At the end of the lease of a commercial or industrial property the tenant normally has obligations to the landlord to return the property in good repair. A schedule of dilapidations records alleged breaches of the terms of the lease (Terminal Schedule of Dilapidations).
The landlord might also be entitled to require the tenant to undertake repairs during the term of the lease (Interim Schedule of Dilapidations).
You should make sure that you are fully aware of the lease terms and their dilapidations implications. Carter Fielding can advise on the implications of the clauses within the lease.
During the lease term, the tenant should consider their possible future dilapidations liability in good time and budget for any costs that might be involved. If alterations are carried out, the landlord may require you to reinstate those alterations before the end of the lease. A licence for alterations may be agreed, setting out the obligations.
Towards the end of the lease term, you may receive a schedule of dilapidations from the landlord. Carter Fielding will review this with reference to the lease and any licences and negotiate on your behalf.
It is important for landlords to protect their position and early advice should be sought from solicitors and surveyors.
Carter Fielding will prepare a schedule of dilapidations for you in a form that is generally recognised by the industry. The schedule might also include a Quantified Demand and we can advise on how this is calculated.
Normally the surveyors appointed by the landlord and tenant can reduce the differences between the parties sufficiently to recommend a settlement figure to their respective clients. If a settlement is not possible then litigation might be needed although the Dilapidations Protocol, published by the Ministry of Justice, states that alternative dispute resolution should be considered.
The Dilapidations Protocol should be adhered to by the surveyors acting for both the landlord and tenant. This document sets out details of what can and cannot be included in the schedule, timing of the claim & response and various other matters.