Landlords expect Commercial tenants to look after the property they are renting and also maintain it according to the terms of the lease.
A failure to do so could result in a dilapidations claim by the landlord, for failing to keep the property in good order.
There are a number of steps that can be taken either at the start of or during the lease to assist with any future dilapidations claim:
Prior to signing a commercial lease
Before signing a commercial lease agreement, it is important to understand how the terms of the lease affect the tenancy and, in particular, the repairs and ongoing maintenance that tenants will be expected to cover. For example, will tenants be responsible for just the interior decoration or for structural maintenance too?
By seeking expert legal advice before agreeing and signing the terms of the lease, tenants and landlords alike will know where they both stand which avoids disputes arising over bills for unexpected repairs.
Schedule of Condition
Before the lease agreement is signed it is a good idea to instruct a specialist, independent commercial surveyor. They will be able to provide an inspection report to ensure that the description of the property’s current condition is accurate, thus avoiding disputes further down the line.
If the surveyor uncovers issues with the property’s state of repair a Schedule of Condition is usually attached to the lease which is clearly referred to within the repairing covenants.
This means that at the end of the lease period a tenant will not be expected to carry out repairs to the property which were already in existence, provided the Schedule of Condition adequately identifies such defects.
Alterations to the property
If a tenant plans to carry out alterations to the property, the terms of a tenancy agreement will outline whether this is allowed.
Tenants may need to liaise with the landlord before doing so and even if the works are approved, the tenant may be required to restore the property to its previous state at the end of the tenancy, even if the alterations might be considered to add value to the property.
A failure to reinstate the building to its original state could result in a dilapidations claim.
Schedule of Dilapidations
Either during or at the end of a tenancy, if a landlord believes that repairs and remedial work is necessary a Schedule of Dilapidations should be presented – which sets out the list of repairs needed and the costs of the same.
The Schedule of Dilapidations will identify the potential sums the landlord could pursue from the tenant should the repairs not be adequately completed before the end of the term. There are further sums that could be claimed in addition to those set out within the Schedule of Dilapidations, such as lost rent.
It is advisable for both parties to seek advice from an independent surveyor who will be able to verify whether the list of repairs is accurate.
Disputing a dilapidations claim
If you are a landlord and a tenant is disputing the Schedule of Dilapidations, we can assist with any claim you might need to bring, whether or not any of the above steps have been taken.
If you are a tenant and feel the Schedule of Dilapidations is inaccurate, we can equally assist in defending any claim. This area of commercial property law can be complex, but our specialist team of solicitors have wide experience of dealing with dilapidations claim disputes on behalf of both tenants and landlords and, as such, we can advise you on the best way forward, to ensure the best possible outcome.
Typical disputes that can arise and where we can assist include:
- Liability for repairs
- The extent of the repairs
- Cost of repairs
- The adequacy of the repairs undertaken
Where a dilapidations claim cannot be resolved, there may well be a provision in the letting agreement that permits the landlord to recover professional fees from the tenant and this should be borne in mind.
Further, where there are outstanding dilapidations this can impact on the validity of break notices, which in turn could impact the ongoing liability of tenants to the landlord.
Get in touch with us now to find out how we can help both landlords and tenants with dilapidation claim disputes.
