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George v. Commercial Credit Corp. - 440 F.2d 551 (7th Cir. 1971)

Rule:

The three tests for determining whether facilities remain personalty or are to be considered part of the realty are 1) actual physical annexation to the realty; 2) application or adaptation to the use or purpose to which the realty is devoted; and 3) intention of the person making annexation to make a permanent accession to the freehold. "Physical annexation" is relatively unimportant and "intention" of the parties is the principal consideration.

Facts:

The property owner, Dale Wallace Foskett (hereinafter, “Foskett”), lived in a mobile home, which was set on cement cinder blocks three courses high and could not move under its own power. The home was subject to a mortgage held by the Highway Mobile Home Sales, Inc. The mortgage was later assigned to Commercial Credit Corporation (hereinafter, “respondent”). After some time, Foskett filed for bankruptcy protection and Thomas T. George was assigned as the trustee. Contending that the mobile home was a fixture under applicable law, respondent asserted interest in the mobile home. On the other hand, the trustee insisted that the mobile home was and still is a motor vehicle, and has personality. The bankruptcy referee ruled in favor of the respondent. The trustee appealed.

Issue:

Under applicable law, was the mobile home in question a fixture?

Answer:

Yes.

Conclusion:

The court held that Wis. Stat. Ann. § 340.01 and decisional law increasingly recognized a distinction between mobile and motor homes. A mobile home was realty if it was physically annexed to realty, if it was adapted to the realty's use, and if the person annexing it intended to make a permanent accession to the freehold. In light of these factors, the court ruled that Foskett’s mobile home was a fixture and thus, it had the nature of real property. As such, the court concluded that respondent had an interest in the mobile home.

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