Landlords want to preserve and protect their property and rental interests, the tenant wants to protect their business from the ravages of recession and economic uncertainty.

With low tenant demand, a tenant in occupation is a valuable asset.  They have a strong bargaining position.  Landlords have the dilemma of exacting the full repairing and service charge obligations which could force tenants out of business, or negotiate a compromise.   Given the difficulty of re-letting and the inducements necessary to do so, empty rates liabilities, and lost rent, is it better for landlords to retain the existing tenant than be left with an empty property? And if the tenant does leave at lease end, dilapidations will be pursued vigorously.

Dilapidations are a matter of negotiation.   The strategy adopted by each party is dependent upon the strength of their case, a judgment on the future state of the market, and the lettability of the property.  It is critical that any case is prepared thoroughly and accurately before any negotiation takes place.

When negotiation fails, the parties head towards ADR or litigation, which brings new uncertainty and significant costs.

The conference considers the issues of dilapidations in the present economic climate.  It is aimed at and will benefit surveyors, valuers and property advisors whoever they represent.

Programme:

Scene setting

• The current market for dilaps
• Landlord expectations
      During the lease
      At lease end
• Tenants viewpoint
• Recent developments
• RICS guidance note and PLA protocol and how these influence procedures and timescales

The Lease and its Repairing Obligations
legal liability
The tenant’s obligation to repair, the standard of repair, the extent of the demised premises, fixtures and chattels

• The repairing covenant
• Improvements, replacement and rebuilding, inherent defects
• The extent of the demise
• Fixtures and fittings
• Can contamination fall within a breach of repairing covenant?
• Problems with common parts

The Schedule of Dilapidations, Heads of Claim
Interim:

• Is there a better way?
  

Terminal

• Form of the Schedule
• Preparation and presentation
• Disrepair and inherent defects
• Loss: the basis of claim
• Valuation methods - diminution in value of the reversion
• Loss of rent, service charge, rates, etc…
• Costs
• Fees
• VAT

Remedies and Disputes
Break clauses

• Absolute and qualified conditions
• Reinstatement of alterations
• Decoration

Remedies

• Damages, specific performance, self-help, forfeiture

When the Parties fail to agree - Falling out, the threat of litigation

• Using the Courts, Arbitrations, Mediation and Expert Determination
• Pre action protocols
• Delivering expert evidence
• The implications – in terms of time, uncertainty, cost

Attack and Defence

• S147, Law of Property Act 1925
• Leasehold Property (Repairs) Act 1938
• Time Limits, Time is of the Essence, Statutory Limitations of Claims
• Section 18(1) 1927 Landlord and Tenant Act
• Shared obligations and services
• Quiet enjoyment as a defence

New Challenges: green leases