Telecommunications – Electronic Communications Code – Temporary Code rights – Respondent owning land over which claimant wishing to acquire Code rights – Claimant making reference to Upper Tribunal to determine preliminary issues – Whether claimant occupying site under subsisting agreement – Whether tribunal having jurisdiction to impose agreement on parties under paragraph 20 – Preliminary issues determined accordingly
The claimant was in the business of providing infrastructure for the use of network operators and was a “code operators” which could acquire rights under the Electronic Communications Code. The respondent was not a code operator. It was a wholly-owned subsidiary of a company which owned and managed over 3,000 mast sites in the UK, and many more worldwide. The respondent was the freehold owner of land at Queens Oak Farm, Towcester, over which the claimant wished to acquire Code rights. The claimant was in occupation of the site. Until October 2016, when its lease expired (the 1997 lease), it had rights under the Code’s statutory predecessor, schedule 2 to the Telecommunications Act 1984 (the old Code). The 1997 lease was contracted out of the protection of part 2 of the Landlord and Tenant Act 1954.
Under the transitional provisions in the Code, part 5 (which governed renewals by operators with existing Code rights) did not apply to leases with security of tenure that expired after the Code came into force. In such circumstances, Cornerstone Telecommunications Infrastructure Ltd v Ashloch Ltd [2019] UKUT 338 (LC); [2020] EGLR 2 confirmed that operators had to seek new tenancies under the 1954 Act which, on termination, could be renewed under the Code.
The claimant remained in occupation and its customers continued to operate from the site under licence agreements. The parties failed to reach agreement about a new lease. The Code came into force on 28 December 2017. In August 2019, the claimant made a reference under schedule 3A to the Communications Act 2003 to determine as preliminary issues: (i) whether the claimant occupied the site under a subsisting agreement within the transitional provisions in schedule 2 to the Digital Economy Act 2017; and (ii) whether the tribunal had jurisdiction to impose an agreement on the parties under paragraph 20 of the Code.
Held: The preliminary issues were determined accordingly.
(1) The parties agreed that a tenancy at will came into existence in October 2016 on the expiry of the 1997 lease which, on the evidence, remained in existence when the reference to the tribunal was made and was not protected by the 1954 Act. The obligation to pay rent, to make additional payments as a result of the sharing of the site, to keep the site safe and so on all became terms of the new and unwritten agreement between the parties. The respondent contended that at some point the tenancy at will became a periodic tenancy, or a contractual licence, because negotiations for a new lease had ended. However, on the evidence, the parties’ intentions had not changed. The payment of rent gave rise to no presumption of a periodic tenancy. Rather, the parties’ contractual intentions fell to be determined by looking objectively at all relevant circumstances. In the absence of any evidence for a change of status the fall-back argument that the claimant had a contractual licence could not succeed. Accordingly, the tenancy at will continued and remained in existence when the reference to the tribunal was made: Barclays Wealth Trustees (Jersey) Ltd v Erimus Housing Ltd [2014] EWCA Civ 303; [2014] PLSCS 94 considered.
If the tenancy at will was a subsisting agreement, the tribunal would have jurisdiction to make an order under part 5 of the Code On the evidence, negotiations for a new agreement had paused pending the negotiation of a framework agreement because the Code was about to come into force and a new approach was needed. The intention remained to agree a new lease and while the framework agreement was being discussed there was no point in site-specific negotiations. However, the tenancy at will did not confer rights under the old Code and was not a subsisting agreement since the claimant did not have the respondent’s written agreement to its keeping apparatus on the land (and the other Code right conferred by the tenancy). Accordingly, the claimant remained in occupation of the site without Code rights.
(2) Paragraphs 20 and 21 of the Code enabled the tribunal to impose an agreement on an operator and a “relevant person”, and to make an order that a relevant person with an interest in the land be bound by Code rights. Paragraph 27 enabled the tribunal to impose temporary Code rights when an operator had electronic communications apparatus on land in circumstances where another person had the right to require its removal. Paragraph 27 referred to paragraph 20. An application could only be made under paragraph 27 if a notice had been served, requiring the imposition of an agreement under paragraph 20; the objective of the imposition of Code rights on a temporary basis was to keep the equipment on the land running pending the determination of the paragraph 20 proceedings and any proceedings under paragraph 40 (for the removal of the equipment).
In Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates Ltd [2019] EWCA Civ 1755; [2019] PLSCS 201, the Court of Appeal held that there was no jurisdiction, in any circumstances, to impose an agreement under paragraph 20 upon an operator in occupation of the site since it applied only to operators new to a site. The consequence of the Court of Appeal’s interpretation of the Code was that the operator in occupation of a site without Code rights, providing a network or providing infrastructure so that other operators could do so, could not succeed in an application under paragraph 20, whether or not an application was also made under paragraph 27. An operator under the Code who was already in situ could not, by making an application under paragraph 27 of the Code, bring itself within paragraph 20. Paragraph 27 required a notice seeking rights under paragraph 20. It presupposed a reference to the tribunal seeking the imposition of an agreement under paragraph 20. In a situation, as here, where there were in fact no proceedings under paragraph 40, paragraph 27 itself was without objective and it was difficult to see how or why temporary rights could be conferred. On the binding authority of Compton Beauchamp, the tribunal had no jurisdiction to impose an agreement under paragraph 20 on the parties, and the reference therefore had to be struck out.
Justin Kitson (instructed by Pinsent Masons LLP) appeared for the claimant; Wayne Clark and Jonathan Wills (instructed by Eversheds Sutherland) appeared for the defendant.
Eileen O’Grady, barrister
Click here to read a transcript of Arqiva Services Ltd v AP Wireless II (UK) Ltd
