Commercial landlords are entitled to claim damages if the tenant has failed to carry out repairs – known as dilapidations – at the end of a lease.
Failure to carry out dilapidations at the end of a commercial tenancy agreement is a breach of covenant – and damages for dilapidations may include any time beyond the term of the lease needed for the repairs, to compensate for any loss of revenue during the period the premises could not be re-let to a new tenant.
Under Section 18(1) of the Landlord and Tenant Act 1927, dilapidations are limited to the landlord’s loss as a result of the breach, however.
A landlord will usually appoint a surveyor to report on repairs needed when a commercial lease ends.
However, disputes between landlords and tenants over liability for any repairs to the premises under a covenant to repair – as well as disputes over which repairs are actually needed – are not uncommon.
Duncan Lewis commercial property solicitors can advise tenants on covenants to repair and disputes over dilapidations – including where necessary, instructing surveyors and property valuation experts; and advising on which fixtures and fittings may need to be replaced under a covenant to repair and which can be repaired or left in a good state of repair at the end of a commercial lease.
Repairing claims and a tenant’s obligations to carry out repairs need to be tackled swiftly to prevent disputes with the landlord from escalating.
If a landlord has issued a Section 146 Notice to a tenant because of breach of covenant, Duncan Lewis property solicitors can advise on the best course of action, including serving a counter notice under the Leasehold Property (Repairs) Act 1938.
It is crucial that tenants served with a Section 146 Notice seek legal advice as soon as possible, so that Duncan Lewis can act swiftly and advise on how to avoid forfeiture of the lease for breach of covenant if the lease is not ending or the tenant wishes to renew it.
A tenant’s obligations to repair should be set out in the lease – but complications can occur if a landlord carries out repairs itself when a tenancy ends and then takes legal action for damages once the works have been done.
Landlords may not be able to claim damages for works which were not actually required under the covenant to repair, but which the landlord carried out to improve the chances of re-letting the premises.
It is important that landlords take legal advice on dilapidations and breach of covenant regarding repairs as soon as possible, as failure to do so may in some cases prejudice any claim for damages – for example, if a landlord appoints a surveyor or property valuations expert and chooses to pursue a tenant via protracted correspondence and/or negotiations over repairs, rather than taking legal action under the terms of the lease.
Duncan Lewis can advise commercial landlords on taking action against tenant in breach of covenant relating to dilapidations and obligations to repair under a lease, including serving a Section 146 Notice or Section 147 Notice on a commercial tenant under the Law of Property Act 1925 – and forfeiture of the lease for tenant’s breach of covenant.
Duncan Lewis commercial property solicitors can also advise landlords and tenants on alternatives to litigation in cases involving dilapidations and repairing claims and obligations, including dispute resolution and mediation.
Duncan Lewis has a successful commercial property department able to advise on all commercial landlord and tenant matters, including disputes over breach of covenants, dilapidations and repairing claims and obligations.
Duncan Lewis can usually offer a Conditional Fee Agreement (CFA) or a set fee for commercial property cases – and also offers a set fee for the initial assessment of a case, so our clients know exactly what they will be paying.
For expert legal advice on Dilapidations and Repairing Claims and Obligations, call Duncan Lewis Commercial Property Solicitors on 020 7923 4020.