Dilapidations: the bill that arrives when the lease ends

Dilapidations are the landlord’s claim that you left the premises in worse condition than the lease required. It usually arrives as a schedule near the end of the term, it is usually larger than the tenant expected, and it is almost always argued with evidence that either exists from the beginning or does not exist at all. Tenants who lose badly are rarely the ones who damaged the building most; they are the ones who cannot show what condition it was in when they took it.

What a dilapidations schedule contains

• Each alleged breach, tied to the specific clause of the lease it breaches — repair, decoration, reinstatement or statutory compliance.
• The remedial work claimed, item by item, with a cost against each.
• Whether the item is disrepair or reinstatement, which are different obligations with different defences.
• The condition the lease actually requires, which is frequently not "as new" and sometimes explicitly limited by a schedule of condition attached at the start.
• Whether the works have been done, are intended, or are hypothetical — this changes the claim substantially.

Where the claim gets reduced

• The schedule of condition agreed at the start, which caps the obligation at the state the property was in on day one. Its absence is the single most expensive omission in commercial leasing.
• Reinstatement of alterations that the landlord licensed and may prefer to keep — a claim for removing something they want is a claim they will drop.
• Betterment: replacing a twenty-year-old system with a new one is an improvement, not a repair, and the difference is deductible.
• The landlord’s actual loss, which in many jurisdictions caps the claim at the reduction in the value of their interest rather than the cost of the works.
• Works the landlord intends to undo anyway — a refurbishment or redevelopment plan can extinguish most of a schedule.

The defence is built at the start of the lease, not at the end. A photographic schedule of condition on the day of entry costs a few hundred and routinely saves five or six figures. If you are signing a lease this month, that is the single highest-return hour of work available to you.

What to keep from day one

1. The schedule of condition, dated, photographic, and attached to the lease rather than filed separately.
2. Every licence to alter, with the drawings and the reinstatement terms actually granted.
3. Service and inspection records for anything you are responsible for maintaining — a planned preventive maintenance history answers half a repair claim on its own.
4. Correspondence about defects you reported and the landlord did not fix, which converts an item on their schedule into a counterclaim.
5. Photographs at exit, taken the same way as at entry, before the keys go back.

Buyers rarely take a landlord's word for the tenancy terms. An estoppel certificate asks the tenant to confirm rent, dates and any side agreements in writing, which is what makes the income schedule reliable in a sale.

Leaving early does not avoid the exit bill. A break clause ends the term, and a landlord can still pursue the condition of the premises — so the repair question arrives at the break date rather than at the original expiry.

Where the evidence lives

Ettex Records holds the property file as a record rather than a folder: the schedule of condition, the licences, the maintenance history and the correspondence, all against the same lease, so that a claim arriving eight years later is answered from one place. Photographs matter more than prose here and should be dated and kept with the record they belong to. Ettex is not a surveying practice and does not price remedial works — when a schedule lands, engage a building surveyor. What this removes is the part where nobody can find the day-one photographs.