Navigating lease-end disputes
Part of our Demystifying Dilapidations series – including the quick guide to Dilapidations and five tips for Occupiers looking to exit a site and limit their dilapidations liability – Head of Commercial at AG Built Environment Consultancy, Dan Metcalf explores some of the common issues that arise at lease-end, and how to navigate them.
Disputes between Landlords and Occupiers at the end of a lease are very common. Landlords, seeking to preserve property value, may accuse Occupiers of neglecting their repair obligations. On the flip side, Occupiers, often focused on short-term interests, resist unnecessary expenses. The crux lies in the failure of either party to comprehend and fulfil their obligations, leading to potential financial losses and disputes.
At lease-end, the relationship between the Landlord and Occupier is coming to an end and very often, no matter how reasonably the parties have got along during the term, opinions and priorities differ. Also, Landlords can often change over the term, so an Occupier should not rely on a relationship.
Some common areas include:
Whether the alleged items within the Schedule of Dilapidations are actually a breach of the lease covenants.
If the requested remedial measures go beyond that required to bring the item into repair, for example, patch repair or total replacement.
If a Schedule of Condition was referred to in the lease – whether the item was already in disrepair at lease commencement and if it has deteriorated.
The costs sought for remedying breaches.
The requirement to reinstate items and the layout of the premises at lease commencement.
If any actual losses are going to be incurred by the Landlord as they may not undertake the works and re-let the premises on similar terms.
The Landlord’s intentions for the premises and if this will affect the loss which may or may not occur.
Whether the Landlord’s claim is capped by the diminution in value of the premises.
Supersession and betterment arguments where for example legislation such as MEES require improvements.
The behaviour/approach of the parties in dealing with the dispute.
Our Approach
AG Built Environment Consultancy is a recognised dilapidations and Occupier specialist. We take a proactive approach rather than allowing a Landlord to dictate the pace and the outcome of the Dilapidations process.
We strive to ensure you understand and limit your liabilities and minimise the risk of expensive litigation – leaving you to get on with your day job other than dealing with drawn out disputes.
Over years of dealing with complex and high value dilapidations claims, we have developed a framework of exit strategies which we can systematically apply to your situation and have been proven to make huge savings.
If you’d like advice on making savings on your lease exit, please get in touch.
