81 N.E.3d 261
Ind. Ct. App.2017Background
- Timothy Luttrell and Don Short formed an oral partnership, J&D Sawing, in 2005; the partners purchased and installed a 50-ton crane and a hydraulic narrow-belt saw in a building on Indiana Stone Works (ISW) property for use in stone fabrication.
- J&D Sawing maintained separate utilities for the building; the equipment was bolted/anchored to rails and connected to electricity and water but could be disassembled and moved (saw in ~2 days; crane removable but would require heavy gear).
- J&D Sawing reported losses and never fully purchased the building; Luttrell claimed the equipment remained partnership personal property and intended to buy the real estate later.
- Regions/Union Planters/NBD Bank (the Lender) held mortgages on ISW and had filed a UCC financing statement claiming interests in "all equipment, fixtures...and attachments" of ISW; the Lender intervened claiming the crane and saw were fixtures subject to its mortgage.
- Luttrell sued to dissolve the partnership and sought possession of the crane and saw; Short and ISW defaulted. The trial court awarded the equipment to Luttrell, finding they were not fixtures subject to the Lender's liens.
- On appeal the sole consolidated issue was whether the crane and saw were fixtures subject to the Lender’s mortgage liens; the Court of Appeals affirmed the trial court.
Issues
| Issue | Plaintiff's Argument (Luttrell) | Defendant's Argument (Lender) | Held |
|---|---|---|---|
| Whether the crane and saw are fixtures attached to ISW realty and thus subject to the Lender's mortgage liens | Equipment purchased by J&D Sawing remained partnership personal property; partners intended equipment to remain removable and not to become part of ISW realty | Equipment is large, installed in a building built for them, bolted/anchored and integral to the building’s intended use, so objectively fixtures subject to the mortgage | The court held the equipment are not fixtures; intent to make them permanent accessions was not shown, so they remain personal property of J&D Sawing and are not subject to the Lender's mortgage liens |
Key Cases Cited
- Dinsmore v. Lake Elec. Co., 719 N.E.2d 1282 (Ind. Ct. App. 1999) (articulates three-part test for fixtures and emphasizes intent controls)
- Gill v. Evansville Sheet Metal Works, Inc., 970 N.E.2d 633 (Ind. 2012) (defines fixture as personal property that becomes part of real estate by attachment)
- Ochs v. Tilton, 103 N.E. 837 (Ind. 1914) (early definition of fixture)
- State ex rel. Green v. Gibson Circuit Court, 206 N.E.2d 135 (Ind. 1965) (fixture determination is mixed question of law and fact dependent on circumstances)
- Citizens Bank of Greenfield v. Mergenthaler Linotype Co., 25 N.E.2d 444 (Ind. 1940) (intention inferred from circumstances governs fixture analysis)
- Peed v. Bennett, 52 N.E.2d 629 (Ind. Ct. App. 1944) (intention to create permanent accession must be shown)
- Hamilton v. Huntley, 78 Ind. 521 (Ind. 1881) (historical support for fixture analysis focusing on integration with building)
