Business Implications of Land Law - Assignment Example

Land Law – Advice One of the first things to consider in this instance is who is to clean the rubbish. The Council will not, because this is private land and public health and safety is not critically affected. The Environmental Protection Act of 1990 states that “it shall be the duty of any person who imports, produces, carries, keeps, treats or disposes of controlled waste…………. to prevent the escape of the waste from his control.”1 This is a duty imposed upon all businesses and the Act holds organizations responsible if they fail to properly dispose of waste. Where contracts for transfer of a business property are concerned, one of the elements that may need to be specially negotiated includes removal of rubbish It may be necessary to include a special provision in the contract requiring the seller to remove all rubbish from the property prior to the completion of the sale.2 In general, a buyer also has the right to inspect the property thoroughly before the sale and if the Company had carried out such an inspection of the property, they would have been able to find the rubbish and require that it be disposed of before the sale was concluded. It is the buyer’s duty to carry out such an inspection and since the Company has chosen to purchase the property without carrying out such a thorough inspection of the premises before the sale was concluded, it may not have much legal recourse to file for any breach of contractual conditions, since the condition for removing of waste and transfer of the property sans rubbish was never set out among the contractual terms. The Company’s legal options are not so good once the sale has been concluded and the property has passed into its hands. Since it has not included any provision for clearing up of the rubbish in the contract and the sale has already been concluded, the disposal of the rubbish may be held to be the responsibility of the Company, because it is the new owner of the property. Although the Company will have to incur a cost of 5000 pounds for removal of the wastes, it appears likely that if the matter is taken to the Courts, the principle of caveat emptor or Buyer Beware will apply. As a result, the stage at which the Company stands is one where it may be held to be the owner of the property and therefore responsible for clearing the rubbish according to the guidelines laid out in the Environmental Act of 1990. The sliding doors could possibly be recovered if it can be proved that they were fixtures to the property rather than chattel. Fixtures will accede to the property when it is conveyed, but chattel will not and can be removed. The decision rendered in the case of Holland v Hodgson3 supported the legal maxim that what is annexed to the land becomes part of the land. It was also held that in determining if something is a fixture, it is necessary to examine (a) the degree of annexation of the object to the land and (b) the object of the annexation.4 An article resting on the land by its own weight may not be a fixture5, as also held in the case of Hulme v Bingham6, where heavy machinery was not held to be a part of the property. When an article has been attached loosely rather than fixed to the walls and can be removed easily, this may classify it as chattel rather than a fixture. This was the case in Leigh v Taylor7 where valuable tapestries had been attached to the wall and were removed, but this was done in such a way that no damage was caused. Gray and Gray have however argued that recent case law has suggested that the Courts have moved away from this earlier position8 of looking only at the extent to which the article is fixed to the property and its purpose. In the case of Elitestone Ltd v Morris9, the House of Lords refined the principle of annexation further in determining whether an article is a fixture or chattel. In this case, it was held that what is to be determined is whether the article has been set up for the purpose of enjoying it better as a chattel or whether it has been attached in order to bring about a permanent improvement to the property. On this basis, the House of Lords held that it must be determined whether an article can be said to be a part and parcel of the property, in which case it will qualify as a fixture that cannot be removed, even if it is removable without damage. Two of the additional factors taken into consideration by the House of Lords in this case were how easily the article could be restored using its constituent parts and how permanent was its attachment to the property10. In this instance, the object at dispute is the sliding doors at the factory, which have been replaced by a cheaper hinged door. In the case of D’Eyncourt v Gregory11 the article in dispute was again tapestries attached to the wall. But the manner of fixing in this case was such that it was deemed to be permanent and therefore, the Court held that the fixtures were intended to become a part and parcel of the property. In TSB v Botham12, the Court of Appeal held that bathroom fittings, fitted cupboards in the kitchen, fitted sink and work surfaces were all fixtures, but fitted carpets, blinds and curtains could be removed because they had been attached in an insubstantial way. White goods were held to be chattel because the degree of annexation was slight and they could be removed without damage to the fabric of the building and without any difficulty. Applying the precedents in the above cases to the sliding doors, where the question of annexation is concerned, the sliding doors are removable without damage to the fabric of the building. The object of annexation is to function as protection for the items placed inside the warehouse and the removal of the sliding door has not interfered with this object of annexation, because the items in the warehouse are still protected through the use of the other door. The most important factor is that the sliding doors are a trade fixture and trade fixtures are removable. In Mancetter Developments v Garmanson Ltd13 tenants were allowed to remove an extractor fan because even when applying the rules set out above, an object may be deemed a fixture, the law allows tenants of business premises to remove them. In Young v Dalgety plc14 tenants were allowed to remove light fittings. The sliding doors may also fall under the category of decorative or ornamental fixtures, which can always be removed by the tenant while vacating, subject to how they have been attached. If an item can be removed without substantial damage to the building, it will be viewed as chattel. For example, in the case of Spyer v Phillipson15 valuable antique wood paneling was held to be chattel, and therefore removable. Applying the case precedents listed above, it appears likely that the sliding doors may be held to be chattel and therefore removable. Where a sale of land has taken place, it has been held in the case of Taylor v Hamer16 that a fixture passes with the land unless the seller tells the purchaser that the things are going to be removed. Where the sliding doors are concerned, there are two factors working against the company in recovering the sliding doors. Despite the fact that all items on the property pass with the sale, the sliding doors are not fixed to the warehouse in such a manner that removing them would cause destruction to the property. Secondly, they are trade fixtures, which can always be removed. Where the fire alarm is concerned however, the Courts may find it to be a fixture rather than chattel. Applying the criterion set out in the case of Elitestone v Morris17, the purpose of the article needs to be considered. Has it been affixed for enjoyment as a chattel or to bring about a permanent improvement to the property? In the case of Re Whaley18, tapestries and portraits were held to be a part of the general architectural design of the property and therefore held to be fixtures. But in the case of Berkeley v Poulett19 where a sale of the property had taken place and seller had removed several objects, the Court held such objects to be chattel rather than fixtures because they were not intended to be enjoyed as objects and not intended to form part of the architectural design of the property. The objects removed by the Seller included statutes, a sundial and some pictures fitted into abscesses into the wall. While the sliding doors may be held to be chattel as detailed earlier, the fire alarm may be held to be a fixture. At the outset, applying the annexation test, it is wired and built into the warehouse. Secondly, its purpose is one of utility, i.e., to detect and broadcast any presence of fire. As specified by Lord Scarman in the case of Berkeley v Poulett20 the object and purpose of annexation is more important than the degree of annexation to the property. Even assuming the fire alarm is removable without causing damage to the property, the purpose served by the object is one integral to the property. If it was installed in the warehouse, the purpose of the alarm was obviously to serve as a protective device ensuring the safety of the warehouse. Removing the object thus deprives the structure of a vital element. It is also possible that dismantling the fire alarm may have involved some structural damage to the ceiling or wiring of the property. On this basis, the alarm would qualify as a fixture rather than chattel. It appears likely that the Company may be able to successfully argue to have it replaced by the Seller, on the grounds that the alarm constitutes part and parcel of the property. The alarm could be considered part of the architectural design of the property as set put in Re Whaley21 or determined to be installed for improvement of the property, as in D’ynCourt v Gregory.22 The conclusions on the issues raised would thus be as follows: (a) Rubbish left on land: The Company’s legal options for any recovery from the Seller are limited. It may be necessary for the Company to arrange for proper disposal of the waste through appropriate sources and pay the necessary fee for the same. (b) expensive sliding doors – the Company’s chances to reclaim these doors through legal action appears limited, because it may not be held to be a fixture. (c) fire alarm – there is a good chance for the Company to receive this back from the Seller, on the grounds that it is part and parcel of the property. Bibliography * Cragg, Braye, 2008. “Buying a residential property”, http://www.brayecragg.com.au/templates/brayecragg_content.aspx?pageID=4905; * Gray, Kevin and Gray, Susan Francis, 2006. “Land Law”, Oxford University Press. * Kirtlan, Yvonne, 1997. “Land, fixture or chattel?” Estates Gazette, 14 July at pp 121 * Section 34(1)(b) of the Act. http://www.opsi.gov.uk/acts/acts1990/ukpga_19900043_en_5#pt2-pb3-l1g34; Cases cited: * Berkeley v Poulett (1976) 241 EG 911 * D’eyncourt v Gregory (1866) LR 3 Eq 382 * Elitestone Ltd v Morris (1997) 1 WLR 687, HL * Holland v Hodgson (1872) LR 7 CP 328 * Holland v Hodgson, Op. Cit. * Hamp v Bygrave (1983) 266 EG 720 * Hulme v Bingham (1943) KB 152 * Leigh v Taylor (1902) AC 157 at 162 * Mancetter Developments v Garmanson Ltd (1986) QB 1212 * Re Whaley (1908) 1 Ch 615 * Spyer v Phillipson (1929) 2 Ch 183 * Taylor v Hamer (2002) EWCA Civ 1130 * TSB v Botham (1996) EGCS 149 * Young v Dalgety plc (1987) 1 EGLR 116 Read More