did not and could not, before the year 1707, affect or concern the holders of English or Irish peerages, dignities, or honours as such, who were not members of either of the Houses of the Scottish Parliament, did not attend either General Councils or Feasts at the Scottish Court, and were not resident in that kingdom.
The earliest document referred to in evidence dealing with the office is a grant of 1393, confirmed by a statute of the Parliament of Scotland, of the Barony of Langton to Alexander Cockburn of Langton, in consideration of certain services to be rendered by him, including those of Usher of Parliaments, General Councils, and Feasts. It is stated in the appellants’ case, and apparently not disputed, that charters were granted by the Scottish Sovereign in the years 1510, 1542, and 1595 respectively, consolidating this barony of Langton and annexing to it, as a dependency, the office of Usher or White Rod with all its rights and privileges. It is further stated, and not apparently disputed, that the taking of fees by theholder of this office is first mentioned in a charter, dated in the year 1642, which, however, is not printed in the record. About five years later, on the 5th of January 1647, Charles I, describing himself as the King of Great Britain, France, and Ireland, by charter under the Great Seal of Scotland, granted to Sir William Cockburn and Robert Cunningham, therein described, this office, with the privileges and advantages belonging to it, to hold during their lives, and after their decease to the heirs-male and assignees of the said Sir William.
This charter contains a grant, the meaning of which was so much discussed, in the words following—“Una cum omnibus feodis casualitatibus aliisque devoriis subscripts solvendis per comites vice comites Barones Majores Equites baronettos aliosqui Equites quovis tempore affuturo creandos aut honores titulos et dignitates recepturos per nos nostrosve commissionarios per literas patentes aut quovis alio modo ab omnibus Scotes solvendis infra nostra dominia et similiter ab omnibus Anglis qui honores et dignitates infra dictum hoc regnum nostrum Scotiæ a nobis recipiant, viz”. Then follows a list of the fees
The next charter necessary to consider is that dated the 5th of June 1674. It grants this office to Sir Archibald Cockburn, son of Sir William, the former grantee, the said Cunningham having renounced. It contains a clause differing in no respect from that above quoted from the previous patent, save that after the word “recepturos,” the words “per quondam clarissimum nostrum patrem,” have been introduced and the word “nos” omitted after the preposition “per.”
Now the first question one has to ask one’s self is, What were the honours and dignities with which King Charles I and King Charles II respectively were dealing in these patents? At that period of time each of these monarchs could, as the Sovereign of England, confer English honours and dignities by patent under the Great Seal of England, as Sovereign of Ireland confer Irish honours and dignities under the Great Seal of Ireland, and as Sovereign of Scotland confer Scotch honours and dignities under the Great Seal of Scotland.
If either of these kings sought, in respect of their grants of English or Irish honours or dignities, to exact fees from the grantees, the exaction should be authorised by an Act of the Legislature binding upon the subject who received the grant, i.e., either a native of the particular country or a person living or sojourning in it, and therefore under the protection of and subject to its laws. (See Coke, 2 Institutes, p. 533; Comyn’s Digest, Title Prerogatives, vol. 7, p. 65.)
Whether the law is the same in Scotland as in England on this point it is unnecessary to discuss, inasmuch as an Act of the Scottish Parliament of the 6th of September 1681 ratified and confirmed the charter of the 5th of June 1674 granted to Sir Archibald Cockburn. This statute recites at length the charter of 2nd January 1647 to Sir William Cockburn and Robert Cunningham, and translates into English the clause in that patent, the meaning of which is in controversy, in the following passage:—“All and sundry the fines, duties, casualties, and profits belonging to the said office within the kingdom of Scotland according to the custom thereof, viz., all and sundry casualties, fines, and composition accressing and belonging to the said office of Principal Usher to His Majesty, and those who exercise the same within the said kingdom of Scotland, and which were in use to be paid to the said Usher for infringements of lands passing the Great Seal within the said kingdom either by resignations, confirmations, or new gifts, with all fees, casualties, and other duties underwritten, payable by earls, viscounts, lords, knights baronets, and other knights to be made in all time coming, or who should receive honours, titles, or dignities from His Majesty’s said father or His Majesty’s Commissioners by patents or any other way. To be paid by all Scotsmen within His Majesty’s dominions, and also by Englishmen who shall receive any honours or dignities from His Majesty within the said kingdom of Scotland.
I have modernised the spelling of the passage. It then sets out that in “ corroboration” of all rights and securities granted to Sir Archibald Cockburn and his predecessors, His Majesty granted and confirmed to him, his heirs and assigns, amongst other things, “all fees, casualties above payable by dukes, marquesses, earls, viscounts, lords, knights baronets, and other knights, made or to be made, and who shall receive honours, titles, and dignities by patent or any other way, and payable by all Scotsmen who shall receive dignities within any of His Majesty’s dominions, and by all Englishmen who have already obtained and who hereafter shall obtain honours or dignities from His Majesty and his successors within the said Kingdome of Scotland.” By this patent a salary of £250 sterling per annum was granted to Sir Archibald Cockburn and his assigns, holders of this office, to be paid out of the “first and rediest of the rents duties payable to His Majesty within the said Kingdome of Scotland.” This is, if I may so call it, the first stage in the documentary office of “White Rod.” No mention is made of the Great Seals of England or Ireland, nor is any English or Irish statute referred to dealing with any of those charters or the fees granted by them. And it would certainly appear to me to be impossible to read over these documents without coming to the conclusion that the honours, titles, and dignities dealt with by them are Scottish honours, titles, and dignities; that is, honours, titles, and dignities each of the several monarchs as he as sovereign of the kingdom of Scotland had power to grant; and to those honours, titles, and dignities alone. It was, as I understood, contended by Mr Clyde, in his ingenious arguments, that owing to the presence of the words “payable by all Scotsmen within our Dominions,” the patent applies to honours, titles, and dignities granted to Scotsmen by the King as Sovereign of England under the Great Seal of England, or as Sovereign of Ireland under the Great Seal of Ireland; and further, that there would be nothing illegal or unconstitutional in the Scottish Parliament passing an Act requiring a Scotsman, in whatever part of the three kingdoms he might receive one of these honours, titles, or dignities, or be domiciled, to pay to this Scotch official a fee upon receiving it, inasmuch as he, being a Scottish subject, wherever he might be, owed allegiance to his Scottish Sovereign and submission to the Scottish Parliament.
Mr Clyde may possibly be right upon this point, though legislation of such a kind as he suggests would be somewhat unjust and altogether anomalous. I cannot, however, adopt the construction for which he contends. I think the words “to be paid by all Scotsmen within His Majesty’s dominions” were introduced in order to make those fees recoverable from the Scottish grantee by reason of his nationality in whichever of the three kingdoms he might be resident or might receive the honour, whereas the English recipient of Scottish honours and dignities could only be reached by a Scottish statute or by a judgment of the Scottish Court if he came within that kingdom. These provisions touching the payment of these fees do not in my view alter the conclusion to which I have come as to the nature of the honours, titles, and dignities dealt with. That this was the view of the Crown and of the Scottish Legislature some few years before the Union is, I think, suggested by the wording of the charter of resignation in favour of Alexander Cockburn junior of Langton, dated the 21st January 1686, and in the Scottish statute confirming it passed on the 15th of June in the same year. The words in the charter dealing with those fees run thus—“Una cum omnibus feodis casualitatibus aliisque censibus subscripts solvendis per Duces, Marchiones, Comites, Vicecomites, dominos, milites, Baronettos aliosque, equites, creatos et creandos ac honores titulos dignitates a nobis vel successoribus nostris aut commissionariis nostris per literas aut quovis alio modo recepturas ac solvendis per omnes Scoticas (sic) dignitates intra quaecunque nostrorum dominiorum recipientes, ac per omnes Anglos qui hactenus assequuti sunt vel in posterum honores et dignitates a nobis vel successoribus nostris in dicto Regno nostro assequentur.” And the confirming statute, though it contains near the end of it a general clause of ratification of the patent, recites the charter intended to be ratified as granting “all new gifts with all casualties, fees, other rents underwritten payable by dukes, marquesses, viscounts, lords, knights, baronets, and other knights created or to be created, and receiving honours, titles, and dignities from His Majesty and his successor within the said kingdom of Scotland.”
It certainly appears to me, therefore, that the rights of the Usher of the White Rod were at the time of the Union simply these—(1) He was entitled to receive the stipulated fees from the recipients of honours conferred by the King as Sovereign of Scotland; and (2) he could recover those fees from a Scotsman in whatever part of the King’s dominions he, the grantee, might be when he received the honour, dignity, or title; and (3) he could recover like fees from all Englishmen whenever they received those honours in Scotland, and could therefore be reached by the tribunals of that country.
The next question is, Did the Treaty and Act of Union alter the White Rod’s position, enlarge or curtail his rights? In my view sections 20 and 23 of the Treaty left his rights precisely as they were, though no doubt they made less lucrative the enjoyment of them. The 20th article runs as follows—“XX.… [ quotes, v. sup. in rubric] …”
It left to this officer all the rights of property he then enjoyed by the law of Scotland by virtue of his office. The operation of this and the 23rd section may, so far as he is concerned, be harsh and oppressive in this, that as peers of Scotland could not thenceforth be created, he loses the fees which but for the Treaty he would have received. This is undoubtedly so, but while such a consideration might possibly give the trustees a strong claim upon the bounty of the Crown, it cannot affect the question of the proper construction of the Treaty and the ancient documents of earlier date. That is a pure question of law, and is, moreover, the only question for the decision of your Lordships. In this case neither the Lord Ordinary nor the Judges in the Second Division, nor indeed counsel in argument, have succeeded in pointing out what is the alleged ambiguity in this article of the Treaty, or indeed in the earlier documents which the usage or practice obtaining from 1766 downwards, the payment through the Treasury of these fees by all recipients of honours, titles, and dignities of the United Kingdom, was admitted in evidence to explain or remove, or how it was legitimately to aid in determining the subject-matter to which these documents apply or to fix the limits of the rights they confer.
As against a plain statutory law no usage can prevail—see Lord Brougham, Dunbar v. Duchess of Roxburghe, 3 Clark and Finnelly, 335, at 354; Lord Campbell, Gorham v. The Bishop of Exeter, A & E. 15 Q.B 52, at p. 73. In Herbert v. Purchas, L.R., 3 P.C. 605, at 650, Lord Hatherley is reported to have said—“It is quite true that neither contrary practice nor disuse can repeal the positive enactment of a statute, but contemporaneous and continuous usage is of the greatest efficacy in law for determining the true construction of obscurely framed documents.” In the Trustees of Clyde Navigation v. Laird, 8 A.C. 658, at p. 673, Lord Watson says—“When there are ambiguous expressions in an Act passed one or two centuries ago it may be legitimate to refer to the construction put upon these expressions throughout a long course of years by the unanimous consent of all parties interested, as evidencing what must presumably have been the intention of the Legislature at that remote period.” And in a recent case in your Lordships’ House— Winstanly v. North Manchester, A.C. 1910—it was held that the rector of a parish was rateable, under the 43 Eliz. c. 2, in respect of the burial fees he received as occupier of the parish burial ground, notwithstanding the fact that for over three centuries the practice had been not to rate him.
It may be doubted in the present case, however, whether the persons who paid these fees knew anything whatever of the right by virtue of which they were demanded, or whether the payment could be described as having been made with the consent, to use the language of Lord Watson, of all parties interested; but however that may be, the payment of the fees for even 150 years from the year 1766, though undoubted, is, I think, irrelevant, and cannot affect the meaning of the documents your Lordships have to construe, inasmuch as their language is plain and unambiguous. So that the question for decision, in my view, narrows itself down to this—Is an honour or other title or dignity of the United Kingdom, created and conferred since 1707, a Scottish title, dignity, or honour within the meaning of the foregoing charters and patents of the Scottish King and statutes of the Scottish Parliament?
I concur with Lord Low, and, as I understand, with the other learned Judges in the Second Division, in thinking that a post Union title or dignity or honour is a wholly different thing from the Royal title, dignity, or honour conferred before the Union by the King of Scotland by virtue of his prerogative as Sovereign of that kingdom.
Where I differ from him and them is in their conclusion that the 20th section of the Treaty of Union is ambiguous in its language, and that because of that the usage of the last 150 years can be relied upon to secure to this officer fees in respect of the honours, titles, and dignities created since its date which are not Scottish honours, titles, or dignities in the sense I have indicated. In my view, the Treaty of Union left the office as it was, with the rights which, under the law of Scotland, the holder of it theretofore enjoyed in respect to the creation of Scottish honours, titles, and dignities properly so called and nothing more.
The order of knighthood is not in any sense a local title. It is an order of chivalry recognisable in every part of the King’s dominions, and differs in that respect altogether from an earldom conferred by the King as Sovereign of the kingdom of Scotland. (See Sir John Douglas’s case, 4th vol., Coke’s Reports, vol. R., p. 16.)
In my opinion, therefore, the interlocutors appealed from are erroneous, and should be reversed, and this appeal be allowed with costs.
Lord Kinnear—I agree entirely with all that has been said by my noble and learned friend opposite, and I therefore think it unnecessary to detain your Lordships by stating my own reasons, which are entirely in accordance with his.
Lord Gorell—I have had the opportunity of reading and considering the judgment of my noble and learned friend Lord Atkinson, and I fully concur with it.
Their Lordships reversed, with expenses, the judgment appealed against.
Roche Ireland Ltd -v- O’Mahoney & Anor
[2010] IEHC 491 Laffoy J
4. The issues
4.1 The primary issues, in my view, which arise on the pleadings and on the facts are the following:
(a) whether the plaintiff is in lawful possession of the material which emanated from the O’Mahony lands and which was incorporated into the Roche premises in the course of the landfill remediation works and landscaping or, alternatively, whether Mr. O’Mahony as the owner of the O’Mahony lands has a claim against the plaintiff for return to him of the said material or to be compensated to its value; and
(b) whether, in making and repeating the communications that the plaintiff acted wrongfully in acquiring, using and retaining that material, the defendants have been, or if they continue to make or repeat such communications will be, liable under any of the torts invoked in the statement of claim, thus entitling the plaintiff to the ancillary injunctive relief it seeks.
4.2 There is a myriad of peripheral issues arising from other allegations made by Mr. O’Mahony in relation to the plaintiff’s conduct. I propose focusing on what I have identified as the primary issues but, as regards the peripheral issues, I think it is appropriate to record the following findings from the evidence.
5. Findings on peripheral issues
5.1 On the basis of the evidence of Mr. Pat O’Shea, the current Operations Director of the plaintiff, I am satisfied that the plaintiff did not commit any breaches of the Waste Management Acts 1996 to 2008 arising out of the removal of the material from the O’Mahony lands to the plaintiff’s premises. It was confirmed by letter dated 11th March, 2009 from Clare County Council to Mr. O’Shea that that was the view of Clare County Council and that no further action was deemed necessary.
5.2 On the basis of the evidence of Mr. Caoimhín Nolan, Inspector of Environmental Enforcement with the EPA, I am satisfied that the EPA has no issue as to the manner in which the capping of the landfill on the Roche premises was implemented by the plaintiff. It is clear on the evidence that Mr. O’Mahony has been repeatedly informed by the EPA that the issue of the removal of the material from the O’Mahony lands is not a matter for the EPA or the enforcement of the IPPC licence held by the plaintiff and, therefore, the EPA has no intention of launching an investigation as he requested. That position was reiterated in a letter of 1st July, 2010 from the EPA to Mr. O’Mahony.
5.3 As a result of a written complaint to An Garda Siochána made by Mr. O’Mahony on 4th September, 2008 a criminal investigation was carried out and a file was sent to the Director of Public Prosecutions on 2nd February, 2009. However, there is no evidence that the investigation related to alleged criminal activity on the part of the plaintiff and there is no evidence that a criminal prosecution has been initiated against any party.
6. Ownership/lawful possession of the material
6.1 As regards the legal principles which govern the issue of entitlement to possession and ownership of the disputed material, that is to say, the subsoil and topsoil from the O’Mahony lands, unfortunately, the relevant principles are identified to a limited extent only in the pleadings and in the submissions made at the hearing, which is understandable because Mr. O’Mahony was not legally represented. While to the lay person the principles may be difficult to understand, having regard to the history of this matter, and, in particular, the conduct of Mr. O’Mahony, which has clearly arisen from a grievance he harbours against the plaintiff, I will endeavour to summarise them in terms from which he will appreciate their implications.
6.2 To recapitulate, the plaintiff’s case is that as a result of the plaintiff having paid TAL and Martins for the works they carried out on the Roche premises and TAL and Martins, in turn, having purchased the material from Milltown, and either having paid for it or accepted liability for payment, the plaintiff, having no knowledge of the provenance of the material or any dispute in relation to it, was a bona fide purchaser for value of the material, lawfully took possession of it and is lawfully in possession of it. As I have recorded, what the plaintiff seeks is a declaration that it is in lawful possession of the material and that it has no liability to Mr. O’Mahony arising from its acquisition. Mr. O’Mahony has pleaded that the defendants are the owner of the O’Mahony lands, that the material was removed from the O’Mahony lands without the defendants’ knowledge or consent, that the plaintiff was at all times aware of the ownership and source of the material, that the defendants are the true and lawful owners of the material and are entitled to its return or to be compensated for its true value. So, the plaintiff is claiming to be in lawful possession of the material and Mr. O’Mahony is claiming ownership and an entitlement to possession. Although the wrong which the defendants allege against the plaintiff is not spelt out in the pleadings, the defendants’ claim must be based in tort for detinue or conversion of the material by the plaintiff.
6.3 The authorities relied on by the plaintiff in its written submission in support of the proposition that the plaintiff was a bona fide purchaser for value without notice of the material and, therefore, was unaffected by the rights of Mr. O’Mahony as owner of the O’Mahony lands all relate to issues concerning land as such (AIB v. Finnegan [1996] 1 ILRM 401; Gannon v. Young [2009] IEHC 511 and Kingsnorth Finance Trust Co. Ltd. v. Tizard [1986] 1 WLR 783). However, as the reference to detinue and conversion in the preceding paragraph indicates, in my view, the legal principles which are applicable to the situation which has arisen here in relation to the material are the legal principles governing possession and ownership of goods. The crucial factor, in my view, is that the material, the topsoil and the subsoil, had been severed from the O’Mahony lands when the plaintiff’s contractors agreed to acquire it. It follows that the relevant legal principles mainly derive from the Sale of Goods Act 1893, as amended by the Sale of Goods and Supply of Services Act 1980 (the Act of 1893). It is with a considerable degree of diffidence that I propose outlining these principles, which were not explored at the hearing. However, the principles, which I will outline and apply, are well established. In circumstances in which the defendants are not legally represented and Mr. O’Mahony has no legal training, having considered the matter carefully, I have come to the conclusion that it is not in his interest to invite further legal argument in this matter, which would merely give rise to further legal costs in circumstances in which the legal position is quite clear.
6.4 Even at common law the material severed from the land would have been regarded as a chattel or goods rather than as land. In Sligo Corporation v. Gilbride [1929] I.R. 351, in which the plaintiff was seeking injunctions to restrain the defendant from removing a wall and to direct the plaintiff to restore it, in the Supreme Court, Kennedy C.J. stated (at p. 362):
“If the ownership of the wall is actually in the plaintiffs, the action is in substance one for damages for trespass and trover and conversion of the stones in the wall, and the injunction is sought as ancillary to that right of property.”
Fitzgibbon J. was of a similar view stating (at p. 366):
“The real cause of action is one of trespass to the plaintiffs’ wall – assuming it to be theirs – and trover and conversion of the materials with which the wall was built”
Moreover, consistent with the decision of Gavan Duffy P. in Scully v. Corboy [1950] I.R. 141, the material comes within the definition of “goods” in s. 62 of the Act of 1893, which defines that term as including “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”.
6.5 Although as I have stated at the outset, it is not clear in whom the title to the O’Mahony lands is vested, it is not in dispute that Mr. O’Mahony is either alone or jointly with his wife, who was in Court throughout the hearing, or through the medium of the second defendant, the owner of the O’Mahony lands. During the hearing, Mr. O’Mahony indicated that he had evidence of his title in Court. However, he was not asked to produce it. For present purposes, I am assuming that he has good title to the O’Mahony lands either solely or as aforesaid. As such, before the material was severed from the land, he owned it. When the material was severed by Milltown he remained the owner of it, subject to the rights, if any, of Milltown. A fundamental principle of our law of property, whether land or goods, like so many other fundamental rules, is known by its Latin tag: the rule nemo dat quod non habet. What the rule means is that no one can give a better title to property than his own. However, at common law that rule is subject to exceptions. Moreover, while, in the case of goods as defined in the Act of 1893, the rule was repeated in s. 21 of that Act, it is subject to the exceptions set out in succeeding sections thereof, including s. 25(2). Section 25(2) provides:
“Where a person having bought or agreed to buy goods obtains, with the consent of the seller, possession of the goods or the documents of title to the goods, the delivery or transfer by that person, or by a mercantile agent acting for him, of the goods or documents of title, under any sale, pledge or other disposition thereof, to any person receiving the same in good faith and without notice of any lien or other right of the original seller in respect of the goods, shall have the same effect as if the person making the delivery or transfer were a mercantile agent in possession of the goods or documents of title with the consent of the owner.”
In s. 62(2) of the Act of 1893 it is provided:
“A thing is deemed to be done ‘in good faith’ within the meaning of this Act when it is in fact done honestly, whether it be done negligently or not.”
6.6 The facts relevant to the application of s. 25(2) to the plaintiff, in my view, are the following. Mr. O’Mahony agreed in principle to sell the lands to Milltown and he allowed Milltown into possession of the lands. Milltown severed the material from the lands while in possession and, accordingly, was in possession of the material, although it remained in the ownership of Mr. O’Mahony until the sale to Milltown would be completed. Milltown sold the material to TAL and Martins, who used it in the landfill capping and landscaping works on the Roche premises in fulfilment of their respective contractual obligations to the plaintiff. TAL paid, or acknowledged the obligation to pay, for the material Milltown sold to it. While it is not clear on the evidence what position Martins has adopted in relation to payment to Milltown, I am assuming it has adopted a position similar to that adopted by TAL. The plaintiff paid TAL and Martins for the works in which they used the material, thereby paying for the material. The plaintiff got actual possession of the material.
6.7 Having regard to those facts, two questions arise in the application of s. 25(2), namely:
(a) Did Milltown get possession of the material with the consent of the plaintiff?
(b) Did the plaintiff receive the material, which was incorporated into the Roche premises, in good faith and without notice of any lien or right of Mr. O’Mahony as the owner of the O’Mahony lands from which the material was severed?
6.8 In relation to the first question, I am satisfied on the evidence that Milltown got possession of the material with the consent of Mr. O’Mahony. It is stated in the letter of 27th November, 2007 from Mr. O’Mahony’s then solicitors and it is pleaded on behalf of Mr. O’Mahony in his counterclaim that Mr. Murphy/Milltown was given possession with a view to doing preliminary works in aid of the development of the O’Mahony lands. It was in the course of that work that the material was severed from the O’Mahony lands. Mr. Murphy’s evidence was that Mr. O’Mahony knew that the topsoil was going to the plaintiff and he was not challenged on that in cross-examination by Mr. O’Mahony, although the thrust of Mr. O’Mahony’s evidence was that he did not know that the material was going off the site. On the basis of the totality of the evidence, I think it is probable that Mr. O’Mahony did know that Milltown was disposing of the material. In any event, I am satisfied that Milltown severed and had possession of the material with the consent of Mr. O’Mahony before the sale to TAL and Martins.
6.9 In relation to the second question, in outlining the factual background earlier, I have referred to the contacts between Mr. O’Mahony and Mr. Liddy, the then managing director of the plaintiff in 2006 and 2007. In April 2007, Mr. O’Mahony notified Mr. Liddy on two separate occasions of his intention to sell the O’Mahony lands. Subsequently, a meeting was held on 4th July, 2007 between Mr. Liddy and Mr. O’Mahony and, on the basis of Mr. Liddy’s evidence, I am satisfied that he agreed to the meeting as a courtesy to a neighbour. At the time, while the proposed development on the O’Mahony lands was of some concern to the plaintiff, the concern was not enough to induce the plaintiff to get involved in the O’Mahony lands. Subsequent to that meeting there were two e-mails from Mr. O’Mahony to Mr. Liddy in July 2007, in the second of which, dated 29th July, 2007, Mr. O’Mahony advised Mr. Liddy that he had “three joint venture proposals for the development of the site and four bids for the outright sale of the site” and that, if he did not hear from Mr. Liddy, there would be little point in keeping him advised of further negotiations with third parties. That was the end of the contact between Mr. Liddy and Mr. O’Mahony until the end of November 2007.
6.10 A meeting arranged at short notice was held between Mr. Liddy and Mr. O’Mahony on 3rd December, 2007. At that stage, Mr. Liddy was not aware of the letter of 27th November, 2007 from Mr. O’Mahony’s solicitors, as the plaintiff’s company secretary was out of the office and it had not been brought to his attention. In any event, Mr. Liddy’s evidence was that Mr. O’Mahony told him that Milltown had been allowed on to the O’Mahony lands on condition that a contract would be signed within three weeks but that on 26th November, 2007 the contract had been returned unsigned. Mr. Liddy’s evidence was that he was completely surprised by Mr. O’Mahony’s statement that Milltown had taken the material illegally. Mr. Liddy’s evidence was that Mr. O’Mahony’s suggestion that the plaintiff return the material came as a real shock to him and was completely unexpected. He passed the problem on to the plaintiff’s legal advisers at that stage.
6.11 A director of TAL, Mr. Martin Hamill, also testified. His evidence was that he was aware that Milltown was doing preparatory work on the O’Mahony lands and was stripping the site. When TAL approached Milltown to purchase the material, he was not aware that Milltown was not the true owner of the soil. On the basis of the evidence of Mr. Hamill, I am satisfied that TAL agreed with Milltown in good faith to purchase the material and received it without any notice of any lien or other right of Mr. O’Mahony in respect thereof.
6.12 Similarly, on the basis of the evidence of Mr. Liddy, I am satisfied that the plaintiff dealt with TAL honestly and in good faith and from the perspective of the plaintiff the material was incorporated into the Roche premises without notice of any lien, right or equity of Mr. O’Mahony in respect thereof. Having regard to what had transpired between the plaintiff and Mr. O’Mahony before September 2007, and the circumstances which prevailed in September 2007, although honesty, as opposed to reasonableness, is the test of good faith under the Act of 1893, in my view, it was reasonable for the plaintiff, acting by Mr. Liddy and other employees of the plaintiff, and for TAL to assume that Milltown had authority to sell the material.
6.13 In summary, having found that Milltown got possession of the material with the consent of the plaintiff and that both TAL and the plaintiff received the material in good faith and without notice of lien or other right of Mr. O’Mahony, by operation of s. 25(2) of the Act of 1893 the plaintiff obtained good title to the material which was incorporated in its premises as against Mr. O’Mahony and is entitled to retain possession thereof. The plaintiff has no liability to the defendants in respect of the material.
6.14 While it is clear that Mr. O’Mahony feels aggrieved that the sale to Milltown fell through after Milltown had sold the material to TAL which was used in fulfilling TAL’s contractual commitments to the plaintiff, he must appreciate that, in the circumstances of the events of September 2007 which I have outlined, the law protects the plaintiff, which acted honestly in its dealings with TAL which, in turn, acted honestly in its dealings with Milltown. It was Mr. O’Mahony who allowed Milltown to go into possession of the O’Mahony lands and to do the pre-development works which created the material and thus facilitated the sale of the material by Milltown to TAL. Whatever, if any, redress Mr. O’Mahony has arising out of the failure of Milltown to complete the acquisition of the O’Mahony lands and from the sale by Milltown of the material can only be pursued against Milltown. It is not a matter for the Court in these proceedings.
7. Mr. O’Mahony’s communications alleging wrongdoing on the part of the plaintiff
7.1 The plaintiff has invoked a plethora of torts in alleging wrongdoing against the defendants and in seeking civil law remedies to redress such wrongdoing. As the plaintiff has decided to forgo its claim for damages, it is unnecessary to consider whether the plaintiff has established liability on the part of the defendants for all or any of the torts alleged. Further, in the light of the findings which have been made as to the ownership and entitlement to possession of the material which was severed from the O’Mahony lands and is now incorporated in the Roche premises, in my view, the only issue which requires to be determined is whether, if the defendants were to continue to make or repeat the type of communications complained of by the plaintiff which alleged that the plaintiff acted wrongfully in acquiring, using and retaining the material, they would be liable in tort to the plaintiff, so as to entitle the plaintiff to the ancillary injunctive relief it seeks. In this context, of the torts invoked by the plaintiff, that which would obviously come into play if the defendants were to continue making or repeating such communications is injurious falsehood encompassing slander of title and slander of goods.
7.2 If, notwithstanding the making of the declaration which I intend to make that the material is in the lawful possession of the plaintiff, Mr. O’Mahony or the other defendant were to communicate to third parties the assertion that, in receiving and retaining the material, the plaintiff received and retained stolen goods, in my view, the plaintiff would unquestionably be able to establish the ingredients of the tort of injurious falsehood as outlined in McMahon and Binchy on The Law of Torts, 3rd Ed., at paragraphs 35.26 to 35.30, for the following reasons:
(a) the statement alleging receipt and retention by the plaintiff of stolen goods would be untrue;
(b) such statement would be made maliciously, because there would be no basis on which Mr. O’Mahony or the other defendant could assert some just cause, excuse or proper motivation for making the statement; and
(c) such statement could only be viewed as calculated to cause pecuniary damage to the plaintiff and being published in permanent form in writing or electronically (as, on the basis of the evidence, it is probable would be the case) the plaintiff would, by virtue of s. 20(1) of the Defamation Act 1961, be relieved from the requirement to prove special damage.
7.3 I am satisfied that the defendants’ allegation that the plaintiff has not come to court with clean hands is utterly without foundation. On the other hand, it is a matter of concern that after September 2008, notwithstanding the existence of the order of the Court made with the consent of Mr. O’Mahony, Mr. O’Mahony persisted in communications alleging wrongdoing on the part of the plaintiff. Accordingly, I consider it appropriate to grant the plaintiff injunctive relief in the terms sought by the plaintiff and set out at (C) in paragraph 3.4 above framed to cover communications to the plaintiff and its associated companies, any officer or employee of the plaintiff and its associated companies, and any third party. An injunction in the terms set out at (D) would merely replicate the content of the injunction in the terms set out at (C) in a vague manner and, for that reason, I do not propose to grant it.
7.4 Even if, despite the information furnished to him from December 2007 onwards as to the circumstances in which the material was incorporated in the Roche premises and the steps taken by TAL to ensure that the defendants would not be prejudiced by the payment of the price of the material directly to Milltown after Mr. O’Mahony raised the issue of the ownership of the material with the plaintiff and after his solicitor’s letter of 27th November, 2007, Mr. O’Mahony honestly believed that he had a good claim against the plaintiff, once the Court has decided that he does not have a good claim against the plaintiff he must appreciate that he would be acting wrongly by asserting otherwise and that he must desist from doing so. In relation to what I have referred to as the peripheral issues, having regard to the findings which I have made in paragraphs 5.1 and 5.2 above, Mr. O’Mahony must also appreciate that he must desist from alleging breaches by the plaintiff and its agents of waste management and environmental enforcement legislation in connection with the removal of the material from the O’Mahony lands and its incorporation in the Roche premises.
8. Order
8.1 The Court will make the following orders on the plaintiff’s claim:
(1) declarations in the terms set out at (A) and (B) of paragraph 3.4 above; and
(2) an injunction in the terms set out at (C) in paragraph 3.4 restraining communications to the plaintiff and its associated companies and any officer or employee of the plaintiff and its associated companies and any third party.
8.2 There will also be an order dismissing the defendants’ counterclaim.
Elitestone Ltd v. Morris and Another
[1997] UKHL 15 [1997] 1 WLR 687, [1997] 27 EG 116, [1997] 2 All ER 513, [1997] 2 EGLR 115, [1997] NPC 66, [1997] WLR 687, (1998) 30 HLR 266, [1997] EG 62, [1997] UKHL 15
Lord LLoyd
My Lords,
The plaintiffs, Elitestone Ltd., are the freehold owners of land known as Holt’s Field, Murton, Near Swansea. The land is divided into 27 lots. The defendant, Mr. Morris, is the occupier of a chalet or bungalow on Lot No. 6. It is not known for certain when the chalet was built. But it seems likely that it was before 1945. Mr. Morris has lived there since 1971.
The plaintiffs acquired the freehold in 1989 with a view to redevelopment. On 30 April 1991 they issued proceedings in the Swansea County Court claiming possession against all 27 occupiers. Five lead actions were selected, including that in which Mr. Morris was defendant. They came on for trial before Mr. Assistant Recorder Bidder in November 1994. The assistant recorder had a number of issues to decide. He dealt with them in a most impressive manner. So far as Mr. Morris is concerned, his defence was that he is a tenant from year-to-year, that he occupies the premises as his residence, and is therefore entitled to the protection of the Rent Act 1977. He claims a declaration to that effect.
The assistant recorder held, correctly, at the end of what was necessarily a very lengthy judgment that the question in Mr. Morris’s case turned on whether or not the bungalow formed part of the realty. If it did, then Mr. Morris was entitled to his declaration.
Having visited the site, the assistant recorder had this to say:
“While the house rested on the concrete pillars which were themselves attached to the ground, it seems to me clear that at least by 1985 and probably before, it would have been clear to anybody that this was a structure that was not meant to be enjoyed as a chattel to be picked up and moved in due course but that it should be a long-term feature of the realty albeit that, because of its construction, it would plainly need more regular maintenance.”
The Court of Appeal disagreed (unreported), 28 July 1995, Court of Appeal (Civil Division) Transcript No. 1025 of 1995. Aldous L.J., who gave the leading judgment, was much influenced by the fact that the bungalow was resting by its own weight on concrete pillars, without any attachment. He was also influenced by the uncertainty of Mr. Morris’ tenure. Although Mr. Morris had been in occupation since 1971, he was required to obtain an annual “licence.” At first the licence fee was £3 a year. It rose to £10 in 1984, then to £52 in 1985, and finally to £85 in 1989. In 1990 the plaintiffs required a licence fee of £1,000: but Mr. Morris, and the other occupiers declined to pay.
On these facts Aldous L.J. inferred that it was the common intention of the parties that the occupiers should acquire the ownership of their bungalows, but the ownership of the sites should remain in the freeholders. On that footing Mr. Morris’ bungalow was to be regarded as a chattel. It was never annexed to the soil, so it never became part of the realty. It followed that the tenancy did not include the bungalow, and Mr. Morris was not a protected tenant.
Unlike the judge, the Court of Appeal did not have the advantage of having seen the bungalow. Nor were they shown any of the photographs, some of which were put before your Lordships. These photographs were taken only very recently. Like all photographs they can be deceptive. But if the Court of Appeal had seen the photographs, it is at least possible that they would have taken a different view. For the photographs show very clearly what the bungalow is, and especially what it is not. It is not like a Portakabin, or mobile home. The nature of the structure is such that it could not be taken down and re-erected elsewhere. It could only be removed by a process of demolition. This, as will appear later, is a factor of great importance in the present case. If a structure can only be enjoyed in situ, and is such that it cannot be removed in whole or in sections to another site, there is at least a strong inference that the purpose of placing the structure on the original site was that it should form part of the realty at that site, and therefore cease to be a chattel.
There were a number of other issues in the Court of Appeal. I need only mention one. This was an argument by the plaintiffs that Mr. Morris was estopped by convention from denying that the bungalow was a chattel. There was, so it was said, a common assumption that the chalets were owned separately from the land, since each occupier purchased his own chalet from the previous occupier (Mr. Morris paid £250 for No. 6 in 1971), and each occupier paid an annual licence fee to the freeholders. Since the Court of Appeal held that the bungalow was a chattel, they did not find it necessary to deal with the estoppel argument. The plaintiffs might have renewed the argument before your Lordships. But in the meantime the House had given judgment in Melluish v. B.M.I. (No. 3) Ltd. [1996] A.C. 454. In that case Lord Browne-Wilkinson said, at p. 473:
“The terms expressly or implicitly agreed between the fixer of the chattel and the owner of the land cannot affect the determination of the question whether, in law, the chattel has become a fixture and therefore in law belongs to the owner of the soil: . . . The terms of such agreement will regulate the contractual rights to sever the chattel from the land as between the parties to that contract and, where an equitable right is conferred by the contract, as against certain third parties. But such agreement cannot prevent the chattel, once fixed, becoming in law part of the land and as such owned by the owner of the land so long as it remains fixed.”
If an express agreement cannot prevent a chattel from becoming part of the land, so long as it is fixed to the land, it is obvious that a common assumption cannot have that effect. It is not surprising, therefore, that Mr. Thom abandoned his estoppel argument.
Thus the sole remaining issue for your Lordships is whether Mr. Morris’ bungalow did indeed become part of the land, or whether it has remained a chattel ever since it was first constructed before 1945.
It will be noticed that in framing the issue for decision I have avoided the use of the word “fixture.” There are two reasons for this. The first is that “fixture”, though a hallowed term in this branch of the law, does not always bear the same meaning in law as it does in everyday life. In ordinary language one thinks of a fixture as being something fixed to a building. One would not ordinarily think of the building itself as a fixture. Thus in Boswell v. Crucible Steel Co. [1925] 1 K.B. 119 the question was whether plate glass windows which formed part of the wall of a warehouse were landlord’s fixtures within the meaning of a repairing covenant. Atkin L.J. said, at p. 123:
“. . . I am quite satisfied that they are not landlord’s fixtures, and for the simple reason that they are not fixtures at all in the sense in which that term is generally understood. A fixture, as that term is used in connection with the house, means something which has been affixed to the freehold as accessory to the house. It does not include things which were made part of the house itself in the course of its construction.”
Yet in Billing v. Pill [1954] 1 Q.B. 70, 75 Lord Goddard C.J. said:
“What is a fixture? The commonest fixture is a house which is built into the land, so that in law it is regarded as part of the land. The house and the land are one thing.”
There is another reason. The term fixture is apt to be a source of misunderstanding owing to the existence of the category of so called “tenants’ fixtures”, (a term used to cover both trade fixtures and ornamental fixtures) which are fixtures in the full sense of the word (and therefore part of the realty) but which may nevertheless be removed by the tenant in the course of or at the end of his tenancy. Such fixtures are sometimes confused with chattels which have never become fixtures at all. Indeed the confusion arose in this very case. In the course of his judgment Aldous L.J. quoted at length from the judgment of Scott L.J. in Webb v. Frank Bevis Ltd. [1940] 1 A.E.R. 247. The case concerned a shed which was 135 feet long and 50 feet wide. The shed was built on a concrete floor to which it was attached by iron straps. Having referred to Webb v. Frank Bevis Ltd. and a decision of Hirst J. in Deen v. Andrews [1986] 1 E.G.L.R. 262 Aldous L.J. continued:
“In the present case we are concerned with a chalet which rests on concrete pillars and I believe falls to be considered as a unit which is not annexed to the land. It was no more annexed to the land than the greenhouse in Deen v. Andrews or the large shed in Webb v. Frank Bevis Ltd. Prima facie, the chalet is a chattel and not a fixture.”
A little later he said: “Unit 6 was just as much a chattel as the very large shed was in the Webb case and the greenhouse in Deen v. Andrews.”
But when one looks at Scott L.J’s. judgment in Webb v. Frank Bevis Ltd. it is clear that the shed in question was not a chattel. It was annexed to the land, and was held to form part of the realty. But it could be severed from the land and removed by the tenant at the end of his tenancy because it was in the nature of a tenant’s fixture, having been erected by the tenant for use in his trade. It follows that Webb v. Frank Bevis Ltd. affords no parallel to the present case, as indeed Mr. Thom conceded.
For my part I find it better in the present case to avoid the traditional two-fold distinction between chattels and fixtures, and to adopt the three-fold classification set out in Woodfall, Landlord and Tenants, Release 36 (1994), vol. 1, pp. 13/83, para. 13.131:
“An object which is brought onto land may be classified under one of three broad heads. It may be (a) a chattel; (b) a fixture; or (c) part and parcel of the land itself. Objects in categories (b) and (c) are treated as being part of the land.”
So the question in the present appeal is whether, when the bungalow was built, it became part and parcel of the land itself. The materials out of which the bungalow was constructed, that is to say, the timber frame walls, the feather boarding, the suspended timber floors, the chip-board ceilings, and so on, were all, of course, chattels when they were brought onto the site. Did they cease to be chattels when they were built into the composite structure? The answer to the question, as Blackburn J. pointed out in Holland v. Hodgson (1872) L.R. 7 C.P. 328, depends on the circumstances of each case, but mainly on two factors, the degree of annexation to the land, and the object of the annexation.
Degree of annexation
The importance of the degree of annexation will vary from object to object. In the case of a large object, such as a house, the question does not often arise. Annexation goes without saying. So there is little recent authority on the point, and I do not get much help from the early cases in which wooden structures have been held not to form part of the realty, such as the wooden mill in Rex v. Otley (1830) 1 B. & Ad. 161, the wooden barn in Wansborough v. Maton (1836) 4 Ad. & El. 884 and the granary in Wiltshear v. Cottrell (1853) 1 E. & B. 674. But there is a more recent decision of the High Court of Australia which is of greater assistance. In Reid v. Smith [1905] 3 C.L.R. 656, 659 Griffiths C.J. stated the question as follows:
“The short point raised in this case is whether an ordinary dwelling-house, erected upon an ordinary town allotment in a large town, but not fastened to the soil, remains a chattel or becomes part of the freehold.”
The Supreme Court of Queensland had held that the house remained a chattel. But the High Court reversed this decision, treating the answer as being almost a matter of common sense. The house in that case was made of wood, and rested by its own weight on brick piers. The house was not attached to the brick piers in any way. It was separated by iron plates placed on top of the piers, in order to prevent an invasion of white ants. There was an extensive citation of English and American authorities. It was held that the absence of any attachment did not prevent the house forming part of the realty. Two quotations, at p. 667, from the American authorities may suffice. In Snedeker v. Warring, 2 Kernan 178 Parker J. said:
“A thing may be as firmly fixed to the land by gravitation as by clamps or cement. Its character may depend upon the object of its erection.”
In Goff v. O’Conner, 16 Ill. 422, the court said:
“Houses in common intendment of the law are not fixtures, but part of the land. . . . This does not depend, in the case of houses, so much upon the particular mode of attaching, or fixing and connecting them with the land, upon which they stand or rest, as upon the uses and purposes for which they are erected and designed.”
Purpose of annexation
Many different tests have been suggested, such as whether the object which has been fixed to the property has been so fixed for the better enjoyment of the object as a chattel, or whether it has been fixed with a view to effecting a permanent improvement of the freehold. This and similar tests are useful when one is considering an object such as a tapestry, which may or may not be fixed to a house so as to become part of the freehold: see Leigh v. Taylor [1902] AC 157. These tests are less useful when one is considering the house itself. In the case of the house the answer is as much a matter of common sense as precise analysis. A house which is constructed in such a way so as to be removable, whether as a unit, or in sections, may well remain a chattel, even though it is connected temporarily to mains services such as water and electricity. But a house which is constructed in such a way that it cannot be removed at all, save by destruction, cannot have been intended to remain as a chattel. It must have been intended to form part of the realty. I know of no better analogy than the example given by Blackburn J. in Holland v. Hodgson, L.R.7 C.P.P. 328, 335:
“Thus blocks of stone placed one on the top of another without any mortar or cement for the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on the top of each other in the form of a wall, would remain chattels.”
Applying that analogy to the present case, I do not doubt that when Mr. Morris’ bungalow was built, and as each of the timber frame walls were placed in position, they all became part of the structure, which was itself part and parcel of the land. The object of bringing the individual bits of wood onto the site seems to be so clear that the absence of any attachment to the soil (save by gravity) becomes an irrelevance.
Finally I return to the judgment of the Court of Appeal. I need say no more about the absence of attachment, which was the first of the reasons given by the Court of Appeal for reversing the assistant recorder. The second reason was the intention which the court inferred from the previous course of dealing between the parties, and in particular the uncertainty of Mr. Morris’ tenure. The third reason was the analogy with the shed in Webb v. Frank Bevis Ltd. [1940] 1 All E.R. 247, and the greenhouse in Deen v. Andrews [1986] 1 E.G.L.R. 262.
As to the second reason the Court of Appeal may have been misled by Blackburn J.’s. use of the word “intention” in Holland v. Hodgson, L.R.7 C.P. 328. But as the subsequent decision of the Court of Appeal in Hobson v. Gorringe [1897] 1 Ch. 182 made clear, and as the decision of the House in Melluish v. B.M.I. (No. 3) Ltd. [1996] A.C. 454 put beyond question, the intention of the parties is only relevant to the extent that it can be derived from the degree and object of the annexation. The subjective intention of the parties cannot affect the question whether the chattel has, in law, become part of the freehold, any more than the subjective intention of the parties can prevent what they have called a licence from taking effect as a tenancy, if that is what in law it is: see Street v. Mountford [1985] AC 809.
As for the third of the reasons, I have already pointed out that Webb v. Frank Bevis Ltd. does not support the Court of Appeal’s conclusion, because the shed in that case was held to be a fixture, albeit a fixture which the tenant was entitled to remove.
In Deen v. Andrews the question was whether a greenhouse was a building so as to pass to the purchaser under a contract for the sale of land “together with the farmhouses and other buildings.” Hirst J. held that it was not. He followed an earlier decision in H.E. Dibble Ltd. v. Moore [1970] 2 Q.B. 181 in which the Court of Appeal, reversing the trial judge, held that a greenhouse was not an “erection” within section 62(1) of the Law of Property Act 1925. I note that in the latter case Megaw L.J., at p. 187G, drew attention to some evidence “that it was customary to move such greenhouses every few years to a fresh site.” It is obvious that a greenhouse which can be moved from site to site is a long way removed from a two bedroom bungalow which cannot be moved at all without being demolished.
For the above reasons I would allow this appeal and restore the order of the assistant recorder.
LORD CLYDE
My Lords,
It is not now disputed that Mr. Morris, the first appellant, is the tenant of Lot No. 6 in the area of land known as Holt’s Field, which is owned by the plaintiffs. He and the second appellant have been living in the bungalow on that site which was erected more than half a century ago. The problem then arises whether the bungalow is part of the land so as to be included in his tenancy. An issue arose whether an estoppel by convention had arisen preventing the contention that the bungalow was part of the realty. It has been held that no such estoppel has arisen and that issue is not now argued. The only question left in the case is whether the bungalow is or is not a chattel. The assistant recorder held that it had become annexed to and part of the realty. The Court of Appeal held that it was a chattel and so was not included in the tenancy of Lot No. 6.
It is necessary at the outset to define what the bungalow comprises. It seems from the facts in the present case as if some form of actual attachment of the bungalow to realty might exist, in the connection with the main electric supply cable and certain drain pipes. But these matters have not been explored in the facts and we are required to proceed on the basis that the bungalow is not physically attached to the land. The next consideration is whether the foundations form part of the bungalow. These are sunk into the ground and if they were to be treated as part of the bungalow would clearly be an element of physical connection with the ground. But it does not appear that there is any particular adaptation of the foundations to the structure above nor any adaptation of the structure to suit the foundations. The main structural elements of the bungalow simply rest on the concrete blocks. The bungalow and the foundations are severable from each other and it is not appropriate to treat the whole as a unum quid so as to conclude that the bungalow is built into the ground. It is with the wooden structure alone that the case is concerned. That was the view on which the Court of Appeal proceeded and on the facts available in this case I consider it correct to proceed on that basis.
The question posed by the parties in their agreed statement of facts and issues is: “Whether the bungalow erected at Unit 6, Holt’s Field was a chattel or a fixture.” I entirely share the unease which has been expressed by my noble and learned friend, Lord Lloyd of Berwick on the use of the word fixture. The ambiguity is illustrated by a passage in the judgment of Rigby L.J. in In re De Falbe [1901] 1 Ch. 523, 530 where having referred to an originally unbending rule that everything affixed to the freehold was held to go with the freehold his Lordship stated:
“But in modern times there have come to be important exceptions to this rule, one being in favour of trade fixtures and entitling a person who has put up what are now called ‘fixtures’ (which means removable fixed things) for the purposes of trade to remove them.”
Later in his judgment he stated, at p. 533:
“But the question is, whether they were not made ‘fixtures,’ meaning thereby objects fixed to the wall which might be removed at the will of the person who had fixed them.”
In Boyd v. Shorrock (1867) L.R. 5 Eq. 72 Sir W. Page Wood V.-C. regarded as conclusive of the case before him a definition given in Ex parte Barclay (1855) 5 De G. M. & G. 403, 410:
“By ‘fixtures’ we understand such things as are ordinarily affixed to the freehold for the convenience of the occupier, and which may be removed without material injury to the freehold, such will be machinery, using a generic term; and in houses, grates, cupboards, and other like things.”
As the law has developed it has become easy to neglect the original principle from which the consequences of attachment of a chattel to realty derive. That is the principle of accession, from which the more particular example has been formulated, inaedificatum solo solo cedit. A clear distinction has to be draw between the principle of accession and the rules of removability.
My Lords, the distinction between these two matters was pointed out long ago by Lord Cairns L.C. in Bain v. Brand (1876) 1 App.Cas. 762. In that case it was declared that the law as to fixtures is the same in Scotland as in England. His Lordship stated, at p. 767, that there were two general rules under the comprehensive term of fixtures:
“One of these rules is the general well-known rule that whatever is fixed to the freehold of land becomes part of the freehold or inheritance. The other is quite a different and separate rule;–whatever once becomes part of the inheritance cannot be severed by a limited owner, whether he be owner for life or for years, without the commission of that which, in the law of England, is called waste, and which, according to the law of both England and Scotland, is undoubtedly an offence which can be restrained. Those, my Lords, are two rules, not one by way of exception to the other, but two rules standing consistently together. My Lords, an exception indeed, and a very important exception, has been made, not to the first of these rules, but to the second. To the first rule which I have stated to your Lordships there is, so far as I am aware, no exception whatever. That which is fixed to the inheritance becomes a part of the inheritance at the present day as much as it did in the earliest times. But to the second rule, namely, the irremovability of things fixed to the inheritance, there is undoubtedly ground for a very important exception. That exception has been established in favour of fixtures which have been attached to the inheritance for the purposes of trade, and perhaps in a minor degree for the purpose of agriculture. Under that exception a tenant who has fixed to the inheritance things for the purpose of trade has a certain power of severance and removal during the tenancy. . . “
It would be right to add that the exception has been developed so as to extend beyond the purposes of trade. By the end of the 19th century it was clearly established that the exception included objects which had been affixed to the freehold by way of ornament: In re De Falbe [1901] 1 Ch. 523, 539. This reflected not a change in the law but, as Lord Macnaghten put it in Leigh v. Taylor [1902] AC 157, 162, a change “in our habits and mode of life.” No doubt the category of exceptions may continue to change.
The present case, however, is concerned with the first of the two rules and not the second. But it is not altogether clear that the distinction between the two rules was clearly put before the Court of Appeal in the present case. If the distinction is not noticed there is a danger that the true issue may become confused by questions truly relating to removability. The Court of Appeal found assistance in the decision in Webb v. Frank Bevis Ltd. [1940] 1 All E.R. 247, regarding the bungalow as no more annexed to the land and just as much a chattel as the large shed in that case. But the court in the Webb case held that the large shed was a fixture but was removable by the tenant. I should add that the second rule may involve particular consideration of the various relationships between the interested parties which may play a part in the matter of removability, such as landlord and tenant, or mortgagor and mortgagee. But those differences play only a subordinate role in relation to the first rule.
The answer to that question is to be found by a consideration of the particular facts and circumstances. In the generality there are a number of considerations to which resort may be had to solve the problem. But each case in this matter has to turn on its own facts. Comparable cases are useful for guidance in respect of the considerations employed but can only rarely provide conclusive answers. It has not been suggested that if the bungalow is real property it can be regarded as distinct from the site so as to be excluded from the property let to Mr. Morris. The question then can be simply asked whether the bungalow is a chattel or realty. On that wider approach a useful starting point can be found in the words of the old commentator Heineccius (Elementa Iuris Civilis secundum ordinem Pandectarum, Lib.I. Tit VIII. Sec.199) where, in classifying things as moveable or immoveable he describes the latter as being things “quae vel salvae moveri nequeunt, ut fundus, aedes, ager . . . vel usus perpetui causa iunguntur immobilibus, aut horum usui destinantur.”
The first of these factors may serve both to identify an item as being real property in its own right and to indicate a case of accession. But account has also to be taken of the degree of physical attachment and the possibility or impossibility of restoring the article from its constituent parts after dissolution. In one early Scottish case large leaden vessels which were not fastened to the building in any way but simply rested by their own weight were held to be heritable since they had had to be taken to pieces in order to be removed and had then been sold as old lead: Niven v. Pitcairn (1823) 2 S. 270. In Hellawell v. Eastwood (1851) 6 Exch. 295, 312, Parke B., in considering the mode and extent of annexation of the articles in that case, referred to the consideration whether the object in question “can easily be removed, integré, salvé, et commodé, or not, without injury to itself or the fabric of the building.” It is agreed in the present case that as matter of fact that “the bungalow is not removable in one piece; nor is it demountable for re-erection elsewhere”. That agreed finding is in my view one powerful indication that it is not of the nature of a chattel.
In many cases the problem of accession arises in relation to some article or articles which have been placed in or affixed to a building. An unusual, although by no means unique, feature of the present case is that the alleged chattel is the building itself. This invites the approach of simply asking whether it is real property in its own right. Apart from the considerations which I already mentioned it seems to me that it is proper to have regard to the genus of the alleged chattel. That approach was adopted in the Australian case, Reid v.Smith (1905) 3 C.L.R. 656. At p. 668 Griffith C.J. said under reference to the decision in the lower court:
“I differ from the learned judge in thinking that it is not sufficient to show that the thing in question is a dwelling-house — an ordinary dwelling-house, on a town allotment, in an inhabited town. In the case of a similar building in another part of the country, erected under entirely different circumstances, a different conclusion might be drawn.”
O’Connor J. put the point more strongly, at p. 679:
“It would I think be stretching the rules of the common law to a point at which they cease to be rules of common sense, if it were to be laid down as a general rule that, except in very exceptional cases, wooden houses, resting by their own weight on land, could ever be regarded as mere chattels, removable at the will of the owner of the timber of which they are built.”
In several cases before the Lands Valuation Appeal Court in Scotland where the issue has arisen whether particular subjects are heritable or moveable for the purposes of valuation for local taxation the test has been applied by asking the question whether the particular subjects belong to a genus which is prima facie of a heritable character and, if they are, whether there are any special facts to deprive them of that character. This approach was recognised in Assessor for the City of Glasgow v. Gilmartin, 1920 S.C. 488 and in John Menzies & Co. Ltd. v. Assessor for Edinburgh, 1937 S.C. 784. It was later applied to such subjects as residential chalets: Assessor for Renfrewshire v. Mitchell 1966 S.L.T. 53, contractors’ huts: Assessor for Dunbarton v. L.K. McKenzie and Partners 1968 S.L.T. 82 and static caravans: Redgate Caravan Parks Ltd. v. Assessor for Ayrshire 1973 S.L.T. 52. Beyond question Mr. Morris’ bungalow is of the genus “dwelling-house” and dwelling houses are generally of the nature of real property. While it is situated in a rural setting it evidently forms part of a development of a number of other houses whose positions are even noted on the ordnance survey map. I find no factors which would justify taking it out of the category of dwelling-houses. On the contrary there are powerful indications that it and its constituent parts do not possess the character of a chattel. It seems to me to be real property.
If the problem is approached as one of accession it has to be noted that in the present case the bungalow is not attached or secured to any realty. It is not joined by any physical link which would require to be severed for it to be detached. But accession can operate even where there is only a juxtaposition without any physical bond between the article and the freehold. Thus the sculptures in D’Eyncourt v. Gregory (1866) L.R. 3 Eq. 382 which simply rested by their own weight were held to form part of the architectural design for the hall in which they were placed and so fell to be treated as part of the freehold. The reasoning in such a case where there is no physical attachment was identified by Blackburn J. in Holland v. Hodgson (1872) L.R. 7 C.P. 328, 335: “But even in such a case, if the intention is apparent to make the articles part of the land, they do become part of the land.” He continued with the following instructive observations:
“Thus blocks of stone placed one on the top of another without any mortar or cement for the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on the top of each other in the form of a wall, would remain chattels. On the other hand, an article may be very firmly fixed to the land, and yet the circumstances may be such as to show that it was never intended to be part of the land, and then it does not become part of the land. The anchor of a large ship must be very firmly fixed in the ground in order to bear the strain of the cable, yet no one could suppose that it became part of the land, even though it should chance that shipowner was also the owner of the fee of the spot where the anchor was dropped. An anchor similarly fixed in the soil for the purpose of bearing the strain of the chain of a suspension bridge would be part of the land. Perhaps the true rule is, that articles not otherwise attached to the land than by their own weight are not to be considered as part of the land, unless the circumstances are such as to shew that they were intended to be part of the land, the onus of shewing that they were so intended lying on those who assert that they have ceased to be chattels, and that, on the contrary, an article which is affixed to the land even slightly is to be considered as part of the land, unless the circumstances are such as to shew that it was intended all along to continue a chattel, the onus lying on those who contend that it is a chattel.”
It is important to observe that intention in this context is to be assessed objectively and not subjectively. Indeed it may be that the use of the word intention is misleading. It is the purpose which the object is serving which has to be regarded, not the purpose of the person who put it there. The question is whether the object is designed for the use or enjoyment of the land or for the more complete or convenient use or enjoyment of the thing itself. As the foregoing passage from the judgment of Blackburn J. makes clear, the intention has to be shown from the circumstances. That point was taken up by A.L. Smith L.J. in Hobson v. Goringe [1897] 1 Ch. 182, 193, a decision approved by this House in Reynolds v. Ashby & Son [1904] A.C. 466, where he observes that Blackburn J.,
“was contemplating and referring to circumstances which shewed the degree of annexation and the object of such annexation which were patent for all to see, and not to the circumstances of a chance agreement that might or might not exist between the owner of a chattel and a hirer thereof.”
Regard may not be paid to the actual intention of the person who has caused the annexation to be made. In In re De Falbe [1901] 1 Ch. 523, 535, Vaughan Williams L.J. said that there was not to be an inquiry into the motive of the person who annexed the articles, “but a consideration of the object and purpose of the annexation as it is to be inferred from the circumstances of the case.” As Lord Cockburn put it in Dixon v. Fisher (1843) 5 D. 775, 793 “no man can make his property real or personal by merely thinking it so.” The matter has to be viewed objectively.
If one considers the object or purpose which the structure serves by being placed where it is, it was clearly placed there to enable the amenity of Holt’s Field to be enjoyed through the establishment of a residence. The bungalow was built there in order that people could live in what is represented as being an idyllic rural environment. The Court of Appeal, however, had regard to the belief of Mr. Morris that he owned the bungalow as evidence of his intention. But his belief cannot control the operation of the law in relation to accession and the matter of intention has to be judged objectively. Indeed the fact that the freeholders may have believed and reminded the occupants that their rights to remain could be terminated, which was also a factor on which the Court of Appeal relied, cannot affect the operation of the law.
Accession also involves a degree of permanence, as opposed to some merely temporary provision. This is not simply a matter of counting the years for which the structure has stood where it is, but again of appraising the whole circumstances. The bungalow has been standing on its site for about half a century and has been used for many years as the residence of Mr. Morris and his family. That the bungalow was constructed where it is for the purpose of a residence and that it cannot be removed and re-erected elsewhere point in my viewto the conclusion that it is intended to serve a permanent purpose. If it was designed and constructed in a way that would enable it to be taken down and rebuilt elsewhere, that might well point to the possibility that it still retained its character of a chattel. That the integrity of this chalet depends upon it remaining where it is provides that element of permanence which points to its having acceded to the ground. The Court of Appeal took the view that the bungalow was no more annexed to the land and just as much a chattel as the greenhouse in Deen v. Andrews [1986] 1 E.G.L.R. 262 (or, as I have already mentioned, the large shed in Webb v. Frank Bevis Ltd.). But there is a critical distinction between Deen v.Andrews and the present case in the fact that the greenhouse was demountable while the bungalow is not. I prefer the conclusion reached by the learned assistant recorder after hearing the evidence and visiting the site to form his own impression of the situation. As he observed towards the end of his judgment, a judgment which deserves commendation for the detail and care which has gone into it:
“. . . it seems to me clear that at least by 1985 and probably before, it would have been clear to anybody that this was a structure which was not meant to be enjoyed as a chattel to be picked up and moved in due course but that it should be a long-term feature of the realty albeit that, because of its construction, it would plainly need more regular maintenance.”
In my view the conclusion reached on this matter by the assistant recorder was correct. The appeal should be allowed and the order made by him relating to Unit 6 should be restored.
Chelsea Yacht & Boat Company Ltd. v Pope
[2000] EWCA Civ 425 Tuckey LJ
Various passages in the speeches in this case are relied on by both sides. However, the broad questions which the Court has to consider are accurately summarised in the head note.
In considering the degree of annexation, it is obviously of importance that the chattel can be removed without injury to itself or to the land. There must also be a degree of permanence. Purpose is also important as the illustration given by Blackburn J in Holland v Hodgson [1872] LR 7 CP 328 at 335 cited with approval in Elitestone shows. He said:
“Blocks of stone placed one on top of another without any mortar or cement for the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on the top of each other in the form of a wall, would remain chattels. On the other hand, an article may be very firmly fixed to the land, and yet the circumstances may be such as to show that it was never intended to be part of the land, and then it does not become part of the land. The anchor of a large ship must be very firmly fixed in the ground in order to bear the strain of the cable, yet no one could suppose that it became part of the land, even though it should chance that the shipowner was also the owner of the fee at the spot where the anchor was dropped. An anchor similarly fixed in the soil for the purpose of bearing the strain of the chain of a suspension bridge would be part of the land.”
Miss Easty in her clear and spirited submissions to us on behalf of Mr Pope referred to a number of other cases under different legislation. First, she referred to rating cases where the Court had to consider whether the occupiers of a hulk Cory v Bristow [1877] 2 AC 262; a landing stage, Forrest v Overseers of Greenwich [1858] XXI Victoria 890; and the Hispaniola Westminister City Council v Woodbury [1991] EGLR 173, all in the Thames were in rateable occupation of land. But these cases only illustrate the circumstances in which under the intricacies of rating law a chattel becomes rateable if it occupies land or is enjoyed with land. They shed no light on the circumstances in which a chattel becomes part of the land and therefore I do not find them of assistance in this case. The same applies to the poll tax case of Stubbs v Hartnell [1997] 74 P&CR D36 which concerned a houseboat in the Thames.
Miss Easty also referred us to Makins v Elson (Inspector of Taxes) [1977] 1 WLR where the Court had to consider whether the tax-payer was liable to capital gains tax upon the disposal of his mobile caravan under the terms of section 29 of the Finance Act 1965. That Act distinguished between a dwelling house and land. The question whether the caravan became part of the land did not therefore arise and again I do not think that this decision helps to resolve the instant case.
Finally, Miss Easty relied on the decision of Farquharson J in R v Rent Officer of Nottinghamshire Registration Area ex parte Allen [1985] 2 EGLR 153 who quashed the decision of a rent officer who had registered a fair rent for a caravan on the basis that its letting fell within the Rent Act. In the course of his judgment Farquharson J said that it was not possible to say that just because the subject matter of the letting was a caravan it would not fall within the Rent Act. However, it is clear from the judgment that the only point the judge considered was whether the caravan was a house. That is the second point in this case upon which we have not heard argument. I do not think the decision casts any real light on the first point which we have to decide.
Elitestone is binding upon us and we have to apply the principles laid down in that case. How should they be applied to the facts of this case?
Miss Easty firstly argued that both the district judge and the judge had found the facts against the appellants in a way which did not enable this Court to interfere.
I do not accept this submission. The district judge decided the case on the basis that Elitestone was of no assistance. He does not appear to have addressed the question of whether the houseboat became part of the land at all. As I have already said, it is not clear whether the judge really did so either. If he did, he appears to have based his decision on the fact that the houseboat was: “Permanently immobile and let as such.” But it was not permanently immobile and it is common ground that the terms of the agreement could not of themselves have created the necessary annexure. For these reasons I do not think we are in any way bound by the findings below.
Turning firstly to the degree of annexure it is important to bear in mind that what is required is sufficient attachment to the land so that the chattel becomes part of the land itself. Here the houseboat rested periodically on the river bed below it and was secured by ropes and perhaps to an extent the services to other structures. It is difficult to see how attachments in this way to the pontoons, the anchor in the riverbed and the rings in the embankment wall could possibly make the houseboat part of the land. One is bound to ask “which land?” There is in my judgment no satisfactory answer to this question. More importantly, however, all these attachments could simply be undone. The houseboat could be moved quite easily without injury to itself or the land. The Agreement contemplates that it will be moved, and, in practical terms, required Mr Pope to dry dock it if he was to fulfil his obligation to paint the hull. The fact that it cannot move under its own power is not the point. Whilst the houseboat was obviously intended to be moored where it was for the term of the Agreement at least, the fact that it could and would have to be moved greatly undermines the argument based on permanence.
Turning then to the object or purpose of annexure, Miss Easty strongly submits that the attachment of the houseboat was to provide a permanent home for its occupant. I do not agree. It is not necessary to annex the houseboat to the land to enable it to be used as a home. The attachments were, like the ship’s anchor referred to by Blackburn J, to prevent the houseboat from being carried by the tide or the weather up or down stream and to provide the services to it.
For these reasons I conclude that the houseboat has not become part of the land. I support this conclusion on the grounds of common sense. It is common sense that a house built on land is part of the land. (See Lord Lloyd in Elitestone at page 692 H). So too it is common sense that a boat on a river is not part of the land. A boat, albeit one used as a home, is not of the same genus as real property.
For these reasons I would allow this appeal and answer no to the question, “Was the agreement governed by the Housing Act 1988.”
LORD JUSTICE WALLER: I agree that, for the reasons given by my Lord and those about to be given by my Lord, Morritt LJ, which I have had the advantage of reading in draft, this appeal should be allowed.
LORD JUSTICE MORRITT: The circumstances in which this appeal arises have been fully described by Tuckey LJ. I gratefully adopt his account of them. It is common ground that the Housing Act 1988 applies to lease or tenancies of land but not of equivalent agreements in relation to chattels. It is equally plain that originally both the landing craft and the barge in which it now rests were chattels. It seems to me, therefore that there are two questions only (1) Has the combined barge/landing-craft become part of the land? (2) If it has is it a dwelling-house?
We heard argument on the first point only. Accordingly the views I express are directed to that point alone even if some of them might be capable of being addressed to both of them.
We are, of course, bound by the decision of the House of Lords in Elitestone v Morris [1997] 1 WLR 687. In that case the House of Lords pointed out that the question was whether the chattel had become part and parcel of the land, not whether it was a fixture. (See page 691G- H). The House of Lords also approved the test formulated by Blackburn J in Holland v Hodgson [1872] LR 7 CP 328 that the answer to the question depends on two factors, the degree and object of annexation. Lord Lloyd of Berwick pointed out that the intention of the parties was only relevant to the extent to which it could be derived from the degree and object of annexation. Illustrative of those principles in relation to a tapestry is the decision in Leigh v Taylor [1902] AC 157 to which we were referred.
In addition to these three cases we were referred to a number of other cases by way of illustration. I commend Miss Easty for her diligence, but I find them of no assistance.
The three rating cases, Cory v Bristow [1877] 2 AC 262, Forrest v Overseers of Greenwich [1858] XXI Victoria 890 and Westminister City Council v Woodbury (VO)And Another [1991] EGLR 173 CA were all concerned with whether there was rateable occupation of the river bed by means of a derrick hulk, a vessel permanently moored and the landing stage. In none of them was the Court concerned with the question whether the chattel in question had itself become a part of the land.
In Makins & Elson [1977] 1 WLR 21 the Court was concerned with the exemption from Capital Gains Tax afforded to the tax payer’s residence by section 29 of the relevant Finance Act. The definition of residence for present purposes was:
“(a) a dwelling house or part of a dwelling house which is, or has at any time in his period of ownership been, his only or main residence, or (b) land which he has for his own occupation and enjoyment with that residence as its garden or grounds…”
Foster J held that the tax payer’s caravan was within paragraph (a) of that definition. It formed no part of his conclusion that in the circumstances of the case the caravan which he had described had become a part of the land itself. In Stubbs v Hartnell [1997] 74 P&CR 36 the Court was concerned with liability to council tax in relation to a houseboat. But liability did not depend on whether the houseboat was part of the land or not. Accordingly, it is of no direct relevance to the question before us. In R v the Rent Officer of Nottinghamshire ex party Allen [1985] 2 EGLR 153 the question was whether a fully mobile caravan was a house for the purposes of the Rent Act 1977. The question whether it was part of the land was not argued. To the like effect, there is a decision in respect of a houseboat called the “Lady Betty” noted in [1949] 118 JPR 376. The question was whether it was a house within the meaning of the Furnished Houses Rent Control Act 1946, not whether it was part of the land.
In agreeing with the district judge, Judge Cotran said:
“The factors necessary to decide the preliminary issue were (a) the terms of tenancy – use and removability; (b) the degree of permanence and movability/immovability; and (c) the nature of the structure and its use. He…” – that is the district judge,
“… said that on the facts as he found them, and on the three factors of importance, the “Dinty Moore”, nothing else was an ensured tenancy within the meaning of the Housing Act 1988. It seems to me that to argue that no houseboat can ever be protected is wrong. Certainly it is wrong if one considers the criteria that the case law has put forward. There has been no decision on a houseboat as such but there has been, in relation to a caravan and its mobility/immobility, and it makes not the slightest difference, as far as I am concerned, whether a houseboat lies on the land after removal from water or is attached to the river bed and/or float for part of the day, so long as it is permanently immobile and let as such.”
In my view there are a number of criticisms which may be made of that passage. First the terms of the tenancy do not appear to me to have any relevance to whether there has been the requisite degree or purpose of annexation. They show the intention of the parties in regard to the contract, but, as Lord Lloyd of Berwick pointed out in Elitestone v Morris (page 693 F) the intention of the parties is irrelevant save in so far as it is derived from the degree and object of the annexation. Second, the judge considered that the only points of importance were whether the object was permanently immobile and let as such. On the first point he was wrong as a matter of fact that the Dinty Moore could be easily detached from its moorings and service connections and towed away by a barge. The second point was only relevant if the Housing Act applied, and that depended on whether the Dinty Moore was part of the land; thus reliance on the second point begged the question to be determined. Third, the judge did not seek to apply Elitestone v Morris, or, as was required by that decision, the twin factors of degree and object of annexation. Indeed at page 15B of the transcript of his judgment he said that that case did not assist the argument.
In the light of these criticisms I reject the submission by counsel for Mr Pope that the issue was one of fact on which both judges below had reached clear conclusions with which this Court should not interfere.
The proper test is that laid down in Holland v Hodgson as approved in Elitestone & Morris. The Court has to consider both the degree and object of annexation. The Dinty Moore is attached to the river wall and the river in the manner described by Tuckey LJ ultimately by ropes and service connections. Those ropes and services may be untied and disconnected without any undue effort to enable the Dinty Moor to be towed away by a barge. Thus the degree of annexation does not require recognition of the Dinty Moore a part of the land.
Counsel for Mr Pope emphasise that the purpose of the annexation was to provide a home. Certainly the object of the conversion of the landing craft and its attachment to the services was to provide a home. But there is nothing to prevent the removal of the Dinty Moore from this mooring to another. The provision of a home does not necessitate annexing the structure (be it a caravan or a boat) to the land so as to become a part of it; it is sufficient that it is fitted out for living in.
I agree with Tuckey LJ that the Dinty Moore cannot, in these and the other circumstances to which he refers, be regarded as a part of the land. In those circumstances the second question, whether the Dinty Moore is a dwelling house within the Housing Act 1988, does not arise.
I too would allow this appeal.
(Short adjournment)
JUDGMENT ON ORDER FOR POSSESSION
LORD JUSTICE MORRITT: The question arises on the form of the order as to whether we should make an order for possession in 28 days or whether we should remit the matter to the county court for the determination of the further issues alleged by counsel for Mr Pope still to be in play.
The position is that following our judgment Mr Pope has no security of tenure. The licence under which he formerly occupied was last extended to 31st August 1997. Accordingly the term under which he last occupied expired at that date. The notice to quit, which on our findings was not strictly required, was served on 18th November 1997 and required Mr Pope to give up possession on 1st January 1998.
The proceedings were commenced on 20th March 1998 and the notice of appeal was served on 26th April 1999. It seems to me that both the notice, the service of the proceedings and the service of the notice of appeal seeking an order for possession were more than sufficient to terminate any residual right of occupation which Mr Pope might have had. Even if it be assumed that he held over on terms requiring reasonable notice to be given, for my part I am satisfied that one, other or all three of those gave the requisite notice. Accordingly for my part I would make the order for possession within 28 days as sought.
LORD JUSTICE TUCKEY: I agree.
LORD JUSTICE WALLER: I also agree.
JUDGMENT ON STAY
LORD JUSTICE MORRITT: We refuse a stay of execution of our order on the undertaking of the claimants that they will forthwith on receiving vacant possession of the boat remit it for the necessary repairs, and, if they consider that the boat is beyond economic repair then we give liberty to both parties to apply to the county court to determine what if any further relief would be sought. It is also on the undertaking that if the boat is capable of economic repair, is repaired, and if the House of Lords determine we were wrong, that the claimants will let Mr Pope back into occupation of it.
Cardigan v Moore & Anor
[2012] EWHC 1024 (Ch)
Newey J
Issue 2: Does the Lease extend to such of the Paintings as are in Savernake Lodge?
It is the Earl’s case that many of the Paintings are included in the Lease. The Paintings in question were taken to Savernake Lodge from elsewhere on the Estate when the Earl moved into the property in the early 1980s. The 8th Marquess explained in a witness statement:
“I was aware that my son felt in the same way about the family heirlooms – especially the collection of family paintings – as my father did, and so we agreed that my son should permanently take the bulk of the family collection to Savernake Lodge with him, excepting the very largest canvasses that had been particularly painted for the halls in the enormous Tottenham House, which were therefore too large to get in the front door of Savernake Lodge”.
Once at Savernake Lodge, larger Paintings were secured by means of large heavy-duty hooks drilled into the walls. Smaller Paintings were hung from steel hooks hammered into the walls. An extensive burglar alarm system was installed to protect the collection. The main room was upholstered in such a way as to match the “Unnamed Landscape”. The Earl’s mother recalled in her witness statement that “[t]he fabric selection for the curtains and sofas were all designed to echo the soft orange and light green colours of the Unnamed Landscape”.
Under clause 1 of the Lease, Savernake Lodge is demised to the Earl together with, among other things, “the use of all the Landlords’ furniture fixtures and fittings in or on the premises”. Mr Bishop relied on each of the words: “furniture”, “fixtures” and “fittings”.
With regard to the first of the words, the Concise Oxford Dictionary defines “furniture” as “the movable articles that are used to make a room or building suitable for living or working in, such as tables, chairs or desks”. As this definition indicates, the word “furniture” nowadays connotes items such as tables, chairs and desks which have a function other than decoration. To my mind, artwork displayed on a room’s walls, which is essentially decorative, would not normally be regarded as furniture. Paintings might perhaps be said to help to furnish a room. I do not think, however, that they would naturally be considered furniture.
Turning to “fixtures”, there was little or no disagreement between the parties as to the relevant legal principles. It was common ground that, when considering whether a chattel has become a fixture, regard is to be had to (a) the degree to which the chattel has become annexed to the land and (b) the purpose of such annexation. The law was explained by Blackburn J in these terms in Holland v Hodgson (1872) LR 7 CP 328 (at 334-335):
“There is no doubt that the general maxim of the law is, that what is annexed to the land becomes part of the land; but it is very difficult, if not impossible, to say with precision what constitutes an annexation sufficient for this purpose. It is a question which must depend on the circumstances of each case, and mainly on two circumstances, as indicating the intention, viz., the degree of annexation and the object of the annexation. When the article in question is no further attached to the land, then by its own weight it is generally to be considered a mere chattel; see Wiltshear v. Cottrell, and the cases there cited. But even in such a case, if the intention is apparent to make the articles part of the land, they do become part of the land: see D’Eyncourt v. Gregory. Thus blocks of stone placed one on the top of another without any mortar or cement for the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on the top of each other in the form of a wall, would remain chattels. On the other hand, an article may be very firmly fixed to the land, and yet the circumstances may be such as to shew that it was never intended to be part of the land, and then it does not become part of the land. The anchor of a large ship must be very firmly fixed in the ground in order to bear the strain of the cable, yet no one could suppose that it became part of the land, even though it should chance that the shipowner was also the owner of the fee of the spot where the anchor was dropped. An anchor similarly fixed in the soil for the purpose of bearing the strain of the chain of a suspension bridge would be part of the land. Perhaps the true rule is, that articles not otherwise attached to the land than by their own weight are not to be considered as part of the land, unless the circumstances are such as to shew that they were intended to be part of the land, the onus of shewing that they were so intended lying on those who assert that they have ceased to be chattels, and that, on the contrary, an article which is affixed to the land even slightly is to be considered as part of the land, unless the circumstances are such as to shew that it was intended all along to continue a chattel, the onus lying on those who contend that it is a chattel.”
Rather more recently, Scarman LJ said this about the law in Berkley v Poulett [1977] 1 EGLR 86 (at 88-89):
“If the purpose of the annexation be for the better enjoyment of the object itself, it may remain a chattel, notwithstanding a high degree of physical annexation. Clearly, however, it remains significant to discover the extent of physical disturbance of the building or the land involved in the removal of the object. If an object cannot be removed without serious damage to, or destruction of, some part of the realty, the case for its having become a fixture is a strong one. The relationship of the two tests to each other requires consideration. If there is no physical annexation there is no fixture. Quicquid plantatur solo solo cedit. Nevertheless an object, resting on the ground by its own weight alone, can be a fixture, if it be so heavy that there is no need to tie it into a foundation, and if it were put in place to improve the realty. Prima facie, however, an object resting on the ground by its own weight alone is not a fixture: see Megarry and Wade, p 716. Conversely, an object affixed to realty but capable of being removed without much difficulty may yet be a fixture, if, for example, the purpose of its affixing be that “of creating a beautiful room as a whole” (Neville J in In Re Whaley [1908] 1 Ch 615 at p 619). And in the famous instance of Lord Chesterfield’s Settled Estates [1911] 1 Ch 237 Grinling Gibbons carvings, which had been affixed to a suite of rooms 200 years earlier, were held to be fixtures. Today so great are the technical skills of affixing and removing objects to land or buildings that the second test is more likely than the first to be decisive. Perhaps the enduring significance of the first test is a reminder that there must be some degree of physical annexation before a chattel can be treated as part of the realty”.
As Miss Reed pointed out, the present case has similarities to Berkley v Poulett. That case concerned, among other things, whether some pictures in an ancestral home were fixtures and so had been sold with the house. Each of the pictures in question had been “fixed into the recesses of a panelled wall” (see 87). The Court of Appeal held, by a majority, that the pictures were not fixtures. Scarman LJ explained his thinking in these terms (at 89):
“It is enough to say that the pictures were firmly fixed and that their removal needed skill and experience if it were to be done without damage to the wall and panelling. Certainly they were firmly enough fixed to become fixtures if that was the object and purpose of their affixing. But, if ordinary skill was used, as it was, in their removal, they could be taken down, and in the event were taken down, without much trouble and without damage to the structure of the rooms. The decisive question is therefore as to the object and purpose of their affixing. Pictures had hung in the two rooms for centuries. ‘The Return’ had been in the anteroom for a very long time—perhaps ever since it was painted. The 7th Earl decided in the early part of the 20th century to install in the two rooms the panelling and so designed it that there were recesses for pictures. It is this feature which lends plausibility to the suggestion that the pictures, fitted into the recesses left for them, were not to be enjoyed as objects in themselves but as part of the grand architectural design of the two rooms. The Vice-Chancellor rejected this view. So do I. When the panelling was installed in the two rooms the design was either panelled walls with recesses for pictures to be enjoyed as pictures, or rooms having walls which were a composite of panelling and pictures: in other words, the pictures were to be part of a composite mural. I think the former was the truth. The panelling was Victorian, the pictures a heterogeneous collection”.
In the course of his judgment, Stamp LJ, the other member of the majority, remarked (at 95):
“Framed pictures are hung on or fixed to the walls for their better enjoyment as pictures, however much they may beautify the rooms in which they are found”.
He also said (again at 95):
“Framed oil paintings in my judgment are, and remain, chattels whether they be hung upon, or over, or screwed by mirror plates to, the panelling of a room, or hung from, over, or screwed by mirror plates to, the walls of an unpanelled room”.
Mr Bishop stressed that, whereas the pictures at issue in Berkley v Poulett were a “heterogeneous collection” (in Scarman LJ’s words), the Paintings are all associated with the Earl’s family. On the other hand, the Paintings do not seem to have been as firmly fixed to the walls as those with which the Court of Appeal was concerned in Berkley v Poulett. Moreover, the Paintings have not been in Savernake Lodge as long as the pictures in dispute in Berkley v Poulett had been in place. While the Paintings have a strong association with the Earl’s family, the link with Savernake Lodge is far weaker.
In all the circumstances, it appears to me that the Paintings are not fixtures. As is apparent from Stamp LJ’s comments in Berkley v Poulett, framed paintings do not usually constitute fixtures, and there is no good reason for the position to be different with the Paintings. They were housed in Savernake Lodge. They never became part of the building. That, in the case of the “Unnamed Landscape”, the colour scheme of a room was based on a painting does not, in my view, alter the position.
Moving on to the word “fittings”, it was suggested that clause 2.26 casts light on what the Lease was intended to comprise. By that clause, the Earl covenanted:
“At the expiration or sooner determination of the said term quietly to yield up the demised premises together with all furniture fixtures and fastenings that now are or which during the said term shall be affixed or fastened thereto (except tenant’s fixtures) in such condition as shall be in accordance with the covenants on the part of the Tenant herein contained and in case any of the said fixtures and fittings shall be missing broken damaged or destroyed forthwith to replace them with others of a similar kind and of equal value and to make good any damage caused to the demised premises by the removal of the Tenant’s fixtures fittings furniture and effects”.
Mr Bishop argued that clause 2.26 uses “fastenings” and “fittings” interchangeably (speaking of “furniture fixtures and fastenings” and “the said fixtures and fittings”) and that the reference in clause 1 to “fixtures and fittings” should therefore be read so as to include chattels which were “fastenings” or “fastened” to Savernake Lodge. The Paintings (it was submitted) fall comfortably within “fastenings” and so are also “fittings”.
On balance, however, the preferable view is, I think, that the Paintings do not represent “fittings”. The word “fittings” is not a legal term of art (see Woodfall, “Landlord and Tenant”, at paragraph 13.131). It is often used in combination with “fixtures” (as in “fixtures and fittings”). That was the case in Berkley v Poulett (see [1977] 1 EGLR 86 at 88), but no one appears to have considered the addition of “fittings” important. Nor does reference to the Oxford English Dictionary suggest that the word “fittings” extends the scope of clause 1 in a relevant way. The Dictionary defines “fittings” as “Fixtures, apparatus, furniture”. Clause 1 makes separate reference to “fixtures” and “furniture”, and the Paintings would not normally be regarded as “apparatus”. Further, the word “fitted” would not naturally apply to the Paintings. A carpet or cupboard might be “fitted”. The Paintings were surely hung rather than “fitted”. The value of the Paintings is also, to my mind, of significance. Had the parties intended the Lease to extend to such valuable items, they might have been expected to refer to them specifically, not to rely on the somewhat vague word “fittings”.
With regard to clause 2.26, the word “fastenings” is not obviously apt to refer to the Paintings. The word would, I should have thought, refer more naturally to an attachment than to the thing attached. On that basis, the chains used to secure Paintings might be “fastenings” but the Paintings themselves would not be. Alternatively, it might be said that the meaning of “fastenings” should be determined by reference to “fittings” rather than the other way around. In any case, the “furniture fixtures and fastenings” which are to be yielded up need not correspond precisely with the “furniture fixtures and fittings” demised. It makes sense that the Earl should be obliged to yield up chattels in Savernake Lodge belonging to the landlords regardless of whether they were encompassed by clause 1.
Accordingly, the Lease does not, in my judgment, extend to any of the Paintings. They do not, as it seems to me, fall within the words “furniture fixtures and fittings”, as those words are used in clause 1 of the Lease.
National Provincial Bank v Ainsworth
[1965] UKHL 1[1965] 3 WLR 1, [1965] UKHL 1, [1965] 2 All ER 472, [1965] AC 1175 Lord Hodson
Until 1952 it was not thought that the wife’s right was other than a
personal right against her husband which she could not enforce against a
third party. In Thompson v. Earthy [1951] 2 K.B. 596 Roxburgh J. had
no hesitation in rejecting a submission that such an enforceable right existed
even where the purchaser had notice of the wife’s position. It should be
noted that the wife’s right against her husband is not varied by his desertion
of her. He cannot turn her out capriciously whether he has deserted her
or not and the observations contained in the paragraph I have cited from
the Royal Commission’s report are applicable to any wife who is living in
the marriage home. So long as her status as a wife remains so long do
her rights against her husband survive. She needs no licence from him
to sustain her.
In 1952. however a decision of the Court of Appeal in the case of Bendall
v. McWhirter [1952] 2 Q.B. 466 laid down for the first time that the wife’s
rights were binding on the trustee in bankruptcy of the husband.
The majority view (that of Somervell and Romer LL.J.) was that the
trustee by virtue of his statutory position was subject to the same special
restriction as prevented the husband from evicting the wife. The minority
view propounded by Denning L.J. was that the wife had an equity which
bound the trustee. The majority view was necessarily accepted by the Court
of Appeal in the following year in Bradley-Hole v. Cusen [1953] 1 Q.B. 300
but the minority view was rejected at p. 306 per Jenkins L.J., the other mem-
bers of the Court concurring, when he said that the wife’s rights against her
husband are ” purely personal “. The minority view has, however, been
followed in later cases at first instance so that the wife’s right has been held
to be binding on a subsequent purchaser with notice of the wife’s right after
desertion has occurred (see Street v. Denham [1954] 1 W.L.R. 624) and
accepted as correct in other cases, e.g. Westminster Bank Ltd. v. Lee [1956]
Ch. 7.
At first sight there is much to be said for the majority view that the trustee
in bankruptcy should be placed in no better plight than the husband. On-
the other hand, there is no reason why the wife should be in a better position
if her husband becomes bankrupt after leaving her than she would have been
if his bankruptcy had taken place while they were living together. Section
105 (1) of the Bankruptcy Act, 1914, which gives the trustee discretion would
not appear to enable the wife to be preferred to the husband’s creditors.
If the majority view of the Court of Appeal in Bendall v. McWhirter
cannot be supported on the ground of the special position of the trustee in
bankruptcy one must look to the wider ” equity ” referred to by Denning L.J.
as justifying the decision. It being conceded that the ” equity ” is not an
equitable interest in the land I find difficulty in seeing how it can operate
so as to affect third parties. The court can protect itself against sham sales
cf. Ferris v. Weaven [1952] 2 All E.R. 233, a decision which can be supported
on that ground, and the court now has power to set aside transfers of
property made to defeat claims for alimony or maintenance as happened in
this case.
When there is a genuine transfer there is no reason why the wife’s personal
rights against her husband, which are derived from her status, should enter
the field of real property law so as to clog the title of an owner.
The Master of the Rolls by way of analogy referred to a number of autho-
rities dealing with licences coupled with an interest or cases where money had
been expended by a licensee in occupation of land. Dillwyn v. Llewelyn
[1862] 4 De G.F. & J. 517 is a well known example of the latter class of
case where a son spent money on property of his father by building a house
on it and was held entitled to a conveyance of the fee simple.
These and other cases are exceptions to the general rule that a transferee
is not bound by a licence even if he has notice of its existence. It may be that
the list of exceptions is not closed but it is, in my opinion, unnecessary
to examine the various cases which may be said to have been decided on
grounds which show a departure from this general rule for in this field the
licence cases are unhelpful.
To describe a wife as a licensee, unless that overworked word is merely
used to describe a person lawfully on land and not a trespasser, is not only
uncomplimentary but inaccurate. She is not a person who needs any licence
from her husband to be where she has a right to be as a wife.
Thomas v. Sorrell (1673) Vaughan 330 at p. 351 contains the classic
definition of a licence propounded by Vaughan C.J.:
” A dispensation or licence properly passeth no interest, nor alters
” or transfers property in any thing, but only makes an action lawful,
” which without it had been unlawful.”
This shows the fallacy of the analogy for the wife would not be a trespasser
in her husband’s house in the absence of a licence from her husband.
If one leaves out of account the authorities on contractual licences and
examines the nature of the wife’s rights as against her husband the concep-
tion of it as one which affects interests in land becomes a difficult one.
Looking upon her as an occupant of the home she has no right to exclusive
occupancy as against her husband and her own right may be determined by
her own conduct or by the offer of suitable alternative accommodation (see
Hill v. Hill [1916] W.N. 59). In few cases would it be easy for a purchaser
to ascertain the true relationship between husband and wife where the wife
claimed that without just cause her husband had deserted.
The duration of the right if it were held to affect the land would be un-
certain. It would not survive divorce nor would it necessarily survive a
judicial separation by order of the court which puts an end to the duty of
cohabitation on both sides. See Harriman v. Harriman [1909] p. 123. The
•duration of the right is said to be discretionary during the subsistence
of the marriage and the discretion is to be exercised either under or
in like manner with that of section 17 of the Matrimonial Causes Act,
1882. If the land is transferred to third parties as happened in this
case no principle would seem to be involved which could guide the
•courts in the exercise of the discretion as between a deserted wife
and a purchaser. Equity may not be past the age of child-bearing but an
infant of the kind suggested would lack form or shape. Counsel for the
Respondent sought to support the view that equity would assist his client
to claim a proprietary right in the land by reference to the language of
Lord Cowper in Dudley v. Dudley, Pr. Ch. 241 at p. 245:
” Now Equity is no part of the law, but a moral virtue, which quali-
” fies, moderates, and reforms the rigour, hardness, and edge of the
” Law, and is an universal truth; it does also assist the Law where it
” is defective and weak in the constitution (which is the life of the
” Law) and defends the Law from crafty evasions, delusions, and new
” subtilties, invented and contrived to evade and delude the Common
” Law, whereby such as have undoubted right are made remediless;
” and this is the Office of Equity, to support and protect the Common
” Law from shifts and crafty contrivances against the justice of the
” Law. Equity therefore does not destroy the Law, nor create it, but
” assist it.”
He submitted that in the facts of such a case as this where a wife has been
deserted in this house she has acquired a proprietary right on the footing
that personal obligations affecting proprietary rights have been performed.
He further submitted as a general proposition that where a promise relat-
ing to real property express or implied is no longer executory so that the
promisee or lessee has acquired a right in respect of the property a pur-
chaser with notice of the right or a volunteer with or without notice can
only take subject to that right.
On the facts of this case he submitted that the promise ceased to be
executory on the 17th August, 1957, when the husband deserted and created
an equity which related to the property and defeated a purchaser except a
purchaser for value without notice.
The answer to these submissions is that they have no relation to the
facts of this case. The husband in deserting his wife did not confer or
purport to confer on her a right to any property other than she had had
before he left her. No question of performance of a promise arises. If
there were an equity it would arise whether or not there had been any
performance.
Lastly, I shall refer to the passage cited by the Master of the Rolls from
Barnhart v. Greenshields (1853) 9 Moore P.C.C. 18 at page 32 where Mr.
Pemberton Leigh (afterwards Lord Kingsdown) said :
” if there be a tenant in possession of land, a purchaser is bound by
” all the equities which the tenant could enforce against the vendor.”
The word “equities” is italicised in the Master of the Rolls’ judgment.
Counsel for the Appellant drew your Lordships’ attention to the case of
Reeves v. Pope [1914] 2 K.B. 284 where the equity claimed was based on
a personal contract and the argument based on the dictum from Barnhart
” and Greenshields was interrupted by Buckley L.J. saying “This right
” which is claimed is not an interest in the land “. In his judgment Reading
L.C.J. used these words:
“The other case Barnhart v. Greenshields contains words which,
taken by themselves, and apart from the rest of the case, and also from
” the facts with which the Court was then dealing, would be certainly
wide enough to cover the proposition. But as Buckley L.J. has pointed
” out, they must be read as if the words at p. 32 after ‘ A purchaser
” ‘ is bound by all the equities which the tenant could enforce against
” ‘ the vendor ‘ were ‘ in the land ‘.”
Having reached the conclusion that the rights which have been referred to as
those of ” a deserted wife ” are of their nature personal rights and such that
they cannot be treated as in any sense running with the land, I am of opinion
that those cases which proceed on the basis of an opposite conclusion were
wrongly decided. Beginning with Bendall v. McWhirter (supra) I do not
think that the decision can be supported on principle or on the ground that
a trustee in bankruptcy is in a special position, for that would involve
putting the wife in front of her husband’s creditors after desertion, a position
which she could not claim to occupy before desertion. Street v. Denham
(supra), which proceeded on the footing that the cases of the trustee in bank-
ruptcy could not be effectively distinguished from the purchaser, must suffer
the same fate.
The same applies to the case of Jess B. Woodcock & Sons Ltd. v. Hobbs
[1955] 1 W.L.R. 152 which seems to have been based on the footing that the
deserted wife had an equity available against a purchaser for value with
notice of her occupation so as to make it discretionary for the court to give
possession to the purchaser. Parker L.J. in that case, however, saw great
difficulty in extending the protection given in Bendall v. McWhirter so as to
give her any rights against a bona fide purchaser for value whether with or
without notice. In Westminster Bank v. Lee (supra) and Churcher v. Street
[1959] Ch. 251 there was no argument but the equity was assumed.
Having done the best I can to analyse the nature of the right which the
wife has against her husband which is fundamentally the right relied on by
the Respondent. I conclude that it does not operate as a clog on the land
which protects her by operating as a mere equity against anyone but a
purchaser for value without notice.
I now approach the construction of the Land Registration Act, 1925, and
find myself in full agreement with Cross J. and Russell L.J. in excluding the
right with which we are concerned from the category of ” overriding ” interests
in section 70 and respectfully adopt the first sentence of the first paragraph on
page 772 of the Report where Russell L.J. says: ” It seems to me that section
” 70 in all its parts is dealing with rights in reference to land which have the
” quality of being capable of enduring through different ownerships of the
” land, according to normal conceptions of title to real property “. I agree
that the right now in question is not of that quality and I am not prepared to
hold that it is embraced by the language of section 70.
I have assumed for the purpose of my conclusion oh the point of construc-
tion that the wife is ” in actual occupation of the land ” notwithstanding the
powerful argument of counsel for the Appellant that the husband and not
the wife must be the person in actual occupation. He relied on the cases
decided under the Rent Restriction Acts where a husband even when he has
deserted his wife has been treated as still in occupation of the premises since
he remained in possession of them through his wife. The statutory tenancy in
these cases still survives cf. Brown v. Draper [1944] K.B. 309, Old Gate
Estates Ltd. v. Alexander [1950] I K.B. 311 and Middleton v. Baldock [1950]
1 K.B. 657 where the wife was joined as a defendant to a claim by a landlord
for possession made against a husband, who had deserted her leaving her in
the house, and was able to defeat the landlord’s claim. I cast no doubt on
the authority of these cases but do not think they are conclusive on the con-
struction of the words ” in actual occupation ” contained in section 70(1)(g)
of the Land Registration Act. 1925. Similar considerations apply to the
argument based on the cases dealing with rateable occupation.
I would accordingly allow the appeal, order possession of the property
124, Milward Road, Hastings to be given to the Appellant within 28 days and
discharge the order for costs made against the Appellant in the Court of
Appeal. No order for costs against the Respondent having been sought by the
Appellant, no further order is required.
Lord Upjohn
But apart from authority, what is the extent and ambit of her right to
continue in occupation? I have already pointed out that before desertion she
has no special rights in the particular house where the spouses are living
and I cannot see why on principle any better rights should arise on desertion.
Her rights as a wife continue as before, they are not increased by breach of
duty on the part of the husband, but being in breach himself he may
find it difficult to turn her out of the house where she is lawfully living
awaiting his return and the Court may prevent the husband by injunction
from dealing with his property to the prejudice of the wife without safe-
guarding her position (Lee v. Lee [1952] 2 Q.B. 489). But then many
things may happen: he may offer alternative accommodation to the wife;
he may offer her substantial maintenance to go and live elsewhere. The
cases that I have already cited shew that provided the wife’s marital rights
are adequately safeguarded the Court would not normally refuse to evict
a wife if the husband wants to deal with his property. Or he may return
and resume cohabitation when the domestic forum resumes exclusive juris-
diction. Or the wife may change her position. She may commit a
matrimonial offence which may lead the Court to refuse her the right
to continue under her husband’s roof; she may obtain (as in this case)
a decree of judicial separation which at all events brings the husband’s
desertion to an end (Harriman v. Harriman [1909] P. 123). Such a decree
must necessarily be an important though not conclusive factor if the husband
is seeking to turn his wife out of occupation. Finally, any right on the part
of the deserted wife to remain in occupation terminates when the marriage
terminates.
Now such being the general nature of the rights of the wife against the
husband after desertion, how do they affect third parties dealing with the
husband at a date after the desertion who I will assume (though it is
certainly not conceded in this case) have full notice of the desertion. The
right of the wife to remain in occupation even as against her deserting
husband is incapable of precise definition, it depends so much on all
the circumstances of the case, on the exercise of purely discretionary reme-
dies, and the right to remain may change overnight by the act or behaviour
of either spouse. So as a matter of broad principle I am of opinion
that the rights of husband and wife must be regarded as purely personal
inter se and that these rights as a matter of law do not affect third parties.
In this case your Lordships are dealing with essentially conveyancing
matters. It has been the policy of the law for over a hundred years to
simplify and facilitate transactions in real property. It is of great impor-
tance that persons should be able freely and easily to raise money on the
security of their property. Of course an intending purchaser is affected
with notice of all matters which would have come to his notice if such
inquiries and inspections had been made by him as ought reasonably to have
been made (s. 199 of the Law of Property Act 1925). But surely any inquiry,
if it is to be made reasonably must be capable of receiving a positive answer
as to the rights of the occupier and lead to a reasonably clear conclusion
as to what those rights are. The answer ” I am a deserted wife ” (if given)
only gives notice of a right so imprecise, so incapable of definition, so
impossible of measurement in legal phraseology or terms of money that
if he is to be safe the mortgagee will refuse to do business and much unneces-
sary harm will be done. I discussed some aspects of this matter in West-
minster Bank v. Lee [1956] Ch 7 and Russell L.J. discussed it at greater
length in the Court below at [1964] 2 W.L.R. 774. I agree with his
observations and am content as a matter of exposition to leave it there. It
does not seem to me that an inquiry as to the marital status of a woman in
occupation of property is one which the law can reasonably require to
be made; it is not reasonable for a third party to be compelled by law to
make inquiries into the delicate and possibly uncertain and fluctuating state
of affairs between a couple whose marriage is going wrong. Still less can it
be reasonable to make an inquiry if the answer to be expected will probably
lead to no conclusion which can inform the inquirer with any certainty as to
the rights of the occupant. These considerations give strong support to the
opinion I have already expressed that the rights of the wife must be regarded
as purely personal between herself and her husband.
But I must examine further the basis of the principle on which it has
been held that third parties with notice are affected by and take subject to
the wife’s right as against the husband to remain in possession. As Lord
Denning M.R. has pointed out the principle was originally founded on
the assumption that possession by a deserting husband could only be
obtained by an application under section 17 of the Married Women’s
Property Act 1882 for a husband could not sue his wife in tort. This stems
from certain obita observations made by Goddard L.J. in Bramwell v.
Bramwell [1942] 1 K.B. 370 to the effect that .the plaintiff ought to have
proceeded under section 17 instead of suing at law. The other members
of the court were silent on this point which was left entirely open in
the later case of Pargeter v. Pargeter [1946] 1 A.E.R. 570. I share the
doubts of Devlin L.J. in Short v. Short [1960] 1 W.L.R. 833 at 848 on the
correctness of these observations of Goddard L.J. Furthermore, the wife
is lawfully in possession, she is not a trespasser as Goddard L.J. treated
her and no question of a tort arises when the true principles which were
applicable are properly understood. As I have pointed out earlier both in
the Chancery and Probate Divisions many orders with regard to possession
of the property of the spouses were made; and they were made without
particular reliance on section 17; such orders are based not on tort but on
the obligations of the spouses to live together.
However, the point is now academic, see Law Reform (Husband and
Wife) Act, 1962.
Apart from this, however, I cannot understand how a purely procedural
section such as section 17 can confer any new substantive rights on either
of the spouses. The section provides a very useful summary method of
determining between husband and wife questions of title and the right to
possession of property. With all respect to the learned Master of the Rolls
I am of opinion that he has put a far too wide construction upon this
section. In H. v. H. [1963] T.L.R. 645 he said in reference to the ambit
of section 17—” The judge should have a free hand to do what is just”.
In the recent case of Hine v. Hine [1962] 1 W.L.R. 1124 he said of the
section: ” Its discretion transcends all rights, legal or equitable “. I prefer
the approach of Devlin L.J. in Short v. Short (supra) at 849. The powers
of the Court under section 17, as the learned Lord Justice said, are sub-
stantially the same as in any other proceeding where the ownership or
possession of property is in question. The discretion of the Court is no
wider and no narrower than the ordinary discretion of the Court in such
cases. In Cobb v. Cobb [1955] 1 W.L.R. 731 Romer L.J. said:
” I know of no power that the court has under section 17 to vary
” agreed or established titles to property. It has power to ascertain the
” respective rights of husband and wife to disputed property, and fre-
” quently has to do so on very little material; but where, as here, the
” original rights to property are established by the evidence, and those
” rights have not been varied by subsequent agreement, the court
” cannot, in my opinion, under section 17 vary those rights merely
” because it thinks that in the light of subsequent events the original
” agreement was unfair.”
See also the observations of Russell L.J. in Wilson v. Wilson [1963]
1 W.L.R. 601 at 608.
Title must be decided as a matter of fact and law; but there will be
many cases where after years of happy married life frequently with one com-
mon banking account to which both contribute and no one taking much heed
as to who pays for what the ownership of property has become so in-
extricably entangled or become legally incapable of solution that an
equitable knife must be used to sever the Gordian knot; In re Rogers’
Question [1948] 1 A.E.R. 328 and Rimmer v. Rimmer [1953] 1 Q.B. 63
are typical examples. But when once the relevant document has been
construed or the rights as to title determined by judicial decision on the
available evidence, as must be necessary (if possible) in the first place,
no further question of discretion on questions of title arise. Questions of
possession must of course still be determined having regard to the mutual
matrimonial duties of the spouses.
Depending as they do on a wider construction of section 17 than it
should have in my opinion, I would not myself regard the recent cases of
Mine v. Mine [1962] 1 W.L.R. 1124 and Appleton v. Appleton [1965] 1 W.L.R.
25 as correctly decided. In the former case the intention of the parties
was clear assuming the learned County Court judge correctly interpreted
the legal effect of the discussion as to avoiding estate duty (and I have no
reason to doubt that he did); in the latter case the husband could have no
claim on property which he knew to be his wife’s by doing work on it,
in the absence of some agreement.
Furthermore, I cannot myself see how this section which is purely personal
between husband and wife (though the section may be invoked by the
company in whose books the disputed property stands) can be used to confer
upon the wife, just because she has been deserted by her husband, any rights
against third parties. That the section was available in proceedings against
third parties was, however, apparently assumed (though in my opinion
wrongly) without serious argument, in Woodcock v. Hobbs [1955]
1 W.L.R. 152.
Now, however, the deserted wife’s right is said to be based on principle
and not to stem from procedural considerations. It is said to be a licence
coupled with an equity. In the words of Lord Denning MR. in the Court
of Appeal at page 763: ” The wife has no tenancy. She has no legal
” estate or equitable interest in the land. All that she has is a licence. But
” not a bare licence. She has a licence coupled with an equity. I mean
“an ‘equity’ as distinguished from an equitable interest.” Then after
referring to Westminster Bank v. Lee (supra) he continued: ” It is an equity
” which the court will enforce against any successor except a purchaser
” for value without notice.”
The wife is asserting rights over the land of another and in respect of
which she has no beneficial ownership. Nevertheless, she claims to enforce
her rights against an assignee of her husband, the owner. How, as a matter
of principle, can she do this?
First, (I am still dealing with the general law) mere exclusive occupation
is by itself not sufficient to establish such a right. It all depends on what
her rights are; of course it may be sufficient, e.g., if the wife is a lessee
who thereby necessarily has an interest in the land. Secondly, notice to a
purchaser that the wife is in occupation as a deserted wife (assuming con-
trary to my opinion that such a right is capable of reasonable definition) is
rot per se sufficient. The observations of Knight Bruce L.J. in de Mattoz v.
Gibson cannot be applied to the law of real property (see L.C.C. v. Allen
[1914] 3 K.B. 642 at 658). Furthermore, the necessity for notice is to get
rid of the effect of the legal estate; notice itself does not create the right.
To create a right over the land of another that right must (apart from
staute) create a burden on the land, i.e., an equitable state or interest in
the land. All this was pointed out in the closely analogous case of restrictive
covenants by Farwell J. in Nisbett and Potts’ Contract [1905] 1 Ch. 391 at
pp. 397-8 in a very full judgment reviewing the earlier authorities which
though at first instance has always been accepted as authoritatively stating
the law. So in principle, in my opinion, to create a right over the land of
another that right must in contemplation of law be such that it creates a
legal or equitable estate or interest in that land and notice of something
though relating to land which falls short of an estate or interest is insufficient.
There are no doubt many cases where judges have said the purchaser ” takes
subject to all equities ” but they meant ” equitable interests “. Such, in my
opinion, were the cases of Jones v. Smith 1 Hare 53, 60 and Barnhardt
v. Greenshields 9 Moo P.C.C. 18. This, I think, is quite clear from the
case of Reeves v. Pope [1914] 2 K.B. 284. See the interjection of
Buckley L.J. at p. 286 and the judgment of Lord Reading C.J. on pp. 288-9.
An equity to which a subsequent purchaser is subject must create an interest
in the land. As Professor Crane has pointed out in an interesting article
in 19 Conveyancer 343 at 346—
” Beneficial interests under trusts, equitable mortgages, vendors’ liens,
” restrictive covenants and estate contracts are all equitable interests.”
No lesser interests have been held to be sufficient. A mere ” equity ” used
in contradistinction to an ” equitable interest” but as a phrase denoting
a right which in some circumstances may bind successors is a word of
limited application and, like the learned editors of Snell, 25th edition, at
p. 18, I shall attempt no definition of that phrase. It was illustrated in
the case before me of Westminster Bank v. Lee (supra) where I was con-
strained in the then state of the authorities to assume that a mere equity
might bind successors, yet being at most a mere equity, even subsequent
equitable encumbrancers, contrary to the usual rule, could plead purchaser
for value without notice. But, my Lords, freed from the fetters which there
bound me, I myself cannot see how it is possible for a ” mere equity ” to bind
a purchaser unless such an equity is ancillary to or dependent upon an
equitable estate or interest in the land. As Mr. Megarry has pointed out in
71 L.Q.R. at p. 482 the reason why a mere equity can be defeated by a
subsequent purchaser of an equitable estate for value without notice is that
the entire equitable estate passes and it is not encumbered or burdened by
a mere equity of which he has no notice. For example, a purchaser takes
subject to the rights of a tenant in possession whatever they may be. If
he sees a document under which the tenant holds, that is sufficient unless
he knows, or possibly in some circumstances is put in inquiry to discover,
that the tenant has in addition a mere equity, e.g., a right to rectify the
document. If the purchaser knows that, he knows that the document does
not correctly describe the estate or interest of the tenant in the land and he
takes subject to that estate or interest, whatever it may be. But a mere
” equity ” naked and alone is, in my opinion, incapable of binding successors
in title even with notice; it is personal to the parties.
So, my Lords, even if my opinion is wrong that from its very nature the
right of the deserted wife is purely personal between husband and wife and
incapable of binding third parties I am of opinion, with all respect to the
Master of the Rolls’ statement of her rights, first that it is incorrect to regard
her as the husband’s licensee and, secondly, her mere equity not amounting
to an equitable interest nor being ancillary to or dependent upon an equitable
interest does not bind purchasers.
Your Lordships heard much interesting discussion as to the rights of con-
tractual licensees to remain in occupation as against third parties. As I
emphatically decline to equate the deserted wife with a contractual licensee
or to draw any analogy between the two I shall be very brief on this subject.
The cases of Forster v. Robinson [1951] 1 K.B. 149 and Errington v. Errington
and Woods [1952] 1 K B 290 were much canvassed before your Lordships.
In the latter case the licensees were in exclusive occupation upon the terms
of paying off the mortgage instalments and after the matrimonial rupture
the wife continued to do so. This, I would have thought, would have given
the spouses an interest in the land, in accordance with a well known line
of authority starting with Webb v. Paternoster 2 Roll Rep. 143, valid
against all except a purchaser for value without notice.
The more interesting and really text book case is Foster v. Robinson
(supra). Whether the right (undoubted contractually against the owner
of the property) of Robinson the retired servant to remain in exclusive
occupation of his cottage rent free for the rest of his life will by judicial
decision one day be held to create an equitable estate or interest binding
all except purchasers for value without notice, or whether, as Russell L.J.
thinks, statutory legislation is required to bring about that result is a matter
upon which I propose to express no opinion. On the other hand, Rox-
burgh J. in Thompson v. Earthy [1951] 2 K.B. 596 at p. 599 may have
taken the view that an exclusive licensee may thereby have an interest in
the land, and Professor Cheshire supports this view in a very interesting
article on this matter in 16 Modern Law Review, page 1. He does, I think,
in that article underestimate the difficulties created by King v. David Allen
& Sons, Billposting, Ltd. [1916] 2 AC 54 and Clore v. Theatrical Properties,
Ltd., and Westby & Co. Ltd. [1936] 3 A.E.R. 483. But if it is later decided
that a licensee having an irrevocable licence to remain in occupation of the
land for a defined period creates an interest in land and is valid against
subsequent purchasers with notice that would not affect my view that the
purely personal, evanescent and changeable rights exercisable against her
husband by the deserted wife cannot affect a purchaser from the husband.
My Lords, it follows that so far as unregistered land is concerned Bendall
v. McWhirter was itself wrongly decided, for a trustee in bankruptcy
succeeds only to the property of the bankrupt in its then plight and condition
and is not concerned with personal rights that do not affect that property.
So was Street v. Denham [1954] 1 W.L.R. 624. Ferris v. Weaven [1952]
2 A.E.R. 233 may possibly be justified on its own facts.
I turn then to consider section 70 of the Land Registration Act.
The whole question is whether the right of the wife as against her husband
to remain in actual occupation of the matrimonial home is an overriding
interest for the purposes of section 70 (1) (g). Having analysed fully the
nature of this right it seems to me clear that such a right cannot possibly
be elevated to the status of an overriding interest for the purposes of the
section.
I find myself in complete agreement with the observations of Russell L.J.
set out in the opinions of my noble and learned friends, Lord Hodson and
Lord Cohen, and I do not think it is necessary to add anything further.
My Lords, when differing as I do with regret from so eminent a judge
as the Master of the Rolls I think it is important to see how this problem
has been dealt with in other comparable jurisdictions.
Both in Australia and New Zealand there has been a refusal to recognise
that the deserted wife has any equity available against third parties. In
Brennan v. Thomas 1953 V.L.R. III Sholl J. sitting in the Supreme Court
of Victoria after an exhaustive review of the authorities including Bendall
v. McWhirter then recently decided in the Court of Appeal refused to
recognise any right, on the part of the wife available against purchasers for
value.
In Public Trustee v. Kirkham 1956 V.L.R. 64 sitting in the same court
Herring C. J. criticised the doctrine.
In Maio v. Piro 1956 S.A.S.R. 233 Ligertwood J. sitting in the Supreme
Court of South Australia followed Sholl J. in preference to the English
decisions.
Finally in Dickson v. McWhinnie 1958 S.R.N.S.W. 179 the Full Court of
New South Wales sitting in bane refused to follow Bendall v. McWhirter
save in relation to bankruptcy. I derive much comfort from such a strong
body of opinion in favour of the view I have expressed.
In conclusion, my Lords, I would like to express my concurrence with
the opinion expressed by Lord Cohen at the conclusion of his opinion
that it is desirable that the recommendations of the Royal Commission on
this subject should receive some further consideration.
I would allow this appeal.
Webb v. Ireland
[1987] IESC 2; [1988] IR 353; [1988] ILRM 565
Finlay CJ
14. Having reached the conclusion as a matter of law that the State was estopped from challenging the title of the plaintiffs to the hoard because it was placed estopped with them and accepted on a bailment, the learned trial judge did not find it necessary to decide the question of the right or title of the landowners to the hoard. He expressed his opinion that the action was not an action concerned with the ownership of the hoard but was an action between a bailor and a bailee and the sole issue was whether the plaintiffs as bailors were entitled to the return of the hoard from the State. The action, he stated, is not concerned with the ownership of the hoard and will not determine its ownership.
15. The first issue which falls to be determined on this appeal, from a logical point of view, is the question as to whether, assuming that the hoard was received by the National Museum as agent for the State in the capacity of a bailee, there must be an implied term in that bailment that the plaintiffs as bailors had a good title to the goods. The decision of the High Court was based on the decision of the Court of Appeal in Rogers Sons & Co v. Lambert & Co [1891] 1 QB 318
16. I have considered that decision and I have come to the conclusion that on the facts of this case there can not be implied into the arrangements between the plaintiffs and the defendant, surrounding the deposit of the hoard with the Museum, any term establishing a title in the plaintiffs to the hoard. The terms under which the hoard was deposited are clearly set out in the letter written by the solicitors for the plaintiffs which was brought to the director of the Museum at the same time as the articles were. The reference in that letter, which I have already quoted in full, to deliver these articles to your care for the present and pending determination of the legal ownership (emphasis added) is, in my opinion, wholly inconsistent with implying into any bailment arising from that delivery an acknowledgment or admission of the plaintiffs’ title to the goods. Whilst, therefore, I would accept as a general proposition of law that bailment involves an implied term as to the title of the bailor of the goods, it can only do so to the extent and in the instances where such an implied term is not by the express terms of the bailment excluded. I am satisfied that this case is one in which such an implied term is by the express terms of the letter excluded from the bailment.
17. It is next necessary to consider the issue as to whether even assuming that the title of the plaintiffs to the goods is not an implied term in this bailment, the State is by reason of the bailment estopped from asserting its own title to the goods which it claims it derived from the landowners, O’Brien and O’Leary.
18. The decision of the learned trial judge in this context was again based largely on the decision in Rogers Sons & Co v. Lambert & Co and also in Biddle v. Bond (1865) 6 B & S 225 which is cited with approval in that case. There can be no doubt that Rogers Sons & Co v. Lambert & Co is a clear authority for the proposition that if a bailee seeks to refuse the return of goods, asserting the right of a third party to the possession and ownership of them, that he can only do so expressly on behalf of and with the authority of the third party, and that having asserted such a right he must prove it. The decision, however, does not appear to me to exclude or indeed to deal at all with the situation where a bailee asserts not the right of a third party to the goods but his own title to them, even if it has been acquired subsequent to the original bailment. The facts of Rogers Sons & Co v. Lambert & Co where the plaintiffs had purchased copper from the defendants and paid for it and whereby the defendants expressly undertook to warehouse the copper and upon payment of the proper warehousing charges to deliver it to the plaintiffs or their order, made it, of course, quite unnecessary to consider any assertion by the defendants of a title in themselves to the copper. In considering the nature of jus tertii which can be asserted by a bailee Lopes LJ at p. 328 of the report quotes with approval from the decision in Biddle v. Bond where Blackburn J delivering the judgment of the Court of the Queen’s Bench said:-
19. We think that the true ground on which a bailee may set up the jus tertii is that indicated in Shelbury v. Scotsford, viz., that the estoppel ceases when the bailment on which it is founded is determined by what is equivalent to an eviction by title paramount.
20. In my view, the true legal position which arises where a bailee asserts and establishes a title in himself to the goods is that he establishes the termination of the bailment and that by reason of that termination any estoppel which would otherwise arise between a bailee and a bailor ceases to operate. Such a view of the law appears to be logical and, in my view, appears also to yield a just result for there could be significant injustice if a bailee having lawfully and properly acquired a title to the goods which had been bailed with him were obliged to return them to the bailor by virtue of an estoppel and presumably left to the remedy of a subsequent second action for the delivery back of the goods to himself again. I, therefore, conclude that it is necessary in this appeal to determine the question as to whether by virtue of the contracts and conveyances made between the State acting through the Minister for Education and the owners of the land the State had, by the time of the institution of these proceedings acquired a title to these articles as against the plaintiffs.
21. The defendants assert a title to the goods derived through the landowners, Messrs. O’Brien and O’Leary, on two separate grounds. Firstly, they allege that the landowner had
Walsh J
Walsh J .
84. The facts of this case have been so fully set out in the judgment which has just been delivered by the Chief Justice that I do not find it necessary to repeat any of them.
85. The Chief Justice has set out in five paragraphs the conclusions of the learned High Court judge. The sequence is not exactly the same as that of the High Court judge in his own judgment but I propose to deal with the matters in the order which has been followed by the Chief Justice.
86. The defence raised in the High Court by the defendants was to rely upon the claim that the former royal prerogative in relation to treasure trove was still applicable in the sense that it was claimed that the State was the successor in title of such prerogative. The claim which the State made to the ownership of the chattels in question was founded on that assertion and was to the effect that it superseded any claim of right of the plaintiffs. For the reasons given by the Chief Justice in the course of his judgment I am of the opinion that this claim by the defendants based on succession to the royal prerogative was rightly rejected by the learned High Court judge and that it cannot be sustained in this or any court. If the State has a rightful claim then it must be found elsewhere. That is a matter to which I shall return later in this judgment. However, so far as the High Court is concerned once the learned High Court judge has reached his decision to reject the State’s claim to a royal prerogative the question of bailment became of great importance. The claim of the museum authorities, voiced through the State, to retain the articles in question notwithstanding that they were bailees of the objects had to be rejected as the claim was based, and apparently solely based, upon the title claimed through the royal prerogative. I agree with the view expressed by the learned High Court judge that all other things being equal, a bailee is not entitled to challenge the title of the bailor.
87. In this case the chattels were left with the museum authorities, as a State agency, and they were left with them for safe keeping pending the outcome of any determination of legal ownership. The bailment was a gratuitous bailment which conferred no rights upon the bailee as such even though it may have imposed certain liabilities. This case is not concerned with that latter aspect of bailment. A gratuitous bailee is precluded from using a chattel bailed in any manner whatever without the express and complete consent of the bailor, unless such use is needful for its preservation. The chattels were not bailed to the bailee for the purpose of being used for any certain time, or at all, but solely for safe keeping pending the outcome of the establishment of legal title. Being a gratuitous bailment it was open at any time to the bailor, in this case the respondents, to call for the return of the article. Other things being equal the bailee could not legally refuse to return them. The objects were bailed to the museum authorities as agents of the appellants and they were not received by the museum authorities as stakeholders or in any similar capacity.
88. In this case, the bailee’s principal, namely the State, asserted a title based on the alleged succession to the royal prerogative of treasure trove. That being the case, then the judge, in my view, was perfectly correct in holding that as the claim to title set up by the bailee in the defence to the claim for return of the goods could not be sustained he was obliged to order the return of the goods to the bailor without determining the title of the bailors. I am of opinion that the use of the words ‘pending determination of the legal ownership’ adds nothing to the matter once the bailees have failed, or their principles have failed, to establish the title which they asserted. It is also my opinion that if a claim for the return had been made before, and without waiting for the title to be established, the bailees would have no legal answer to the claim to return the goods on demand having regard the nature of the bailment unless they were able to establish a claim of title on behalf of themselves or their principals. This they failed to do. This aspect of the case does not concern any claim by a third party because the bailees were quite clearly acknowledged to be and were treated as agents of the appellants. At no time did the bailees, namely the National Museum authorities, assert a claim on behalf of any part other than the State. Obviously if the bailee can establish a title for himself or for his principals he has ousted the title of the bailor and the matter ceases to be one of bailment. However, that is not what happened in the present case.
89. But in so far as the learned High Court judge held that the bailees could not avail of a title to the goods acquired after the bailment, it appears to me that he was not correct.
90. The second ground of defence which was offered by the appellants in the High Court was that if they did not have a right to the title before the bailment, they did acquire the title by assignment from those who had it before it was sought to determine the bailment. This post bailment title, which is asserted, is claimed to be derived from the owners of the lands in which the chattels were found, namely Messrs O’Brien and O’Leary. The landowners had by an agreement, for consideration of £25,000 to each of them, assigned to the State all their title to the chattels found. Naturally, this was only effective to pass title if they had any title.
91. This claim is based on the argument that the owner of the fee simple of the land is entitled to any chattel which may be on the land against any finder of the chattel upon the land. There is legal authority for such proposition and, also, there is legal authority to distinguish between a claim which the owner of land may assert in respect of objects found upon this land as from those which are found in or under the land surface. The Chief Justice in his judgment has referred in some detail to the legal authorities in question and has analysed them.
92. These cases reflect that the importance which appears to have been attached to the ownership of lands was such as to denigrate, if not obliterate, the true title claimed in respect of the chattels themselves.
93. I think it is true to say that there is no such thing as a chattel which has never had an owner. In this particular case the judge found as a fact that the chattels had been placed in or on the land for safe keeping. I say in or on the land because I have regard to the number of centuries that has elapsed which makes it difficult to say whether the initial hiding place was beneath the surface of the soil or simply achieved that situation through the course of time. On the view I take of this case it is not necessary for me to decide whether some distinction should be drawn between the chattels found upon the land and those found in land or under land. Leaving aside any question which might arise under the Statute of Limitations, 1957, which was not relied upon in this case, it cannot be asserted that these articles were abandoned in the sense that ownership had been abandoned. If chattels are expressly or by implication abandoned in favour of a particular and ascertainable person or persons then the chattels become the property of that person or those persons if they accept them. If they do not accept them then the chattels have no particular owner. Articles cannot be regarded as lost if they are intentionally placed in a particular situation. In my opinion it would be a great injustice if the true owner of the chattels, having intentionally placed them in a particular place for safe keeping and then cannot recall where he placed them, or where he did not have an opportunity to come back to recover them, should be deemed to have lost his title in favour of the owner of the lands in which he placed them. Strictly speaking nothing can be said to be lost in the literal sense if it continues to exist even though its owner may be unknown or because it has been unknowingly misplaced. Notwithstanding the number and the weight of the authorities cited it is my opinion that the owner of the land upon which mislaid or unremembered chattels are intentionally placed for safe keeping, whether in or under the surface, cannot claim to be the owner of the chattels simply by reason of his being the owner of the land. To so hold would be fail to vindicate the rights of property of the true owners of the chattels so placed and would permit the type of injustice which Article 40.3 of the Constitution is designed to prevent. The owner of such land is to be deemed to be in bare possession of the chattels even if he does not know of their existence on his lands. He can assert a good claim to possession, as distinct from ownership, against any claimant whether it be trespasser, or otherwise, whose claim is based on simply unearthing and removing the chattels in question. Even the former royal prerogative of treasure trove acknowledged that in so far as treasure trove was concerned the true owner, or his successors in title, could always claim ownership and possession of the treasure if he could establish title.