Part of your solicitors' role in a conveyancing transaction is to try and minimise avoidable disputes arising in your sale or purchase of real estate property.
An area that has a high potential for dispute, and usually the most easily avoidable, concerns what is included or not included in the sale of a property.
The law defines that land also includes its "fixtures". So when selling your house, fixtures are automatically included.
Fixtures are "attached" to the land. Easily identifiable fixtures include, for example, any permanent buildings and improvements built onto the land. They also include things (or "chattels") permanently or securely attached to the land or to the building.
How "permanent" or "secure" is "permanent" or "secure"? Well, that's one area where disputes can arise. If a thing is attached so that it's hard to remove without causing damage, then it's most likely a fixture.
So, if your dishwasher is only 6 weeks old, but you've decided to sell the house. Is the dishwasher included? Well, it depends. If it's freestanding and its only connection is one power cord plugged into a standard power-point, a water supply hose and a waste water hose, arguably it's not a fixture and you can take it.
On the other hand if it's custom built into the kitchen's furniture and decor, and it's likely to cause some damage if it's removed, then it's probably a fixture and you can't take it.
You've sold the property, settlement morning arrives, and after completing their final inspection, the buyer complains to his solicitor about the missing dishwasher (or dryer, or whatever...). You always intended to take the dishwasher, and the buyer always assumed it was included; after all, it was part of the kitchen's attractions.
What happens now? Well, if it's a fixture, the contract usually provides that the seller has to either return it, or compensate the buyer. This can be very annoying if it means forking out another $1,200.00 the seller wasn't counting on. It's hardly worth jeopardising a $600,000.00 sale over a $1,200.00 dispute. On the other hand, if it isn't a fixture, the buyer is very annoyed to for the same reasons. Either way, it leaves a very sour taste.
How can this be avoided? Especially if a chattel could be either a fixture or not.
Simplest answer: make sure the sale contract actually states what is included or not included in the sale.
If you're selling, to be on the safe side and avoid a later hostile argument about inclusions, ask your solicitor to ensure that the contract makes it plainly clear that the dishwasher (or dryer, air-conditioner, the custom aviary, the wedding present bird-bath, mum's special curtains, sentimental light fitting, or whatever) is excluded from the sale.
If you're the buyer, don't assume all what you see is included in a property sale. If you have time, consult your lawyer to discuss your concern. Better still, if you're in a situation where you need to sign a contract right there, insist or negotiate that the particular item or chattel you want is written in the contract as an inclusion (usually on page 1 of the NSW standard contract).
Another way of saying this, is that regardless of whether a thing is a chattel or a fixture, the contract can simply state whether they're included in the sale or not, and that simply does away with any dispute about definitions.
The issue concerning chattels and fixtures applies to other land and property transactions too, such commercial & retail leases and sales. Indeed, an issue that appears to come up regularly concerns racking or shelving; often these are specialised and expensive - but they too have fallen into the debate of whether they're chattels or fixtures.
To avoid an avoidable dispute, maintain harmony, reduce unnecessary stress and angst, and help to make your sale or purchase a more pleasant experience, ask your solicitor to ensure the contract deals with these types of issues.
The law defines that land also includes its "fixtures". So when selling your house, fixtures are automatically included.
Fixtures are "attached" to the land. Easily identifiable fixtures include, for example, any permanent buildings and improvements built onto the land. They also include things (or "chattels") permanently or securely attached to the land or to the building.
How "permanent" or "secure" is "permanent" or "secure"? Well, that's one area where disputes can arise. If a thing is attached so that it's hard to remove without causing damage, then it's most likely a fixture.
So, if your dishwasher is only 6 weeks old, but you've decided to sell the house. Is the dishwasher included? Well, it depends. If it's freestanding and its only connection is one power cord plugged into a standard power-point, a water supply hose and a waste water hose, arguably it's not a fixture and you can take it.
On the other hand if it's custom built into the kitchen's furniture and decor, and it's likely to cause some damage if it's removed, then it's probably a fixture and you can't take it.
You've sold the property, settlement morning arrives, and after completing their final inspection, the buyer complains to his solicitor about the missing dishwasher (or dryer, or whatever...). You always intended to take the dishwasher, and the buyer always assumed it was included; after all, it was part of the kitchen's attractions.
What happens now? Well, if it's a fixture, the contract usually provides that the seller has to either return it, or compensate the buyer. This can be very annoying if it means forking out another $1,200.00 the seller wasn't counting on. It's hardly worth jeopardising a $600,000.00 sale over a $1,200.00 dispute. On the other hand, if it isn't a fixture, the buyer is very annoyed to for the same reasons. Either way, it leaves a very sour taste.
How can this be avoided? Especially if a chattel could be either a fixture or not.
Simplest answer: make sure the sale contract actually states what is included or not included in the sale.
If you're selling, to be on the safe side and avoid a later hostile argument about inclusions, ask your solicitor to ensure that the contract makes it plainly clear that the dishwasher (or dryer, air-conditioner, the custom aviary, the wedding present bird-bath, mum's special curtains, sentimental light fitting, or whatever) is excluded from the sale.
If you're the buyer, don't assume all what you see is included in a property sale. If you have time, consult your lawyer to discuss your concern. Better still, if you're in a situation where you need to sign a contract right there, insist or negotiate that the particular item or chattel you want is written in the contract as an inclusion (usually on page 1 of the NSW standard contract).
Another way of saying this, is that regardless of whether a thing is a chattel or a fixture, the contract can simply state whether they're included in the sale or not, and that simply does away with any dispute about definitions.
The issue concerning chattels and fixtures applies to other land and property transactions too, such commercial & retail leases and sales. Indeed, an issue that appears to come up regularly concerns racking or shelving; often these are specialised and expensive - but they too have fallen into the debate of whether they're chattels or fixtures.
To avoid an avoidable dispute, maintain harmony, reduce unnecessary stress and angst, and help to make your sale or purchase a more pleasant experience, ask your solicitor to ensure the contract deals with these types of issues.
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