Property Management - Alterations and Dilaps Flashcards
What are alterations in a lease context?
Alterations are changes made by a tenant during the lease, usually requiring landlord approval before works commence.
What must be checked before undertaking alterations?
Ensure compliance with the Equality Act 2010, CDM 2015, and that there is a risk assessment, liability insurance, and method statement (RAMS) in place.
What is a Licence for Alterations?
A Licence for Alterations is a document that must be completed before works commence, protecting both parties at rent review and dilapidations.
What are the two useful functions of a Licence for Alterations?
To protect the parties at rent review and dilapidations at the end of the lease.
What should be included in a Licence for Alterations?
The Licence must clearly document the works agreed.
What does Section 19 of the Landlord and Tenant Act, 1927 state?
If a lease prohibits improvements without landlord’s consent, such consent cannot be unreasonably withheld.
What are dilapidations?
Dilapidations refer to the negotiations at lease expiry to restore the property to its original condition, assuming a repairing liability exists.
What should be outlined in a schedule of dilapidations?
Repairing obligations, remedies and costs of breaches, loss of rent, and fees for surveyors and lawyers.
What are the two choices a tenant has before the lease expiry date regarding dilapidations?
- Tenant can do the agreed works, or 2. Tenant can pay a sum to the landlord to undertake the works.
What must be served in accordance with the 1925 Law of Property Act for breach of lease?
A Section 146 notice must be served.
What are the three forms of schedules in dilapidations?
- Interim Schedule, 2. Terminal Schedule, 3. Final Schedule.
What does the RICS Professional Standard: Dilapidations aim to do?
It aims to reduce claims between landlords and tenants and provides guidance on diminution valuations.
What are some reasons why a dilapidations claim might not be agreed?
- Lease not on full repairing terms, 2. Reinstatement not required, 3. Schedule of condition limits liability, 4. Building to be demolished, 5. Diminution in value cap, 6. Tenant in administration, 7. Agreement to roll over claim.
