Law of Dilapidations
Dilapidations and Commercial Lease – What is it?
Property dilapidations refer to the process of identifying and repairing any damages or defects that exist in a property, particularly commercial properties, at the end of a lease.
It is typically the responsibility of the tenant to ensure that the property
is returned to the landlord in a repaired condition, in accordance with
the lease covenants, taking into account reasonable wear and tear.
Before the end of the lease, the landlord or their appointed surveyor
will carry out an inspection of the property to identify any areas of
damage or disrepair.
This inspection will form the basis of a Schedule of Dilapidations, which
outlines the repairs that the tenant is required to carry out.
The tenant may be given the opportunity to carry out the repairs
themselves, or the landlord may arrange for the work to be carried
out and deduct the cost from the tenant's deposit. The tenant may
dispute the dilapidations schedule and appoint their own Chartered
Surveyor to assess the contents of the Schedule.
It is important for both landlords and tenants
to understand their obligations with regards to
property dilapidations, as failure to comply
can result in financial penalties or legal action.
The landlord typically includes a clause in the lease agreement that
outlines the tenant's obligations with regards to dilapidations. This may include requirements to ‘put’, ‘keep’, repair or replace any damaged fixtures or fittings, to redecorate the property, and to return it to its original state. It is also usual for a clause in the lease stating that the tenant is responsible for the costs of the preparation and service of a Schedule of Dilapidations.
If the tenant fails to meet these obligations, the landlord may be able to withhold part or all of the tenant's deposit to cover the cost of repairs and renovations. The landlord may also be able to take legal action against the tenant to recover any additional costs.
It's worth noting that property dilapidations can be a complex area of law, and it's important for both landlords and tenants to seek professional advice to ensure that they understand their rights and obligations.
We have 30 years experience in dealing with Schedules of Dilapidations, so give us a call if you have any questions.