Interaction between operator’s rights under the Electronic Communications Code and Landlord and Tenant Act 1954

Summary

The Upper Tribunal does not have jurisdiction under Part 4 of the Electronic Communications Code to impose Code rights over land in favour of an operator, which already occupies that land under a tenancy that is continued after its contractual expiry date by the Landlord and Tenant Act 1954. This is an important decision exploring the relationship of the Code and 1954 Act.

Context

We reported in Law-Now on the Court of Appeal’s decision in Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates that the Upper Tribunal does not have jurisdiction to order the conferral of Code rights over land by the landowner, where a third party is in occupation of the land.

That decision provided an important backdrop to a recent judgment of the Upper Tribunal in Cornerstone Telecommunications Infrastructure Ltd v Ashloch Ltd and AP Wireless II (UK) Ltd [2019] UKUT 338 (LC).

The Upper Tribunal had to decide as a preliminary issue whether it had jurisdiction under Part 4 of the Electronic Communications Code (Code) to impose Code rights to benefit an operator.

Circumstances

Vodafone had a tenancy of part of a roof that was protected by Part II of the Landlord and Tenant Act 1954 (1954 Act). This gave Vodafone rights to remain in occupation after the contractual term ended, to renew the tenancy and to compensation if the renewal was refused on particular grounds. Vodafone continued to remain in occupation after the contractual term ended.

Vodafone’s rights were, what the Code legislation calls, a “subsisting agreement”, namely an agreement under the old Code that was in force when the new Code began in December 2017. The legislation contains transitional provisions relating to such subsisting agreements and governing the interaction between the 1954 Act and Code rights, which proved problematic for the old Code.

So Part 5 of the new Code, which deals with termination and modification of agreements as well as renewal of rights, does not apply to a subsisting agreement to which the 1954 Act applies, provided there has been no agreement excluding the security of tenure provisions of the 1954 Act. Therefore, a tenant under a 1954 Act tenancy which was not contracted out and which had either not expired or was continuing under the 1954 Act when the new Code began, cannot make use of Part 5 to renew or modify their tenancy.

Cornerstone (which is a joint venture between Vodafone and Telefonica) gave a notice under paragraph 20 of the Code, seeking the agreement of a long leaseholder, AP Wireless II (UK) Ltd (APW), to Cornerstone being conferred Code rights. The rights sought related to the part of the roof that Vodafone continued to occupy under the 1954 Act.

The paragraph 20 notice is the first stage of a process by which a Code operator can apply to the Tribunal under Part 4 of the Code for an order imposing Code rights on the relevant person if they do not agree to them.

APW disputed the Tribunal’s jurisdiction to impose Code rights on it, because it was not in occupation of the relevant part of the roof, an argument vindicated by the Upper Tribunal and Court of Appeal in Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates.

In the light of this, Vodafone’s rights were assigned to Cornerstone, so there was a direct contractual relationship between Cornerstone and APW, and a further paragraph 20 notice was given to APW.

Competing arguments

APW contended that the rights under Part 4 of the Code were not available to Cornerstone, because Cornerstone was now the occupier of the site and it benefited from continuing rights under the 1954 Act. APW argued that the only way for Cornerstone to obtain new rights was by applying to the County Court for a new tenancy under the 1954 Act.

Cornerstone on the other hand contended that it had a choice either to seek a new tenancy under the 1954 Act, or to apply to the Tribunal for the imposition of a Code agreement under Part 4. It argued, more widely, that an occupier in situ could always make use of Part 4. If, as in this case, it occupied under a subsisting agreement with 1954 Act protection, Part 4 would be available as an alternative to renewal under the 1954 Act. If the operator’s rights were under an agreement made under Part 2 of the Code (relating to the conferral of Code rights) or imposed under Part 4, the right to seek a new agreement under Part 4 would be an alternative to the right of renewal under Part 5. Any procedural issues created by the availability of alternative routes to renewal could be resolved by sensible case management.

Decision

The Upper Tribunal determined the preliminary issue in APW’s favour.

The Tribunal has no jurisdiction under Part 4 where the operator is in occupation of the relevant land under a subsisting agreement. An operator in situ under a subsisting agreement is in the same position as an operator in situ under an agreement made under Part 2 or imposed under Part 4; that status does not confer the right to give notice under paragraph 20 of Part 4, except for the very limited purposes of obtaining interim or temporary rights.

Also an operator that is in occupation under a tenancy continued by the 1954 Act may not make use of Part 5 of the Code to obtain a new tenancy. Instead, the occupier must first apply in the County Court for a new tenancy under the 1954 Act. However, when that new tenancy is close enough to its contractual termination, the operator may give six months’ notice under paragraph 33 of the Code and seek a new agreement under Part 5.

The interactions between the 1954 Act and the Code are complex and this Upper Tribunal decision is the first one to consider their relationship. For that reason, it is a significant judgment.

The transcript can be found here.