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England

Commercial Property

Terminal Dilapidations UK

Terminal dilapidations: the schedule of dilapidations at lease end, the LTA 1927 s.18(1) cap (diminution in value of reversion), supercession (landlord's demolition plans), Jervis v Harris self-help clauses, reinstatement of alterations, and the RICS Dilapidations Protocol.

14 min readUpdated 7 June 2026Last reviewed: 17 May 2026terminal-dilapidationsdilapidationsLTA-1927-s18Jervis-v-Harris

Terminal Dilapidations Schedule

A terminal (exit) schedule is served at or after lease expiry, claiming damages for all unremedied repairing, decorating, and reinstatement breaches. The RICS Dilapidations Protocol (2012) requires prompt service by the landlord; the tenant responds within 56 days with a Scott Schedule; both parties commission diminution in value reports; a without-prejudice surveyor meeting follows.

The Section 18(1) LTA 1927 Cap

Damages for dilapidations cannot exceed the diminution in the value of the reversion at lease end. The schedule face value almost always exceeds the actual diminution in value. Where the landlord intends to demolish or substantially alter (supercession — Salisbury v Gilmore [1942]), the diminution in value is nil and no damages are recoverable.

Jervis v Harris Clauses

Where the lease contains a Jervis v Harris self-help clause (Jervis v Harris [1996] Ch 195 CA), the landlord can enter, carry out the repairs, and recover the cost as a contractual debt — bypassing the s.18(1) cap. The landlord must actually carry out the works. The clause must be strictly complied with. Landlords should insist on Jervis v Harris clauses in all new commercial leases.

Reinstatement of Alterations

Where the lease requires reinstatement of tenant alterations, the landlord must specifically require reinstatement (in the licence to alter or by notice at or before lease expiry); failure to require reinstatement in time waives the right. Reinstatement costs can be very significant — payment in lieu is commonly negotiated. Ruxley Electronics v Forsyth [1996] AC 344 (HL) — courts will not order reinstatement where the cost is wholly disproportionate to the benefit.

Frequently asked questions

What is the LTA 1927 s.18(1) cap on dilapidations?+

Section 18(1) LTA 1927 limits the landlord's recovery for dilapidations to the diminution in the value of the reversion caused by the breach — even if the actual cost of repairs is higher. Where the landlord plans to demolish or substantially alter the building at lease end (supercession), the damages may be nil.

What is a Jervis v Harris clause?+

A Jervis v Harris clause is a self-help clause allowing the landlord to carry out repairs the tenant has failed to do and recover the cost as a contractual debt (not as damages). Because the s.18(1) cap only applies to damages, a Jervis v Harris clause allows the landlord to recover the full cost of works, bypassing the diminution in value cap.

What is supercession in dilapidations?+

Supercession (under the second limb of s.18(1) LTA 1927) applies where the landlord intends to demolish or substantially alter the building at lease end — the disrepair has caused no loss because the landlord was going to demolish the building anyway; the landlord's damages claim is nil (Salisbury v Gilmore [1942]).

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