In the repossession of secured collateral in a bankruptcy case, it happens on occasion that some of the items have been affixed to the premises, such as boilers, heaters, cooling systems, cabinets, rugs, chandeliers, etc. What happens then? Can the creditor take the item or items?
When an item of collateral has been permanently affixed to realty, it is said to be a “fixture” and cannot be removed. Even if a piece of collateral may be removed from a premises, it may still qualify as a fixture under some situations. In Re Heflin, 326 B.R. 696 (W.D. Ky 2005). The relative ease with which an object can be removed is one of the tests to see if something qualifies as a “fixture” or not.