DEFINITION OF LAND

The English Oxford Dictionary defines land as “the solid part of the earth’s surface, as
distinguished from the sea or water or from the air.”
Section of 5 NLC 1965 defines land as:
a) The surface of the earth and all substances forming that surface;
b) The earth below the surface and all substances therein;
c) All vegetation and other natural products, whether or not requiring the periodical
application of labour to their production, and whether on or below the surface;
d) All things attached to earth or permanently fastened to anything attached to the earth,
whether on or below the surface; and
e) Land covered by water.
The provision of Section 5 of NLC demonstrates that the term land has a very extensive
meaning. The definition of land under paragraph (d) of Section 5 NLC provides a further
extension to the definition especially if it covers the area related to fixtures.

LAW OF FIXTURES (RULE AND EXCEPTIONS)

In order to determine ownership of the land, it is important to identify what constitutes
fixture, as land has been defined to include things attached to land. Fixtures are defined as
“chattels which are so affixed to land or to a building on land as to become in fact part of the
building or land thereof”.
Fixture are movable property, which are so affixed or to a building. It will lose the character
of chattels and pass on with the ownership of the land. In Minshall v Lloyd, it was held that
whatever is attached to the soil becomes part of the soil (quic quid plantatur solo, solo cedit).
This maxim describes the nature of fixtures in relation to land.
This Latin Legal Maxim has been adopted in English law and applies invariably to the
Malaysian land law. Section 3 of CLA 1957 provides for the adoption of English Common
Law principles subject to following restrictions:
a) It only applies if there is no statutory provision in Federation
b) If it applies, it is applied unmodified by any English Statutes
c) It must be applied only in so far as the circumstances of the Federation and its
inhabitants permit and subject to local customs
Therefore this concept has been adopted and hence reproduced under Section 5(d) of NLC
1965. In the absence of statutory provision, English legal principle governing fixtures are
applied in Malaysia. The Malaysian courts referred to English cases on this subject matter.
In Goh Chong Hin & Anor v The Consolidated Malay Rubber Estates Ltd, Sproule CJC
stated: “… the legislative of these states has already … declared as its policy the adoption of
English law on this matter…” At the Court of Appeal, Blackburn J’s rule in Holland v
Hodgson was stated as the rule applicable in Malaysian situation: “… an article which is
affixed to the land even slightly is to be considered part of the land…”
TEST TO DISTINGUISH BETWEEN FIXTURES AND CHATTEL
It is important to distinguish between fixtures and chattels since it is a determining factor as
to whether an object has become a fixture or remains a chattel. In Holland v Hodgson:
“Whether a chattel has been affixed to the premises so as to become a fixture is a
question of fact which principally depends first on the mode and extent of the
annexation, and especially on whether the chattel can easily be removed without
injury to itself or to the premises and secondly on the object and purpose of the
annexation, that is whether it was for the permanent and substantial improvement of
the premises or merely for a temporary purpose or for the more complete enjoyment
and use of the chattel as a chattel”.
In this case, the owner of a mill purchased some looms for use in his mill. They were attached
to the stone floor by nails driven into wooden beams. They could quite easily be removed.
The owner then mortgaged the mill and failed to keep up the payments and the mill was
repossessed. The question for the court was whether the looms were fixtures forming part of
the land or whether they remained chattels. It was held that the looms had become fixtures
and thus formed part of the land mortgaged.
In Goh Chong Hin & Anor v The Consolidated Rubber Estates Ltd, Goh Chong Hin charged
his land including buildings and factory to SRMS Lechman Chetty (chargee).There were
machinery in the factory. Annexed by nuts and bolts to concrete foundations sunk in the soil.
In June 1921 – Goh Chong Hin executed Bill of Sale over the machinery in the factory to
Consolidated Malay Rubber Estates Ltd (grantee). In October 1923 – The chargee by the
consent of Goh Chong Hin took possession of the land and the factory. In December 1923 -
The grantee applied for order to seize and sell the machinery by virtue of the Bill of Sale. The
charge in possession opposed the application. The trial judge decided in the respondent’s
favour and the charge then appealed.
Held: 1. The ordinary English law of fixtures applies in this country. 2. It is well settled by
that law that prima facie machinery affixed to earth becomes fixture and part of the land. 3.
Even if the machinery was set up after the date of the charge, it nevertheless accrued to the
land and became part of the chargee’s security.
The first test is connected with the factual situation of the thing in relation to land. The above
statement shows that the test of the degree of annexation is an objective test and the result of
the test stands as a rebuttable presumption.
The question in this degree of annexation test is whether the chattel can be easily removed
without injury to itself or to the premise. This test is also known as the adaptation test or
damage test.
The second test is that object or purpose of annexation. What matters here is not so much
how firm the object has been affixed to the land but rather why it was affixed. This test
though subjective is sometimes produced to rebut or strengthen the earlier objective test of
the degree for annexation. Thus, if the objective of the attachment of the thing is for the better
enjoyment of the land, then that would strengthen the presumption set under the first test that
the thing is a fixture and has thus become part of the land.
In Socfin Co Ltd v Chairman Klang Town Council, it was said that these tanks might be
considered as “structures” attached to the land and could therefore be held to be fixtures.
In Shell Co of Federation of Malaya Ltd v Commissioner of Federal Capital of Kuala
Lumpur, the court decided that underground petrol storage tanks that were two feet deep
below ground and turfed or concreted over, with the intention that it should remain there
permanently should be considered as fixtures. The tank were placed underground were
intended to remain in site for as long as the filing stations continue in operation.
In Esso Malaysia Bhd v Hills Agency (M) Sdn Bhd, It is trite law that land includes fixtures.
But on the contrary it cannot be dismissed that fixtures do form part of the land – this is
especially so when there is a permanent attachment to the land. This principle is based on a
general rule of great antiquity that 'whatever is affixed to the soil belongs thereto' as the
maxim goes 'quic quid plantator solo, solo cedit'.
However it must be observed that the mere fact of physical attachment is nevertheless not
conclusive to deem an article or a chattel a fixture; what is of greater importance is the object
of annexation rather than the mode. Even when a chattel is actually affixed to the land but can
be removed without damage to it or the premises to which it is attached and the annexation is
merely for a temporary purpose and for the more complete enjoyment and use of it as a
chattel, it will not in the circumstances lose its chattel character and will not become part of
the land.

GENERAL PRINCIPLE ON FIXTURES

The general principle that all fixtures attached to the land form part of the land does not apply
in the case of tenant’s fixtures which comprise trade fixtures, agricultural, ornamental and
domestic fixtures and in the case where proved custom allows for their removal.
In Sri Kajang Rock Product Sdn Bhd v Maybank Finance Bhd & Ors, the general principle
that all fixtures attached to the land form part of the land may not be relied upon by a lessee
of an equipment lease agreement to question the validity of the agreement by contending that
as he is now the owner of the equipments (fixtures), he could not be the lessee in respect of
them. The ‘fixtures’ argument may only be made by parties not privy to such an agreement,
for example, a purchaser of the land or a charge who is applying for an order for sale of the
land pursuant to a charge thereon.
In Kiah bte Hanapiah v Som bte Hanapiah, it was held that a tenant has the right to remove
tenant’s fixture affixed to the land so long as he is in possession as a tenant. Thus, when an
existing tenancy expires or is surrendered and is followed immediately by another, to the
same tenant remaining possession, the tenant does not lose his right to remove tenant’s
fixtures but is entitled to remove them at the end of his new tenancy. Where he does not
remove them within a reasonable time after the expiration of his tenancy, the landlord’s title
to the fixtures becomes absolute.
However, the said general rule applies in the context of certain relationship such as that of
vendor and purchaser, and charger and chargee. In the case of former, unless the contract of
sale indicates otherwise, all fixtures attached to the land at the time of the contract pass to the
purchaser. In the case of the latter, all fixtures, whether attached before or after the date of
charge; pass to the charge unless otherwise provided for in the charge agreement.
The rationale for such rule is that charge is over the land which is defined to include all
fixtures attached to the land, the charge will give the chargee security over all such fixtures to
the exclusion of other persons in the absence of a contrary intention. In Goh Chong Hin case,
there exists under the Malaysian Torrens system an inexpensive mode of ascertaining the
existence of incumbrances on the land by making a search on the register document of title to
the said land, thereby warning oneself to the nature of the incumbrance on the land.
To avoid the result in Wiggins Teape (M) Sdn. Bhd. v Bahagia Trading Sdn. Bhd. & Ors, the
owner of the article under the hire-purchase agreement should require the landowner to
exclude the article from any charge to be subsequently created over his land.
In Gebrueder Buehler AG v Peter Chi Man Kwong & 2 Ors, the Equipment supplied by the
plaintiffs, though installed and incorporated into the processing plant have not lost their
identity and are identifiable, machinery by machinery and equipment by equipment. The
question whether the Equipment had become fixtures and therefore part of the land depends
on the intention of the Company at the time they were installed in the factory.
If it was intended that the Equipment should form a permanent part of the factory then in law
they became fixtures upon annexation thereof to the factory and such intention is to be
gathered mainly from: (i) the degree of annexation and (ii) the object or purpose of
annexation. All or substantially all parts of the plant were fixed either directly to the factory
or indirectly thereto, i.e. - affixed to other equipment or structures which were themselves
affixed directly to the factory. The cocoa processing plant in the present case was installed in
the factory as "an adjunct" to the factory and to improve its usefulness as a factory for
manufacturing cocoa butter and cocoa powder.
Therefore there was physical annexation of the Equipment to the land and the annexation was
for the better enjoyment of the factory. In law they had become fixtures and formed part of
the land to which they were affixed. The Equipment had become part of the land long ago, at
least when it was installed. Therefore the plaintiffs had lost their title to the Equipment long
before the sale to the third party and what they had lost they could not and did not regain.
EXCEPTIONS TO GENERAL RULE IN LAW OF FIXTURES
The legal position is that once determined that an object is a fixture then there are certain
legal restrictions to their removal as they are no longer regarded as chattels. The legal
situation is that objects determined as fixtures will remain with the land and the title over it
will pass to whomever becomes a proprietor. But if such items are adjudged as chattels then
they may be removed by whoever claiming to be their owner, which could be different from
land ownership.
The rationale of the general rule underlying the concept or fixtures is that unless otherwise
provided for in the contract, a purchaser or chargee of the land has a right to all things if
proved to be fixtures, as being part of the land. In case of charge, fixtures pass to the chargee
even if they were affixed to the land after the charge transaction.
In Goh Chong Hin & Anor v The Consolidated Rubber Estates Ltd, it was held that the
English law of fixtures applied and that the rule stated by Blackburn J in Holland v Hodgson
was cited with approval. And as the machinery was fixed to the foundations of the building
and was securely attached into the soil with bolts it became fixture and this may be classified
as land. The items so attached to the land has been determined as fixtures and they will pass
to the chargee even if they have been affixed to the land after the transaction to create a
charge was completed.
The situations is also similar in cases where a dispute arises between a chargee and the owner
(Chargor) of the object under hire purchase. In Wiggins Teape (M) Sdn. Bhd. v Bahagia
Trading Sdn. Bhd. & Ors, it was held that the machine is a fixture and thus passes chargee
even if it were attached to the land after concluding the charge agreement unless of course
contrary was provided for in the contract.
The general rule is that when proved as a fixture, an item becomes part of the land and the
title over passes to whoever is regarded as a title-holder over the land. In MBF Finance Bhd v
Global Pacific Textiles Industries Sdn Bhd & Anor, the court held that the dyeing machines
are chattels and not fixtures and they are installed in the factory temporarily and their
removal would not occasion material injury to land. The annexing or affixing of the dyeing
machine to the land was never intended to have the effect of depriving the plaintiff’s title nor
is it meant to pass title to the first defendant.
There are two other exceptions to the general rule, which are practised under the law of
fixtures namely; exception under custom and Common law exceptions.
Exception under custom is where a custom exists in relation to a particular item that should
be considered chattel in all circumstances and can therefore be removed by the claimant. In
Re Tiambi bt Ma’amin, it was held that the existence of custom may act as waiver to the
presumption that the thing was intended to be permanently affixed.
The case of Kiah bte Hanapiah v Soom bte Hanapiah, further explains whether a Malay
traditional house of built on stilts, which could easily be dismantled and removed from one
place to another is a fixture.
Therefore, the only type of house that can be regarded as personalty in which ownership may
be separate from ownership of the soil is a Malay type wooden resting stilts which is not
buried into the earth.
The common law exempts item affixed by the tenant, or things attached to land as being
essential for trading or business purposes, or that for agricultural purposes or put by the
owner as domestic fixtures or as ornaments.