The Upper Tribunal (Lands Chamber) has awarded compensation and costs to the respondent in an application for interim Code rights under paragraph 26 of the Electronic Communications Code in EE Ltd and another v HSBC Bank plc [2022] UKUT 174 (LC) and has explained its reasons for doing so.
The parties had agreed the terms of an order for interim rights under paragraph 26 of the Code and the tribunal made an order imposing that agreement on the parties. The only live issues at the hearing were those of compensation and costs. The tribunal directed that the claimant operator should pay compensation to the respondent site owner under paragraphs 25 and 84 of the Code equal to its transaction costs – the costs of negotiating and completing the agreement – which the tribunal will determine if the parties are unable to agree. The claimants were directed to pay the sum of £12,500 on account.
The tribunal also ordered the claimants to pay the respondents’ costs of the reference, summarily assessed on the standard basis at £15,000. The tribunal was asked to give its reasons for the award of costs and was happy to do so, in order that the approach to costs in these types of case can be more widely known.
Most references under paragraph 26 of the Code for the imposition of an agreement conferring interim Code rights to enable operators to conduct surveys of potential telecommunications sites are resolved by agreement without the need for a hearing and the parties file an agreed form of order which provides that there shall be no order as to costs which the tribunal is invited to make.
However, the costs of references under paragraph 26 of the Code are in the discretion of the tribunal. The usual order – where the parties have not reached agreement – is that the operator should pay the site provider’s costs, to be summarily assessed. The costs of a reference are necessary because interim Code rights cannot be conferred by agreement but must be imposed by order of the tribunal and, in principle, there is no reason the site provider should pay its costs incurred in a reference which is only necessary because an operator wishes to have a Code right to undertake a survey. This reflects the practice in compulsory purchase cases made in the public interest where the costs incurred by claimants in establishing the amount of compensation to which they are entitled are part of the expense imposed on them by the acquisition and normally paid by the acquiring authority.
In this particular case there was an element of conduct which was another reason why the respondent should have its costs of the reference. At all times the respondent was prepared to allow the claimant access to its land to undertake surveys. However, the claimant ignored the terms of a draft agreement proposed by the respondent – for reasons which were not explained – and commenced the reference without responding to them.
Louise Clark is a property law consultant and mediator