Schedule of Dilapidations
It can be a bit of a shock to be served a Schedule of Dilapidations from your landlord, in which they may claim you owe them an eye-watering amount of money.
What is a Schedule of Dilapidations?
A Schedule of Dilapidations relates to claims for damages from the landlord to the tenant, in relation to the physical state of a commercial property at the termination of a tenancy. It sets out what the landlord considers to be the breaches, the works required to remedy those breaches and any relevant costings.
Harrison Clarke are experts in managing Dilapidations claims and we can confidently say to you, based on our years of experience successfully managing and reducing claims, “Don’t panic!”.
The first thing we want to reassure you about is that the figures set out in the Schedule of Dilapidations are not set in stone. The Schedule may look intimidatingly formal and presented as an enforceable claim but, actually, it’s most usually a record of technical breaches of the lease and is the landlord’s way of starting negotiations for a financial settlement, or requesting a fee to complete remedial works before lease end.
Some clients worry that their landlord will take them to court if they don’t pay the initial claim demand. However, the Dilapidations Protocol and the RICS Dilapidations guidance note both set out the process whereby surveyors usually work together to pre-empt the decision the court would take. So, in reality, it is unusual for Dilapidations claims to reach the courts.
If you work with a competent Dilapidations surveyor, they will understand the risks of different approaches and support you in making the right decisions that should ensure your claim stays out of court.
Appointing a qualified and experienced surveyor who specialises in Dilapidations could be one of the best investments you will ever make.
A couple of cases that spring to mind, where Harrison Clarke successfully negotiated huge reductions for our clients…
One client received a Dilapidations claim for £800,000, which we reduced to £300,000.
Another client received a claim of £510,000, which we reduced to £35,000.
We have even been known to reduce a claim to zero, which meant that our happy client only paid around £1,500 in fees, and not a penny of the £112,000 demand they had received in a Dilapidations claim.
Some clients are reluctant to pay a surveyor to handle their Dilapidations claim. We strongly recommend that you don’t go down this route, and we genuinely say that with your bank balance in mind, not our own bottom line!
We have never known an unrepresented party in Dilapidations to reach a better outcome than they would have done with professional representation and, as we have already explained, we can be talking about a LOT of money. Negotiating your own claim will almost always result in being the most expensive option in the end.
Even spending a couple of hours with a Dilapidations surveyor to run through your claim can highlight areas where certain actions can be taken to reduce or eliminate particular sections of the Dilapidations claim.
The law surrounding Dilapidations is very complex and is often based on case law which, at first glance, can look like it doesn’t follow common sense. If you choose the right surveyor, they will be familiar with all areas of Dilapidations law and will be able to guide you to the right settlement.
So, the most important decision you can make when you have received, read and digested your Schedule of Dilapidations, is to find an excellent Dilapidations surveyor. We guarantee that they will pay for themselves many times over.
