MANY landowners in Cumbria have telephone masts located on their property with the leases generally historically held under the Landlord and Tenant Act 1954. This however has changed following the introduction of The Electronic Communications Code, as part of the Digital Economy Act 2017 which came into force on December 28 2017 and so whilst this is not new news, it continues to cause problems.

The purpose of the code was to clarify the law, give operators clearer rights, greater flexibility in enjoying those rights and was intended to facilitate the sharing of network apparatus. It is fair to say that the new provisions are strongly advantageous to the operators as opposed to the landowners.

The introduction of The Code has however not been straightforward and two years on many leases which should have been renewed under the new code have not and it is generating a large number of legal cases in the both the County Courts and The Upper Tribunal.

The cases appear to be covering two main areas, what the consideration (rent) should be under the new regime and how renewals of leases should take place.It appears that operators of masts are trying to use the Code to dramatically reduce rents for sites as Paragraph 24 of the code applies a “no network assumption” and as such the rent must be assessed for the site on the basis that it isn’t used as a telecommunications mast site that is likely to reduce rents.That said for Landlords which hold a lease which is currently under the 1954 Act the recent case of CTIL v Ashloch and AP Wireless confirmed that the procedure for renewal of a non-contracted out telecoms agreement in England and Wales was through the County Court for renewal of the lease. This matters because the terms of the agreement, including rent, will be decided in line with the provisions of the 1954 Act, rather than the Electronic Communications Code. Rent is likely to be assessed on an open market basis, without the disregard for telecoms use required by the Code.

Once the County court settle the terms of the new lease however it will be within the code and is therefore been seen as a stepping stone for operators to then be able to revise terms under the code when the new lease comes to and end. They are therefore looking for very short lease terms. In the first case heard by the County Court, Vodafone v Hanover Capital, Vodafone as the operator sought an agreement for just three years hoping to bring that new agreement to an end quickly and seek a new lease on what it expected would be more favourable terms. The court considered that against the landowner’s wish for certainty and respite from further litigation and awarded a 10 year term with a break in favour of the operator after 5 years, for a rent of £5,750 per annum.

The matter is further complicated however where the original 1954 Act lease was contracted out of the security of tenure provisions as was commonly the case for many rural masts then a key distinction occurs between lease terms which have expired before or after the code was introduced on December 28 2017. Where the lease expires after this date the operator can seek renewal under paragraph 33 of the Code and does not have to apply to the County Court. The rent will be assessed in line with paragraph 24 of the Code an as such is in the “no network assumption”. For leases which expired before this date the position is less clear and will create more cases to the courts, one such being Arqiva v AP Wireless (“Queen’s Oak”) and the Tribunal concluded that the operator had a tenancy at will, but as that was not in writing, the operator had no Code powers.

It is therefore vital that if you are approached by your mast operator to seek advice immediately to ensure that the correct procedure is followed. The cases mentioned in this article are all subject nearly all subject to legal appeal and as such the situation may further change and evolve in the future and as such certainty to Landowners may not be provided for many years after the Code was introduced.