Out-Law Analysis | 29 Nov 2019 | 5:36 pm | 6 min. read
This week, the Court of Appeal found in favour of mobile operator Cornerstone Telecommunications Infrastructure Ltd (CTIL) in a dispute over access rights with landowner the University of London. The judgment comes shortly after two decisions in favour of landowners: the Court of Appeal upheld an Upper Tribunal decision that Code rights can only be granted by the 'occupier' of the relevant land; and the Upper Tribunal found in favour of a landowner in a case dealing with the interrelationship between the Code and rights governed by the 1954 Landlord and Tenant Act (1954 Act).
On 26 November, the Court of Appeal, upholding an Upper Tribunal judgment of October 2018, ruled that the Code covers the right to access property in order to decide whether it is suitable for installing electronic communications apparatus.
In overtly recognising the policy basis behind the new Code, the Court of Appeal expressly recognised a fundamental principle: to make it easier and cheaper for operators to roll out their electronic communications apparatus.
CTIL had sought access to the roof of student accommodation owned by the University of London for a 'multi-skilled visit' (MSV): effectively a survey and other "non-intrusive investigations" which would establish the suitability of the site. The question for the court was whether an MSV was "works in connection with the installation" of apparatus, to which the Code applied.
The court agreed with the Upper Tribunal that this was the case. It referred to the underlying purpose of the new Code - to "facilitate the provision of electronic communications apparatus in the public interest" - and ruled that 'works' was not restricted to the installation of apparatus as this right is already guaranteed elsewhere in the Code.
"Where the legislation uses an imprecise word, a court is entitled to place strong reliance on the legislative purpose underpinning the legislation," the court said in its judgment. "That purpose is undoubtedly to facilitate the improvement of electronic communications throughout the country. That purpose cannot be sensibly achieved unless operators can acquire (compulsorily if need be) the right to assess the suitability of potential sites."
The court also found that it would make no difference if the MSV concluded that the side was not suitable.
"Something may be 'connected with' a future event even if it is uncertain whether that event will ever happen," it said.
Property disputes expert Ian Morgan of Pinsent Masons, the law firm behind Out-Law, said: "In overtly recognising the policy basis behind the new Code, the Court of Appeal expressly recognised a fundamental principle: to make it easier and cheaper for operators to roll out their electronic communications apparatus (ECA)".
"The Court of Appeal found that the 'commercial consideration' underlying the appeal was that the new Code is supposed to 'reduce the price payable by operators for the acquisition of code rights'. This theme prevailed throughout the judgment which affirmed the Upper Tribunal's earlier decision that an MSV constitutes works 'for or in connection with' the installation of ECA, whether or not a final decision to install any ECA has yet been made and whether or not the MSV is to be intrusive," he said.
"Operators are likely to welcome the decision, not least because the Court of Appeal also affirmed that the right to carry out such works, including an MSV, could be sought on an interim basis under paragraph 26 of the Code, which will often be determined by the Tribunal 'on the papers', without the delay and expense involved with a full hearing - and, importantly, whether or not the operator has existing ECA on the site," he said.
On 8 November, the Upper Tribunal ruled that it had no jurisdiction to renew an operator's rights to operate ECA where the original agreement pre-dated the coming into force of the Code in December 2017.
CTIL applied to the Upper Tribunal under paragraph 20 of the new Code to renew rights in respect of a rooftop mast site, which had been transferred to it from Vodafone. The Vodafone lease was signed in 2002, and was governed by the 1954 Landlord and Tenant Act (the 1954 Act).
Referring to the Compton Beauchamp decision in October (referred to below), Martin Rodger QC, deputy president of the Upper Tribunal (Lands Chamber) (the Tribunal), first found that CTIL was the 'occupier' of the land, and therefore not entitled to seek a new agreement under part 4 of the Code. However, it was also prevented from seeking a renewal of rights under part 5 of the Code by operation of the 1954 Act.
The judge went on to set out the procedure applicable in these circumstances: "Such an occupier must first apply in the county court for a new tenancy under the 1954 Act; when that new tenancy is close enough to its contractual termination the operator may give six months' notice under paragraph 33 and seek renewal under part 5 of the Code".
Property disputes expert Rhiannon Saunders of Pinsent Masons, the law firm behind Out-Law, said: "This Tribunal’s interpretation as to how subsisting agreements under the 1954 Act sit alongside the Code when it comes to renewal may be of welcome news to landowners on the basis it has ruled that, where an operator is already in occupation under a tenancy which has continued under section 24 of the 1954 Act, the Upper Tribunal does not have jurisdiction under part 4 to grant Code rights over land and, in the first instance, an application must be made to the county court for a new 1954 Act tenancy".
"One of the key concerns for both landowners and operators will be the monetary consideration to be paid under the terms of the new agreement and, to this end, landowners may take comfort in the tribunal's comments that 'the existence of the Code and the consideration settled in the open market for new and old Code agreements will all be matters capable of being taken into account by the court when determining the terms and rent for tenancies renewed under the 1954 Act," she said.
In late October 2019, the Court of Appeal confirmed that only the 'occupier' of relevant land can confer rights under the Code, in a case brought by a landowner which was not in occupation.
CTIL sought the grant of Code rights in its favour in relation to a mast located near the Didcot to Swindon railway line, on land owned by Compton Beauchamp Estates. Another operator, Vodafone, which is part of the joint venture behind CTIL, is currently occupying the site, although its lease of the land has expired.
The Court of Appeal agreed with the Upper Tribunal that the wording of the Code is such that only the party in actual occupation of the land is able to grant a Code right. Further, in the context of the Code, whether a party is the occupier is "a question of fact rather than legal status; it means physical presence on and control of the land".
The court went on to confirm that, for Compton to be bound by the agreement, CTIL would either have to seek its agreement or make a separate application to the tribunal under the Code if that agreement was not forthcoming.
Whilst we are seeing an increase in applications to the Tribunal and decisions being handed down giving clarification on certain aspects of the Code, the position remains in a state of flux.
Property disputes expert Patricia Mellody of Pinsent Masons said: "Following this judgment, as matters currently stand, there is now clarity that notices served by operators under paragraph 20 of the Code to confer Code rights to facilitate the installation, repair, maintenance etc. of ECA - as set out at paragraph 3 of the Code - must primarily be served on the actual, physical occupier of the land".
"Any Code agreement must be between the operator and the physical occupier," she said.
"If there is another entity with an interest in the land who is not in actual occupation, or who is in occupation of parts of the land over which additional access rights would run, operators should seek to bind such parties to any Code agreement by serving further notices under paragraph 20 of the Code, and ensure they are a party to any Code agreement in addition to the occupier of land on which ECA is to be installed," she said.
Property disputes expert Siobhan Cross of Pinsent Masons said: “Since the introduction of the Code in December 2017, there has been a degree of uncertainty within the industry as to how certain provisions of the Code would be interpreted in particular scenarios".
"These decisions give current guidance for landowners when faced with requests by operators for access to land to undertake surveys/site investigations; go some way to explaining how the Courts will consider the interplay between the 1954 Act and the Code in subsisting agreements in force when the Code was enacted in December 2017; and, help operators identify the correct entity on whom to serve notices under the Code and be a party to Code agreements."
"Whilst we are seeing an increase in applications to the Tribunal and decisions being handed down giving clarification on certain aspects of the Code, the position remains in a state of flux. It is important that all parties concerned seek up to date legal advice as to best practice under the Code before landowners/occupiers and operators enter into dialogue with each other regarding the installation/maintenance of ECA on land,” she said.
12 Jul 2019
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