How to preserve your terminal dilapidations claim - a checklist

Posted: 19/08/2013

Check extent of the tenant’s obligations

• Are they limited to repair and decoration?
• Does the tenant have to do more, eg to replace items at the end of their useful life?

 Keep good records

• You can’t properly enforce reinstatement obligations if you don’t know what alterations were made and by whom and whether/when you need to give notice to reinstate.

Know what is outside the Section 18 cap on damages

• Reinstatement of alterations
• Specific decoration obligations
• Payment of professional costs
• Compliance with statute

are all outside the limit of the diminution in the value of the landlord’s reversion.

Establish the facts

• Prepare a comprehensive costed schedule promptly after the lease ends.
• Update any earlier schedule.
• Check lease for timescales for service if you want to recover costs.
• Consider getting specialist reports if there could be arguments about whether substantial items of plant and machinery can be repaired or require replacement.

Keep your options open

• Best to decide the future of the building after the lease ends. A firm decision taken before the lease ends, to demolish or carry out substantial alterations, means that no dilapidations can be claimed.

This article was published in Estates Gazette in August 2013.   

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