Limitations are placed on dilapidations claims by the Landlord and Tenant Act 1927. Under section 18(1) the amount claimed cannot exceed the diminution in value to the reversionary interest.
Car Giant v Major and Burgesses of the London Borough of Hammersmith 2017 has highlighted that the courts are adopting a robust approach to claims.
The landlord raised a schedule for works to bring the premises to the same standard that they had been in prior to the 25 year lease.
The cost of repairs claimed totalled £402,887. The landlord had only undertaken repairs in the sum of £183,897.
The lease ended in February 2011 and the case reached the court in September 2016. By that time the majority of works were still outstanding.
The premises were marketed at full market rent.
The landlord failed to provide evidence why some of the repairs listed in the schedule were outstanding and why the premises had not been marketed at a reduced rent.
It was held that awards for dilapidations should be based upon the relevant necessary repair work and that in this case the necessary repair and the loss in value appeared to be £183,897, rather than £402,887 claimed, as evidenced by the marketing of the premises at full market rent.
Car illustrates again that works actually undertaken are good evidence of damage to the reversion and that landlords should be wary of bringing claims for repairs if they are unable to prove an intention to carry them out.
Jacksons Law Firm has a wealth of experience dealing with all forms of dispute resolution, if you require any assistance regarding any commercial litigation matters please contact Inderjit Gill.
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