Q&As

A freeholder grants a lease to A, who sublets to B. Prior to the expiry of the headlease, the freeholder granted a new lease directly to B. That lease has now expired and B has vacated. Can the freeholder bring a dilapidations claim (1) against A under the headlease? (Or has the freeholder waived its right to recover dilapidations from A by entering into the direct lease with B?); (2) against B pursuant to the direct lease?

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Published on LexisPSL on 31/08/2017

The following Property Q&A provides comprehensive and up to date legal information covering:

  • A freeholder grants a lease to A, who sublets to B. Prior to the expiry of the headlease, the freeholder granted a new lease directly to B. That lease has now expired and B has vacated. Can the freeholder bring a dilapidations claim (1) against A under the headlease? (Or has the freeholder waived its right to recover dilapidations from A by entering into the direct lease with B?); (2) against B pursuant to the direct lease?
  • Can the landlord bring a dilapidations claim against the tenant?
  • Can the landlord bring a dilapidations claim against the subtenant?
  • Interaction of both claims

Much of the dilapidations claim relates to items installed by A before the grant of the sublease to B and which were not reinstated at the end of the term of the headlease.

It is assumed that the property is commercial. It is also assumed that the headlease and sublease were on standard commercial terms with a full repairing and insuring covenant and are not subject to schedules of condition and that any required notices to reinstate were given. It is not clear whether the sublease to B was a sublease of whole, on what basis the freeholder granted a lease to B while the lease to A continued, or how and when both leases came to an end.

This Q&A will refer to the freeholder as the landlord, A as the tenant and B as the subtenant.

Can the landlord bring a dilapidations claim against the tenant?

It is not clear when the headlease came to an end. It is also not clear on what basis it came to an end. However, the starting point is that if the headlease contained a tenant’s obligation to repair which the tenant breached and, as a result, the landlord has suffered loss then it is entitled to recover damages equivalent to that loss. These damages will be capped by reference to section 18(1) of the Landlord and Tenant Act 1927

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