Material Trading Pte Ltd v DBS Finance Ltd is an application by the plaintiffs to the High Court of Singapore to declare that overhead cranes were chattels.
The parties involved were:
- Plaintiff: Material Trading Pte Ltd
- Defendants: DBS Finance Ltd
On 15 February 1988, the judgement was delivered by:
- Thean J: L.P. Thean (or Thean Lip Ping)
Facts of the Material Trading Pte Ltd v DBS Finance Ltd
Material Trading Pte Ltd leased two plots of land. DBS Finance Ltd provided the mortgage through four instruments.
As Material Trading Pte Ltd was going through liquidation, its properties and possessions were sold off by the liquidators. Among the items were three overhead cranes installed in its warehouses. Before the liquidation, Material Trading Pte Ltd used these warehouses to store its hardware materials inventory.
DBS Finance Ltd sent a notice to the liquidators 17 days after the three overhead cranes were sold through an auction. The purchaser was in the process of removing these cranes. DBS Finance Ltd contended that the cranes were fixtures. Because they were fixtures, these cranes were part of the land.
Material Trading Pte Ltd’s Position
The plaintiff contended that the cranes are movables:
- The cranes aren’t fixed to the ground;
- They travel along steel runways;
- Removing the cranes do not damage the runways, the steel framework the cranes rest on, or other parts of the structure of the buildings;
- The steel runways can accommodate more than one crane – suggesting that the cranes can be replaced, substituted, orr interchanged without any destruction or damage to the warehouse.
They cited these cases to support their contention:
- Hutchinson v Kay (1857) 23 Beav 413; 53 ER 163
- Hulme v Brigham and Anor [1943] 1 All ER 204
DBS Finance Ltd’s Position
The defendant focused their arguments on the steel runway:
- The cranes need the runways – thus, the former is an intergral part of the latter;
- The runways are permanently attached to the buildings;
- Holland and Anor v Hodgson and Anor (1872) LR 7 CP 328 (link to my previous entry here); and
- Reynolds v Ashby & Son [1904] AC 466
- Because the cranes were installed part of the warehouses, it makes them essential to the building
- D’Eyncourt v Gregory (1866) LR 3 Eq 382
- Monti v Barnes [1901] 1 QB 205; and
- Vaudeville Electric Cinema Ltd v Muriset [1923] 2 Ch 74.
Court’s Decision
The High Court dismissed the application.
Thean J’s Judgement
A Question of Fact and Law
Whether the cranes are fixtures or chattels/movables is a matter of both law and fact. One has to look at the why (intention and circumstances indicating the intention).
The learned judge goes beyond addressing how the steel runways are attached to the building. He examined what the overhead cranes consist of: the principal components of the cranes are the long steel girder, the chain hoists and other accessories attached to it, the end truck frames, the wheels and the steel runways. Without the runways, the cranes are incomplete and cannot operate.
Manner of Annexation – Hutchinson v Kay and Hulme v Bringham Distinguished
The learned judge notes that both cases were decided based on their own circumstances. However, the commonality of the two is the matter of annexation to the land or building. The cotton looms and the printing machines were attached purely by their weights. In the present case, the steel runway was fixed permanently to the warehouse.
Purpose of the Annexation
Besides considering how something is attached to the land, the courts need to look at why it’s brought there.
In law, an article may become a part of the land by its own weight and without any attachment by nail or bolt
Thean J in Material Trading Pte Ltd v DBS Finance Ltd [1988] 2 MLJ 162
Based on this principle, statues and decorative items resting on their weight become fixtures on the ground when they were included in the house design – D’Eyncourt v Gregory (1866) LR 3 Eq 382.
The two other cases , the learned judge notes, applied the principles:
- Monti v Barnes [1901] 1 QB 205 – “dog grates” installed with the intention to improve the inheritence and be part of the freehold are fixtures despite being held down by their own weight
- Vaudeville Electric Cinema, Ltd v Muriset [1923] 2 Ch 74 – Cinema chairs bolted to the floor for “better enhoyment of the Hippodrome”.
Returning to Material Trading Pte Ltd v DBS Finance Ltd, the learned judge notes that the warehouse was constructed with the specification of the cranes in mind. These fixed overhead cranes were supposed to be there permanently. They are different from mobile cranes.
Singaporean Case in Malaysian Common Law
Malaysia’s common law evolves with time. We turn to decisions in other jurisdictions that can help us formulate, refine, or revisit our past decisions. Though the decisions of the High Court of Singapore has no bearing in Malaysia, it is still persuasive. Check out this entry (link) where you can explore the importing of cases further.
Material Trading Pte Ltd v DBS Finance Ltd [1988] 2 MLJ 162 found its way into our legal body of knowledge through several cases:
- Esso Malaysia Bhd v Hills Agency (M) Sdn Bhd & Ors [1994] 1 MLJ 740
- Sri Ternak Mart (SK) Sdn Bhd v Majlis Perbandaran Subang Jaya [2019] MLJU 1635
The High Court in Malaya – in these cases – referred to Material Trading Pte Ltd v DBS Finance Ltd.
