Dilapidation in Relation to a Commercial Lease, What you Need to Know

The starting point for almost any landlord in the case of determining the extent of a tenant’s obligations and whether there may have been a breach by the tenant is to read over the lease and any other supplemental documents such as a licence for alterations and a deed of variation. If the covenant requires the tenant to "put and keep" in repair, this often means that a tenant needs to put the property in repair even if it was out of repair at the beginning of the lease. What is considered to be to “put and keep” in repair can be a reason for the dispute itself.

A tenant will often be responsible for repairing the property and not necessarily improving it. A landlord won’t often pass on the costs of improvement works that are necessary to draw in new tenants to a property.

How does a landlord need to deal with dilapidations?

Once a landlord is satisfied that they have a dilapidation claim, they need to think about their future plans for the property at an early point in time. If their intention is to sell or re-let, the earlier the schedule of dilapidations is served on the tenant, the bigger the chance that the tenant will be able to carry out the work and the landlord will be able to re-let much quicker. At the same time, the landlord might prefer to wait until the end of the term and then serve a schedule of dilapidations with a view to negotiating a financial settlement near the end.

Evidence

There is standard practice for assessing dilapidations at the end of a Lease, and often a surveyor is instructed by the landlord to prepare a Schedule identifying the dilapidations claimed, and what value the landlord places upon them. The surveyor needs to sign an endorsement to confirm that the landlord’s future intentions for the property have been taken into account when preparing a schedule. This indicates that there should be no schedule setting out proposed extensive repairs to a property if in fact it will be redeveloped.

If you believe your landlord’s schedule of dilapidations has been unfairly served or is inaccurate, you need a professional surveyor to help you with your case. Our team of dilapidation surveyors in Borehamwood, Barnet and Watford are highly experienced and fully RICS qualified. Don’t suffer in silence, get in touch with Simon Levy Associates and get the justice you deserve in the right way. To find out more, please contact us today.