Telecommunications – Electronic communications code – Code rights – Claimant Code operator applying for rights under Code to install and operate apparatus on roof of respondent’s building – Whether prejudice to site provider outweighing public benefit of imposing agreement – Whether prejudice capable of being compensated in money – Application dismissed
The claimant was a Code operator providing telecommunications infrastructure for its shareholders which provided telecommunications networks. The respondent was a collegiate university with sites in different places in London, including the London College of Communications at Elephant and Castle.
The claimant had had equipment on two roof-top sites in the Elephant and Castle shopping centre but had to leave those sites because of the impending redevelopment of the area. The redevelopment was a major programme which would take several years to complete.
The respondent was not the developer, having agreed to sell the building to a development company and rent it back temporarily while it fitted out a new building to be constructed by the developer nearby. It was a condition of the agreement that the respondent would deliver vacant possession of its existing building free from any third-party rights and telecommunications apparatus, to enable the developer to demolish it.
The claimant applied under paragraph 20 of schedule 3A to the Communications Act 2003 (the Code), seeking rights under the Code to install and operate apparatus on the roof of the respondent’s building at Elephant and Castle. Paragraph 20 enabled the tribunal to impose an agreement conferring Code rights upon an operator and an occupier of land, if the conditions set out in paragraph 21 were met.
In May 2020, the tribunal had imposed on the parties an agreement conferring Code rights on the claimant on an interim basis pursuant to paragraph 26 of the Code to last until the determination of the claimant’s application for rights under paragraph 20, or further order.
Held: The application was dismissed.
(1) It was clear that parliament in enacting the Code intended private landowners to participate in the provision of telecommunications sites for the public good by suffering the use of their land for that purpose, being compensated for any damage caused but for consideration calculated on a basis that prevented them from making a profit out of the deal as they could under the Code’s statutory predecessor. But the fact that parliament provided, in paragraph 21(2), a way out for the landowner who would suffer prejudice that could not be compensated, or in paragraph 21(3) contemplated a level of prejudice so great that it would outweigh the public benefit, pointed to the fact that parliament did not intend a landowner to comply with that public duty at all costs. There was a point at which it was too much to ask.
(2) Under paragraph 21(5) of the Code, the tribunal was prevented from granting Code rights to an operator if the party on whom the rights were being imposed intended to redevelop all or part of the land in question and could not reasonably do so if such rights were to be granted. However, the respondent could not avail itself of paragraph 21(5) because it was not itself going to carry out the redevelopment. Instead, the respondent contended that the tribunal should not make an order under paragraph 20 of the Code because neither of the conditions in paragraphs 21(2) (loss suffered could not be compensated in money) and 21(3) (prejudice would outweigh the benefit that the public would derive from the use of the site).
(3) The development was very likely to go ahead as work had been continuing despite the current pandemic; and there was a fair chance that the respondent would be able to move in the summer of 2025. There was also a high risk of further litigation to remove the operator from the site. That would cause uncertainty and reputational damage to the respondent, as well as difficulties in its relationship with the developer and its students and might prove unsuccessful. Those were prejudices which could not be compensated in money. Accordingly, the condition in paragraph 21(2) was not met.
(4) As regards paragraph 21(3), the public benefit being considered was the benefit to the public of the claimant operating from the rooftop under the paragraph 20 agreement, whether or not that benefit could be achieved from another site. Even considering the benefit of the claimant’s operation on the site, without netting off other disbenefits, the prejudice to the respondent in the particular circumstances was too great to be outweighed by the public benefit likely to result from the making of the order.
The imposition of a paragraph 20 agreement put the respondent at risk both of having to pay rent at the rate of £3 million per annum after the first 18 months of the lease-back, and of being liable in very substantial damages to the developer at the end of the three-year lease. Although it would seek to recover those losses from the claimant, the process of doing so was hardly likely to be easy. The weighing of private prejudice against public benefit was difficult; the two were not obviously commensurable. Public benefit would generally outweigh inconvenience and annoyance and readily calculable losses, but there was far more than that in the present case: it crossed the boundary between prejudice that had to be suffered for the public good, and prejudice that was too much to ask. The condition in paragraph 21(3) was not met. Accordingly, the application for an agreement under paragraph 20 would be refused.
(per curiam) The level of hostility between the parties had been unnecessary and had inflated costs on both sides. The understandable caution and frustration of the parties had been taken too far, despite the fact that each party was endeavouring to provide a public service safely and efficiently and neither was seeking to wrong the other or do anything illegal. The respondent accepted that the claimant was entitled to put equipment on the roof-top site, albeit on an interim basis, and it was in the interests of both parties to build a relationship that would work well in the coming years. An approach that assumed the worst in all circumstances and required provision in the agreement for duplicated safeguards and excessive bureaucracy would generate pointless costs, was likely to lead to contradictory obligations and would sour the atmosphere for the future.
Graham Read QC (instructed by Osborne Clarke) appeared for the claimant; Jonathan Wills (instructed by Eversheds Sutherland) appeared for the respondent.
Eileen O’Grady, barrister
Click here to read a transcript of Cornerstone Telecommunications Infrastructure Ltd v University of the Arts London
