chattels and fixturesThis is the story of a nice house, an even nicer playhouse, and how sometimes, real estate transactions don’t go as planned. In real estate lingo, we’d say this is a story about chattels and fixtures (more on that later).

The Buyers, Barbie and her husband (not Ken, she broke it off with him after college) purchased a quaint suburban home and the main selling feature for them was the playhouse. So extravagant was this playhouse, that it even had electricity. It was a place where they envisioned their daughter playing and having tons of fun using her imagination.

The Sellers, Ken and his wife, decided that they too loved this playhouse and much to the contrary of the Agreement of Purchase and Sale they had signed, (not to mention the MLS listing), they disconnected the power and took the playhouse with them when they moved out. Ken and his wife also decided to leave garbage and items they no longer wanted in the house, for Barbie and her family to deal with.

Barbie’s Agreement of Purchase and Sale clearly stated that the playhouse was included in the sale and further, that the Sellers were to leave the house in “broom swept” condition. Barbie is now tasked with having to take Ken to small claims court for loss of perceived value and breach of contract. This should be a very winnable case for Barbie and her family.

Unfortunately, this is a problem that arises too frequently when buying a property, usually because the real estate agent representing the Sellers didn’t confirm with them what was included and excluded with the sale or because the agent representing the Buyers didn’t take the time to list what was and what was not included in the Agreement of Purchase and Sale.

In real estate lingo: a chattel is movable property and includes furnishings, things that you can pick up and move around – for example, appliances, a gas BBQ, curtains or a playhouse. In most real estate transactions, chattels are NOT included in a sale, unless specifically provided for in the Agreement of Purchase & Sale. A fixture, on the hand, is an item that is physically affixed to the property, for example, a medicine cabinet , doors or fancy faucet. In most real estate transactions, fixtures are automatically part of the sale, unless excluded in the Agreement of Purchase of Sale.

My rule of thumb: always specifically define what is and is not included in the sale, including anything that could be a grey area, like an air conditioning unit or playhouse. That will ensure there’s a paper trail and more importantly, a binding contract clearly stating what is included with the purchase of the property.

On a side note, always, always, always insert a clause that the Seller will not leave any personal items or debris for you to deal with … those 1-800 guys are EXPENSIVE.

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