1.1 Real Property vs. Personal Property

Land, Real Estate, and Real Property

Exam questions hinge on three nested terms. Land is the surface, everything beneath it down to the center of the earth, and the air space above it (the inverted pyramid). Real estate is land plus all permanent man-made improvements attached to it: buildings, fences, paved drives. Real property is real estate plus the bundle of legal rights that ownership conveys.

Memorize the bundle of rights with DEEPC: Disposition (sell, will, gift), Exclusion (keep others out), Enjoyment (use without interference), Possession (occupy), Control (use within the law). A lease transfers possession and use but not disposition, which is why a tenant cannot sell the building.

Appurtenances and Rights

An appurtenance is a right that runs with the land and transfers automatically on sale: water rights, mineral rights, air rights, and easements benefiting the parcel. The phrase "runs with the land" signals an appurtenance on the exam.

Personal Property and Fixtures

Personal property (also called chattels or personalty) is everything that is not real property: movable items such as furniture, a refrigerator that simply plugs in, and a contractor's tools. It conveys by a bill of sale, never by deed.

The classic dispute is the fixture: an item that was once personal property but has been attached to real estate so that it now passes with the land. Courts apply the MARIA test:

Intention, judged objectively from the circumstances, is the most heavily weighted factor. A built-in dishwasher hard-wired and plumbed is a fixture; a portable one on wheels is personal property.

Trade Fixtures and Emblements

• Trade fixtures are items a commercial tenant attaches to conduct business (a restaurant's walk-in cooler, a salon's wash stations). They remain the tenant's personal property and may be removed before the lease expires; the tenant must repair any damage. If left behind, they pass to the landlord by accession.
• Emblements are annual crops produced by a tenant farmer's labor (corn, wheat). They are treated as the tenant's personal property even after the lease ends, so the farmer may re-enter to harvest. Naturally occurring perennial growth (trees, wild berries) is real property.

Conversion Both Directions

Property changes category in two directions, and the exam tests the vocabulary:

• Annexation (affixation) — personal property becomes real property by attachment. Lumber (personalty) nailed into a frame becomes part of the real estate.
• Severance — real property becomes personal property by detachment. Cutting down a tree or mining ore severs it from the land, converting it to a chattel.
• Accession — an owner gains title to additions made to the property, including abandoned trade fixtures and natural growth.

The conveyance instrument follows the category: real property transfers by a deed recorded in the county land records; personal property transfers by a bill of sale. A purchase agreement for a home routinely conveys both — the real estate by deed and listed appliances by bill of sale — which is why a thorough contract itemizes personal property explicitly.

Worked Example: The Disputed Sale

A buyer tours a home and notes a wall-mounted flat-screen TV on a custom bracket, a chandelier in the dining room, and an above-ground pool. The contract is silent. After closing the seller removes all three. Which was the buyer entitled to keep?

• Chandelier — hard-wired into the ceiling; method of attachment plus intention show it is a fixture; it stays. Removing it was improper.
• Wall bracket — screwed into studs, a fixture; the bracket stays, but the TV resting on it is personalty and goes with the seller.
• Above-ground pool — movable, not permanently affixed; generally personal property that the seller may take.

Notice that the same physical room produced three different outcomes, all driven by the MARIA factors of attachment and intention. The lesson the exam reinforces is procedural: list every questionable item in the contract.

Trap: A clean, professional practice is to specify each borderline item in the purchase agreement. The exam rewards the answer "specify in the purchase agreement," because agreement (the second A in MARIA) overrides every other factor. When the contract states an item conveys, it conveys regardless of how it is attached — and when it states an item is excluded, the seller keeps it even if it is bolted down. Agreement is the master key that resolves fixture disputes before they start.

Crops, water, and support rights at the boundary

Two more boundary categories appear on exams. Fructus naturales — naturally growing perennial plants such as trees, shrubs, and wild grasses — are part of the real property and pass with the deed. Fructus industriales (emblements) — cultivated annual crops produced by human labor — are personal property and may belong to a departing tenant farmer even after the lease ends.

Water rights also travel as appurtenances. Riparian rights attach to land along a flowing waterway (river, stream); littoral rights attach to land bordering a still body of water (lake, ocean). In either case the right runs with the land and cannot be sold separately from it in most jurisdictions.

Trap: Once mineral or water rights are severed by a separate conveyance, they become a distinct estate and no longer pass automatically with the surface deed — a frequently tested distinction.