Preparing and serving a dilapidations schedule

There is no set format for a dilapidations schedule, although it should always set out the details of the claim clearly and concisely, such that the tenant can easily understand it. The schedule should be laid out so that against each particular item of the landlord’s allegation of the breach (including which clause of the lease is deemed to be broken) the remedies necessary to correct this breach and, where damages are being sought, the perceived cost of remedying each item, can be seen. The best means of achieving this is through a table that includes columns for each of these points. Appendix A of the RICS Dilapidations guidance note contains a range of sample schedules (including suggested preamble wording, which now must include a statement that they contain the surveyor’s true views) indicating typical columns that would be used to present the schedule.  The Dilapidations Protocol also includes a suggested format.

It is important to consider the covenant that has been breached against each item, to ascertain that it is a valid dilapidations item. If it is not possible to identify a covenant that has been broken, it is probably not a valid claim.

It can be helpful to include additional columns in the schedule for the tenant’s response. These columns should leave room for the tenant to respond and comment on the validity of the allegation, the remedy put forward and the cost of this remedy. This developed version of a schedule of dilapidations is often called a Scott schedule. A suggested Scott schedule format is included in Appendix D of the RICS guidance note.

The use of such formats enables the negotiating parties to formulate their own arguments quickly and to interpret those of their opponents, which will assist in the resolution of the dispute. Typically, schedules are made available electronically.

In some instances, more than one specialist will submit elements of the schedule to be incorporated in the final claim. It is the responsibility of the party co-ordinating the dilapidations claim to ensure that a consistent format has been adopted and that there is no duplication or contradiction of items.  See also Quantified Demand

Subdivision of the schedule

It is important to structure the schedule logically. Typically, information will be recorded in the sequence of inspection, by reference to location or main element. When schedules are checked, being able to do so in a logical sequence will assist the process.

However, when presenting the claim, it is useful to differentiate between the types of covenant that has been breached, such as items of repair, decoration, reinstatement and statutory compliance. A number of surveyors consider that, where there are reinstatement requirements, they should be set out first, because attending to them will have an impact on the repair and decoration items that then follow. Also note that in terminal schedules the Dilapidations Protocol (3.2) stipulates that the surveyor is ‘required to specifically identify in the schedule (where appropriate) any notices served by the landlord requiring reinstatement works to be undertaken’.

However the schedule is presented, it should be referenced to a numbering system that aids discussions. It is important to ensure that, for the benefit of both the author and the reader, the sequence is readily traceable through the building in question and the claim.

Some practitioners prefer to repeat or summarise, at the beginning of the schedule, the lease covenants that they consider have been broken, often in place of the column that is intended to show this against each particular item. Such an approach would not be incorrect. However, the practice of seeking to consider the covenant that has been breached against each item is more useful in making certain that it is a valid dilapidations item. If it is not possible to identify a covenant that has been broken, it is probably not a valid claim.