When buying and selling property, it is important to understand the difference between chattels & fixtures so everyone understands what is included as part of the transaction.
In this article, we'll delve into the concepts of chattels and fixtures, their significance in Queensland residential contracts, and how they affect property transactions.
1. Defining Chattels and Fixtures
Chattels and fixtures are terms used to classify different types of property items. These categories help identify whether an item is considered part of the real property or are otherwise personal property. In Queensland, the legal distinction between chattels and fixtures can be critical in defining what is included or excluded from the property sale.
Chattels
Chattels refer to movable and personal items that are not physically attached to the property in a permanent way. They are typically items that can be easily removed without causing any damage to the property. Chattels might include furniture, appliances, garden tools, rugs, and other loose items that can be taken away when the property changes ownership.
Fixtures
Fixtures are items that are permanently attached or affixed to the property in a way that they become part of it. These items are considered to be an integral part of the property and cannot be removed without causing damage or alteration. Fixtures might include built-in cabinets, light fixtures, ceiling fans, built-in appliances, solar panels, and even certain landscaping elements.
Common "Grey Areas"
Curtains: If the curtain rail is sitting on hooks, it is generally considered a chattel as the curtain and rail are not fixed. However, the hooks are fixed and would be considered a fixture;
Air Conditioning: Generally a fixture as the piping is usually fixed to the dwelling;
Dishwasher: If the dishwasher is built in, it is generally considered a fixture;
Pool Equipment: These items are nearly always considered chattels (e.g. net and pole, robotic pool cleaner).
If a Buyer wants to include any chattels as part of the sale, ensure these are added in the "included chattels" section of the contract of sale.
2. Importance in Queensland Conveyancing
The distinction between chattels and fixtures plays a crucial role in property transactions. When a property is being sold, the parties need to agree on what is included in the sale. The contract of sale should clearly specify which items will remain with the property and which items are chattels and will be taken by the Seller.
Failure to properly identify and distinguish between chattels and fixtures can lead to legal disputes, costly legal complications, and settlement delays.
It is also important to remember that if a fixture is specifically excluded in the contract (e.g. a wall-mounted TV bracket) the Seller must repair any damage caused by removing said fixture. In the example of a wall-mounted TV bracket example, this might include patching any holes in the wall or repainting.
3. Chattels and Fixtures in the Contract of Sale
To avoid any ambiguity and potential conflicts, the contract of sale must have a clear and detailed list of chattels and fixtures. The list should specify the items included in the sale, their condition, and any relevant warranties or guarantees.
A practice we often see is a list of chattels as an annexure to the contract, which provides a comprehensive inventory of items.
We always recommend that the Buyer also undertake a pre-settlement inspection of the property to ensure that they are satisfied with any included chattels before proceeding to settlement.
4. Resolving Disputes
Despite clear provisions in the contract, disputes over chattels and fixtures can still arise. If a disagreement occurs between the parties, negotiation and communication are crucial to finding a resolution.
Determining whether an item is a chattel or fixture can sometimes be problematic. In this instance, the outcome is determined according to a legal principle known as the doctrine of fixtures. Under this doctrine, two tests are applied:
The degree of annexation; and
The object of annexation.
Degree of Annexation
This refers to how the item is attached to the property. A fixture is typically attached to the property in some permanent way by any means other than its own weight (e.g. screws, bolts, glue), whereas a chattel can be easily moved.
If removing the item from the property would result in damage to either the property or the item itself, it is generally considered a fixture.
Object of Annexation
This refers to what the item is and why it was attached. In a dispute, the courts will examine a range of factors. These might include:
whether the item was intended to be in its position permanently or temporarily;
whether it was attached for the enjoyment of the item itself (e.g. fabric curtains), or for the enjoyment of the property (e.g. ceiling fans);
whether the item has been customised in any way to fit the property (e.g. built-in cabinetry or furniture items).
This list is not exhaustive, and any legal dispute will have its own unique considerations that a court must consider.
By engaging an experienced lawyer for your property transaction, they can ensure your rights and obligations are being protected and met throughout the process, and can provide further advice in more complex matters.
Conclusion
Understanding which items are considered part of the property and which can be removed is crucial for both buyers and sellers. A comprehensive contract of sale that clearly identifies the included chattels and fixtures can help prevent disputes and ensure a smooth property transaction.
As always, seeking professional advice from a qualified conveyancer or solicitor can provide the necessary guidance to navigate the complexities of chattels and fixtures in Queensland property transactions. With proper understanding and clear communication, buyers and sellers can embark on their property journey with confidence and peace of mind.
If you have any questions or want to ensure your draft contract properly addresses fixtures and chattels, consider having our experienced property lawyers undertake a Contract Review before signing.
Disclaimer: This publication is not intended to be comprehensive, nor does it constitute legal advice. We are unable to ensure the information is current and there is no guarantee in relation to accuracy. You should seek legal or other professional advice before acting or relying on any of the content of this publication. The views and/or opinions expressed in this publication is that of the author and may not necessarily represent the views and/or opinions of RHC Solicitors.
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