## Facts

- General Electric Capital Corp. (GE Capital) financed medical equipment used by Oncology Associates of Ocean County, LLC (Oncology Associates) in its New Jersey oncology practice.
- The parties’ written finance/lease documents stated that the equipment would remain **tangible personal property** and would not become a **fixture** or part of the real estate, regardless of installation.
- After a dispute involving the parties’ rights in the equipment, Oncology Associates contended that the equipment had become so connected to the building that it should be treated as real property (fixtures).
- GE Capital maintained that the equipment remained personal property under the contract and that its interest should be treated as an interest in goods governed by New Jersey’s UCC Article 9 framework for personal-property collateral.
- New Jersey’s UCC definition describes fixtures as goods “so related” to particular real property that an interest in them arises under real-property law, but the statute does not specify exactly when that relationship is created.
- Oncology Associates argued that New Jersey recognized either (a) an “institutional doctrine” sometimes applied to equipment used in medical facilities or (b) the traditional common-law fixture test (including the parties’ intention), and that either method supported fixture status here.
- The dispute required the court to decide whether the equipment’s installation and use in a medical facility could override the contract’s express “no fixture” language as between the parties.

## Issues

1. Under New Jersey law governing fixtures, did the oncology equipment become fixtures despite the parties’ written agreement stating the equipment would remain tangible personal property?
2. Can the institutional doctrine or common-law fixture factors override clear contractual language on fixture status in a commercial equipment-financing relationship?

## Decision

- The court held the equipment **did not become fixtures** and remained **tangible personal property**.
- The court treated the parties’ express contractual statement that the equipment would remain personal property as the strongest evidence of their intention regarding fixture status.
- The court declined to use the institutional doctrine to convert the equipment into real property when the parties had agreed to the opposite result.
- Considering traditional fixture considerations (physical attachment, relationship to the premises’ use, and intention), the court found that any attachment and medical use did not outweigh the written intent that the equipment remain personalty.
- The court resolved the fixture-classification dispute in GE Capital’s favor, confirming that the equipment should be analyzed as personal property rather than as part of the real estate.

## Legal Principles

- Under New Jersey law, goods are fixtures only when they become so connected to real property that real-property interests arise in them; the statutory definition relies on real-property law to determine when that connection exists.
- In applying New Jersey’s fixture doctrine, the parties’ **intention** is a primary consideration, and clear contract language on whether goods will remain personal property generally governs disputes between the contracting parties.
- A medical facility’s use of specialized equipment, and even significant installation, does not by itself make the equipment a fixture when the contract unambiguously states it will remain personal property.
- The institutional doctrine does not automatically convert medical equipment into real property where sophisticated parties have expressly agreed that the equipment will not become fixtures.

## Conclusion

The court held that the oncology equipment financed by GE Capital remained tangible personal property under the parties’ agreement and did not become fixtures under New Jersey law, rejecting Oncology Associates’ reliance on the institutional doctrine and other fixture factors to override the contract’s explicit “no fixture” provision.


General Electric Capital Corp. v. Oncology Associates Of Ocean County, 2011 WL 6945739, 2011 U.S. Dist. LEXIS 143919 (2011)