Property dilapidations in detail

A Schedule of Dilapidations generally refer to items of disrepair that are covered by repairing covenants contained in a lease. The term is often used, as shorthand for terminal dilapidations, to cover breaches of the tenant's covenants relating to the physical state of the premises when the lease ends.

Breaches of the following types of covenant are generally relevant to the tenant's liability for dilapidations: 

• Repairing covenant.
• Decorating covenant.
• Covenant to comply with statute.
• Covenant to yield up and any related obligations that specify the state in which the tenant is required to leave the premises at the end of the term.
• Reinstatement requirements that relate to alterations carried out by the tenant (and usually apply at the end of the term). 

These types of covenants are normally contained in the lease but additional obligations might also be found in a supplemental document such as a licence for alterations or deed of variation. The remedies available to ensure repair of the items depend in part on the terms of the lease and whether the term of the lease has expired. There are also restrictions on the landlord's remedies for breach of a tenant's repairing covenant. In addition to the legal position regarding remedies, there may also be the added practical considerations as to how and when a landlord takes enforcement action. 

A tenant's failure to comply with its repairing covenant entitles the landlord to claim damages. However, the landlord's right to claim damages for breach of a repairing covenant by the tenant may be restricted during the term where the lease was granted for a term of at least seven years and has at least three years left to run. A claim for damages is the landlord's only remedy once the lease has ended. There are ways to calculate this. Following expiry of the term, the measure of damages is the reasonable cost of doing the works plus loss of rent for the period until the works have been completed.