LC-2023-000815 - [2025] EWCA Civ 971

This appeal centres on the proper interpretation and legal effect of a single clause in a written agreement dated 11 March 1997. This agreement was entered into between the owner of Fields Farm, Congleton Road, Sandbach and Orange Personal Communications Services Limited to install and maintain telecommunications equipment including a phone mast on a site on the owner’s land (the Agreement).

Clause 2.1 (clause 2.1) of the Agreement provided as follows:

Mr Justice Edwin Johnson (the judge) decided that the Agreement did not create a term certain. In those circumstances, he held that the tenancy purportedly created by the parties was void, and took effect as a licence. This was so notwithstanding that the other two requirements for a tenancy to exist, namely the payment of rent and exclusive possession, were present. The judge thought that his decision was compelled by the terms of clause 2.1 and the law, but that it was unsatisfactory (see the postscript to his judgment).

The owner (as appellant) advanced three arguments as to why the judge was wrong. Each had the conclusion that the Agreement ought to be regarded by the law as having created a term certain.

First, Baroness Hale had identified only two invalidating features at [93] of her judgment in Mexfield Housing Co-Operative Ltd v. Berrisford [2011] UKSC 52, [2012] 1 AC 955 (Mexfield). Both those features were absent in this case: (i) here the term was not of uncertain duration as, for example, was a term meaning “for the duration of the war” in Lace v. Chantler [1944] KB 368; (ii) here there was no fetter of uncertain duration on either parties’ right to serve notice as, for example, in Prudential Assurance Co Ltd v. London Residuary Body [1992] 2 AC 386 (Prudential) where the tenancy was terminable on two months’ notice but notice was not to be given until the land was required for road widening. I will call this the “invalidating features argument”.

Secondly, the owner argued that the Agreement itself created a valid term certain for a minimum term of 10 years, terminable by either party giving 12 months’ notice expiring on any day after the minimum term. I will call this the “interpretation argument”.

Thirdly, the owner argued that, even if the Agreement was void for want of a certain term as the judge held, an annual periodic tenancy ought to have been inferred (as happened in Prudential), rather than defaulting to holding that the Agreement constituted a contractual licence. I will call this the “inferred periodic tenancy argument”.

If the owner is right, the Agreement will be regarded as creating a valid tenancy (or there will be an inferred periodic tenancy) which will be renewable under the terms of Part II of the Landlord and Tenant Act 1954, attracting a higher rent. If the owner is wrong, and the judge was right that the occupier holds only a contractual licence, that licence will be renewable under the terms of the Electronic Communications Code now contained in schedule 3A to the Communications Act 2003 (the Code), attracting a lower rent. Both parties accepted that our decision had consequences for numerous other agreements beyond the Agreement.

I have decided that all three of the owner’s arguments are wrong, so this appeal should be dismissed. In relation to the invalidating features argument, Baroness Hale was not laying down any general rule at [93] of Mexfield. In relation to the interpretation argument, clause 2.1 is clear and unambiguous. It purports to create a term of 10 years that can be determined on any day on or after its 10^th anniversary on 12 months’ notice given by either party. The length of the tenancy purportedly created could not be determined when the Agreement was entered into and was, therefore, uncertain and invalid. Thirdly, in relation to the inferred periodic tenancy argument, the judge was right to refuse to infer a periodic tenancy. Following the reasoning of the Supreme Court in Mexfield, allowing the terms of the Agreement to survive as a valid contractual licence best accords with what must be taken to have been the intentions of the parties from the terms of the Agreement.

With that introduction, I shall give my more detailed reasons under the following headings: (i) the relevant terms of the Agreement, (ii) the authorities in chronological order, and (iii) each of the three arguments I have already described.