What makes it attached equipment?

Often during the course of a facility inspection, the owner will be walking with me asking various questions. One that is often repeated is "what makes that attached?" The business owner will be pointing at a piece of equipment and waiting for an answer. The legal definition of attached equipment or improvement pertaining to realty begins with the question: when is an improvement an improvement pertaining to realty? It is an improvement pertaining to realty when it conforms to one of these three tests:
1. The equipment is attached (it is by definition a fixture)

• CC660 - permanent by means of nails, bolts, screw, cement, plaster. CC1019 If the removal can be effected without injury to the premises unless the thing has, by the manner in which it is annexed, become integral to the premises
• common law - MCIP, i.e., Manner, Character, Intention, Purpose. Manner in which it is annexed. Character of the fixture, Intention of the persons making the annexation and the Purpose for which the premises are in use

2. Substantial economic loss in value to the fixture, i.e., diminished economic value in either a physical or economic manner.

3. substantial damage to the real property. Economic damage and or physical damage.

So, it is attached if through removal either the building or the equipment will suffer substantial economic loss. Substantial economic loss - who determines this and when? This also is rather subjective. It is at this point during the facility inspection the Appraiser must make a judgment, based upon the information he/she is confronting. Filtered with the above three conforming factors and decide - attached or or not?

For example, consider a recent assignment located at a lumber/hardware store. This business had been an operating enterprise for the last fifty years. Recently the new owners purchased and installed new gondola merchandisers during a complete remodeling of the hardware store sales area. The intent was annexing the equipment in a permanent manner. The proof of the intention was DE facto to the method of installation, i.e., hard wiring the gondola light canopy, bolting to the interior walls and floors. Only after careful contemplation of the method of installation, and intention, was the conclusion made to consider as attached equipment. Directly across the street, same project, different business a very similar scenario. Same type of equipment, however the installation and intentions different. At this business the gondola merchandisers were considered movable.