The Supreme Court considered whether telecoms operators with equipment already installed on land are precluded from applying for new code rights under the Electronic Communications Code because they are the ‘occupier’ of the site. The Court held that an operator seeking code rights is not the ‘occupier’ for para 9 purposes merely because its equipment is present.
Background
Three conjoined appeals concerned the operation of the Electronic Communications Code (Schedule 3A to the Communications Act 2003, inserted by the Digital Economy Act 2017) and its transitional provisions. The Code establishes the framework by which telecommunications operators can acquire rights (‘code rights’) to install and maintain electronic communications apparatus (ECA) on land. Paragraph 9 of the Code provides that code rights may only be conferred by agreement between the ‘occupier of the land’ and the operator.
In the Compton Beauchamp appeal, Cornerstone sought code rights over a site where Vodafone (a separate operator) had ECA installed under an expired lease. In the Ashloch appeal, Cornerstone had taken an assignment of Vodafone’s continuation tenancy at a rooftop site protected by Part 2 of the Landlord and Tenant Act 1954 and sought new code rights under para 20. In the On Tower appeal, On Tower’s leases had expired, it remained on site under an unwritten tenancy at will, and it applied under para 20 for new code rights. In all three cases, the respondent site owners argued the operator was precluded from applying under para 20 because the operator itself was the ‘occupier’ of the land for the purposes of para 9, and a person cannot contract with itself.
The Court of Appeal had held in two judgments that an operator with ECA installed on a site was generally the ‘occupier’ for para 9 purposes and was therefore barred from applying under Part 4 of the Code. The Court of Appeal directed operators to use Part 5 (which deals with continuation and modification of code agreements after their contractual term expires) or renewal under the Landlord and Tenant Act 1954 where applicable.
The Issue(s)
The central question was whether an operator with ECA already installed on land is the ‘occupier of the land’ within the meaning of para 9 of the Code, such that it is precluded from applying for new or additional code rights under Part 4 (para 20). Related issues included: how the transitional provisions from the old code to the new Code operated; whether Part 5 was the exclusive route for operators on site; and the interaction with the Landlord and Tenant Act 1954.
The Parties’ Key Arguments
The Appellants (Cornerstone and On Tower)
The appellants argued that an operator seeking code rights should not be treated as the ‘occupier’ for para 9 purposes merely because it has ECA installed. They contended that the Code contemplated operators on site being able to apply for new code rights, as evidenced by paras 26 (interim rights) and 27 (temporary rights) which expressly envisage applications in respect of ECA already installed. They submitted that treating the operator as occupier would frustrate the policy of facilitating the roll-out of digital communications infrastructure and would produce arbitrary results depending on the physical nature of the installation.
The Respondents (Compton Beauchamp, Ashloch, AP Wireless)
The respondents argued that ‘occupier’ bore its ordinary meaning and included operators with ECA physically present on the site. They submitted that the Code’s structure required parties to honour their existing bargains during the initial contractual term, with Part 5 providing the exclusive route for modification or renewal thereafter. Permitting operators to use Part 4 during an existing agreement would undermine Part 5 and expose site owners to repeated applications.
The Court’s Reasoning
The Proper Approach to ‘Occupier’
Lady Rose, delivering the unanimous judgment, held that the meaning of ‘occupier’ must be determined by reference to context and statutory purpose, not by starting with a fixed definition. She cited Lord Nicholls in Graysim Holdings Ltd v P & O Property Holdings Ltd [1996] AC 329 at pp 334-335:
As has been said on many occasions, the concept of occupation is not a legal term of art, with one single and precise legal meaning applicable in all circumstances. Its meaning varies according to the subject matter.
She also endorsed the approach in Bloomsbury International Ltd v Department for Environment, Food and Rural Affairs [2011] UKSC 25 at para 10:
In matters of statutory construction, the statutory purpose and the general scheme by which it is to be put into effect are of central importance. They represent the context in which individual words are to be understood.
How the Code is Intended to Work
Lady Rose held that the fundamental premise of para 9 is that the ‘operator’ and the ‘occupier of the land’ are different persons, since a person cannot contract with itself. Given the policy underlying the Code — to facilitate swift and economic roll-out of digital infrastructure — it would not make sense for the mechanism for creating new code rights to be disapplied at all sites where an operator happened to be in occupation because of previously installed ECA.
She identified several problems with the respondents’ construction:
- It would force operators to ‘future proof’ initial agreements by demanding all possible code rights from the outset, even those not currently needed, which was inefficient and wasteful.
- It applied arbitrarily: operators who merely fixed antennae to a roof (not in occupation) could apply for new rights, but those with a fenced compound could not.
- It disadvantaged operators in rural areas where more intrusive installations were needed, contrary to Government policy.
- It encouraged pointless workarounds such as removing ECA temporarily and reinstalling it.
- It created additional disputes for the tribunal about whether the operator was factually in occupation.
As Judge Cooke had stated in the Upper Tribunal in the On Tower case:
The idea that an operator should be debarred from obtaining Code rights in relation to a particular site precisely because it is in occupation, has apparatus there, and is providing a service from the site is baffling and I do not understand why such a policy would be adopted.
Relationship Between Parts 4 and 5
Lady Rose accepted the appellants’ concession that Part 5 is the exclusive route for modifying existing code rights once Part 5 becomes available. However, she held this was achieved by the structure of paras 28-30 of Part 5 itself, not by treating operators as occupiers under para 9. An operator could use Part 4 to obtain additional code rights but not to modify rights already conferred under an existing agreement before Part 5 became available.
Textual Indicators
Lady Rose found the textual indicators confirmed her conclusion. Paragraphs 26 and 27 of the Code clearly envisaged applications by operators with ECA already installed. In particular, para 27 could only apply where the operator had given notice under para 20(2) in respect of ECA ‘which is already installed on, under or over the land’. If an operator in occupation could never validly apply under para 20, para 27 could never assist it. Para 40(8) similarly assumed that an operator with ECA on site could apply under para 20. The transitional provisions further demonstrated the difficulties with the respondents’ interpretation, as operators whose old code rights were not embodied in written ‘subsisting agreements’ would be left without any route to obtain code rights.
Application to the Individual Appeals
Compton Beauchamp
The appeal was dismissed. It was not Cornerstone (the applicant operator) but Vodafone that was the occupier. Since Vodafone occupied the site, Compton Beauchamp was not the occupier for para 9 purposes and could not confer code rights. Cornerstone’s notice under para 20 was therefore served on the wrong person.
On Tower
The appeal was allowed. On Tower’s ECA was on site under an unwritten tenancy at will which was not a ‘subsisting agreement’. It had no route to Part 5. The sole basis for denying jurisdiction under para 20 had been the Court of Appeal’s interpretation of ‘occupier’, which the Supreme Court held was wrong. The Upper Tribunal had jurisdiction to determine On Tower’s application.
Ashloch
The position was more complex. Cornerstone had rights under a tenancy protected by Part 2 of the 1954 Act. The Court found persuasive the reasoning below that an operator with such protection should not bypass the tenancy renewal route (and the ‘no-scheme’ valuation advantages of the Code) by applying under Part 4. While Cornerstone could apply for genuinely additional code rights under Part 4, it could not use Part 4 to circumvent its obligation to renew its tenancy under the 1954 Act. The Court invited further submissions on remittal.
Practical Significance
This decision is of major significance for the telecommunications sector. It establishes that operators with ECA installed on land are not precluded by para 9 of the Electronic Communications Code from seeking new code rights under Part 4, whether by agreement with the site owner or by application to the Upper Tribunal. The Court drew an important distinction between seeking additional code rights (permissible under Part 4) and seeking to modify existing code rights during the initial contractual term (which must await Part 5). The decision resolves a construction of the Code that had caused significant practical difficulties for operators, particularly those on sites without written subsisting agreements, and removes an interpretation that the Upper Tribunal itself had described as ‘baffling’. It also clarifies the interaction between the Code, the transitional provisions, and the Landlord and Tenant Act 1954.
Verdict: The Supreme Court allowed On Tower’s appeal, holding that the Upper Tribunal had jurisdiction to determine its application under para 20 of the Code. Cornerstone’s appeal in Compton Beauchamp was dismissed because Compton Beauchamp was not the occupier of the site. The outcome of Cornerstone’s appeal in Ashloch was deferred pending further submissions from the parties on whether the matter should be remitted to the Upper Tribunal.
Source: Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates Ltd [2022] UKSC 18
