An RICS surveyor prepared and served a schedule of dilapidation alleging £214,410 inclusive of the VAT as the amount allegedly necessary to repair and/or reinstate an office of 2,350 sq ft. Dr. Philip Antino was appointed by the Tenant.
It was an internal repairing lease only and the tenants had at the commencement of the lease 10 years spent £148,000 + VAT fitting the office out to a very high standard.
The RICS surveyor was advised by Dr. Antino that the starting point for any dilapidations claim, is to demonstrate whether there is any diminution in the landlords reversionary interest and thus establish the section 18(1) cap.
Dr. Antino believed that on any assessment of the condition of the building there was no disrepair. It was a fully functioning modern office with air conditioning, luxury fitted kitchen, carpets, suspended ceilings and lighting, high quality WC facilities including showers, modern glazed partitioning. It was clear that there was no disrepair and that there would be no diminution in the reversion.
The landlords RICS surveyor refused to accept the role that section 18(1) of the landlord and tenant act 1927 played in capping a landlords dilapidation claim. Furthermore, the schedule was based on a preliminary inspection some 4 months prior to the expiry of the lease, which of course dilapidation do not arise until the expiry of the term.
Dr. Antino suggested and indeed made on behalf of his clients a Part 36/Calder bank Offer of £16,000 + VAT, plus the tenant would waive any costs incurred in trying to negotiate the resolution of the alleged dilapidation that had been incurred to date. The Part 36 Offer was ignored by the landlords’ silence.
On Dr. Antino’s advice an independent FRICS surveyor was engaged to prepare a section 18(1) valuation to establish the diminution in the reversionary interest. Not unsurprisingly that surveyor confirmed Dr. Antino’s position that there was no diminution. Therefore, there was no legal claim because there was no reduction to the landlord’s reversion.
The landlord was then invited to settle on the basis of paying the tenants costs including the costs of the section 18(1) valuation surveyors’ fees to bring the matter to a conclusion. That invitation went unanswered. The property was handed back in November, the landlord has received a nil contribution. The landlord has now closed his file and had to pay his own surveyors fees and legal expenses. Had they accepted the Calder bank offer they would have made a small profit on the situation. If you need advice on dilapidations claims call Dr Antino on 01245 492495 or email him on firstname.lastname@example.org www.apaproperty.com