Surveying for Dilapidations

by Malcolm Hollis

  First Published 1988

Book Review

Overview

This was my first dilapidations book and I remember it being very readable, having what I thought at the time was a lot of photos, for this type of book, many of which were slightly unusual. Also, I do recall liking the acknowledgements at the start, which ends with the analogy that Malcolm Hollis hopes that you will be able to see the wood for the trees' once you have read the book, which we think is very important in dilapidations particularly with the rise of the Section 18 Valuation that we do not think was about when this book was written.

Format

We would describe the format as practical, very much drawing on Malcolm Hollis's experiences over the years.

Readability

Having re-read the book it is still very readable, the photos are still rather obtuse and now stand out mainly due to them being black and white; there are some good real life examples within the book and whilst some of it is now dated, much of it is still of practicable use to the surveyor. We have not managed to discover whether it is still available or whether it is something you will have to go onto ebay for.

Chapters

We think it is worth looking at each chapter in a bit more detail:

Chapter One - Dilapidations

This chapter has the mandatory definitions that all dilapidations books seem to have; in this case advising that the word dilapidations' derives from two Latin words, which may be interpreted to mean to pull stone from stone' or to lay waste'.

We also enjoyed the reference to the pre word-processing time and it harks back to agreements that were two or three pages long, where they are now more like 30 40 pages long, and I do recall the mentions of a paperless office as one of the advantages of computers.

There is good practical advice to read the lease with a highlighting pen.

The chapter mentions Schedules of Wants of Repair, Interim Schedules, once and for all breaches, Terminal Schedules of Dilapidations, and then spends time looking at how the surveyor should take instruction and confirm instruction and there are example letters and also examples of how to calculate appropriate fees and makes the lovely comment about most clients expecting a partner for the price of an office junior, which still holds true!

Chapter Two Preparation

This chapter is very much written from the surveyor's point of view working for the landlord and comments about the landlord wanting a good, strong Schedule to hit the tenant with everything, and equally comments that this would not stand up to scrutiny should it go to court.

It looks at the reasons for the Schedule for the Landlord:

•  To obtain vacant possession.

•  To ensure the tenant maintains the property, reference the Law of Property Act 1925, Section 146.

•  Rent review time.

The chapter then looks at the property and fees, where it mentions the RICS fee structure, which is a long gone system, but remembered fondly by many. It does emphasise that the surveyor should get their fees right.

The chapter also discusses that it is important to know the type of property and the access, or to be more exact, the difficulties of access, for example to a roof, or assistance that may be needed from a building services engineer.

The Approach

Then the approach is considered from the Surveyor's point of view. The author talks about the often misleading notion that the landlords have that all surveyors costs will be paid by the tenant. This may ultimately be true, but as he rightly says the surveyor must ensure the landlord understands that the contract holds true regardless of what is in the lease agreement.

Malcolm Hollis also talks about the honesty approach to gaining access to the property, i.e. explaining the reason for the visit and the report and also comments that it may be of use to ask at what time the building normally closes, then the tenant tends to keep clear to ensure that the surveyor finishes at a reasonable time so that everyone can go home!

The author also talks about the insurance inspection routine, which is commonly used by surveyors and there is a lovely line about sending a letter to the tenant advising him of the good standing of the surveyor in the community and how he frequently helps old tenants across the road! Again, he emphasises how important it is for the surveyor to confirm the instruction and again there are many obtuse photos!

Chapter Three The Lease

The chapter advises that the surveyor should have carefully read the lease and for the surveyor to get help from the solicitor if in any way the wording of the lease is ambiguous. We would add that we find it useful to have visited the property on the same day that the lease is reviewed and can understand that many surveying practices may not have the time, or the want, or the wherewithal to carry this out.

Hollis also comments that a checklist of items of information to extract from the lease would be useful, which we would agree with. Here is the checklist that Malcolm Hollis proposes:

•  The Property check any plans and drawings.

•  Access this may require a given period of notice.

•  Schedule of Condition it is important to see any schedules that have been agreed at the commencement of the lease.

•  Statutory Requirements giving a good example where the tenant may try to counter the request for improvements to comply with statutory requirements by saying the absence of such work has not affected the value of the building. The example of asbestos roofs is given with regard to the Public Health Act, commenting that its removal could be pressed for, providing the lease is worded with such a clause. The tenant would argue that there is no need to upgrade the building to comply.

The surveyor may also arrange for the client's solicitor to check if there are any outstanding notices, such as:

•  Building Regulations.

•  Planning Authority.

•  Listed Building or Ancient Monument requirements.

•  The Public Authority.

•  Local Authority Engineers Department with regard to pavements etc.

•  Means of escape with regard to fire.

•  The factory inspector

•  Health and Safety with regard to boundaries for example.

•  User Class

•  Alterations does the lease require reinstatement of the property where it has been altered?

•  Repairing Covenants which normally fall into three groups.

•  PUT the premises into repair.

•  KEEP in repair.

•  LEAVE in repair.

•  Other considerations are fair wear and tear'.

•  Extent of repair where items may or may not have been missed.

•  Adjectives with comments on the terms good repair', habitable repair', necessary repair', needful repair' and sufficient repair' and says how these should be interpreted.

•  Notification of disrepair giving various examples of lease terms and some more obscure photos.

 

Chapter Four Repair

The Meaning of Repair

The book rightly states that the single word repairs', at the centre of the whole practice of Dilapidations, the interpretation of this word is fundamental to the complexity or defending of the Schedule. A case history is mentioned Lurcott v Wakely and Wheeler 1911; it says the question of repair is in every case one of degree. The test is whether the act to be done is one which in substance is the renewal or the replacement of defective parts or the renewal or replacement of substantially the whole.

Later on in this section he goes on to discuss the case of Lister v Lane and Nesham 1893 and also Brew Bross v Snax Ross Limited 1970. Other cases include Smedley v Chumley and Hawke Limited 1981. You will have to obtain a copy of the book or law reports for full details.

The chapter concludes with cases emphasising the importance of keeping abreast of legal interpretations of repair'. Malcolm Hollis offers guidance saying the following tests need to be applied:

•  The actual wording of the covenant.

•  What is the age of the premises one is dealing with and at what stage has the deficiency in repair become evident?

•  What is the cost of repair and what relationship does it bear to the value of the building in good repair?

•  Will the repair mean giving back to the landlord a wholly different property than that which he let to the tenant?

The next part of this chapter discusses the standard of the repair and rightly says it is important to distinguish between the responsibility to carry out the repair to the standard which must be provided and mentions several cases, Proudfoot v Heart 1890, Calthorpe v McOscar 1924 and Ravenseft Properties Limited v Davston Holdings Limited 1979, and there are some good examples given with regard to damp proof courses, electric under floor heating, and flat roofs decoration, and summarises where a tenant has expressly covenanted to repair the tenant does not have a responsibility to provide something different from that which was surmised to him or his predecessors at the start of the lease.

There is also a summary that is worth reading, although it is now dated.

Chapter Five The Inspection

Malcolm Hollis starts by discussing how surveyors are less likely to be sued for a Schedule of Dilapidations than a structural survey, which is an interesting way to start the chapter. He then looks at:

Prior to the inspection

Preparation

The appointment of any specialists

The rest of the property

The tenant and occupant

Access

The period of the lease

Schedule of Condition

Repairing Covenants of the lease

Licences

User drawings

Boundaries, fences, drives, roadways and paths

Equipment - recommending a moisture meter, a note book, viewing aids, measuring equipment, destructive testing (by this he means nothing more than carrying screwdrivers to open up ducts and manhole keys to lift and inspect the drainage).

Specialist testing for example to the lifts etc

Some form of proof of identity

Next he looks at the inspection in detail looking at the roofs, the walls, boundary walls, drainage etc, and also then looks at the internal inspection, specifically with compliance to Statute, for example fire escape, electrics, provision of toilet accommodation etc.

Chapter Six The Report

This chapter talks about the layout and comments that the Schedule of Dilapidations is not a specification of repair. The intention of the Schedule is to direct the tenant's attention to the items of disrepair and require the tenant to repair and correct these faults; it is not necessarily to tell them how to deal with them, which does seem to be forgotten.

Chapter Seven Looking at a Fictional Property

This chapter looks at a Fictional property and goes into great, great detail, asking many questions and answering a few! It concludes nicely with the resultant verdict after the case went to court.

Chapter Eight Claims

This section looks at claims and helpfully defines the to put into repair' clause and to keep in repair', which advises that the claim can be made within six years after the end of the tenancy if it is not by deed, or within 12 years if it is by deed. To leave in repair' can only be instigated at the end of the lease.

The chapter also looks at restrictions on claims for damage, under lessees, remedies and forfeiture, injunctions, the landlord doing the repairs, damages, additional costs (i.e. costs that can be recovered such as solicitors, valuers or surveyors) in preparation and submission of the claim, and looks at the assessment of damages which interestingly covers:

•  The cost of carrying out the repairs.

•  The Value Added Tax on it.

•  The loss of rent during the time necessary to enable the repairs.

•  Specific provision within the lease to cover the cost of surveyor's legal fees etc.

•  The cost of professional fees for supervision etc.

A practical example is given with Calabar Properties Limited v Stitcher 1983.

Chapter Nine Service

The Method of Service Under a 146 Notice

This section makes the very valid point that the service of the Schedule of Dilapidations may very much depend upon the tactics of the landlord. At times when there is a good market the landlord may wish to serve a notice to allow them to have a new tenant, who will pay full market rent. At times of a poor economic market the tenant may be looking for a way to get out of the lease and walk away should a Dilapidations Notice be served, leaving the landlord with a property that cannot be let. So, the service of a Dilapidations Notice is often tactical.

This section looks at the strict way the notice has to be served. It mentions a case Sidnell v Wilson 1966, and Swallow Securities Limited v Brand 1981. Various examples of notices are given, again, as the landlord's agents and also very obscure photos are present!

Chapter 10 Receipt

Acting for the Tenant

We were pleased to see that Malcolm Hollis's experiences were similar to ours; where often the surveyor is called in when there is limited time available to act and that it needs to be established very quickly what information is available, as well as ensuring your fees are understood.

He first considers checking the schedule and Hollis mentions fourteen areas that need to be checked and he also looks at what the tactical approach should be from the tenant's point of view.

Chapter 11 Defence

This chapter looks at various issues for defence.

Demolition

Demolition is considered where the tenant's surveyor knows that future demolition is to take place with evidence (in the form of a planning consent, or a signed building contract etc) and defence can be used as a good defence.

Structural Alterations

In a similar vein to demolition, where it is known that substantial alterations are about to take place; again, the onus of proof is on the tenant's surveyors.

Improvements

The tenant may equally claim that the works carried out are improvements and the Morcom v Campbell-Johnson 1956 is sited.

Inherent Defect

Inherent defect is another argument and the Brew Bros v Snax (Ross) Limited case is sited. It is also stated that it is a question of fact and degree, and reference is made to the Ravenseft Properties Limited v Davston Holdings Limited 1979. as previously mentioned.

No Damage to the Value of the Reversion

Hollis also talks about the service of a counter notice under Section 146 of the Law of Property Act 1925.

Chapter 12 Negotiation

This chapter considers:

• Appointing surveyors
• Disputes
• Scott Schedules
• Value Added Tax
• Surveyors' fees
• Rents
• Tenants Claims for Compensation

The book ends here, rather suddenly!

Sample Section

We would normally do a sample of a chapter here, but as this was my first book review I précised most of the chapters, which I hope you find helpful.

Review upon Reflection

The more recent books we have read on dilapidations are very much more orientated towards the legal cases, possibly over emphasising them, as in reality a surveyor, although needing a working knowledge, we have heard it described very much like a policeman who has a working knowledge of the law but isn't an expert in it, would ultimately leave the decision with regard to the cases to a solicitor. We do like the more practical approach that this book has. Maybe it is time for Malcolm Hollis to do a full revision of this book.