Telecommunications – Electronic Communications Code – Mast – Code rights – Operator applying for code rights in respect of existing mast site – Respondent landowners intending to redevelop land and allegedly prevented from doing so if rights conferred – Whether respondents entitled to rely on para 25(1) of Schedule 3A to the Communications Act 2003 – Judgment accordingly
The claimants were mobile telephone network operators. They were competitors but shared infrastructure, such as masts and cabinets, in many locations. They sought to acquire rights pursuant to Schedule 3A to the Communications Act 2003 (the Electronic Communications Code) over land owned by the respondents. The land was a mast site at the Cat Plantation on the respondents’ Hinton Admiral Estate in the New Forest in Hampshire. The respondents were not willing to confer those rights on the claimants and therefore the claimants made an application under para 20 of the Code seeking code rights in respect of the existing site. The respondents resisted the application. They relied upon para 21(5) of the Code, arguing that they planned to redevelop the site and would be prevented from doing so if the rights were conferred. The respondent’s scheme involved the removal of the claimants’ 22.5m monopole mast from the Cat Plantation site, and the installation of a 35m lattice mast capable of supporting not only mobile phone antennae belonging to the claimants and to other operators but also the apparatus required for fixed wireless access broadband (FWA) to serve the estate.
The issues in dispute were: (i) whether any of the rights sought by the claimants should be imposed on the respondents; (ii) if so, which ones and what other terms should be imposed; and (iii) what should be the consideration and compensation. The court gave an interim decision on the first issue only, and only insofar as it was asked to consider the respondents’ reliance upon para 21(5) of the Code.
Held: Judgment was given accordingly.
(1) Just as an important policy of the Landlord and Tenant Act 1954 was to confer a benefit on business tenants in the form of the new tenancy and the continuance of possession, the policy of the Code was to enable code operators to acquire code rights at a price calculated on the basis of assumptions that were favourable to them. A redevelopment conceived purely to prevent the acquisition of code rights, which the relevant person would not pursue if code rights were not sought, would not satisfy the test in para 21(5). Such an intention was not the unconditional intention that Parliament sought to protect. Accordingly, whether the respondents wished to build a mast or a housing estate, they could resist the claimants’ application only if they could demonstrate both that they had a reasonable prospect of being able to carry out their redevelopment project and that they had a firm, settled and unconditional intention to do so. If they intended to do so purely in order to prevent the claimants from getting code rights then they would fail: Cunliffe v Goodman [1950] 2 KB 237 and S Franses Ltd v Cavendish Hotel (London) Ltd [2018] UKSC 62; [2019] EGLR 4 applied.
(2) The respondents had a planning permission that enabled them to carry out their current scheme. The respondents had not established the financial viability of their project but so far as financial resources were concerned, the respondents could fund the redevelopment. The business plan for the original scheme proved to be over-optimistic, in view of the Claimants’ unwillingness to participate, and the business plan envisaged far more modest revenues even with free broadband factored in. On the other hand, the respondents had considerable resources. The current scheme was essentially unprofitable and required a financial contribution from the respondents that might deter a less determined landowner, but if the respondents wished to carry out the development scheme, it was clear that money was no object. Accordingly, with planning permission granted, and their substantial resources, the respondents had a reasonable prospect of being able, by themselves and without the need for the co-operation of others, to bring about their redevelopment scheme.
(3) At no time during the negotiations had there been any mention of a plan for redevelopment on the respondents’ part. If the respondents’ priority was the delivery of better broadband, they would first have contacted the established providers already present on the estate to ascertain first what could be done at reasonable cost, and by means with proven effectiveness, by those who were in the business of providing mobile phone and broadband services. They would have pursued those discussions and eliminated other options before expressing a firm commitment to a redevelopment that involved the waste of serviceable masts, and huge expense for the respondents and the claimants. Mindful of their duties as trustees, or simply as sensible landowners, if their priority was better broadband they would not have chosen an expensive and wasteful option without first opening conversations to make sure that they could not improve broadband by other and less expensive means. Nor would they be doing so by a method that now looked likely to involve the loss of mobile phone signals from most of the estate. The respondents had not shown that there was an estate-wide problem with poor broadband and their responses to a questionnaire had been misrepresented by the respondents not only to the tribunal but also to the local planning authority. Although the respondents were able to bring about their redevelopment plan, through sheer weight of resources, it was not a viable plan. It involved the loss of mobile coverage for much of the estate, in exchange for the provision of FWA broadband. The importance of broadband was not in dispute but the evidence of the need for new provision on the estate was far from convincing. Even if there was a need, there was considerable evidence that that was not the best way to meet it. It was wholly implausible that the respondents, as trustees with fiduciary duties to their beneficiaries (and also as landowners who claimed to be committed to the welfare of their land and their tenants) would waste their resources on it. In reality the redevelopment plans were conceived in order to defeat the claim for code rights. Accordingly, the respondents could not rely on para 21(5) of the Code.
Graham Read QC and Shaen Catherwood (instructed by DWF LLP) appeared for the claimants; Alan Maclean QC and Jonathan Wills (instructed by Fladgate LLP) appeared for the respondents.
Eileen O’Grady, barrister
Click here to read a transcript of EE Ltd and another v Trustees of the Meyrick 1968 Trust
