In New Jersey, as in all other states, landlords and tenants occasionally find themselves disputing over ownership (and potentially removal) of fixtures installed on the property.
What is a fixture, exactly?
In the landlord-tenant context, there are essentially three main classes of property relating to the premises and the objects within.
A fixture is therefore an object that – while recognizable as a separate item – is generally regarded as having been fully integrated into the real estate itself. It occupies something of a middle ground between separate personal property and building materials.
If an object is transformed into a fixture, the tenant may not remove it without the landlord’s permission. A fixture has become part of the real estate and therefore belongs to the landlord (with the exception of trade fixtures).
New Jersey law, perhaps, more eloquently describes when a separate physical object is transformed into a fixture in the NJ Revised Statutes section 12A:2A-309(1)(a). As per the Revised Statutes, a physical object becomes a fixture when it “becomes so related to particular real estate that an interest in it arises under real estate law.”
The question of whether a separate object – say, a newly-installed sink – has become a fixture is a question that depends on the circumstances of the case. The court must determine whether a given object has become so tightly integrated into the real estate so as to constitute a permanent attachment. Communications between the tenant and landlord may also reveal the intentions of each party with regard to the potential fixture.
Though the particular circumstances of a case plays a role, certain expectations have developed over time with regard to certain objects and fixtures. A New Jersey court is likely to find that ceiling fans, insulation, heating, sanitation, and plumbing equipment constitute fixtures that integrate into the real estate property. By contrast, a New Jersey court is likely to find that individual window-based air conditioning units, appliances (such as a washer/dryer), and decorative lighting equipment constitute separate personal property that the tenant is entitled to.
To avoid disputes, it’s generally recommended that landlords and tenants in New Jersey explicitly identify and determine, under written contract, which objects are to be considered fixtures and which will continue to be the personal property of the tenant.
Commercial tenants make use of “trade fixtures.” Unlike standard fixtures, trade fixtures – which is any fixture-like object used in a commercial tenancy for the purpose of conducting business – are owned by the tenant and may be removed, so long as the tenant can restore the property to its pre-installation condition.
For example, a built-in cabinet installed by a residential tenant would likely be considered a fixture and would belong to the landlord. A built-in cabinet installed by a commercial tenant (for use as a retail shelf), on the other hand, would likely be considered a trade fixture and would belong to the tenant.
However, commercial tenants that abandon their trade fixtures after the lease term is over may not come back to claim them. A trade fixture that remains after the lease term will become integrated into the real estate property.
If you are a New Jersey landlord having a tenant fixture dispute, you should consult with an attorney who has experience handling landlord tenant law in New Jersey. Let the skilled attorneys at Griffin Alexander, P.C. help you today.
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