It is often the “non” legal matters that can cause the biggest delays and upset in the conveyancing process. The Buyers and Sellers of a property cannot agree on what should and should not be included in the purchase price and on what basis offers to buy the property were made and exchange of contracts is consequently delayed whilst the wrangling over fridge freezers and the like is resolved. Worse still, on the day of completion the purchasers move in only to discover items that they thought were being taken have been left behind (often because of the pure difficulty of removal) or vice versa.
When viewing a property it is not always clear what it is to be included and often the first time the matter is addressed is when the fixtures and fittings form completed by the Sellers is supplied as part of the conveyancing process. By this time most people are focusing on kitchen appliances and the bigger picture generally and inclusion of other items can be overlooked. It is only then that the importance of the distinction between a “fixture” and a “fitting” becomes apparent as their classification directly relates to their inclusion or exclusion from the sale and consequently the redress if any, available to the aggrieved party.
In the absence of express agreement, there are legal presumptions that provide guidance as to the distinction between fixtures and fittings and this focus on the degree and purpose of annexation. “Fixtures” are generally items which are attached to and form part of the property, ie boilers, radiators, fitted units etc and therefore are included as part of the property unless expressly excluded. Alternatively a “fitting” or “chattel” does not form part of the property, for example carpets and free standing furniture and these are not generally included unless expressly agreed. Unfortunately in the absence of agreement between the parties, whilst these legal presumptions exist, their application in practice is far from clear cut and case law has been required to settle disputes over items such as kitchen appliances, wood flooring, garden ornaments and greenhouses to name but a few and the cost of resolving an issue relating to such matters quite often proves more costly than the subject matter of the dispute !
Another related issue relates to the apportionment of price between “fixtures” and “fittings” and the contractual purchase price of the property. The sale of fittings does not attract stamp duty land tax and therefore the apportionment issues raises it head when the price of a property is close to one of the current stamp duty thresholds. It has been known for buyers and sellers to produce lists of “fittings “ with part of the purchase price being apportioned to them It is essential that any such list is representative of fittings only and that these are not artificially inflated. Any overvaluation of the chattels is a fraud on the revenue and as such ultimately the contract could be rendered void on the grounds of public policy.
Once buyers and sellers have agreed the chattels included in a sale, it is important to remember that the contract for the same takes effect as a contract for the sale of goods and as such ownership passes on completion and the items must be transferred in the same condition as they were at exchange ie if they were working /undamaged on exchange then they should be working/undamaged on completion. Secondly, that the seller must make good any damage caused to the property following removal of an excluded item. In order to alleviate some of these difficulties a fixtures fittings and contents form should always be completed and annexed to the Contract. This is not a very substantive form and is best completed on an inspection of the property including the garden, rather than from memory, so as to ensure that any additional items are referred to where appropriate. If you are unsure as to whether an item is deemed to be included or excluded then please speak to your Solicitor for advice and ensure that the item is accounted for – it will save an awful lot of time, aggravation and cost in the long run!
Rebecca Bozier – Gawor & Co Solicitors