Michigan Nat. Bank, Lansing v. City of Lansing

• Decision Date: 02 April 1980
• Docket Number: Docket No. 44162-44167
• Citation: 96 Mich.App. 551,293 N.W.2d 626
• Parties: MICHIGAN NATIONAL BANK, LANSING, Petitioner-Appellant, v. CITY OF LANSING, Respondent-Appellee.
• Court: Court of Appeal of Michigan — District of US

Page 626

293 N.W.2d 626

96 Mich.App. 551

MICHIGAN NATIONAL BANK, LANSING, Petitioner-Appellant, v. CITY OF LANSING, Respondent-Appellee.

Docket No. 44162-44167.

Court of Appeals of Michigan.

April 2, 1980.

Released for Publication July 11, 1980.

Leo Goldstein, Michael R. Kramer, Southfield, for petitioner-appellant.

Stephen R. Sawyer, Lansing, for respondent-appellee.

Before J. H. GILLIS, P. J., and ALLEN and KELLY, JJ.

J. H. GILLIS, Presiding Judge.

This is an appeal from a Michigan Tax Tribunal order affirming six real property assessments made by the respondent on certain items of petitioner's property. Five of the assessments concern properties owned by the petitioner and one of the assessments involves property leased by the petitioner. The matter in dispute is whether certain items of bank equipment, specifically, bank vault doors, night depository equipment, drive-up teller window equipment and remote transaction systems, are subject to assessment and taxation as real property or whether they are items of personal property which are exempt from taxation under M.C.L. § 211.9(m); M.S.A. § 7.9(m).

In an opinion dated February 14, 1979, the Tax Tribunal affirmed the assessments holding that each of the items was subject to assessment and taxation as real property. The petitioner appeals from that determination as of right. See CAF Investment Co. v. Saginaw Twp., 79 Mich.App. 559, 262 N.W.2d 863 (1977), M.C.L. § 205.753; M.S.A. § 7.650(53).

This Court's authority to review a decision of the Tax Tribunal is very limited. On appeal, we are bound by the factual determinations of the Tribunal. Ironwood v. Gogebic County Board of Comm'rs, 84 Mich.App. 464, 469, 269 N.W.2d 642 (1978). Where, as here, no fraud is alleged, our review is limited to the question of whether the Tribunal committed an error of law or adopted a wrong principle. Consolidated Aluminum Corp., Inc. v. Richmond Twp., 88 Mich.App. 229, 231, 276 N.W.2d 566 (1979), Const. 1963, art. 6, § 28.

For the purpose of taxation, real property includes "all lands within the state, and all buildings and fixtures thereon". M.C.L. § 211.2; M.S.A. § 7.2. Petitioner contends that the Tribunal erred as a matter of law in concluding that the items were fixtures. We disagree.

The test to be applied in order to ascertain whether or not an item is a fixture emphasizes three factors:

(1) Annexation to the realty, either actual or constructive;

(2) Adaptation or application to the use or purpose of that part of the realty to which it is connected or appropriated; and

(3) Intention to make the article a permanent accession to the realty. Morris v. Alexander, 208 Mich. 387, 175 N.W. 264 (1919), Peninsular Stove Co. v. Young, 247 Mich. 580, 226 N.W. 225 (1929). The intention which controls is that manifested by the objective, visible facts. The permanence required is not equated with perpetuity. It is sufficient if the item is intended to remain where affixed until worn out, until the purpose to which the realty is devoted is accomplished or until the item is superseded by another item more suitable for the purpose. See San Diego Trust & Savings Bank v. San Diego County, 16 Cal.2d 142, 105 P.2d 94 (1940).

Applying these factors to the present case necessitates the conclusion that the Tribunal properly found the items in question to be fixtures. All four items are physically annexed to the realty. The night depository equipment, drive-up window equipment and the vault doors are all cemented into place. Once installed, they are integrated with and become part of the wall in which they are mounted. The remote transaction units are also physically integrated with the land and the buildings. Such a unit consists of a roof-type canopy supported by pillars which extends from the building wall or roof over the customer unit. The customer unit is mounted with steel bolts to a specially constructed concrete island. A pneumatic tube system runs either up into the canopy or down into the ground and then into the building.

Furthermore, each item is adapted to the use of the realty. In fact, not only is the present use of these buildings dependent on the presence of these items, none of these items can be used unless they are affixed to a building or land.

Taken together, these factors establish the petitioner's intent to permanently affix these items to the realty. The Tribunal did not err in classifying them as fixtures. As fixtures they are...