Dilapidation Disputes & How to Resolve Them

Despite best efforts, Dilapidation Disputes frequently arise between landlords and tenants. Here are some of the most common points of contention in Dilapidation Disputes and how they tend to be resolved:

Dispute Over Whether There’s a Breach

Tenants may argue that certain items are not their responsibility. For example, a schedule might claim rotten structural beams as disrepair, but the tenant’s lease may not oblige structural repairs, or the decay might pre-date the lease.

Resolution:

Examine the lease and evidence. Referencing lease covenants and any schedule of condition often resolves this – if the issue was pre-existing and documented, the tenant isn’t liable.

Independent experts might be jointly appointed in contentious Dilapidation Disputes to opine on specific issues (e.g., whether a crack is longstanding or new).

Scope of Works (Standards) – “Repair” vs “Replace”

A classic issue in Dilapidation Disputes is whether a tenant must repair an item or fully replace it. Landlords might claim for full replacement under an obligation to keep the property in repair, while tenants argue for patch repairs or allowances for end-of-life items.

Resolution:

This usually depends on what is reasonable and the legal definition of "repair." Tenants are not generally required to replace an item if repair can restore the required condition.

However, if an item is beyond economical repair, replacement may be necessary. Negotiations often result in compromise costs, factoring in depreciation to avoid landlord betterment.

Quantification of Loss – Cost of Works vs Diminution in Value

Another common battleground in Dilapidation Disputes is whether the landlord’s claim should be capped by the property's diminution in value under Section 18.

Resolution:

If not settled during negotiation, expert valuation evidence is needed. Famous cases like Hammersmatch v. Gobain (2013) illustrate how courts may cap damages well below the cost of works. Pragmatic settlements often land between full costs and diminution values.

Landlord’s Intentions (Supersession Arguments)

In many Dilapidation Disputes, tenants challenge the landlord’s intentions. If landlords plan to redevelop or gut-renovate, tenants argue that claimed repairs are moot.

Resolution:

The Dilapidations Protocol requires landlords to disclose intentions. If refurbishment will supersede certain repairs, claims for those items may be reduced or nullified. Evidence like building plans or budgets often determines outcomes in such disputes.

Calculating Associated Losses (Rent, Service Charges, Fees)

Claims for rent loss, service charges, insurance, and professional fees are common areas of disagreement in Dilapidation Disputes.

Resolution:

Landlords must justify claimed losses with evidence. Tenants may argue for reduced periods or dispute excessive professional fees. Settlements often involve agreed sums for associated costs unless scrutinised line-by-line in court.

“Wear and Tear” vs “Disrepair”

Tenants sometimes assert that an item’s condition results from normal wear and tear, not actionable disrepair – a frequent issue in Dilapidation Disputes.

Resolution:

Lease wording is key. Where fair wear and tear is excluded from liability, tenants may avoid some claims. Otherwise, even worn items could fall under repair obligations. Reasonable views and negotiation often resolve these issues based on the property's age and condition at lease start and end.

Disputed Quality of Repairs

Occasionally, tenants complete repairs that landlords later claim are substandard – another common flashpoint in Dilapidation Disputes.

Resolution:

Lease obligations regarding workmanship standards guide outcomes. Independent surveyors can assess whether works meet required standards. Open communication before repairs can help avoid later disputes over quality.

Legal and Procedural Disputes

Procedural missteps, such as late service of claims, sometimes feature in Dilapidation Disputes.

Resolution:

Courts generally focus on substantive issues rather than penalising technicalities. However, if delays cause genuine prejudice, outcomes can be affected. Following the Dilapidations Protocol helps avoid procedural disputes.

How Dilapidation Disputes Are Resolved

The vast majority of Dilapidation Disputes are resolved through negotiation or mediation rather than litigation.

Surveyors play a lead role in narrowing disputes, and professional mediators may be engaged for complex cases.

Court proceedings are rare due to costs and uncertainty. Pragmatic settlements typically involve compromises based on legal precedent and practical realities.

Dilapidation Disputes Top Tip

One effective tool in resolving Dilapidation Disputes is a jointly updated Scott Schedule. By clearly identifying disputed items and focusing arguments, it facilitates settlement and minimises court risk.

After extensive negotiations, many disputes boil down to a few key issues – and the risk of unpredictable court outcomes often incentivises both sides to find a sensible middle ground.

Get in Touch

Need help with a dilapidations matter? Our expert team provides tailored advice to landlords and tenants across the UK.

From initial inspections to final settlement, we bring clarity and confidence to every stage.

Related Resources - Dilapidation Disputes

Managing Dilapidations Proactively

Key Stages of the Dilapidations Process

Landlords Dilapidations Guide

See our Dilapidations blog

Contact

Our expert team have extensive experience of dealing with all dilapidations matters. We act for both landlords and tenants, ensuring a global approach to the dilapidations process.

We assist commercial landlords and tenants on all aspects of lease obligations, repair and dilapidations.

We provide specialist surveys, new lease schedules of condition and general dilapidations advice.

For any help or advice on repair obligations, Dilapidations issues; or to commission a schedule of condition for a new lease call us on 020 4534 3132 or contact one of the team :