Local Government Lawyer Home Page


Sharpe Edge Webpage Banner

Welcome to Sharpe Edge, Sharpe Pritchard’s local government legal hub on Local Government Lawyer.

Sharpe Edge features news, views and analysis from our team of specialist local government lawyers working at the heart of the latest legal developments. Sharpe Edge platform is also the only place where local government lawyers can get e-access to two law books by our Head of Local Government Rob Hann: The Guide to Local Authority Charging and Trading Powers (‘LACAT’) and The Guide to Local Authority Companies and Partnerships (‘LACAP’).

 

                                                                                                  

Slide background

Rooftop rows: What does an imposed Code agreement mean for site providers and operators?

Lillee Reid-Hunt and Christos Paphiti consider a recent Upper Tribunal decision that provides useful guidance on what site providers and telecoms operators can expect from the terms of an imposed Code agreement, especially in relation to upgrading and sharing of equipment and ballpark consideration and compensation figures.

Upper Tribunal (‘UT’) imposed agreement

Telecommunications operators will seek to acquire rights under Schedule 3A of the Communications Act 2003 (the ‘Code’) to install and maintain apparatus on land through negotiation of a written agreement with a site provider, being the person or entity in occupation of the land (usually the landowner). Failing this, subject to certain conditions the operator can apply to the UT for an order imposing an agreement under paragraph 20 of the Code.

The UT can make an order if the conditions of paragraph 21 of the Code are satisfied, as follows:

  1. the prejudice caused to the site provider can be adequately compensated by money; and
  2. the public benefit likely to result from the order outweighs the prejudice to the site provider. In considering this limb, the UT must have regard to the public interest in having a choice of high-quality electronic communications services.

Cornerstone Telecommunications Infrastructure Ltd v London & Quadrant Housing Trust [2020] UKUT 282 (LC)

Cornerstone Telecommunications Infrastructure Limited (‘CTIL’) sought the right to install electronic communications apparatus on the rooftop of a mixed-use development in Peckham following determination of an agreement under which the apparatus was housed on another site. The Peckham development was owned by London & Quadrant Housing Trust (‘Quadrant’), a registered social housing provider, and around two thirds of the rooftop comprised solar panels.

Following failed negotiations between the parties, CTIL successfully applied to the UT for the imposition of interim Code rights in April 2020 and then for the imposition of a final Code agreement. The question on whether the paragraph 21 test was met was settled early in the claim and the parties had agreed upon various terms that should be included in a final Code agreement. The UT was therefore asked to consider what the terms of a final Code agreement should comprise in relation to:

  1. a cap on the equipment that could be installed by CTIL;
  2. upgrading and sharing – this was particularly relevant for CTIL’s business, which operates by providing apparatus for the purposes of the networks operated by its two shareholders, Telefonica UK Ltd and Vodafone Ltd; and
  3. compensation and consideration – this was particularly relevant for Quadrant given the existence of the solar panels on the rooftop and the potential effect of the apparatus on its building services and costs (safety, maintenance, insurance, use of common parts etc.).

The Decision

Equipment cap

Quadrant sought to limit the equipment that CTIL could install under the terms of the agreement to an exhaustive list, but the UT held that a cap would be inappropriate because Quadrant’s interest was already sufficiently protected. It held that the proposed Code agreement contained terms preventing CTIL from overloading the building and required it to take all reasonable steps to ensure its apparatus did not pose any health and safety issues. Further, CTIL would be limited to installations within the defined site boundaries and any additional equipment would be subject to planning constraints.

Upgrading and sharing

Paragraph 17 of the Code enables an operator to upgrade and share apparatus, provided that the exercise of such rights does not have a more than minimal adverse impact on appearance of the apparatus and does not impose any additional burden on the site provider.

CTIL sought unlimited upgrade and sharing rights. Quadrant argued that any such rights granted should be limited to the conditions in paragraph 17 of the Code to counteract the burden that would be caused (especially in relation to health and safety) in the context of a mixed-use development with alternative infrastructure occupying much of the rooftop.

The UT accepted CTIL’s argument that paragraph 17 does not comprehensively contain the upgrade rights that may be required by an operator, and an operator may seek express agreement from a site provider for a wider range of rights. The UT applied the ‘least possible loss and damage principle’ contained in paragraph 25 of the Code and held that Quadrant’s concerns could be addressed by limiting CTIL’s sharing rights to two operators without any paragraph 17 conditions, with further sharing to be permitted subject to paragraph 17 conditions. The UT decided that restrictions on upgrade would be in inappropriate given the expected improvements to technology during the ten-year term of the agreement.

The UT highlighted that the fast pace of technological change in the telecommunications industry means that operators must future proof sites because the rights granted under a Code agreement cannot be expanded during the term of such agreement without further negotiation and compensation. The UT held that paragraph 17 is a ‘statutory irreducible minimum’ so it operates as a floor, not a ceiling, and the minimum rights under paragraph 17 were not appropriate in the context of a ten-year Code agreement with an operator whose business is to share apparatus.

Consideration and compensation

The decision in this case provides the first full review of valuation under Code agreements since EE Ltd and another v LB Islington [2019] UKUT 0053 (LC).

The UT set consideration for the rooftop site at £5,000 per annum (considerably less than the consideration in the sum of around £16,000 sought by Quadrant). The figure took into account:

  • a nominal site value per annum (approx. £50);
  • the benefit to CTIL of the provision of Quadrant’s building services – insurance and maintenance (approx. £1,500);
  • an allowance for additional burdens to Quadrant for managing CTIL’s access to the common parts and the rooftop (including the solar panels) (approx. £1,000); and
  • an allowance reflecting anticipated costs to Quadrant for CTIL’s sharing rights to two additional operators and unlimited upgrade rights.

The UT capped compensation payable to Quadrant for its professional fees in connection with negotiation of the Code agreement at around £3,000.

The UT reiterated that pre-Code transactions are not relevant to the assessment of consideration under paragraph 24 of the Code, and further, while each determination will be fact-specific the UT would not expect that the market value of a rooftop site with extensive rights would be more than £5,000 per annum, regardless of its location.

Remark

The UT’s comment on the market value of rooftop sites for telecommunications apparatus helps to manage the expectations of parties negotiating new Code agreements, and presents telecoms surveyors with a ballpark figure from which to apply the Code’s valuation methodology across various sites. The decision also guides parties to take a ‘holistic’ approach in considering what protections are available under the Code, the planning regime and the terms of the agreement itself to address concerns.

Parties may also approach negotiations with more of an eagerness to settle Code agreements between them without seeking the imposition of an agreement by the UT. Not only could the UT impose less favourable terms, but the costs associated with the court process will not necessarily be borne by the successful party – especially where a Code agreement is imposed and neither party can necessarily be deemed the ‘winner’. In this case, each party was ordered to pay its own costs (CTIL’s were in the sum of around £300,000 and Quadrant’s in the sum of around £150,000).

Lillee Reid-Hunt is an Associate and Christos Paphiti is a Trainee Solicitor at Sharpe Pritchard.

For further insight and resources on local government legal issues from Sharpe Pritchard, please visit the SharpeEdge page by clicking on the banner below.

sharpe edge 600x100

This article is for general awareness only and does not constitute legal or professional advice. The law may have changed since this page was first published. If you would like further advice and assistance in relation to any issue raised in this article, please contact us by telephone or email This email address is being protected from spambots. You need JavaScript enabled to view it.

LACAT BookFREE download!

A Guide to Local Authority Charging and Trading Powers

Written and edited by Sharpe Pritchard’s Head of Local Government, Rob Hann,

A Guide to Local Authority Charging and Trading Powers covers:

• Updated charging powers compendium          • Commercial trading options

• Teckal ‘public to public’                                    • Localism Act

FREE DOWNLOAD

LACAT BookAvailable to buy:

A Guide to Local Authority Companies and Partnerships

An invaluable, comprehensive toolkit for lawyers, law firms and others advising
on or participating in Local Authority Companies and Partnerships”

- Local Authority Chief Executive

BUY NOW

  More Articles

<a href=

Environment Act 2021: What Does it Mean for Waste Authorities?

Sally Stock, Juli Lau, Ellen Painter and Beth Edwards discuss notable changes made to the Environment Bill 2021-2022, which received Royal Assent on the 9th November.
<a href=

ESG and its relevance to the public sector

Peter Collins and Sydney Chandler discuss the growing importance of Environmental, Social, and Governance criteria in public procurement.
<a href=

JCT 101: Time and Punishment

Rachel Murray-Smith, Clare Mendelle and Laura Campbell discuss a common Construction scenario regarding the Practical Completion of a project, and the position under the unamended JCT DB 2016.
Icons Court

The importance of due process, communication and fairness in employee conduct investigations – what you need to know.

Julie Bann and James Hughes discuss the importance of fairness in employee conduct investigations, taking a look at the London Borough of Hammersmith and Fulham -v- Mr S Keable case.
<a href=

Becoming More Inclusive: VAT and the Public Procurement (Agreement on Government Procurement) (Thresholds) (Amendment) Regulations 2021

Juli Lau, Natasha Barlow and Beth Edwards examine the recently published Public Procurement Regulations 2021, focussing upon amendments to the thresholds within various procurement regimes.
<a href=

The LADs are Alright

Laura Campbell discusses liquidated damages in construction contracts, focussing upon the long-running Triple Point saga which ended in the Supreme Court this year.
<a href=

Procurement Policy Note 08/21

Juli Lau and Beth Edwards outline Procurement Policy Note 08/21, recently published by the Cabinet office.
Icons Court

Hard Times: Improving Air Quality with Clean Air Zones

Rob Hann and James Goldthorpe examine the introduction of Clean Air Zones to improve air quality across the UK.
<a href=

Autumn Budget Spending Review 2021 – What Public Bodies Need To Know

Rob Hann and James Hughes examine the Autumn Budget Spending Review 2021, looking at what Public Bodies need to know.
<a href=

Net Zero – What’s new for local authorities?

Steve Gummer and Sophie Drysdale look at two major climate publications: the Heat and Buildings Strategy and the Net Zero Strategy.
Icons Hazard

Jumping to conclusions: Final Statements, liquidated damages and material breaches of natural justice

Michael Comba looks at a recent Technology and Construction Court case that provides useful guidance on the JCT’s procedural requirements on disputing Final Statements.
Icons Court

Three times one equals one: Several disputed payment applications amount to a single dispute

Michael Comba considers a case in which the High Court dismissed an employer’s argument that an adjudicator lacked jurisdiction because the referral concerned three separate payment applications and, therefore, comprised three separate disputes.
<a href=

Warm feelings or hot air: the Heat and Buildings Strategy and Heat Networks

This week the government published its Heat and Buildings Strategy (Strategy). This contained vital innovations and essential step changes in terms of how heating is provided, writes Steve Gummer.
<a href=

Procurement reforms: update from Cabinet Office

Rob Hann, Nicola Sumner and Juli Lau assess the Cabinet Office's update on the progress of the government's public procurement reforms.
Icons Court

Bond, Performance Bond. Delivering value for the Public Sector?

Justin Mendelle examines whether public sector clients achieve value for money from the provision of performance bonds.
Icons Hazard

Not so personal messages: R. (on the application of Good Law Project Ltd) v Secretary of State for Health and Social Care and Abingdon Health Plc [2021] EWHC 2595 (TCC)

Nicola Sumner, Juli Lau and Beth Edwards look at The Good Law Project's challenge of the direct award by the Secretary of State for Health and Social Care of three contracts for the production and supply of rapid Covid-19 antibody tests (the “Contracts”).
<a href=

Insolvency – Termination and Beyond

Rachel Murray-Smith and Clare Mendelle consider the potential warning signs of, and the compliant manner for dealing with, contractor insolvency.
Icons Court

Settlement agreements – waiving Personal Injury claims

In the case of Farnham-Oliver v RM Educational Resources LTD, the Queen’s Bench Division of the High Court allowed a Personal Injury claim (“PI claim”) to be pursued by an employee against his former employer despite the parties signing a Settlement Agreement in respect of an Employment Tribunal claim on the same issue. Julie Bann and James Hughes report.
Icons Hazard

Mandatory Vaccination for Care Home Workers in England – Update

Rachel Murray-Smith and Francesca Gallagher look at the detail of the government's guidance on compulsory vaccination for care staff.
<a href=

Make your mind up! Liquidated Damages clause upheld despite Employer’s challenge

In the recent case of Eco World Ballymore (EWB) v Dobler[1] , an Employer took the unusual position of challenging their own entitlement to liquidated damages (LDs) on the ground that the LDs provision constituted an unenforceable penalty clause. Clare Mendelle and James Goldthorpe investigate.
<a href=

Are Collateral Warranties Construction Contracts? Timing is Key.

Clare Mendelle and Anna Sidebottom examine the recently decided case of Toppan v Simply[1], which has provided guidance on when collateral warranties may be considered “construction contracts” under the Housing Grants, Construction and Regeneration Act 1996 and so give the warranty holder the right to adjudicate.
Icons Court

Climate emergency or climate catastrophe?

Rob Hann asks how central & local government departments and councils can work together more effectively to combat the challenges to achieve net zero by 2050.
Icons Court

Big Problems Need Radical Solutions – Time to Play Monopoly with District Heating?

Steve Gummer examines how local authorities might make district heat networks a reality.
<a href=

The Judicial Review and Courts Bill

The Judicial Review and Courts Bill was introduced to the House last week on 21 July 2021. William Rose and Anna Sidebottom discuss the potential impact of the bill.
<a href=

Liquidated damages and termination

Clare Mendelle, Francesca Gallagher and James Goldthorpe provide an outline of the Supreme Court's recent decision in Triple Point Technology vs PTT Public Company Limited.

Mandatory Vaccination for Care Home Workers in England

The Government has announced that people working in care homes in England must be fully vaccinated against Covid-19 from October 2021, unless they have a medical exemption, write Rachel Murray-Smith and Francesca Gallagher.
Icons Court

Transparency in Procurement: Procurement Policy Note (“PPN”) 07/21

Julie Lau, Clare Mendelle and Beth Edwards outline the new regime for publishing procurement notices post-Brexit
Icons Court

When procurement law and contracts for interests in land meet

Colin Ricciardiello provides a case law update examining cases that have examined the overlap between a requirement to procure and a contract for the disposal of an interest in land.
tb w74 h74 crop int a734a5aec8e0dcb7849ee8ebeb84a53d

UK granted data protection adequacy decision

Charlotte Smith summarises the new data protection adequacy decision.

First Impressions on the New Subsidy Control Bill

Last week the Government published its new Subsidy Control Bill. The Bill represents a significant shift in the way in which subsidies are assessed and also provides some clarity about the regime that will replace the EU State aid regime, writes Peter Collins.
Icons Court

Managing new enforcement powers for councils under the Traffic Management Act 2004

Rob Hann considers the recent legislative changes to traffic management in England, including the introduction of Clean Air Zones and widening local authorities enforcement powers for moving traffic offences.
Icons Court

Implementing Net Zero: Taking account of Carbon Reduction Plans in the Procurement of Major Government Contracts

The Government recently published the Procurement Policy Note 06/21. This will require suppliers bidding for major government contracts to provide a Carbon Reduction Plan at the selection stage and commit to achieving Net Zero by 2050, writes Clare Mendelle and James Goldthorpe.
tb w74 h74 crop int a734a5aec8e0dcb7849ee8ebeb84a53d

Public Procurement Update June 2021

On 3 June 2021, the Government issued the National Procurement Policy Statement (NPPS), and the associated Procurement Policy Note (PPN). George Dale explains what each document does.

What a bind: Section 106 planning obligations where there are multiple land interests

Rachel Lee and Christos Paphiti consider whether the case of R (on the application of McLaren) v Woking Borough Council impacts upon local planning authorities (LPAs) ability to properly consider the land interests and parties as regards to performance of specific obligations.
Icons Court

The use of experts only works when everyone plays by the same rules

Colin Ricciardiello looks at the use of expert witnesses in the wake of an important recent decision.
Icons Court

Unlawful Award of Contract

The High Court has ruled that the Minister for the Cabinet Office, Michael Gove, broke the law by giving a contract to a market research company, Public First, who are run by long-time associates of his. Anna Sidebottom, Francesca Gallagher and Clare Mendelle report.
Slide background