Helm v. Gilroy

Bean, J. — This case comes here on appeal from an order denying a preliminary injunction. The record is in a very unsatisfactory condition. In place of trying the issue between the parties in the original suit to foreclose plaintiff’s mortgage, as should have been done, it seems it was tried on a proceeding for a preliminary injunction, in aid of the original suit. In this proceeding, the court, after hearing the evidence, not only denied the writ, but entered a decree determining the question as to whether the property in controversy was subject to the lien of plaintiff’s mortgage, thereby splitting-up the original cause of suit; in the original suit entering a decree foreclosing the mortgage and ordering the real property sold to satisfy the amount due plaintiff, and in the ancillary proceedings for an injunction, determining the question as to whether the machinery was a part of such realty, when the entire question should have been put in issue either by [520] the original or an amended complaint and determined by one decree. A preliminary injunction is only a provisional remedy, the sole object of which is to preserve the subject in controversy in its then condition and without determining any question of right, merely to prevent the further perpetration of wrong, or the doing of any act whereby the right in controversy may be materially injured or endangered. In granting or refusing temporary relief by preliminary injunction, courts of equity should in no manner anticipate the ultimate determination of the question of right involved. They should merely recognize that a sufficient case has or has not been made out to warrant the preservation of the property or rights in statu quo until a hearing upon the merits, without expressing a final opinion as to such rights. (1 High Inj. §4; Hill’s Code, §§ 408, 411.) The granting or refusing such an injunction rests largely within the discretion of the court, and being merely an interlocutory order, made during the progress of the cause, does not ordinarily partake of the nature of a final judgment or decree to such an extent as to warrant an appeal therefrom. (2 High Inj. § 1693.) But in this case, the court not only refused the injunction but entered a decree settling the rights of the parties, and in effect determined the suit so as to prevent a decree therein, so far as this machinery is concerned, and therefore it must necessarily be an appealable order or decree under section 535, Hill’s Code; (Smith v. Walker, 57 Mich. 456; Tol. A. A. & N. Mich. Ry. v. Det. L. & N. R. R. 61 Mich. 9.) From what has already been said, it follows that so much of the decree of the court below as adjudges and decrees “ that the machinery referred to and described in plaintiff’s complaint for injunction is not a part of the real estate in controversy in this suit, and not included in plaintiff’s mortgage,” must be reversed. But since the question seems to have been determined in the court below on a full hearing of the evidence, which is made a part of the transcript, and both parties expressed a desire on the argument that we [521] should examine the case on its merits, we have concluded to do so. It is argued for respondent that under the agreement between the P. & L. M. Company and Gilroy & Youle, the machinery in controversy did not become fixtures, but retained its character as chattels, notwithstanding its annexation to the building in which it was placed, and was therefore not subject to the lien of the plaintiff’s mortgage. Before discussing this question, it will be well to understand the relationship of the parties to this record. The defendant Eogers, who alone is contesting plaintiff’s claim, is the assignee of the defendant Gilroy, plaintiff’s mortgagor, under the general assignment law of this state. As such assignee he succeeds only to the rights of his assignor, and is affected by all the equities existing as against him. He takes the property subject to all existing valid liens and charges. He acquires no better title than his assignor, and in this suit can make no defense to the mortgage that his assignor could not make. (Jacobs Bros. & Co. v. Ervin, 9 Or. 52; Gammons v. Holman, 11 Or. 284; Burrill on Assignment § 391.) The fact that he may have paid the P. & L. M. Co. with funds belonging to him as assignee the balance due to it from Gilroy & Youle on the purchase price of the machinery, does not change his relationship to the property in any way. It is in effect the same as if Gilroy himself had made the payment. He does not acquire title to this property by virtue of the bill of sale from the P. & L. M. Co., but by virtue of the deed of assignment from Gilroy. While the agreement between the P. & L. M. Co. and Gilroy & Youle was in form a lease, it was in effect a sale, and whatever right if any the company may have had as against this property was never asserted by it. It follows, therefore, that if the property in controversy was subject to the lien of plaintiff’s mortgage, as between them and Gilroy, such lien exists as against this defendant. The question then as to whether this machiuery became a fixture as to the P» [522] & L. M. Go. is immaterial in this case, and we forbear to express an opinion thereon. It has often been remarked that the law of fixtures is one of the most uncertain titles in the entire body of jurisprudence. The line between personal property and fixtures is often so close and so nicely drawn that no precise rule has or can be laid down to control in all cases. Each case must depend largely on its own particular facts. The reports and text-books are filled with decisions and discussions of this question, but none of the rules laid down are infallible or of universal application. We shall not attempt to quote from them, nor enter into any detailed discussion of the the question. We could not hope to throw any new light upon the vexed question. The weight of modern authority, keeping in mind the exceptions as to constructive annexation, admitted by all the authorities to exist, seems to establish the doctrine that the true criterion of an irremovable fixture consists in the united application of several tests: (1) Real or constructive annexation of the article in question to the realty. (2) Appropriation or adaptation to the use or purpose of that part of the realty with which it is connected. (3) The intention of the party making the annexation, to make the article a permanent accession to the freehold, this intention being inferred from the nature of the article affixed, the relation and situation of the party making the annexation, the policy of the law in relation thereto, the structure and mode of the annexation and the purpose or use for which the annexation has been made. (Henkle v. Dillon, 15 Or. 610; Ewell on Fixtures, 21; Teaff v. Hewitt, 1 Ohio St. 511; Thomas v. Davis, 76 Mo. 72, 43 Am. Rep. 756; Clore v. Lambert, 78 Ky. 224; Southbridge Sav. Bank v. Stevens Tool Co. 130 Mass. 547.) Applying these rules to the facts in hand, it is clear that the property in controversy as between the mortgagor and mortgagee must- be regarded as fixtures. Its annexation to the realty was sufficiently permanent to enable it to be used for the purposes intended, and was of the character usual with such machinery. It is [523] true the screws and bolts with which it was annexed could have been taken out and the machinery removed without serious damage to it or the building, but so no doubt could have been the doors and windows. It was in its very nature adapted to the business for which the land was used. The party making the annexation must have intended that it should remain as long as it continued serviceable, as the convenience and usefulness of the property would have been seriously impaired by its removal. So much of the decree of the court below as adjudges and decrees that the machinery in controversy is not part of the realty, and not subject to the lien of plaintiff's mortgage, is therefore reversed.