Fixtures v. Chattels – What is the Difference?
This blog post explores the nebulous world of fixtures v. chattels. While there are some bright lines in the law, this remains a grey-area for many property transactions and is fraught with disagreement over interpretation. Often, the sellers’ and buyer’s realtors will lead the negotiations concerning what fixtures are excluded and what chattels are included in the transaction.
On that point, it is very important to keep in mind that the Agreement of Purchase and Sale governs the deal – to the extent that it remains silent on fixtures and chattels, this is where the grey areas arise. The default rule in the APS is that fixtures are included unless specifically excluded, and chattels are excluded unless specifically included.
There are two presumptions in law that helps to categorize property as a chattel or a fixture:
Presumption of a Fixture: The general rule is that a thing that is affixed to the real estate will be presumed to be a fixture, unless the evidence shows it is affixed for the purpose of making better use of it as a chattel as opposed to being an integrated part of the property as a whole. Common examples of fixtures include stoves, dishwashers, fridges, washer & dryer and light fixtures.
Presumption of a Chattel: The general rule is that a thing that is not fixed to real estate will be presumed to be a chattel unless the evidence shows that its presence on the property is intended to make it an integral part or an enhancement of the property as a whole. Common examples of chattels include home theatre systems, living room furniture and bedroom furniture just to name a few.
While these are the ‘bright lines’, let’s look at some real world examples from a recent client of ours:
1. ‘Smart’ Home Devices
‘Smart’ devices such as Google Home and Alexa are becoming more ubiquitous not only in the design and use of a home, but also to its construction and functionality. It is good practice to specify in the APS whether such ‘smart home’ devices are included in the sale. Typically, a basic Google Home device (i.e. the small, portable speaker) would be considered a chattel, because it can be easily moved and is not fixed to the property; however, if Google Home is connected with a sound/TV system that is integrated into the construction of the home, or if the smart home system is integral to the use and functionality of the space, then it may be considered to be a fixture because it is part of the enhancement of the property as a whole.
2. TVs/Computers mounted to a Wall
It is well-established that TVs or computers are chattels because they are easily removable. However, it is also good law that the mounts or brackets are fixtures, and they would remain behind. If the seller is insistent on taking the mounts, then the buyer should ask for the seller to fix any damage caused by the removal of the fixture, or the corresponding amount of money.
3. Home Theatre Systems
Similar to TVs mounted to a wall, in some cases home theatre systems may considered chattels; if components can be removed, then those components are chattels, and the mounting hardware would stay. However, once again, to the extent that they are built-in to the walls or studs of the house (think: ceiling speakers, TVs recessed into a wall, etc.), or if they are integral to the proper functioning and better use of the specific space, there is an argument to be made that they are fixtures. The same is true for vacuum systems: central vacuum systems are most certainly fixtures, whereas wall-mounted vacuums are chattels.
4. Custom-Designed Furniture
This is another grey area; however, for pieces which are either custom-designed for a given space, or affixed to a wall or the property, they may well be considered fixtures. A good example is a custom-designed IKEA pantry built and mounted to a wall. If removed, the space would lose its main functionality, and it is most likely the case that another “non-custom” piece would not fit the space in the same way. Therefore, there is good argument that custom furniture affixed to the property is a fixture.
5. Fire Pits
Courts have held that fire pits may well be considered to be fixtures, even if they are capable of being removed or disassembled for moving. There is case law supporting the proposition that the bricks comprising a custom-built fire pit are fixtures, even though they can be individually disassembled and removed. Once again, the issues with fire pits is the extent to which they make ‘better use’ of the home and the property – in this case, the bricks’ intention is to “be” a fire pit in that specific location and use. Otherwise, they are merely individual bricks – and who just wants random bricks in their backyard?
Aura LLP is Ontario’s leading law firm in co-ownership of residential and commercial property. We have helped hundreds of clients close on their dream home, and dozens of co-owners structure their co-ownership agreements. Contact us to learn more about how we can help you.
