Tenant not will to pay condition survey costs

[semisane]

Tenant for office has given notice and left the premises in poor condition and has not repainted as specified in the lease.

They owe approx £1k for rent and service charge, which they say they are willing to pay, but only if I write off the £700 invoice to put the premises back into a suitable condition to rent.

Given the relatively small amount I think starting to write solicitor letters will soon add up to more than the debt, so is small claims court the way to go ?

Thoughts?

[kiethton]

In short yes...although I’d make sure that a solicitor setter was sent (commercial leases/court will often allow for these types of costs to be added -check!)

Before you do however I’d be looking at how solvent the company actually is, die it have the reserves/cash to pay these (admittedly small) amounts?

[Evanivitch]

Out of interest, because I have no experience of this:

1. Are business tenants required to leave the premises in a rentable condition? I understand for a domestic property fair wear and tear is reasonable. Depending on the duration they've been there, and any specific issue this standard could vary wildly.

2. Have they changed the paint or damaged it in some way? Again, on a domestic property I don't think you could enforce such a clause unless there was evidence they had changed or damaged the walls.

I'm not an authority on this, but I'm interested in the response from someone that knows more.

[semisane]

Yes in the situation.

There are specific clauses in the lease regarding leaving the premises in a condition not less than when they took up residence.

There was a comprehensive pre tenancy survey agreed with tenant

There is also a clause about repainting the internals with 2 coats of paint.

[Mandat]

Have you served the tenant with a Terminal Schedule of Dilapidations?

That is usually the starting point for a claim against a tenant for non compliance with the lease terms.

[semisane]

kiethton said:

In short yes...although I’d make sure that a solicitor setter was sent (commercial leases/court will often allow for these types of costs to be added -check!)

Before you do however I’d be looking at how solvent the company actually is, die it have the reserves/cash to pay these (admittedly small) amounts?

Thanks

Re solvency, they took up the £10k government grant but seemingly spent it elsewhere.

This is the main reason I am going to chase this.

If they had acted differently I would have considered writing it off.

[Castrol for a knave]

Evanivitch said:

Out of interest, because I have no experience of this:

1. Are business tenants required to leave the premises in a rentable condition? I understand for a domestic property fair wear and tear is reasonable. Depending on the duration they've been there, and any specific issue this standard could vary wildly.

2. Have they changed the paint or damaged it in some way? Again, on a domestic property I don't think you could enforce such a clause unless there was evidence they had changed or damaged the walls.

I'm not an authority on this, but I'm interested in the response from someone that knows more.

A tenant is obliged to return the premises in the same state that they were left in. There should usually be a survey carried out before occupation and one prior to termination. If there is any diminution in the value of the landlord's reversion i.e. if the premises fall below the condition they were let in then the landlord can clam this from the tenant. Usual stuff is repairing fixings and cabling conduit applied to walls, floor coverings, coat or two of paint etc.

The landlord cannot ask a tenant to yield up or pay towards what could be classed as improvements or provide the landlord with betterment - it has to be like for like.

This is covered in Sec18 of the L&T Act 1927 if you find yourself unable to sleep one night

Semisane - did you undertake a condition survey when the tenant took occupation. if so and your S18 report is valid, then tell them to do one - they should pay you for anything that requires you to make good to the standard they enjoyed at the commencement of the lease.

Edited by Castrol for a knave on Saturday 18th July 18:02

[NGee]

Is it worth £700s worth of hassle, aggro, stress, time and money?
Only you can answer this.
As annoying as it is, principles cost!!

If it was me I think I'd snatch their hand off for the rent and service charge, before they change their mind on that, and then move on.
I would consider getting any money out of small businesses under the current situation as a bonus!
Get it redecorated and rent it out again ASAP.

Others may see it differently and I can't help you on the legal side.

Edited by NGee on Saturday 18th July 18:15

[semisane]

Castrol for a knave said:

A tenant is obliged to return the premises in the same state that they were left in. There should usually be a survey carried out before occupation and one prior to termination. If there is any diminution in the value of the landlord's reversion i.e. if the premises fall below the condition they were let in then the landlord can clam this from the tenant. Usual stuff is repairing fixings and cabling conduit applied to walls, floor coverings, coat or two of paint etc.

The landlord cannot ask a tenant to yield up or pay towards what could be classed as improvements or provide the landlord with betterment - it has to be like for like.

This is covered in Sec18 of the L&T Act 1927 if you find yourself unable to sleep one night

Semisane - did you undertake a condition survey when the tenant took occupation. if so and your S18 report is valid, then tell them to do one - they should pay you for anything that requires you to make good to the standard they enjoyed at the commencement of the lease.

Edited by Castrol for a knave on Saturday 18th July 18:02

Yes condition survey undertaken. We had just finished completely renovating to a good specification .

[Evanivitch]

Castrol for a knave said:

A tenant is obliged to return the premises in the same state that they were left in.

Edited by Castrol for a knave on Saturday 18th July 18:02

So fair wear and tear is only applicable to residential properties?

[Big_Dog]

Most commercial leases are fully insuring and repairing. Mine are. So the property should be as it was at the start of the lease.
At risk of stating the obvious surely read your lease agreement.

[bladebloke]

Big_Dog said:

Most commercial leases are fully insuring and repairing. Mine are. So the property should be as it was at the start of the lease.
At risk of stating the obvious surely read your lease agreement.

To add - an FRI lease (which, as Big Dog correctly says, means most commercial leases) can often mean that the property has to be given back in better state (sometimes much better), rather than being as it was at the start. A covenant to repair is an obligation to put the property into repair, rather than just keep it as it was.

This is why negotiating for repair obligations to be limited by reference to a schedule of condition is so important for a tenant -then it becomes as Big Dog said.

[semisane]

Big_Dog said:

Most commercial leases are fully insuring and repairing. Mine are. So the property should be as it was at the start of the lease.
At risk of stating the obvious surely read your lease agreement.

Who is the final sentence aimed at ?

[surveyor]

£700 is almost laughably low. As long as the firm is still trading go for them.

Not laughing at OP. More the chancing tenant.