If you are a landlord or a tenant of a commercial lease which is coming to an end then amongst other things, you ought to revisit the lease to establish whether there are any repairing covenants or obligations, governing the state of repair of the premises when the tenant relinquishes possession at the end of the term. If the tenant has failed to comply with its repairing obligations, the Landlord may bring a claim against the tenant for damages.
Landlords would normally instruct a surveyor to inspect the premises and prepare a schedule of dilapidations. The schedule of dilapidations informs the tenant what repairs the landlord considers are required to be carried out. As there are specific rules, covering when and how a schedule of dilapidations should be served on the tenant, it would be sensible to instruct a solicitor to serve the schedule of dilapidations for you.
If you are a tenant who has been served with a schedule of dilapidations, you should consider instructing a surveyor and solicitor to assist you in responding to the schedule of dilapidations.
How does the process work?
Once a landlord has served the tenant with a schedule of dilapidations, the parties should comply with the “Dilapidations Protocol” which is governed by the Civil Procedure Rules 1998. The purpose of the Dilapidations Protocol is to enable parties and their professional advisers to seek to resolve any dilapidations issues without having to commence court proceedings.
The flowchart available here provides a basic summary of how the Dilapidations Protocol works and the steps that parties should take.
In certain circumstances, there can be some benefit in serving a schedule of dilapidations prior to the termination of the lease. If a tenant is served with a schedule of dilapidations, prior to the termination of the lease (but still close to the end of the term of the lease), it can also afford the tenant the ability to carry out any necessary repairs before handing the premises back to the Landlord.
How long does the process take?
The process mentioned in the flowchart above can take a few months, depending on how constructive the negotiations between parties are.
However, if the Landlord issues court proceedings, a claim is likely to be considered at trial within a period of 12 to 18 months. In the majority of cases, disputes are resolved prior to trial by parties agreeing settlement terms.
How much does it cost?
When we meet with you, we will consider the matters that need to be attended to and provide you with a cost estimate at the outset. Please note that there is likely to be input from surveyors and therefore you should also be mindful of the costs associated with instructing a surveyor to either prepare or challenge a schedule of dilapidations.
What you should consider before calling
Before calling us or arranging a meeting with one of our specialist lawyers, please ensure you have a copy of your lease to hand, together with any licence for alterations or deed of variation. If relevant, please also ensure that you have a copy of any survey report/schedule of condition that was commissioned at the time the lease was entered into.