Dilapidations: Something for everyone
A breach of repairing obligations in a lease gives rise to dilapidations, but the pain can be reduced.
Tenants usually have a short term interest in the premises and do not want to spend any more than they have to.However, both parties can reduce the risk of drawn-out and miserable disputes with some easy steps:
- Get the lease drafted to suit you and to suit the building. For example, if you want replacement carpets at the lease end, say so.
- Rather than wait until the lease end, consider serving an interim schedule during the term if you are concerned about the tenant’s neglect of the building causing deterioration to your asset value.
- Get good pre-lease advice from a Chartered Building Surveyor and negotiate onerous aspects out of the lease. Agree a rent-free period that covers the cost of the works or that the landlord does these works prior to the lease commencement.
- Reduce your liability by reference to a Schedule of Condition stating you will not return the premises in any better condition at lease end than when you took it.
- Plan your exit to minimise the risk of dilapidations disputes and possibly loss of rent claims if a landlord has to undertake the works post lease.