THE ADVOCATE 697
VOL. 78 PART 5 SEPTEMBER 2020
WHAT’S MINE IS MINE AND
WHAT’S YOURS IS MINE: WHO OWNS
A BUILDING BUILT ON LEASED LAND?
By Joel Nitikman*
Suppose you are asked who owns the fixture or the building in
each of the following four scenarios:
(a) your client, a tenant, has leased land and a building thereon
from a landlord. The tenant attaches a chattel to the building
in such a way that it becomes a fixture;1
(b) same as (a), but the landlord and tenant agree that the chattel will
belong to the tenant after it is attached to the building;
(c) the tenant has leased bare land from a landlord. The tenant builds a
building on the land;
(d) same as (c), but the landlord and tenant agree that the building will
belong to the tenant after it is built.
In respect of scenario (a), the law has been clear for hundreds of years
that the fixture belongs to the landlord after it is attached to the building, or
to be more correct technically, the chattel becomes a fixture at the moment
it is attached to the building and ownership of it passes to the landlord by
operation of law at that instant. In essence, the law regards the chattel as
“melding with” and becoming part of the building. As the building belongs
to the landlord, and as the chattel, qua fixture, is now part of the building,
the fixture belongs to the landlord.
The same is true in scenario (c). For hundreds of years the common law
has said that if a tenant builds a building on the landlord’s land, then the
landlord owns the building, even though the tenant paid for it: quicquid
plantatur solo, solo cedit (whatever is fixed to the land becomes part of it).
The tenant may be given the right to sever the building and take it away at
the end of the lease, but that does not change the fact that, during the term
of the lease, the landlord owns the building. In essence, the building is just
* Michelle Moriarty of Legacy Tax Lawyers researched parts of the law cited herein. Any mistakes are the author’s.