Schedules of condition

A schedule of condition is intended to be an accurate and fair record of the state and condition of a property at a particular time. We look at some of the ins and outs.

Often built in to a lease to clarify the tenant’s repairing obligations, a schedule has the effect of limiting the obligations by requiring the property to be kept in no worse a condition than evidenced by it. It should therefore be prepared shortly before the start of the lease and is perhaps more suitable for short term leases.

A schedule usually consists of a written description supported by photographs, though there is no set format: the surveyor will decide on how it should best be drafted to suit its purpose.

Advantages

• The repairing obligations of the tenant are limited.
• It can form useful evidence in disputes between landlord and tenant regarding repair and/or reinstatement of the property/fixtures and fittings.
• If the schedule contains evidence of disrepair, it can help the tenant if the landlord claims that repair works are required.

Disadvantages

• Because it is based on a visual inspection, latent defects (eg dry rot) may not be revealed unless parts of the property were opened up at the time the schedule was prepared.
• To comply with the obligation to repair, it may be necessary to replace an item completely, rather than just the defective part. This may mean putting the property in a better condition than that evidenced by the schedule.
• Clear definitions must be used, eg the term ‘good repair’ might mean one thing to the landlord and something quite different to the tenant.
• Accurate drafting is essential when incorporating the schedule into the lease, and the extent to which it limits the repairing obligations. This will avoid potential conflict with other parts of the lease (eg the tenant’s obligations to decorate the property or to comply with laws and regulations) which may mean that the tenant is putting the property in a better condition than that evidenced by the schedule.
• The property needs to be clearly defined. If part of the property is not referred to, it will be assumed that there was no disrepair present in that area.

Dilapidations disputes are quite common. The schedule can be of practical and valuable benefit to both landlords and tenants as long as its purpose is clear to both parties and also to the surveyor so that it is prepared in the most suitable way.

As always, if you need commercial and pragmatic legal advice, we’re here to help so please get in touch.

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