Store Shelves, Coolers & Displays Are Trade Fixtures, Not Landlord’s Personal Property

What Happened: A strip mall tenant made extensive improvements to convert what had been a used clothing store into a grocery store. Over time, relations with the landlord soured. Convinced that he was paying too much for rent and CAM, the tenant decided to vacate and move to a new location when the lease expired. The landlord then moved in to remove the ventilation hood, display cases, checkout counters, interior freezer cases, and other improvements. The tenant cried foul, claiming that these things were its property. After a two-day trial, the lower court sided with the tenant.

Ruling: The Maryland appeals court upheld the ruling.  

Reasoning: The chattels were “trade fixtures” owned by the tenant rather than personal property owned by the landlord. While “fixtures” affixed to the property are normally considered part of the property owned by the landlord, as in most states, Maryland makes an exception for “trade fixtures,” defined as “items affixed to realty for the purpose of enabling the tenant to perform properly a trade or profession, which can be removed without material or permanent injury to the realty.” The items in this case met the standards for being considered trade fixtures:

• The tenant installed them so that it could run a grocery store offering refrigerated and frozen foods; and
• The cooler and other systems were installed in an impermanent and movable way that allowed for their subsequent removal without damaging the building systems or structures.  

• EBC Props., LLC v. Urge Food Corp., 2023 Md. App. LEXIS 156