Dilapidations Commercial Property

1. UNDERSTANDING
DILAPIDATIONS
Berkley Court, Borough Road, Newcastle-under-Lyme, ST5 1TT Tel: 01782 715555

2. Introduction
 Schedule of Condition
 Interim Dilapidations
 Terminal Dilapidations
 Landlord and Tenant Act 1927 Section 18(1)
 Dilapidations CPR Protocol 2012
 Dilapidations Contentious Matters
 Questions
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3. Schedule of Condition
 Schedule of Condition
 Appended to the lease
 Liability Limitation
 Detailed narrative
 Statutory Requirements
 Immediate works
 Accuracy
 Benefit
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4. Interim Dilapidations
 Criteria For Service
 Longer than 7 years
 More than 3 years remaining
 Concerns of significant disrepair
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5. Interim Dilapidations
 Remedies Available
 Damages
 Forfeiture
 Entry to carry out the works followed by claim for costs
 Main Pieces of Legislation
 Law of Property Act 1925
Section 146 Notice
 Leasehold Property (Repairs) Act 1938
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6. Interim Dilapidations
 Statutory Test
 Section 5 - Leasehold Property (Repairs) Act 1938
 Devaluation of the property
 Failure to comply with bye-laws or statute
 Delay will significantly increase work required and costs
 Disrepair will affect other occupiers
 Special circumstances as the court sees fit
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7. Interim Dilapidations
 Re-entry
Jervis v Harris; CA (Sir Stephen Brown P, Millett, Otton LJJ); 9 Nov 1995
Overruling Swallow Securities v Brant (1981) 45 P & CR 328, the court held
that a landlord's right to enter the property, effect repairs himself and then
claim to recover the cost of doing so from the tenant was not a claim for
damages for breach of a covenant by the tenant "to keep or put in repair
during the currency of the lease all or any of the property comprised in the
lease" requiring the consent of the court under s 1 of the Leasehold
Property (Repairs) Act 1938. The tenant's liability to reimburse the
landlord was not a liability in damages for breach of the repairing covenant.
The landlord's claim sounded in debt not damages and was in effect a claim
for reimbursement of sums actually expended by the landlord in carrying
out the repairs himself.
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8. Terminal Dilapidations
 Terminal Dilapidations
 Less than 3 years left on the lease
 Lease clauses
 Repair
 Redecoration
 Reinstatement
 Yield Up
 Professional fees
 Statutory Compliance
 Costings
 Benefits
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9. Landlord & Tenant Act 1927
 Landlord & Tenant Act
1927 Section 18(1)
 Diminution Valuation
 Repairs
 Redecoration
 Latimer V Carney (2006)
 Reinstatement
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10. Dilapidations Protocol 2012
 Timescales ‘within’
 Endorsement
 Landlord
 Tenant’s Surveyor
 Diminution Valuation
 Valuation Surveyor
 Before proceedings
 Works completed
 Works partly completed
 Non compliance
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11. Dilapidation Contentious Matters
 Reinstatement
 Statute of limitations
 Compensation
 VAT
 Statutory compliance
 Professional fees
 Historical records
 Loss of Rent / Rates
 Non-traditional buildings
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12. Any Questions ?
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