Module 3.3: Man-Made Attachments

Question 1

Fixtures

Answer 1

Fixtures are man-made attachments that were once personal property, but have since become attached to the land and are now presumed to be real property

Question 2

T/F: Fixtures transfer with the land when it’s conveyed, even if they aren’t specifically mentioned in the purchase agreement or deed.

Answer 2

True

Question 3

CA’s statutory fixture test AKA method of attachment test

Answer 3

whether an item has been permanently attached to land, and is thus a fixture, depends on how it is attached

Question 4

An item is permanently attached when it is:

Answer 4

• attached to the land by roots (as with trees, shrubs, and vines),
• embedded in the earth (like foundation walls, septic tanks, or sprinkler systems),
  permanently resting on the land (as with houses, gazebos, or barns), or
• attached by any enduring method (such as with cement, plaster, nails, bolts, or screws)

Question 5

actual annexation

Answer 5

physical attachment

Question 6

T/F: Physical attachment is absolutely necessary for an item to qualify as a fixture

Answer 6

False

The force of gravity, for example, may be sufficient to render a theoretically moveable item immovable.

Question 7

Ex Gazebo:
large, prefabricated gazebo on their property.
The gazebo was brought in on a flatbed truck and now rests on cinderblocks.

T/F: the gazebo probably is a fixture

Even though it is not permanently or physically attached to the property, the gazebo would probably be considered annexed to the property, and would be a fixture

Answer 7

True
Even though it is not permanently or physically attached to the property, the gazebo would probably be considered annexed to the property, and would be a fixture

Question 8

T/F: If removing an item of personal property would result in damage to the item or property, it may also be considered a fixture

Answer 8

True

Question 9

T/F: keys to a house’s front door = a fixture

Answer 9

True

Question 10

T/F: Some small items are completely moveable, but they may still be considered fixtures if they are important to the real estate itself.

Answer 10

True

Question 11

the Doctrine of _____ states that an item may be so strongly connected with the property that it will be considered a fixture, even though it’s not actually attached

Answer 11

constructive annexation

Question 12

This fixture test examines whether an annexor’s actions showed the intent to make an item part of the real property

Answer 12

If an annexor intended an item to become part of the realty, under the intention of annexor test, it will be considered real property

Question 13

T/F: Church pews may be specifically adapted to realty

Answer 13

True

Question 14

T/F: Trade fixtures may be removed by the tenant unless there is a specific lease provision to the contrary

Answer 14

True

*The tenant is responsible for restoring the property to its original condition

Question 15

T/F: Certain farming equipment and items, such as small tool sheds or prefabricated henhouses, are called agricultural fixtures and may be removed by the tenant farmers when they leave the property

Answer 15

True

Question 16

T/F: the parties’ contractual agreement overries any consideration of intent or adaptation to the realty

Answer 16

true

Question 17

EX:
A lease stated that all fixtures installed in a restaurant became part of the real property and belonged to the landlord at the end of the lease. Cal-Pacific had an unrecorded security instrument in the restaurant equipment, however, and argued that, as trade fixtures, the items belonged to the tenant.

Did the court decide the items belonged to the landlord or the tenant?

Answer 17

The court held that a contractual agreement between the parties takes precedence over general landlord-tenant law, so the usual rules about trade fixtures could be changed by written agreement.

Bridges v. Cal-Pacific Leasing Co. (1971) 16 Cal.App.3d 118.

Question 18

Secured financing

Answer 18

refers to an arrangement in which personal property or fixtures are used to secure a loan or line of credit

Question 19

Secured transactions are governed by Article ___ of the Uniform Commercial Code (UCC)

Answer 19

9

Question 20

When secured financing is used, the loan terms are specified in a

Answer 20

security agreement

Question 21

financing statement

Answer 21

gives all future buyers constructive notice of a security interest in the fixture

Question 22

____ records a financing statement when secured financing is used

Answer 22

lender

Question 23

T/F: The financing statement, when properly recorded, trumps the usual rules regarding fixtures

Answer 23

True

Question 24

T/F: If a default occurs and the property is sold, items subject to the security agreement can be repossessed by the holder of the security interest—even if the items would normally be considered fixtures

Answer 24

True

Question 25

T/F: Mobile homes may also be classified as either a fixture or as personal propert

Answer 25

True

Question 26

T/F: A mobile home that is personal property may only be sold by a licensed mobile home dealer (not a real estate agent)

Answer 26

True

**one exception

Question 27

T/F:a mobile home that is a fixture will be subject to real estate license law requirements and will be taxed as part of the real property.

Answer 27

True

Question 28

Whether a mobile home is a fixture or personal property depends on whether or not it has been affixed to the real property. State law says that attachment of a mobile home to a foundation is not enough to show affixation.

Instead, affixation requires the owner to:

Answer 28

(1) obtain a certificate of occupancy, and
(2) obtain a building permit that shows:
- written evidence of ownership of the underlying land, or proof of a lease for more than 35 years (although certain other leases may qualify);
- proof that there are no liens against the mobile home, or that if there are, that the lienholders consent to the attachment to real property; and
- plans and specifications by the mobile home manufacturer or signed by a licensed California architect, that detail the installation of the individual mobile home.

Question 29

Affixation status is permanent as of ___

Answer 29

the day the certificate of occupancy permit is issued.

Question 30

The affixation must be recorded in the county where

Answer 30

the real property is located

Question 31

Once a mobile home is installed as a fixture, the owner can’t remove it without:

providing proof of consent of all parties with an interest in the real property.

Answer 31

1) giving the Department of Housing and Community Development and the county assessor 30 days’ notice of intent to remove, and
2) providing proof of consent of all parties with an interest in the real property.

Question 32

SUMMARY: Fixtures

Answer 32

Fixtures are man-made attachments that were once personal property, but are now attached to the real estate in such a way that they are considered part of the real property and transfer automatically upon conveyance of the land.

Question 33

SUMMARY: The method of attachment test

Answer 33

The method of attachment test is a statutory test under which an item of moveable or personal property becomes part of the real estate once it is permanently attached to the land.

Question 34

SUMMARY: doctrine of constructive annexation

Answer 34

Under the doctrine of constructive annexation, a completely moveable item may be regarded as so strongly connected with the property that it is considered a fixture, even though it is not actually attached to the realty.

Question 35

SUMMARY: Trade fixtures

Answer 35

Items of personal property installed by a tenant for use in a trade or business, which usually may be removed at the end of the lease term.

Question 36

QUIZ: In this fixture test, a court will inquire into whether an item is embedded in the earth or rests permanently on the ground.

Answer 36

The method of attachment test states that an item becomes part of the real estate when it is permanently attached to the land by an enduring method.

Question 37

QUIZ: This doctrine states that an item may be so strongly connected with the property that it will be considered a fixture, even though it’s not actually attached.

Answer 37

Constructive annexation states that an item, such as a house’s front door key, may be considered a fixture even if it isn’t truly attached

Question 38

QUIZ: This fixture test examines whether an annexor’s actions showed the intent to make an item part of the real property.

Answer 38

If an annexor intended an item to become part of the realty, under the intention of annexor test, it will be considered real property

Question 39

QUIZ: Under this fixture test, an item that was specifically designed for a property is considered real property.

Answer 39

The adaptation to realty test considers an item a fixture if it was specifically designed for the property or is integral to the property’s use.

Question 40

QUIZ: This fixture test might examine whether the item was installed by a landlord or a tenant.

Answer 40

The relationship of the parties fixture test will usually assume that items installed by a tenant are personal property, while items installed by an owner are real property.

Question 41

QUIZ: This type of item may usually be removed by a commercial tenant at the end of the lease term, unless there is an agreement to the contrary.

Answer 41

A trade fixture is an item installed by a commercial tenant that is integral to the tenant’s use of the space. It may be removed by the tenant at the end of the lease term.

Question 42

QUIZ: The presence of ____ will control whether an item is real or personal property, regardless of any fixture test.

Answer 42

Contractual agreement
If the parties decide in writing how a particular item will be treated, that will control, regardless of how any fixture test might treat the item.

Question 43

QUIZ: For ____ to become real property, the owner must obtain a certificate of occupancy and a building permit.

Answer 43

Attaching a mobile home to a foundation is not adequate for it to become real property. The owner must obtain a certificate of occupancy and building permit.

Question 44

QUIZ: T/F: An appurtenance is any right, privilege, or improvement associated with a piece of real property

Answer 44

Appurtenances are rights (such as the right to use air or water) that automatically transfer with the property.