Schedules of Condition (“SOC”) can be important for both landlords and tenants when negotiating the terms of a commercial or residential lease for buildings and/or land. The most common and simplest types of SOC that we have dealt with are Photographic Schedules of Condition (“PSC”). A PSC relies mainly on photographs and will usually be appended to the back of a Lease which will detail the current state of repair and condition of a property, prior to the completion of a transaction.
Full Schedules of Condition (“FSC”) are comprised of written descriptions and photographs, which together document the current state and condition of each element of the building/land.
These Schedules can be useful to both sides of a tenancy agreement as they create an accurate reflection of the current state and condition of a property, which can then act as a benchmark against which the future condition can be assessed and measured.
As best practice, the SOC should be agreed between all parties in order to guarantee that it fairly reflects the property’s condition when it is prepared and should be completed by an external third-party expert to ensure impartiality and fairness.
Appointing an independent third-party expert to prepare a SOC should give greater weight to any further or subsequent negotiations or claims for disrepair/dilapidation.
For Landlords, as disrepair/dilapidations can arise at any time during the term of a tenancy, the SOC allows for any disrepairs/ dilapidations to be easily assessed and measured. This means that you can act quickly to either have the disrepairs/dilapidations rectified by your tenant (if the tenant has a fully repairing obligation under the Lease) or contact your former tenant and put them on notice that you have identified a disrepair/dilapidation. The SOC can then be used to measure the level of visible disrepair/dilapidation from when the tenancy started, to when it ended.
For tenants, SOC’s are useful for qualifying the extent of their repairing obligations. If an SOC is agreed prior to the commencement of the lease, the end result is that the tenant is not obliged to put the property back in any better state of repair/condition than that evidenced in the agreed SOC.
In the event that things do become litigious due to the state and condition of a property either during or at the end of a tenancy, the SOC can be used to evidence the level and extent (if any) of such disrepair/ dilapidation.
Should you require any assistance or advice regarding Schedules of Condition or wish to bring and/or defend a litigation action brought about through disrepair/dilapidation, then speak to our experienced Commercial and Litigation Departments for a FREE 30 minute consultation. Call 01744 454433 or email us at firstname.lastname@example.org today.