Re Companies Act (1908); Ross and Boal
| Jurisdiction | Northern Ireland |
| Judgment Date | 26 June 1924 |
| Docket Number | (1922. No. 279.) |
| Date | 26 June 1924 |
| Court | Court of Appeal (Northern Ireland) |
Appeal. (N. I.)
Company winding up - Fixtures - Benches and power-driven sewing machines - Sewing machines not affixed to but resting on prepared positions on benches - Mortgagor and mortgagee.
Motion on behalf of the liquidator of Ross and Boal, Limited, for a declaration that the sewing machines which were in use in the company's warehouse premises, 11 Donegall Square, South, Belfast, at the commencement of the liquidation were movable machinery to which the liquidator was entitled for the benefit of the unsecured creditors.
The company carried on business as linen merchants, and owned the leasehold interest in a warehouse and premises at 11 Donegall Square, South, Belfast. At the date of the commencement of the liquidation the company's interest in these premises was subject to an equitable charge to the Ulster Bank, Limited, created by a deposit with the Bank of the company's lease and title deeds as security for its indebtedness to the Bank.
The top floor of these premises was fitted with benches and power-driven sewing machines used in connexion with its business; there were the necessary shafting and power arrangements for working the machines. At the commencement of the liquidation there were sixty sewing machines of various types on the premises.
Wilson J. held that the sewing machines were not part of the machinery which supplied the power, and that they did not pass as fixtures to the mortgagees, the Ulster Bank, Limited; the liquidator was therefore entitled to the proceeds of the sale of the machines.
R. & B., Ltd., carried on business as linen merchants in Belfast in a warehouse held under a long lease. The company went into voluntary liquidation; but previously the company's leasehold interest in the premises had become subject to an equitable charge to its bankers by assignment by way of mortgage by deposit of title-deeds.
The top floor of the premises was fitted with benches and power-driven sewing machines, which were used in connexion with the business carried on there, and there were also the necessary shafting and power arrangements for working the machines. The benches on which the sewing machines rested were affixed to the floor by spikes or bolts, and the shafting and plant in connexion with the power arrangements were affixed to the benches or to the walls or floor of the premises. The sewing machines were not permanently affixed to the benches in any way; they merely rested on prepared positions on the benches, and were held in position by means of easily movable attachments.
Held by the Court of Appeal, N.I. (Moore L.J. and Andrews L.J.), affirming the decision of Wilson J., that the sewing machines did not pass as fixtures to the bank under the equitable mortgage.
Cur. adv. vult.
| Moore L.J. :— |
The question for us in the present case is what are the fixtures which pass with the land as part thereof under all equitable assignment by way of mortgage by deposit of title deeds. This form of the proposition absolves us from all inquiry into the problem of trade fixtures which would arise were the parties in the relation of landlord and tenant.
Fixtures, as understood in our law, are prima facie those chattels which, by reason of some connexion either permanent or even temporary, have become annexed to the land. But the word may also in some cases include movable chattels which are taken to be annexed to the land by reason of their own weight, such as the cisterns in Mather v. Fraser(1) and the anvil on which a steam hammer falls (though not fixed in position otherwise than by its own weight); Metropolitan Counties Society v. Brown(2); chattels which form an essential part of other chattels such as machinery which is itself fixed such as the machinery in Mathers v. Fraser(1) and the copper rollers in Ex parte Astbury(3), though these are not at the moment for determination themselves fixed; and also chattels not otherwise fixed which have been brought on to the mortgaged premises for the benefit of the inheritance such as the statuary and vases in D'Eyncourt v. Gregory(4)and the "dog-grates" in Monti v. Barnes(5).
If I do not allude to other possible cases it is because I am not attempting an exhaustive description, but dealing only with the several heads under all or some of which, in the present case, the appellants claim to succeed. But the state of the law on this difficult question is well described by Lord Lindley in his speech in Reynolds v. Ashby and Son(6) (a House of Lords decision) where he says: "I do not profess to be able to reconcile all the cases on fixtures, still less all that has been said about them. In dealing with them attention must be paid not only to the nature of the thing and to the mode of attachment, but to the circumstances under which it was attached, the purpose to be served, and last but not least, to the position of the rival claimants to the things in dispute." He then refers to and explains Trappes v. Harter(7)and Lyon v. London City and Midland Bank(8). To the foregoing may be added the judgment of the Court of Appeal, per A. L. Smith L.J., that, in determining whether or not a chattel has become a fixture, the intention of the person affixing it to the soil is material only so far as it can be presumed from the degree and object of the annexation. Hobson v. Gorringe(9).
All this amounts to a legal result (in which I respectfully concur) that, in dealing with the question of fixtures, it is difficult to generalise, and that attention must be paid to the special facts of each case.Mr. Murphy has correctly described the operating mechanism here as "a system of machinery" for turning out a sewed, hemmed, or embroidered product.
The system is composed of three main heads:—1, the power and the rotary shaft conveying it; 2, the heavy bench which underneath supports the shaft of No. 1 and in a tray or depression on the surface receives the bottom of the sewing machine; and 3, the sewing machine itself, about which the present controversy has arisen; and I refer to these hereafter for the sake of brevity by their numbers, when convenient to do so. There is also below the bench a foot-treadle which is used for starting the machine, worked by a band on the sewing machine direct, but whether this is attached to 1 or 2 or to either of them does not appear.
It is admitted that Nos. 1 and 2 are fixtures in the general sense, and no argument has arisen as regards them.
For the claimants to succeed as regards No. 3 they must prove either that they are so annexed to 1 and 2 or that they are thereby part of the freehold, or, failing this, that they are essential parts of 1 and 2 viewed as machinery, or that they have been placed in their present position with the intention that they should become part of the inheritance; it does not matter in this respect whether the mortgagor was owner in fee simple or only a leaseholder. Southport and West Lancashire Banking Co. v. Thompson(1).
Dealing with these propositions in the order stated, let us see if, in the first place, the sewing machines are annexed to the building by their connexion with 1 or 2 or both. The sewing machine itself is in form like the sewing machine to which we are accustomed in our own houses, more stoutly built and apparently stronger and heavier and without a hand attachment, but about the same size, and it can be lifted out of the tray by one hand. So far as I can see its only attachment to No. 1 is by a driving-belt of leather which passes through slits made in the bench (No. 2) and so round the rotary shaft. It is connected with the treadle by a leather band, and the treadle at one point is screwed to the floor, but the treadle was not mentioned in argument, and no reliance appears to be placed on it.
The sewing machine is...
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