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Over the past year we have seen a dramatic decline in the number of Schedules of Condition being carried out, particularly when tenants take on new premises.

When a landlord and tenant agree Heads of Terms for a new lease, one of the major considerations will be the state and condition of the property, this is why a Schedule of Condition is so important.

Not only are landlords and tenants not carrying out Schedules of Condition, tenants are not seeing the need to invest in a Schedule of Condition, particularly if they are on a short-term lease. Some are even carrying out a ‘DIY’ version with a few photographs themselves. Unfortunately this does not clearly define who is responsible for repairs or maintenance over time. Should a dispute occur, a solicitor would not have sufficient evidence to fight a case and costs could spiral.

What is a Schedule of Condition?

A Schedule of Condition is an accurate record of the condition of the demise of the property, typically included within a lease to limit the tenant’s repairing obligations prior to lease commencement. It is retained for future use and acts as proof of the previous condition of the premises.

Photographic Schedule of Condition

This is prepared in a simple format and is a photographic record of the property’s condition. Although this method is cost-effective it can have limitations, unless carefully worded to include areas not shown in the photo. This type of schedule may not document issues such as damp, movement, leaks, or the extent of specific defects.

Full Schedule of Condition

To accurately record all aspects of a property, a full Schedule of Condition is recommended. This includes both text and photographs, together with a general description of a property and a detailed tabular schedule. The schedule documents the form of construction and condition of each building element, supported by a photographic record as evidence.

Extra information

Sometimes a video of the property is included in a full Schedule. This provides evidence of certain defects, for example, to illustrate loose fixings, leaking pipes, or loose cladding, etc.

Specialist information can also be included to fully record a building’s condition. This could include, for example, a CCTV Survey of the underground drains, an electrical test report of the electrical system, or an engineer’s report on the lifts.

A typical Schedule of Condition contains:

• Good quality, detailed photographs of the whole property.
• Some commentary to accompany the photographs.
• A general description of the condition and fabric of the property.
• Plans showing the extent of the property.
• A note of the date the photographs were taken.

A bird’s eye view

To accurately record the roofs and upper elevations of a property, a drone is used. This allows detailed access to roof areas including a high-level view down onto roofs and a close-up of specific issues where access is limited. Roofs are often one of the main liabilities under a lease. 

Why do you need a Schedule of Condition

To lessen the exposure to such costs, tenants usually seek to limit their repairing obligation by referring to a Schedule of Condition so that the tenant is not required to keep the property (and return the property to the landlord at the end of the term) in any better state of repair than is illustrated by the Schedule of Condition. This limitation would need to be agreed by the landlord at the outset and can often be a highly negotiated point.

It’s generally accepted that the tenant should only be required to hand back the property in the condition it was in when the lease was granted. However, this question has been the subject of many cases brought before the courts. Therefore, advice must be obtained from your solicitor.

Whether you’re a tenant, landlord, or property owner, a Schedule of Condition should be carried out to properly document the condition of the property. A Schedule of Condition can take time, effort and patience to initially agree and produce (and, for a decent Schedule of Condition, to pay for), it is worth investing in one to avoid a costly dilapidations bill and any potential for dispute. For further information on Schedule of Conditions please visit the link here.

Feel free to ask any questions, we are here to offer help and advice, if you have any queries with any of the above, please feel free to call 01905 676169 or email robertcant@gjsdillon.co.uk

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