Upper Tribunal Clarifies Legal Principles on Electronic Communications Apparatus & Code Agreement Termination

Citation: [2024] UKUT 51 (LC)
Judgment on

Introduction

In the matter of On Tower UK Limited v British Telecommunications PLC, the Upper Tribunal (Lands Chamber) delivered a substantive review of the legal issues pertaining to electronic communications apparatus, the validity of contract termination notices, and the interplay between contractual agreements and statutory provisions of the Communications Act 2003 (“the Act”). This case provides a nuanced examination of the legal principles governing code agreements and the termination of such agreements under the Act, focusing on the correct statutory interpretation and application of the Electronic Communications Code (“the Code”).

Key Facts

The dispute arose when British Telecommunications PLC (“BT”) sought to remove electronic communications equipment owned by On Tower UK Limited (“On Tower”) from its telephone exchange building on Kenton Road. The central question pertained to the nature of the lease agreement between the parties and whether it conferred Code rights under the Act. If classified as a Code agreement, different rules applied to its termination compared to a conventional lease. The termination notices in question included a contractual break notice and a notice under paragraph 31 of the Code furnished by BT.

Several key legal principles were explored in this decision:

  1. Definition of Electronic Communications Apparatus and Land: The tribunal had to determine whether the building containing communications equipment was “land” or “electronic communications apparatus” for the purposes of the Code. Paragraph 108 of the Code stipulates that “land” does not encompass electronic communications apparatus. If the building was solely for enclosing such apparatus, it would be treated differently than if it served multiple purposes (Paragraph 5 of the Code). The tribunal concluded that the building’s purpose was broader than merely enclosing apparatus, thereby making it “land” and subject to Code rights.

  2. Continuation and Termination of Code Rights: The tribunal evaluated whether the Code agreement could be terminated through a contractual notice served under the lease’s provisions or solely in line with the termination provisions in the Code (Paragraphs 30 and 31). It was concluded that a paragraph 31 notice was required due to the lease being a Code agreement, and the contractual notice, irrespective of its validity, was ineffective as the Code agreement superseded it.

  3. Validity of a Paragraph 31 Notice: Critical to the assessment of the paragraph 31 notice’s validity was whether the date specified for termination could occur after a date on which the site provider could bring the agreement to an end, absent paragraph 30. The tribunal concluded that the respondent could have validly terminated the lease on the dates stipulated, satisfying the prerequisites set by paragraph 31.

Outcomes

The tribunal determined that:

  • The Site Lease was a Code agreement and subject to the provisions of the Code, including the continuation of Code rights under paragraph 30.
  • The contractual notice under clause 5.8 of the lease was superfluous due to the continuation of the Code agreement, and its validity was deemed irrelevant.
  • The paragraph 31 notice served by BT was valid as it satisfied the conditions set forth in paragraph 31(3)(b) of the Code.

Conclusion

The tribunal’s determinations in On Tower UK Limited v British Telecommunications PLC underscore the significance of Code rights within the statutory framework of electronic communications in the UK. Importantly, it emphasizes that Code agreements are governed by a set of statutory provisions that override conventional contractual termination mechanisms, thus safeguarding the integrity and continuity of electronic communications infrastructure. The meticulous legal analysis provided by the tribunal serves to reinforce the primacy of statutory provisions in defining and governing agreements between Code operators, while also balancing these considerations with the property rights of site providers.