The litigation in Borwick Development Solutions Ltd v Clear Water Fisheries Ltd [2019] EWHC 2272 (Ch) raised a second interesting point relating to land sold by Law of Property Act receivers appointed by a mortgagee. Were 40 solar panels, each of which was 1m by 0.75m in size, their associated controls and a feed-in tariff meter, fixtures – so that title to the panels passed with the land?
The panels were affixed to metal frames, which were bolted onto wooden platforms, which were concreted into the ground. But they could be easily unclipped and removed from their frames. They generated electricity for use by a restaurant and any surplus was uploaded to the National Grid in order to cover their capital cost and, eventually, to generate a profit pursuant to a 25-year contract with Eon. The contract contained provisions for transferring ownership of the solar panels. They required the landowner to complete a transfer of ownership agreement form, to inform Eon one month in advance, and to provide Eon with the relevant meter readings on completion.
There was no requirement in the Eon contract that the solar panels should be placed on any particular piece of land, or that they should supply electricity to the restaurant, and the buyer had removed them and put them into storage pending the outcome of the litigation. But it had had to employ a specialist sub-contractor in order to do so and the removal of the panels and the wooden platform, together with the meters and the underground cabling, took six men using a mechanical digger three days. The structures had been deeply embedded in the soil and the surface had had to be repaired and re-levelled following the removal of the panels.
The judge observed that whether an item is a chattel, or a fixture that passes with land, depends on the method and degree of its annexation to the land and on the object and purpose of the annexation. If an item cannot be removed without causing serious damage to, or destroying, some part of the realty, the case for its having become a fixture is a strong one. But, although this used to be the primary test, it has become so much easier to attach objects to, and detach them, from land or buildings that the “annexation test” is no longer the dominant test. Therefore, chattels may retain their status, even after annexation, if they were attached to the land for the better enjoyment of the object itself, rather than to improve the land. However, in this context, the “purpose test” is an objective one. It is the purpose which the object is serving that is important – and the subjective intention of the person who put the object there is irrelevant.
The buyer had argued that the solar panels could not be divorced from the structure that had been concreted into the ground – and the judge agreed. The court should have regard to the structure as a composite whole. It followed that the panels were fixtures and had become part of the realty. But, even if that were not the case, the judge considered that the panels had been affixed to the property for the benefit of the land and for use as an integral part of the land itself – and not so that they could be enjoyed as independent objects. Consequently, the judge agreed that title to the panels had passed to the buyer on the sale of the land.
Allyson Colby, property law consultant
