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Commercial property update

Magnus Hassett, Laura Williamson and Katherine Ekers consider the implications of the dilapidations protocol, break clauses, business rates relief and the meaning of 'unreasonable withholding of consent' in leases

12 March 2012

Dilapidations protocol

The dilapidations protocol has been formally adopted by the courts with effect from 1 January 2012.

The protocol has been around in various forms since 2002. Its principal aim is to save costs by ensuring that the parties are honest with each other as to the true extent of their losses (landlords) and liabilities (tenants).

As a result of the protocol being adopted by the courts, the endorsements that landlords or their surveyors make in order to support their intentions for the premises at the end of the term are now going to come under greater scrutiny by the court. Tenants’ solicitors are likely to focus on trying to establish (through disclosure of documents or otherwise) that the landlord has misrepresented the claim in some way and to then use this to seek to negotiate better terms for settlement (in some cases the protocol may result in additional legal costs being incurred rather than costs being saved!)

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