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Code operators have to use the 1954 Act if they have a 1954 Act protected tenancy

The Court of Appeal in CTIL v Ashloch and APW [2021] EWCA Civ 90, CA has determined, upholding the decision of the Deputy President of the Upper Tribunal, that the Upper Tribunal has no jurisdiction under Part 4 of the Electronic Communications Code (“the Code”), which came into force on 28 December 2017, to impose Code rights over land in favour of an operator which is already in occupation of the same land under a tenancy granted before the Code came into force; and which is continuing after its contractual expiry date under section 24(1) of the Landlord and Tenant Act 1954. The appeal of the operator, CTIL, was accordingly dismissed.

This decision is important for a number of reasons. First, the Court of Appeal considered whether it was possible to distinguish its own decision in CTIL v Compton Beauchamp [2019] EWCA Civ 1755, CA, (to be heard later this year by the Supreme Court) in a case involving two parties (rather than the three-party case considered in Compton Beauchamp). The Court decided that it could not. That decision now stands, subject to any decision of the Supreme Court, and reiterates and reinforces the “essential principle” (para [69] of Compton Beauchamp) that only an occupier for the time being can confer Code rights; an operator in situ is thus precluded from making any claim under paragraph 20 of the Code.

Second, it follows from that reasoning that any lease protected by the 1954 Act can only be renewed or terminated in accordance with that Act; the operator tenant has no entitlement to seek new Code rights under Part 4 of the Code.

Third, given the “essential principle”, an operator who wishes to have modified Code rights cannot have recourse to paragraph 20 during the contractual term of the operator’s agreement. It can only obtain such modification by a consensual agreement with the site provider, either by way of a variation of its existing agreement in accordance with paragraph 11 of the Code, or by way of a new agreement with the site provider, which will take effect pursuant to paragraph 34 (8) of the Code as a Part 2 agreement. Absent any such agreement, the operator  is bound by the existing agreement while it remains in force.

The case repays detailed consideration as it comments, in a comprehensive judgment by Lord Justice Lewison, on a number of paragraphs of the Code, and in particular, paragraphs 26, 27, 33, 34, 40 (8), 100 and 105 together with a detailed consideration of the Transitional Provisions.

The case comes at a time when the Department for Digital, Culture Media and Sport has published on 27 January 2021 a Consultation Paper on changes to the Code to deal with the suggested difficulties generated by Compton Beauchamp, as well as the subject case (which at the time of publication had only been determined by the Upper Tribunal). No doubt the upholding of the decision of the Upper Tribunal by the Court of Appeal will add to the sound of the drum beat for change.

Jonathan Seitler QC with Oliver Radley-Gardner appeared on behalf of the operator, CTIL and Christopher Pymont QC with Wayne Clark appeared on behalf of the site provider.

Link to judgment below.

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