Schedule of Condition

A schedule of condition is a formal record of the physical state of a property at a specific point in time, most commonly prepared at the commencement of a commercial lease. Its purpose is to establish a baseline against which condition at the end of the lease can be compared, thereby limiting the tenant's liability for dilapidations to deterioration that occurred during the tenancy — rather than to pre-existing defects.

Without a schedule of condition, a tenant taking a lease with full repairing and insuring (FRI) obligations is theoretically required to return the property in perfect repair at the end of the term, regardless of its condition at the start. This can result in claims for repairs to pre-existing deterioration that the tenant had nothing to do with. A well-prepared schedule of condition protects the tenant by recording those pre-existing defects in detail.

The schedule is typically prepared by a chartered building surveyor and takes the form of a written report accompanied by photographs, usually appended to the lease itself. The level of detail varies with the age and condition of the building — a newly constructed property may require only a brief schedule noting minor snags, while an older industrial building with visible defects in the structure, roof, and services may require a comprehensive room-by-room record.

Photographic quality is critical. A written description of "cracking to the north elevation" is open to interpretation: how wide? How long? How many cracks? A 360° panoramic photograph taken from outside the north elevation — or from inside looking out — captures the full extent of the cracking as a single, spatially complete image. When pinned to the floor plan at the location from which it was taken, it provides an unambiguous spatial record that is far more difficult to dispute than a flat photograph or written description.

As the legal weight of schedules of condition has become better understood, the standard of evidence expected has risen. Surveyors who produce schedules with comprehensive 360° photographic records — rather than a selection of representative flat photographs — offer their clients meaningfully stronger protection.