Updated: October 2025
When a commercial lease comes to an end, questions about the condition of the property can often lead to tension between landlords and tenants. Understanding what your lease actually requires when it says a property must be left in “good repair and condition” can make all the difference — financially and legally.
Failing to comply with your lease’s yield-up or repair obligations can expose you to significant costs. Disputes around dilapidations (damage or disrepair) are one of the most common causes of litigation between landlords and tenants.
A key case highlighting this issue is Pullman Foods v Welsh Ministers [2020] EWHC 2521 (TCC), which clarified how the courts interpret “good repair and condition”.
In this case, the lease required the tenant to return the property in “good and substantial repair and condition to the satisfaction of the landlord.” It also stated that any buildings erected by the tenant had to be removed at the end of the term.
During the removal process, contractors disturbed asbestos on the site. The court ruled that the property was not in good condition because it could not safely be re-let without remedial work, even if the asbestos had existed before the tenant’s occupation.
The judgment made it clear that “good condition” goes beyond mere repair. Even if no physical damage is present, a property may still fail to meet this standard if it’s not fit for occupation or poses health or safety risks.
The court drew a distinction between:
Repair – remedying physical damage or deterioration caused during the lease term.
Condition – a broader concept that covers the overall state of the property, including issues not caused by direct damage.
In practice, this means tenants may have to go further than repairing damage. They may also need to ensure the property meets the landlord’s expectations for safety, usability, and presentation. However, landlords’ judgments must still be within a “reasonable range of opinions.”
To minimise the risk of costly disputes, tenants should:
A professionally prepared schedule of condition at the start of the lease provides a detailed record of the property’s state, protecting tenants from being held liable for pre-existing defects.
It should:
Be prepared by a qualified surveyor
Include photographs and a written report
Be appended to the lease and agreed by all parties
This becomes vital evidence if a landlord later brings a dilapidations claim.
Ensure your lease does not require you to return the property in a better condition than when you took it on. The inclusion of a schedule of condition can make this clear and prevent unfair obligations.
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