Under the law, the state is required to compensate a property owner only for the real property acquired and for damages, if any, caused to remaining real property. No payment can be made for personal property; hence, proper legal classification of a particular item must often be decided. Generally, the challenge of identifying an item as personalty or realty requires determining whether it constitutes a “fixture,” as the laws of this state comprehend that term. The term “fixture” is generally used to denote an item of personal property that has become so annexed to land or buildings that is has become a

part

of the realty. Making this determination is often not an easy matter. The courts have no fixed rule classifying forever any certain item as a fixture. However, certain definite rules have been developed which are to be followed in determining whether an item is a fixture. For this reason, the determination must necessarily be made in the field. The ROW Program Office will assist in any way possible. Emphasis is placed on the investigation and study to be made, and the analysis should be as objective as possible. The conclusion reached should not be swayed or influenced by sympathy for or statements made by the property owner, nor should it be swayed or influenced by the desire to save money for the state. The appraiser must identify the items considered in the appraisal to be real property as well as those major items identified as personal property in the appraisal report (49 CFR 24.103(a)(2)(i)).

If the status of the item is not obvious to the appraiser, he/she should request legal instructions and should state in his/her report that the property has been appraised in accordance with such legal opinion. The appraiser’s personal opinion may not be in agreement with the legal opinion; however, this is a legal rather than an appraisal matter. The appraiser should follow such instructions, setting out in the report that the resulting value is “subject to the instructions” rather than an “instructed value.” When questionable items exist, the appraiser should be furnished with a copy of form with the owner/tenant regarding items of personalty and realty.