Elitestone Ltd v Morris

Whether an object placed on land becomes part of the land depends principally on the degree and objective purpose of its annexation. The parties’ subjective intentions, agreements or beliefs cannot determine its legal character.

A dwelling constructed so that it can be enjoyed only in situ and cannot be removed or re-erected elsewhere without demolition is part of the realty, even though it rests on the ground solely by its own weight. The law distinguishes accession from removability: an object may become part of the realty while remaining removable by a tenant under the separate rules governing tenants’ fixtures.

The freeholder sought possession of land occupied by Mr Morris, who lived in a wooden bungalow resting by its own weight on concrete pillars. He claimed a year-to-year tenancy of the bungalow and the protection of the Rent Act 1977.

The assistant recorder held that the bungalow formed part of the realty and granted the declaration sought. The Court of Appeal reversed that decision in Court of Appeal (Civil Division) Transcript No. 1025 of 1995, reasoning that the bungalow had not been attached to the land and remained a chattel. The sole issue before the House was whether the bungalow had become part of the land or had remained a chattel.

1. Appeal allowed unanimously. Lord Lloyd of Berwick and Lord Clyde delivered substantive speeches. Lord Browne-Wilkinson, Lord Nolan and Lord Nicholls of Birkenhead agreed with both. The order of the assistant recorder was restored.

2. Per Lord Lloyd, the legal classification is not confined to a choice between chattels and fixtures. An object brought onto land may remain a chattel, become a fixture, or become part and parcel of the land itself. Both latter categories form part of the land. The question depends on all the circumstances, principally the degree of annexation and its object.

3. Per Lord Lloyd, a house designed to be removable as a unit or in sections may remain a chattel. A house which cannot be removed except by destruction cannot have been intended to retain that character. Its construction shows objectively that it was intended to form part of the realty. The bungalow could not be dismantled and re-erected elsewhere. Its lack of attachment to the soil, apart from gravity, was therefore immaterial.

4. Per Lord Clyde, accession may occur without a physical bond. The relevant intention is objective and is better understood as the purpose served by the object. The court considers whether it serves the use and enjoyment of the land or the more convenient enjoyment of the object itself. The parties’ beliefs, motives and arrangements cannot control the operation of the law.

5. Per Lord Clyde, the bungalow belonged to the genus of dwelling-houses, which are ordinarily real property. Its residential purpose, long-term character and inability to be removed and reconstructed elsewhere supplied powerful indications of permanence and accession.

6. Per Lord Lloyd and Lord Clyde, accession must be distinguished from removability. A tenant’s fixture has become part of the realty, although a separate rule may permit the tenant to sever it. Webb v Frank Bevis Ltd [1940] 1 All ER 247 therefore did not support treating the bungalow as a chattel. Deen v Andrews [1986] 1 EGLR 262 was materially different because its greenhouse was demountable.

7. Per Lord Lloyd, Melluish v BMI (No 3) Ltd [1996] AC 454 established that an agreement cannot prevent an attached chattel becoming part of the land. A common assumption or estoppel could have no greater effect. The bungalow was part of the realty and was included in Mr Morris’s tenancy.

1. House of Lords: The appeal was allowed unanimously and the assistant recorder’s order relating to Unit 6 was restored.

2. Court of Appeal: In an unreported decision dated 28 July 1995, Court of Appeal (Civil Division) Transcript No. 1025 of 1995, the court reversed the assistant recorder. It held that the bungalow remained a chattel and was not included in the tenancy.

3. Swansea County Court: The assistant recorder held that the bungalow had become part of the realty. Mr Morris was consequently entitled to a declaration that his residential tenancy attracted the protection of the Rent Act 1977.