Receiving a Schedule of Dilapidations from your Pubco can feel like a knockout blow to your business. Often running into tens of thousands of pounds, these claims are frequently inflated with items that constitute Betterment rather than legitimate Repair. As an expert operator, you know that every pound handed over to a Pubco is a pound taken away from your team, your guests, and your bottom line.
In this guide, we reveal the “Legal Shield” every pub landlord needs to protect their capital.
The Secret Weapon: Section 18(1) of the Landlord and Tenant Act 1927
Most Pubcos rely on the fact that tenants don’t understand the “ceiling” of their liability. Section 18(1) is the most powerful piece of legislation in a tenant’s arsenal. It dictates that the damages for a breach of repair are strictly capped at the Diminution in Value of the property.
In plain English: If a repair doesn’t actually increase the market value of the building (the “reversion”), the landlord cannot legally claim the full cost of the works. If your Pubco is demanding a full roof replacement on a building they plan to redevelop, Section 18(1) may reduce your liability to zero.
Betterment vs. Repair: Spotting the Overcharge
A common “predatory” tactic in a commercial lease is for the landlord to ask for an upgrade disguised as a fix. This is known as Betterment.
- The Repair: Fixing a cracked safety floor in the commercial kitchen.
- The Betterment: Demanding you replace that floor with premium non-slip tiling.
Under a standard Repairing Covenant, you are only required to keep the premises in “good and substantial repair.” You are not an interest-free loan for the Pubco’s property upgrades.
Why You Need a Digital “Schedule of Response”
To win this battle, you must move from a defensive posture to an authoritative one. Using our AI-powered tool, you can generate a professional Scott Schedule (a line-by-line rebuttal) that cross-references site photo evidence against your lease terms. This “Triangulation of Truth” signals to the BDM that you are an Expert Operator who uses top-tier technology to defend your business.
Turning Legal Savings into Trading Profit
As Rory Sutherland often notes, the “value” of something is defined by its context. Saving £20,000 on a dilapidations claim isn’t just a legal win; it’s a massive injection of Trading Capital.
Instead of liquidating your cash flow to pay for the Pubco’s “Betterment,” you can reinvest that money where it belongs: in your pub’s growth. Once you’ve secured your capital, ensure your operations are as tight as your legal defense. https://smartpubtools.com/the-ultimate-pubs-code-law-assistant/
Don’t let a Schedule of Dilapidations be the end of your story. Use the law, use the technology, and stay Remarkable.