Van Wezel v. Van WezeVs Trustee.1 See also Macdonald, Ltd. v. Radin,N. O., and the Potchefstroom Dairies and Industries Co., Ltd.' See alsoBrodie v. Attorney-General'.
L. A. Rajapakse (with him P. A. Senaratne), for the plaintiffs, respond-ents.—The second defendant claims the machinery on the deed andnot as the owner of the soil. The transferor cannot give a better title thanthe one he possesses according to the maxim nemo dat quod non habet.Further this is a case of artificial accession and the intention of theparties must be looked into. The first defendant ought not to be allowedto enrich himself at the expense of the plaintiffs. See 2 Maasdorp,pages 48, 49. A bona fide improver of the land has the right for compen-sation and the jus retentionis till it is paid as held in Nugapitiya v. Joseph
The case for the plaintiff is that the machinery is detachable withoutinjury to the land and therefore there is no question of compensation orjus retentionis. In a series of cases it has been held that in determiningthe question the elements to be considered are the nature of the thingannexed, the degree of annexation and the intention of the personannexing it. See Wille on Landlord and Tenant (2nd ed.), page 264.The mill which is movable property, the identity of which is preserved,which has not been physically incorporated in the land and is separablefrom the land to which it has been attached, cannot be considered aspart of the land unless the owner intended that it should remainpermanently annexed. See Macdonald, Ltd. v. Radin, N. O. and thePotchefstroom Dairies & Industries Co., Ltd.'.
N. Nadarajah, in reply cited Hobson v. Garringe and Reynolds v.Ashby & Son.'
Cur. adv. vult.
September 25, 1940. Howard C.J.—
This is an appeal by the second defendant from the judgment of theDistrict Judge of Chilaw declaring that the plaintiffs are entitled to athree-fourth share in a fibre mill named St. Joseph, and the engine,factory and other things appertaining thereto and further ordering thatboth defendants pay to the plaintiffs the sum of Rs. 60 per mensem asrent from April 29, 1938, till the plaintiffs are resorted to joint possession.The facts so far as material for the decision of this appeal are as follows : —The plaintiffs were the owners of three-fourths and the first defendant ofone-fourth share of the fibre mill and other things appertaining theretowhich in this judgment are referred to as the fibre mill. The fibre millwas erected in 1925 from funds contributed by the first and secondplaintiffs, the father of the third, fourth, and fifth plaintiffs and the firstdefendant who were all brothers and was situated on land belonging tothe first defendant. From 1925 onwards the mill was worked by one ormore of the partners. From 1934-1936 it was worked by the firstdefendant alone. Thereafter the first plaintiff and the father of the third,fourth and fifth plaintiffs worked it until January, 1937, when the latterdied. On June 22. 1937, the first defendant was charged by the first
1 (1924) A. D. 409.4 (1926)28 N. L. R. 140.
* (1915) A. D. 454.s (1915)A. D. 454 at 469.
= 7 N. L. R. 81.* (1897)1 Ch. 182.
; (1904) .1. C. 466.
HOWARD C.J.—Tissera v. Tissera.
plaintiff, in P. C. Chilaw, No. 3,841 with theft of books and intimidation.The case was settled on August 17, 1937, on the first defendant under-taking not to interfere with the working of the mill for the next sevenmonths and admitting the plaintiff had the right to work the mill forthat period.
By agreement dated December 14, 1937, the fibre mill was leased bythe plaintiffs and the first defendant to the first defendant for a term oftwo years from April 1, 1938, at a rental of Rs. 120 per mensem. Thefollowing conditions were contained in this agreement: —
That a sum of Rs. 90 should be paid to the plaintiffs before the15th of every month out of the rental of Rs. 120;
That on failure to pay such rent as aforesaid a sum of Rs. 120shall be paid before the 15th of the succeeding month and on failure tomake such payment the lease shall become void in full. In suchcircumstances the remaining period of two years shall be auctionedamongst the owners of the three shares and assigned to the highest
, bidder on the same qonditions :
That the first defendant during the term of the lease in lieu ofground rent for the land on which the mill was situated should be paidthe sum of Rs. 5 per mensem;
That after the termination of the term of two years the firstplaintiff shall possess On lease for two years and thereafter the third,fourth and fifth plaintiffs on lease for two years.
The fibre mill was handed over to the first defendant by the firstplaintiff on April 1, 1938. On April 29,' 1938, by bill of sale for the sumof Rs. 2,000 the first defendant sold, transferred, conveyed, granted,assigned and set over to the second defendant the fibre mill which wasdescribed in the schedule as purchased by the first defendant and fixedon the soil of the undivided three-fourth share of land called Lolugahagal'a.By indenture of lease of even date the first defendant leased to the seconddefendant for a- period of five years at the rate of Rs. 100 per annum anundivided extent of one and a half acres on which the fibre mijl is put upadjoining the western boundary of the remaining undivided three-fourthshare of land called Lolugahagala.
No rent has been paid to the plaintiffs in respect of the agreement ofDecember 14, 1937, and the second defendant since the date of the bill ofsale and lease has been working the mill.
In the lower Court in reply to the case set up.by the plaintiffs in proof, of their ownership of the fibre mill the defendants relied on the propositionof law that whatever is fixed to the land becomes the property of theproprietor of the land. The learned Judge, in rejecting the applicationof this proposition so far as the case of the defendants is concerned, inthe course of his judgment also held that the plaintiffs besides beingco-owners were induced to be parties to the transaction embodied in theagreement of December 14, 1937, by the first defendant’s admission oftheir rights and that he and the second defendant are clearly stoppedfrom denying those rights. He was also not satisfied that the seconddefendant was an innocent purchaser.
HOWARD C.J.—Tissera v. Tisser'n.
The first defendant has not appealed against the judgment of theDistrict Court, but the second defendant has raised in this Court the pleathat was unsuccessfully raised before the District Judge. It has beenconceded that, if the fibre mill retained its character as movable property,it would not pass to the second defendant by virtue of the bill of sale. Inthese circumstances, that part of the decree of the District Court declaringthat three-fourths of the ownership of the fibre mill was vested in theplaintiffs cannot be assailed. The main problem, therefore, with whichwe are faced is the question as to whether the fibre mill on April 29, 1938,was movable or immovable property.
In the course of the argument our attention has .been invited to passagesfrom books of various authorities on Roman-Dutch Law. At page 300in Wille on Landlord and Tenant the following passage occurs : —
“ Whether additions or improvements are movable or not dependson their nature and object, the way in which they are fixed and theintention of the person who erected them. ”
In Paul Voefs treatise De Natura Bonorum Mobilium et Immobilium. inCap. 3, paras 2 and 3; and Cap. 4, paras 1 and 2 he points out that thespecies of mill (molendium Dwanakmolen) is an immovable “ for it is fixedto the soil by means of posts and earth, and it has been built in theposition in which it is with the intention that it should remain therepermanently ”. So also are windmills “ for although for the most part.they do not adhere to the soil they must be considered to be immovablebecause they are not easily removed”. The same applies to wine andoil presses.
Burge also in vol. 2, page 15, states that “ movables affixed to landor buildings acquire the quality of immovables by reason not alone oftheir being affixed, but of their being affixed with the intention ofpermanently remaining ”.
. The principles formulated by the authorities I have mentioned are alsosupplemented by numerous decisions of the South African Courts.
In the case of Olivier and others v. Haarhof & Co.Innes C.J. laid downthe law as follows : —
“ The conclusion to which I have come is that it is impossible to laydown one general rule; each case must depend on its own circumstances.The points chiefly to be considered are the nature and object of thestructure, the way in which it is fixed, and the intention of the personwho erected it. And of these the last point is in some respects the mostimportant. ”
In Victoria Falls Power Co., Ltd. v. Colonial TreasurerInnes C.J.reaffirmed the principle he stated in Olivier and others v. Haarhof & Co. inholding that certain electric pole lines were erected for the purposes of theconcession and not intended to remain permanently affixed to the soil andwere not immovable property.
The question was exhaustively considered in the case of MacDonald,Ltd. v. Radin, N. O. and the Potchefstroom Dairies & Industries Co., Ltd. ‘The facts in that case were as follows:—The appellants had sold certain
1 (1906) T. s. 497.! (1909) T. S. 140.
=> 5. A. Law Rep. 1915 ; A. D. 454.
84HOWARD C.J.—Tissera v Tissera.
machinery for £1,153 payable in instalments, it being a condition thatthe appellants should erect it on premises purchased by one Jacobson forthe respondents, but that ownership in the machinery should remain inthe appellants until Jacobson should have paid the total amount of thepurchase price. Previously to the sale of the machinery the respondentssold the premises on which it was erected to Jacobson upon the termsthat the purchase price should be paid in instalments and that uponfailure of any one instalment the sellers should have the right to cancelthe sale and claim all improvements made by the purchaser as forfeited.The machinery so obtained by Jacobson was erected by the appellants interms of the agreement, and fastened down to beds of concrete and inpart to the wall by bolts and nuts in such a way that it could be removedwithout injury to the premises. Subsequently on default of payment byJacobson both the appellants and the respondents cancelled their agree-ments with him and Jacobson was thereafter declared insolvent. Theappellants having demanded the return of the machinery it was held by amajority of the Court that, under all the circumstances of the case, the
machineryhad not -beeome a fixture, but was the property of the
"appellants. The machinery erected by the appellants and the extent ofits attachment to the building is described in the judgment of Innes C.J.as follows :—“Part of it is held in position by long bolts and nuts, theformer embedded in a solid concrete foundation ; another part is attachedto the wall also by bolts and nuts ; pipes connecting the various portions- pass through holes in the walls and certain tanks and coil piping aresupported and fixed in manner described ”. The new plant could betaken to pieces and removed without injury to the premises. The ChiefJustice re-affirmed the principle laid down by him in Olivier and others v.Haarhof, & Co. and in doing so stated as follows :— “The elements to beconsidered in determining whether an article originally movable- has'become immovable through-'Smiexation by human agency to realty, arethe nature of the particular^article, the degree and manner of its annexa-tion and the intention of the person annexing it. The things must be inits nature capable of acceding to reality, there must be some effectiveattachment (whether by mere weight or by physical connection) andthere must be an intention that it should remain permanently attached,The importance of the first two factors is self-evident from the nature ofthe inquiry. But the importance of intention is for practical purposesgreater still; for in many instances it is the determining element. Yetit is sometimes settled by the mere nature of the annexation. Thearticle may be actually incorporated in the realty, or the attachmentmay be so secure that separation would involve substantial injury eitherto the immovable or its accessory. In such cases the intention as topermanency would be beyond dispute ”. The judgment then proceedsto discuss the fundamental principle formulated by various authoritiesthat (subject to a few specific exceptions) dominium cannot be trans-ferred or altered, save by the intent of the dominus. As an example ofsuch an exception is the case of a house acceding to the soil in which itwas built. The Chief Justice reaches the conclusion that movableproperty like the machinery in dispute, the identity of which has beenfully preserved, which has not been physically incorporated in the realty
HOWARD C.J.—Tissera v. Tissera.
and which is separable from the building to which it has been attached,cannot be considered as part of the building unless the owner intendedthat it should remain permanently annexed. He then goes on to holdthat inasmuch as Jacobson was not authorised by the appellants toattach the plaint in any way that would interfere with the latter’s owner-ship, the dominium was not changed and the machinery remained movableproperty.
The principles formulated in this case were shortly afterwards reviewedin Newcastle Collieries Co., Ltd. v. Borough of Newcastle In this case aprivate railway line was built on land which had been leased for a periodof 21 years with a right of renewal for further similar periods indefinitely.The lease was terminable by the lessee at six months’ notice and by thelessor upon certain eventualities. At the expiration of the term or incase of earlier surrender the lessee was entitled to remove “ all railwayserected on the premises ”. The line so built was ballasted together.The rails were fixed to sleepers and coupled together by fish-plates,bglts and nuts and the sleepers were embedded in stone ballast. Therewere culverts and a bridge built in stone and cement. In some partsthere were axcavations to a depth of six feet or more and in other partsthe soil had been made up to a considerable height to obtain a bettergrade. The line had been worked for 25 years and was likely tocontinue to be so worked. It was held that the line was immovableproperty and rateable as such. In his judgment, Innes J. referred tothe principles laid down in Macdonald, Ltd. v. Radin, N. O. and statedthat the intention of permanency is to be presumed from the method ofannexation, and though the builder may have reserved the right in aspecified eventuality to remove the structure, still while it stands itremains a portion of the realty. That portion of the railway representedby culverts and bridges was undoubtedly immovable property. Theremainder consisting of sleepers and rails could not be removed withoutconsiderable violence resulting in displacement of soil and ballast.Degree and manner of annexation, therefore, afforded strong evidence ofan intention that the railway should remain permanently in situ. More-over the intention of the lessee was an indefinitely extended currencyand the line was so worked with no prospect of discontinuance. TheChief Justice, therefore, considering both the manner and degree ofannexation and the intention of the lessee, came to the conclusion thatthe railway, fixed as it was, and intended to be worked during theoperation of so long a lease, must be regarded as having been constructedwith the intention that it should remain permanently annexed to the soil.
One more South African case deserves attention. In Van Wezel v. VanWezel’s Trustee’, the facts were as follows:—W. leased three standsfrom the D. Company. The leases were monthly, but in practice wereregarded as renewable in perpetuity and the evidence showed thatvaluable houses were built upon stands so leased. One of the clauses ofeach lease required the lessee to remove all structures before the expiryof the lease under penalty that otherwise such structure should be theproperty of the Company without compensation. Upon one of the1 S. A. Lav Rep. 1916, A.D. 561.* S. A Laio Rep. 1924, A.D. 409.
3J. N. B 17828 (6/52)
HOWARD C. J.—Tissera v. Tissera.
stands a dairy was erected when W took it over and he built upon it ahouse, a windmill and a tank. From the windmill a pipe ran to the tankwhich stood upon a masonry structure and from which pipes led to thehouse and dairy. The foot of the windmill was made of iron rails whichwere embedded in the earth and to this foot the tower was bolted. In1913 W transferred the stand on which stood the windmill and tank toa Bank as security for a debt and in July, 1920, the son of W, theappellant, bought from his father the windmill and tank together with acowshed, enclosures and fence erected on another of the stands andcontinued to use them in situ in connection with the dairy business. InMarch, 1923, the estate of W was sequestrated and respondent appointedtrustee. In an action in which the appellant claimed from respondentdelivery of the windmill and other structures purchased by him from Wit was held as follows : —
That as the evidence showed that the structures claimed had been
erected on the stands with the intention that they should remainpermanently they should in law be regarded as immovableproperty ;
That the clause in the lease requiring the lessee to remove buildings
and improvements did not alter the juridical character of thestructures and convert them from immovable into movableproperty.
In his judgment Wessels J.A. considered the juridical1 character of thevarious structures. The evidence was that the windmill was erectedwith the intention that it should remain there permanently in order tosupply the house and dairy with water. It was intended to be an appurte-nance to the house and dairy. The tank was necessary to distribute the .water. The dairy was not claimed. The cowshed was constructed ofbrick, wood and iron on a foundation. The enclosures and fences wereaccessories thereto. All these structures were in the view of the Judgeprima facie to be regarded as immovable. A structure built into thesoil by a lessee becomes part of the soil as soon as it is fixed to the soil-and thereafter the dominium in it lies in the owner and not the lessee.The windmill and tank, therefore, never became the property of W buttheir dominium was in the D Company, and they could not be transferredby W to the appellant. Nor could the appellant for similar reasonsbecome the owner of the cowshed. During the currency of the lease Wcould have broken down the cowshed and as each part became detachedit became his property, and he could sell it to the appellant. This right,however, expired when the control over the leased property passed toW’s trustee.
Cases from the Ceylon Law Reports are few in number and are notparticularly helpful. In de Silva v. Harmanis,1 it was held by Lawrie J.that the builder of a house on another man’s land does not acquire asaleable right to the house, but the house becomes the property of theowner of the soil. In Brodie v. Attorney-General' it was held thatfixtures are articles which by being affixed or let into the ground or/annexed or attached to buildings acquire the character of immovables
1 3 n.l. n. ICO.
R. 81.
HOWARD CJ.—Tissera v. Tissera.
and pass into the building. When a “ land and building ” were put upfor sale and purchased by the Crown through its agent, who some daysafter sale was alleged by the owner of the land and building to have agreedwith him to take certain fixtures therein at a valuation, it was held thateven if such an agreement was entered into the Crown could not be madeliable to pay for what was already its own.
We have in the course of the argument been referred to the Englishlaw and certain English authorities. In this connection the dictum ofInnes C.J. in Oliver and others v. Haarhof & Co. that the law of England-appears to be the same is of considerable interest. He proceeds to citewith approval the judgment of Lord Blackburn in Holland v. Hodgson1.This was a dispute between the mortgagee to whom the realty had beenmortgaged, and the assignee, to whom the movable property had beenassigned. It was held that certain looms attached to the stone floors ofthe rooms of the mill by nails driven through holes in the feet of thelooms and which could not be removed without drawing the nails, passedby the mortgage of the mill as part of the realty even though the loomscould be removed easily and without serious damage to the flooring.Innes C.J. referring to the judgment of Lord Blackburn, states that thefollowing language might have been taken from Paul Voet:—
“ There is no doubt that the general maxim of the law is, that whatis annexed to the land becomes part of the land; but it is very difficult,if not impossible, to say with precision what constitutes an annexationsufficient for this purpose. It is a question which must depend on thecircumstances of each case, and mainly on two circumstances, asindicating the intention, viz., the degree of annexation and the objectof the annexation ”.
We were also referred to Hobson v. Gorringe ’, in which it was held thatin determining whether or not a chattel has become a fixture, the intentionof the person affixing it to the soil is material only so far as it can bepresumed from the degree and object of the annexation. A gas engineaffixed to freehold land of the hirer by bolts and screws to prevent it fromrocking, and to be used by him for purposes of trade, was let out on thehire and purchase system under an agreement in writing that it shouldnot become the property of the hirer until the payment of all the instal-ments, and should be removable by the owner on the failure of the hirerto pay any instalment. Default having been made in the payment ofthe instalments, the engine was claimed by the owner and also by amortgagee of the land who took the mortgage after the hiring agretementand without notice of it and had entered into possession while the enginewas still on the land. It was held that the engine was sufficientlyannexed to the land to become a fixture and that any intention to beinferred from the terms of the hiring agreement that it should remain achattel did not prevent it from becoming a fixture, and consequentlythat it passed to the mortgagee as part of the freehold. This decisionwas followed in Reynolds v. Ashby & Son*, where machinery fasteneddown to a building and which could be removed without injury to thepremises was held to pass to the mortgagee though it had been supplied1 L. R. 7, C. P. 328.* (1897) 1 Ch. 182.
3 (1904) A. C. 466.
HOWARD C.J.—Tissera v. Tissera.
by the owner to the lessee of the building on the hire purchase system.Innes C.J. in MacDonald, Ltd. v. Radin, N. O. makes reference to thesetwo decisions and distinguishes them from Holland v. Hodgson (supra) onthe ground that in that case tKe person who annexed was the owner of themovable. With regard to Hobson v. Gorringe he reaches the conclusionthat the South African Courts would not under similar circumstanceshave deprived the owner of the engine of His property.
In the various English and South African cases I have been impressedby the minute and careful examination by the Judges of the character ofthe structures concerned. It is obvious that such an examination isnecessary if the correct principles are to be applied. The learned DistrictJudge has given very perfunctory treatment to this aspect of the question.The only indication of an appreciation of its importance is a passage inhis judgment in which he states that the evidence shows that the mill canbe removed without causing damage. In this case the structures asdescribed in the bill of sale given by the first to the second defendantconsist of a mill together with the engine, factory, buildings, and all otherbuildings, the five pairs of machinery boxes, the sieve screen, belting, axleand so forth, waterpump and baling press appertaining thereto. Inhis evidence the first plaintiff states that The mill consists of a buildingand machinery. The oil engine is fixed with screws to the floor of thebuilding on a concrete foundation. To remove the engine the foundationmust be broken. The engine can be removed in parts but the wholeengine cannot be removed without breaking up the foundation. Othermachinery can be removed. Although this description of the variousstructures is- not very satisfactory nor helpful so far as elucidates theirrelationship to each other and the manner of their annexation to the soil,certain features stand out. The plaintiffs claim the building in whichthe engine is housed. But applying the principle laid down by the SouthAfrican authorities, both text-book writers and cases, buildings becomepart of the land on which they are built. The description does notspecify the number of buildings nor when they were erected. Presumablythey were erected in 1925 when the brothers embarked on this venture.They must, however, all have become part of the soil when erected. Itwould appear that the oil engine which is attached to the floor of thebuilding on a concrete foundation by screws can be removed by breakingthe foundation. One cannot in the case of the oil engine say that it isincorporated in the realty or that the attachment is so secure thatseparation would involve substantial injury either to the building or theengine itself. The nature of the article, the manner and degree ofannexation do not, therefore, in the case of the oil engine determine theintention that it should remain permanently attached. Other evidenceof intention must in these circumstances be sought. The brothersembarked on their venture in 1925 when it must be presumed the buildingswere erected and the mill installed. The land on which the buildingswere erected had passed into the ownership of the first defendant byvirtue of deed of gift in 1915. The mill was worked in turns by variousmembers of the partnership. A lease by the other partners was some-times the authority for such working. At other times there seems to
HOWARD C.J-—Tissera v. Tissera.
have been no document of authorisation. On December 14, 1937, anagreement was signed leasing the mill to the first defendant. Themanner in which the venture started and the mode ill which the mill wasoperated over a number of years indicated only too clearly that thebrothers intended that the mill should remain permanently affixed to thebuilding in which it was installed. There is no evidence to indicate thatits removal was ever contemplated by the partners. In these circum-stances I am of opinion that it became permanently fixed to the soil in1925. The waterpump, baling press, machinery boxes, belting and otherarticles must be considered as accessories to the engine and, as in the caseof the accessories in Van Wezel v. Van Wezel’s Trustee1 be regarded aspart of the structure. The so-called lease of December 14, 1937, cannotaffect the question as to whether the engine became affixed to the soiland must be regarded as sanction to the first defendant to work the mill.It cannot affect the rights of the appellant. There may, as was pointedout in de Silva v. Harmanis, exist equities, such as a right to compensationas between the plaintiffs and the first defendant. In my opinion, there-fore, the various structures which constituted the fibre mill became partof the soil on which they stood. In these circumstances they passed tothe second defendant by virtue of the bill of sale dated April 29, 1938.It is not really necessary to decide the full effect of this document. Thedominium in the mill and the land on which it stood was in the firstdefendant. It was open to the latter to sever the ownership of thevarious structures from that of the land. The right and effect of suchseverance is discussed in Van Wezel v. Van Wezel’s Trustee. On the otherhand the fact that the second defendant entered upon the land and'worked the mill indicates that no such severance was intended. Theeffect of the bill of sale, read in conjunction with the lease of the samedate, was to convey to the appellant the mill together with the bare landon which it stood whilst at the same time he was given a lease of thesurrounding area as specified in the lease.
In the circumstances, it is not necessary to consider whether theappellant was aware of the precise relations that existed between theplaintiffs and the first defendant with regard to the ownership of the mill.In my opinion the appellant was not estopped from denying the plaintiffs’rights. There is no evidence to justify a finding that he was anythingbut an innocent purchaser. The claim of the plaintiffs that they areentitled to a three-fourths share in the fibre mill, therefore, fails.
In their plaint the plaintiffs claimed on the basis of the agreement ofDecember 14, 1937, rent at Rs. 90 per mensem. The learned Judge hasawarded a sum of Rs. 60 per mensem as damages and not as rent. Thedecree, however, awards this sum as rent. Whether the sum awarded isfor rent or damages it is based on the agreement. The appellant wasnot a party to this agreement. Nor is there any real evidence that whenhe took possession of the mill he was aware of this agreement. Hencetheir claim for rent or damages as against him must fail.
For the reasons mentioned herein the appeal is_ allowed with costs.
Heakne J.—I agree.Appeal allowed.
1 S. A. Lav Rep. 1924 ; A. D. 409.