LC-2023-000815 - [2024] UKUT 263 (LC)

This appeal is concerned with the status of two agreements, each relating to the installation and operation of telecommunications equipment on an area of land. The question which arises is whether each of these agreements (one of which was subsequently amended) took effect as a licence or a lease.

The question of whether these agreements constituted licences or leases came before the First-tier Tribunal (“the FTT”) by way of preliminary issues in two references made pursuant to the provisions of Part 5 of the Electronic Communications Code in Schedule 3A to the Communications Act 2003 (“the Code”).

In each of those references (“the References”) the Respondent to this appeal, On Tower UK Limited (“OT”), sought the termination of the existing agreement and an order that the parties enter into a new agreement, pursuant to paragraph 34(6) of the Code.

The respondent to each Reference, and the Appellant in this appeal, is AP Wireless II (UK) Limited (“APW”), which is the freehold owner of the respective areas of land which are the subject of each of the agreements.

The preliminary issues were heard in the FTT by Judge Jackson (“the Judge”). For the reasons set out in his decision (“the Decision”) dated 30^th October 2023 the Judge decided that each agreement constituted a licence, and not a lease.

With the permission of the Judge APW appeals against the Decision. APW says that the Judge was wrong to decide that each agreement took effect as a licence, and that each agreement took effect as a lease. For its part OT resists the appeal (“the Appeal”). OT says that the Judge was right to decide that each agreement took effect as a licence, both for the reasons given in the Decision and for certain additional reasons relied upon by OT in the Appeal.

The particular reason why the lease/licence point matters is that the agreements, when they were originally entered into, were subject to the Telecommunications Code in Schedule 2 to the Telecommunications Act 1984, as amended (“the Old Code”). The agreements qualify as subsisting agreements for the purposes of the Code, within the meaning of paragraph 1(4) of the transitional provisions in Schedule 2 to the Digital Economy Act 2017. The catch is that paragraph 6(2) of these transitional provisions provides that Part 5 of the Code does not apply to a subsisting agreement which is a lease of land in England and Wales if (i) it is a lease to which Part II of the Landlord and Tenant Act 1954 (“the 1954 Act”) applies and (ii) there is no agreement under Section 38A of the 1954 Act, excluding the lease from the protection of Part II.

It is common ground that the agreements, if they did take effect as leases, were not contracted out of the protection of Part II of the 1954 Act, but were and remain subject to that protection. If therefore the agreements did take effect as leases, the References fall to be struck out, on the basis that the FTT has no power under paragraph 34(6) of the Code to terminate the agreements or order the parties to enter into new agreements. Instead, OT will have to seek renewal of the agreements, as leases, pursuant to the provisions of Part II of the 1954 Act.

At the hearing of the Appeal APW was represented by David Holland KC and Wayne Clark. OT was represented by Oliver Radley-Gardner KC. The hearing was listed for a day. When I saw the joint list of authorities for the hearing, this looked highly optimistic. The list of authorities was quite remarkable in its length, and was supplemented by the arrival of further authorities at the hearing itself. It was not easy to be sure that Mr Holland’s opening line, to the effect that the joint list of authorities had not quite reached Donoghue v Stevenson, was actually meant in jest. That said, both leading counsel were efficient and organised in their submissions, and it proved possible to complete the oral argument by sitting late within the listed day. I am grateful to all counsel for their written and oral submissions and for their assistance in my consideration of the question of whether the Judge was right to find that the agreements were licences rather than leases.