Terminal Schedule of Dilapidations for Landlords
The terminal schedule of dilapidations is the document a landlord serves at the end of a commercial lease to recover the cost of disrepair, missing reinstatement and decoration. Claims on offices, warehouses and retail units commonly run to tens of thousands of pounds. Clayton Ayling, a chartered building surveyor regulated by RICS, prepares the schedule and the quantified demand, serves them under the Dilapidations Protocol and negotiates the settlement.
Send the address, floor area and lease end date. A fixed fee proposal follows the same working day.
Get a fee proposal →What a Terminal Schedule of Dilapidations Is
A terminal schedule of dilapidations lists every breach of the repairing, reinstatement and decoration covenants that the landlord alleges at lease expiry or on a break date. Each item names the lease clause breached, the remedial work required and the cost of that work.
The schedule is served with a quantified demand. The quantified demand totals the cost of the works, adds any consequential losses (losses that flow from the breaches rather than the cost of the works themselves, such as rent lost while the repairs are carried out and the professional fees the lease allows), and states the sum the landlord seeks. Together, the two documents are the opening position of the claim.
A schedule that is tied closely to the lease and to photographic evidence survives scrutiny. A schedule that overstates the claim invites a line-by-line response, delays settlement and can cost the landlord in the final negotiation.
When to Instruct
The strongest claims are inspected while the tenant is still in occupation. Instruct in the final three to six months of the term so the inspection, the lease review and the costing are complete before the tenant hands back the keys.
The Dilapidations Protocol expects the landlord to serve the schedule within a reasonable time after the lease ends, normally 56 days. A late schedule does not end the claim, but the evidence is weaker once the unit has been stripped, re-let or refurbished.
- Lease expiry in the next six months and no interim schedule served.
- A tenant break date approaching, where compliance with conditions must be recorded.
- A tenant that has vacated early or left works unfinished.
- A portfolio with several lease events falling in the same year.
What You Receive
Every instruction follows the same sequence so that each item in the claim is supported by the lease and by dated evidence.
- Review of the lease, any schedule of condition, licences to alter and the reinstatement notice position.
- Inspection of the premises with photographs referenced to each item. Roofs and high-level cladding are recorded by drone where access is limited.
- A terminal schedule of dilapidations in the Protocol format, with the Protocol endorsement signed by the surveyor.
- A quantified demand costed at current rates for the location, with consequential losses included where the lease allows.
- Advice on Section 18 of the Landlord and Tenant Act 1927 and on how your plans for the building affect what is recoverable.
- Negotiation with the surveyor acting for the tenant, and expert witness evidence under Civil Procedure Rules Part 35 if the claim proceeds.
Fees and Timescales
Fees are fixed for the schedule and quantified demand and are set out in a written fee proposal before any work starts. The fee depends on the floor area, the number of buildings and the state of the lease documents. Negotiation is charged separately at an agreed hourly rate or as a further fixed fee once the response has been received.
Inspection is usually carried out within ten working days of instruction. The schedule and quantified demand follow within ten working days of inspection for a single unit. Larger premises take longer and the timetable is agreed at the outset.
Use the fast-track form for a fee proposal the same working day. It asks for the address, the floor area, the lease end date and the lease documents you hold.
TERMINAL SCHEDULE OF DILAPIDATIONS
Prepared by Clayton Ayling BSc (Hons) MRICS, Chartered Building Surveyor
| Item | Breach and remedy | Claimed | Settled |
|---|---|---|---|
| 2 Internal areas — ground floor | |||
| 2.1 | Partitioning installed by the tenant. Remove and make good. | £8,400 | £5,100 |
| 2.2 | Suspended ceiling tiles damaged. Replace to match existing. | £3,150 | £1,900 |
| 3 External areas | |||
| 3.1 | Roof covering in disrepair. Overhaul and repair. | £21,700 | £12,400 |
| 3.2 | Decorations in the final year not undertaken. | £9,800 | £6,200 |
Claim as served
£88,400
Settled at
£70,000
Protocol Format
The schedule follows the Pre-Action Protocol format and carries the surveyor endorsement. A tenant surveyor cannot dismiss it on form.
Costed for the Location
Each item is priced at current rates for the area rather than from a national schedule, so the quantified demand holds in negotiation.
One Surveyor Throughout
Clayton Ayling inspects, writes the schedule and negotiates it. Nothing is handed between departments and no detail is lost.
Terminal Schedule FAQs
Answers to the questions landlords ask before instructing a terminal schedule of dilapidations.
The terminal schedule lists each breach of the lease, the work needed to remedy it and the cost of that work. The quantified demand totals those costs, adds any consequential losses such as lost rent and recoverable fees, and states the sum the landlord claims. The Dilapidations Protocol expects both to be served together.
The Protocol expects service within a reasonable time after the lease ends, usually 56 days. Inspection should take place before the tenant leaves wherever possible, so the schedule records the condition at the end of the term rather than after the unit has been cleared.
A terminal schedule is served at or after the end of the lease. Where the lease still has time to run, an interim schedule can be served to require the tenant to carry out repairs during the term. Both can be prepared by the same surveyor.
Section 18 of the Landlord and Tenant Act 1927 caps the damages at the reduction in the value of the landlord interest caused by the disrepair. Where the landlord intends to demolish or substantially alter the building, the claim for those items can fall to nil. The intended use of the building is therefore checked before the schedule is finalised.
The fee is fixed and depends on floor area, the number of buildings and the state of the lease documents. A fee proposal is sent the same working day that the fast-track form is submitted. Professional fees are usually recoverable from the tenant where the lease provides for them.
The tenant has 56 days under the Protocol to respond, usually item by item. The surveyors for each side then meet to narrow the differences. Most claims settle by negotiation. Where settlement is not reached, the Protocol has been followed and the claim can proceed to court with the costs position protected.
Lease ending in the next six months?
Send the lease and the address now. The inspection is booked before the tenant leaves and the schedule is ready to serve within the Protocol timetable.