1. These are nine conjoined applications under para 33(5) of the Electronic Communications Code (“the Code” or “the new code”) contained in schedule 3A to the Communications Act 2003 each of them seeking the termination of existing agreements under the former code in the form of leases whose terms have expired and are presently running on tacit relocation and their replacement with new agreements under the new code. EE Limited are the applicants in three applications, Hutchison 3G UK Limited are applicants in another three and these two operators are joint applicants in the remaining three. The respondents are the various site providers. The names of the parties and the sites with which the applications are concerned are given in an appendix hereto.
2. The applications having been opposed for want of jurisdiction, competency and relevancy, we heard a debate on these pleas at Edinburgh on 19 and 20 August, when the applicants were represented by Mr Jonathan Barne QC, the respondents in all but one of the cases by Mr Michael Upton, advocate, and the remaining respondent, Grangemouth Rugby Football Club, by Mr Liam Entwistle, solicitor.
Communications Act 2003
TERMINATION AND MODIFICATION OF AGREEMENTS
28 This Part of this code makes provision about—
(a) the continuation of code rights after the time at which they cease to be exercisable under an agreement,
(b) the procedure for bringing an agreement to an end,
(c) the procedure for changing an agreement relating to code rights, and
(d) the arrangements for the making of payments under an agreement whilst disputes under this Part are resolved.
Application of this Part
29(1) This Part of this code applies to an agreement under Part 2 of this code, subject to sub-paragraphs (2) to (4).
(2) This Part of this code does not apply to a lease of land in England and Wales if—
(a) its primary purpose is not to grant code rights, and
(b) it is a lease to which Part 2 of the Landlord and Tenant Act 1954 (security of tenure for business, professional and other tenants) applies.
(3) In determining whether a lease is one to which Part 2 of the Landlord and Tenant Act 1954 applies, any agreement under section 38A (agreements to exclude provisions of Part 2) of that Act is to be disregarded.
(4) This Part of this code does not apply to a lease of land in Northern Ireland if—
(a) its primary purpose is not to grant code rights, and
(b) it is a lease to which the Business Tenancies (Northern Ireland) Order 1996 (SI 1996/725 (NI 5)) applies.
(5) An agreement to which this Part of this code applies is referred to in this code as a “code agreement”.
Continuation of code rights
30(1) Sub-paragraph (2) applies if—
(a) a code right is conferred by, or is otherwise binding on, a person (the “site provider”) as the result of a code agreement, and
(b) under the terms of the agreement—
(i) the right ceases to be exercisable or the site provider ceases to be bound by it, or
(ii) the site provider may bring the code agreement to an end so far as it relates to that right.
(2) Where this sub-paragraph applies the code agreement continues so that—
(a) the operator may continue to exercise that right, and
(b) the site provider continues to be bound by the right.
(3) Sub-paragraph (2) does not apply to a code right which is conferred by, or is otherwise binding on, a person by virtue of an order under paragraph 26 (interim code rights) or 27 (temporary code rights).
(4) Sub-paragraph (2) is subject to the following provisions of this Part of this code.
How may a person bring a code agreement to an end?
31(1) A site provider who is a party to a code agreement may bring the agreement to an end by giving a notice in accordance with this paragraph to the operator who is a party to the agreement.
(2) The notice must—
(a) comply with paragraph 89 (notices given by persons other than operators),
(b) specify the date on which the site provider proposes the code agreement should come to an end, and
(c) state the ground on which the site provider proposes to bring the code agreement to an end.
(3) The date specified under sub-paragraph (2)(b) must fall—
(a) after the end of the period of 18 months beginning with the day on which the notice is given, and
(b) after the time at which, apart from paragraph 30, the code right to which the agreement relates would have ceased to be exercisable or to bind the site provider or at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider.
(4) The ground stated under sub-paragraph (2)(c) must be one of the following—
(a) that the code agreement ought to come to an end as a result of substantial breaches by the operator of its obligations under the agreement;
(b) that the code agreement ought to come to an end because of persistent delays by the operator in making payments to the site provider under the agreement;
(c) that the site provider intends to redevelop all or part of the land to which the code agreement relates, or any neighbouring land, and could not reasonably do so unless the code agreement comes to an end;
(d) that the operator is not entitled to the code agreement because the test under paragraph 21 for the imposition of the agreement on the site provider is not met.
What is the effect of a notice under paragraph 31?
32(1) Where a site provider gives a notice under paragraph 31, the code agreement to which it relates comes to an end in accordance with the notice unless—
(a) within the period of three months beginning with the day on which the notice is given, the operator gives the site provider a counter-notice in accordance with sub-paragraph (3), and
(b) within the period of three months beginning with the day on which the counter-notice is given, the operator applies to the court for an order under paragraph 34.
(2) Sub-paragraph (1) does not apply if the operator and the site provider agree to the continuation of the code agreement.
(3) The counter-notice must state—
(a) that the operator does not want the existing code agreement to come to an end,
(b) that the operator wants the site provider to agree to confer or be otherwise bound by the existing code right on new terms, or
(c) that the operator wants the site provider to agree to confer or be otherwise bound by a new code right in place of the existing code right.
(4) If, on an application under sub-paragraph (1)(b), the court decides that the site provider has established any of the grounds stated in the site provider's notice under paragraph 31, the court must order that the code agreement comes to an end in accordance with the order.
(5) Otherwise the court must make one of the orders specified in paragraph 34.
How may a party to a code agreement require a change to the terms of an agreement which has expired?
33(1) An operator or site provider who is a party to a code agreement by which a code right is conferred by or otherwise binds the site provider may, by notice in accordance with this paragraph, require the other party to the agreement to agree that—
(a) the code agreement should have effect with modified terms,
(b) where under the code agreement more than one code right is conferred by or otherwise binds the site provider, that the agreement should no longer provide for an existing code right to be conferred by or otherwise bind the site provider,
(c) the code agreement should—
(i) confer an additional code right on the operator, or
(ii) provide that the site provider is otherwise bound by an additional code right, or
(d) the existing code agreement should be terminated and a new agreement should have effect between the parties which—
(i) confers a code right on the operator, or
(ii) provides for a code right to bind the site provider.
(2) The notice must—
(a) comply with paragraph 88 or 89, according to whether the notice is given by an operator or a site provider,
(i) the day from which it is proposed that the modified terms should have effect,
(ii) the day from which the agreement should no longer provide for the code right to be conferred by or otherwise bind the site provider,
(iii) the day from which it is proposed that the additional code right should be conferred by or otherwise bind the site provider, or
(iv) the day on which it is proposed the existing code agreement should be terminated and from which a new agreement should have effect,
(as the case may be), and
(c) set out details of—
(i) the proposed modified terms,
(ii) the code right it is proposed should no longer be conferred by or otherwise bind the site provider,
(iii) the proposed additional code right, or
(iv) the proposed terms of the new agreement,
(as the case may be).
(3) The day specified under sub-paragraph (2)(b) must fall—
(a) after the end of the period of 6 months beginning with the day on which the notice is given, and
(b) after the time at which, apart from paragraph 30, the code right to which the existing code agreement relates would have ceased to be exercisable or to bind the site provider or at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider.
(4) Sub-paragraph (5) applies if, after the end of the period of 6 months beginning with the day on which the notice is given, the operator and the site provider have not reached agreement on the proposals in the notice.
(5) Where this paragraph applies, the operator or the site provider may apply to the court for the court to make an order under paragraph 34.
What orders may a court make on an application under paragraph 32 or 33?
34(1) This paragraph sets out the orders that the court may make on an application under paragraph 32(1)(b) or 33(5).
(2) The court may order that the operator may continue to exercise the existing code right in accordance with the existing code agreement for such period as may be specified in the order (so that the code agreement has effect accordingly).
(3) The court may order the modification of the terms of the code agreement relating to the existing code right.
(4) Where under the code agreement more than one code right is conferred by or otherwise binds the site provider, the court may order the modification of the terms of the code agreement so that it no longer provides for an existing code right to be conferred by or otherwise bind the site provider.
(5) The court may order the terms of the code agreement relating to the existing code right to be modified so that—
(a) it confers an additional code right on the operator, or
(b) it provides that the site provider is otherwise bound by an additional code right.
(6) The court may order the termination of the code agreement relating to the existing code right and order the operator and the site provider to enter into a new agreement which—
(a) confers a code right on the operator, or
(b) provides for a code right to bind the site provider.
(7) The existing code agreement continues until the new agreement takes effect.
(8) This code applies to the new agreement as if it were an agreement under Part 2 of this code.
(9) The terms conferring or providing for an additional code right under sub-paragraph (5), and the terms of a new agreement under sub-paragraph (6), are to be such as are agreed between the operator and the site provider.
(10) If the operator and the site provider are unable to agree on the terms, the court must on an application by either party make an order specifying those terms.
(11) Paragraphs 23(2) to (8), 24, 25 and 84 apply—
(a) to an order under sub-paragraph (3), (4) or (5), so far as it modifies or specifies the terms of the agreement, and
(b) to an order under sub-paragraph (10)
as they apply to an order under paragraph 20.
(12) In the case of an order under sub-paragraph (10) the court must also have regard to the terms of the existing code agreement.
(13) In determining which order to make under this paragraph, the court must have regard to all the circumstances of the case, and in particular to—
(a) the operator's business and technical needs,
(b) the use that the site provider is making of the land to which the existing code agreement relates,
(c) any duties imposed on the site provider by an enactment, and
(d) the amount of consideration payable by the operator to the site provider under the existing code agreement.
(14) Where the court makes an order under this paragraph, it may also order the operator to pay the site provider the amount (if any) by which A exceeds B, where—
(a) A is the amount of consideration that would have been payable by the operator to the site provider for the relevant period if that amount had been assessed on the same basis as the consideration payable as the result of the order, and
(b) B is the amount of consideration payable by the operator to the site provider for the relevant period.
(15) In sub-paragraph (14) the relevant period is the period (if any) that—
(a) begins on the date on which, apart from the operation of paragraph 30, the code right to which the existing code agreement relates would have ceased to be exercisable or to bind the site provider or from which, apart from that paragraph, the code agreement could have been brought to an end by the site provider, and
(b) ends on the date on which the order is made.
What arrangements for payment can be made pending determination of the application?
35(1) This paragraph applies where—
(a) a code right continues to be exercisable under paragraph 30 after the time at which, apart from the operation of that paragraph, the code right would have ceased to be exercisable or to bind the site provider or from which, apart from that paragraph, the code agreement relating to the right could have been brought to an end by the site provider, and
(b) the operator or the site provider has applied to the court for an order under paragraph 32(1)(b) or 33(5).
(2) The site provider may—
(a) agree with the operator that, until the application has been finally determined, the site provider will continue to receive the payments of consideration from the operator to which the site provider is entitled under the agreement relating to the existing code right,
(b) agree with the operator that, until that time, the site provider will receive different payments of consideration under that agreement, or
(c) apply to the court for the court to determine the payments of consideration to be made by the operator to the site provider under that agreement until that time.
(3) The court must determine the payments under sub-paragraph (2)(c) on the basis set out in paragraph 24 (calculation of consideration).
3. Some of arguments advanced by Mr Upton were common to all of the applications, some applied to five out of the nine and others to single cases.
Mr Upton’s generic submissions
(i) No jurisdiction because no written agreements
4. The new code was introduced into the 2003 Act by the Digital Economy Act 2017 (“the 2017 Act”). It replaced the previous code contained in Schedule 2 to the Telecommunications Act 1984 (“the existing code” or “the old code”). Schedule 2 of the 2017 Act contains transitional provisions dealing with the effect of the new code on subsisting agreements. Para 2(1) provides that “a subsisting agreement has effect after the new code comes into force as an agreement under Part 2 of the new code between the same parties, subject to the modifications made by this Schedule.” Mr Upton’s argument was that the agreements before us were not “subsisting” agreements because they were not in writing, as para 2(1) of the existing code required (at least in respect of the consent of the occupier of the land to the exercise of the code rights). Here the written agreements had expired, so there were no subsisting agreements to which paras 33 and 34 could apply and, hence, no jurisdiction in the tribunal.
5. In support of the proposition that leases running on tacit relocations are not written agreements, and by way of analogy, Mr Upton’s founded on the English Upper Tribunal decision in Arqiva Services Ltd v A P Wireless II (UK) Ltd, a case dealing with an expired old code agreement which had been followed by a tenancy at will. Specific reference was made to several parts of Judge Elizabeth Cooke’s judgment including paras 68, 69, 78, 79, and 84 in the course of which she came to the conclusion that the agreement between the parties now being a tenancy at will, the original written permission of the occupier of the land to the exercise of code rights over it had expired and there was, therefore, no subsisting agreement. The law, Mr Upton submitted, was the same in Scotland in that tacit relocation involved the creation of a new contract in each year: it “put a red pen through the original lease”. Support for that was said to be found in the following passage from Paton & Cameron, The Law of Landlord and Tenant in Scotland, at page 222:
“It is perhaps misleading to speak of a lease being “renewed” by tacit relocation. In the general theory of the doctrine there is ample support for the view that, while in every case there is a new contract implied from the tacit assent of parties to a continuance of the relationship, it does not follow that there is a new lease; from the first there is inherent in the bargain an implied agreement that, whatever may be the stipulated period of endurance, that period may be extended by tacit agreement of the parties. Tacit relocation is therefore to be distinguished from prorogation and renewal; they imply the making of a new lease by agreement; tacit relocation implies the prolongation of an existing one by tacit consent. However tacit relocation is not an indefinite prolongation of a lease; it is the prolongation each year of the tenancy for a further year (that is if the lease was for a period of years), if the actings of the parties show that they are consenting to this prolongation. As in all contracts, a tacit relocation or reletting must be based on consent, and in the case of tacit relocation the law implies that consent, if all parties are silent on the matter.”
Notwithstanding that there were tensions within that passage, said Mr Upton, the fact was that tacit relocation was tacit and, if it was tacit, it wasn’t in writing. Accordingly paras 33 and 34 did not apply and the Tribunal had no jurisdiction.
(ii) Irrelevancy because the agreements could not be brought to an end by the site providers
6. Esto the Tribunal had jurisdiction, the applications were irrelevant for a number of reasons, the first of which was that they did not aver grounds upon which the site providers could bring the agreements to an end.
7. Underpinning this argument was the submission that Part 5 of the Code should (or need) only to be resorted to where the operator’s tenure was precarious. Developing that proposition, Mr Upton submitted that it was not enough that an operator’s tenure was precarious at common law (as it would be if a lease was running on tacit relocation) because there were statutory protections on which the operator could rely: it had to be precarious both at common law and under the Code. However, the only grounds upon which a site provider could terminate the agreement under the Code were those set out at para 31(4) and none of them applied here. The applications were, therefore, irrelevant.
(iii) Irrelevancy for want of adequate reasons for termination of the agreements by the Tribunal
8. The thrust of this submission was that the applicants had to justify the termination of the agreements. They had to aver site-specific, objectively verifiable needs (the word used in para 34(13)(a). Their convenience was insufficient: there had to be a need to bring the agreement to an end and all that was averred here was a wish. What the applicants wished to achieve was, perhaps, clear enough. It boiled down to (i) wanting Parts 3 and 5 of the new Code to apply without modification, (ii) wanting to pay less rent and (iii) wanting to be relieved of their agreements to pay the respondents for sharing. This was notwithstanding that it was the policy of the 2017 Act that part 3 of the new Code was not to apply to subsisting agreements – which was said in terms in para 5(1) of the transitional provisions contained in Schedule 2 – and that para 7(4) of that Schedule excluded the consideration payable under the existing agreement from the Tribunal’s consideration. What the applicants were trying to do was the very thing that Parliament had said was not to be done. That rendered their interpretation of para 34 untenable. There was no provision in the Code “making the general profit or convenience of a party a sufficient ground for the judicial cancellation of an existing contract”. The list of circumstances to which the Tribunal was to have regard in para 34(13) was not open-ended; the ejusdem generis principle applied. If there was ambiguity as to how para 34 was to be interpreted it had to be resolved in favour of the respondents.
9. All of this was consistent with, and underpinned by, the principle that statute does not interfere with subsisting and freely negotiated contracts other than on grounds which Parliament plainly intended would justify doing so: cf Allen v Thorn Electrical Industries Ltd per Danckwerts LJ at 505A-B and Winn LJ at 508G-509A, CTIL v Compton Beauchamp Estates Ltd at paras 86-87 and CTIL v Keast at para 13. The Tribunal had a discretion to exercise but there were rules as to how discretion was to be exercised and it should not be used to give the applicants what Parliament had denied them; Padfield v Minister of Agriculture, Fisheries and Food  AC 997, per Lord Reid at pages 1030C, 1033G-1034A and Lord Upjohn at page 1060G
10. Moreover, where, in the exercise of statutory powers, it was proposed to change the terms of a lease, the burden of persuasion rested on the party proposing the change, O’May v City of London Real Property Co Ltd, per Lord Hailsham of St Marylebone at page 740G and the cases cited by his Lordship at 741A-C. In this case, as in that one, the Tribunal was obliged to consider the terms of the existing agreement in the event that parties were unable to agree on the terms of a new code right or new agreement; see para 34(12). The applicants here had failed to discharge the persuasive burden, with the result that the applications were irrelevant.
(iv) Incompetency due to lack of proportionality
11. The argument here was that statutory powers have to be exercised proportionately and must not impair rights or freedoms to any extent greater than is necessary to secure their objective; R v Secretary of State for the Home Department ex parte Daly, per Lord Steyn at para 27 and the Law Commission’s report on the Code at paras 2.6 and 4.7. Paragraph 34(2) to (6), setting out the list of orders which could be granted on an application under 33(5), had to be read in that context. Here the applicants had gone for the most sweeping power the Tribunal could exercise without pleading anything which could justify the wholesale abrogation of the existing leases. The Tribunal, for its part, was obliged to use its powers “surgically” and could not competently grant a remedy which was disproportionate to the objective which had to be secured. Only where the whole subsisting agreement thwarted the legitimate purpose to be secured would selection of the most drastic remedy be proportionate. That was not the case here and the applications were, therefore, irrelevant.
12. Mr Upton’s written Note of Argument also contained a section on compatibility with the European Convention on Human Rights but he did not rely on it in oral submissions.
Additional submission re the Duncan, Filshie, First Grandchildren’s Fund, Gilmour and Woodland Investment cases
13. In each of these five cases the date specified for termination of the existing agreements is not an anniversary of the ish of the lease and Mr Upton says the applications are incompetent and irrelevant for that reason.
14. His argument turns on the wording of para 33(3)(b) which, for convenience, we repeat here:
“The day specified under sub-paragraph (2)(b) must fall –
(b) after the time at which, apart from paragraph 30, the code right to which the existing code agreement relates would have ceased to be exercisable or to bind the site provider or at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider.”
15. That sub-paragraph is in two parts and the argument focuses on the difference between “after the time at which …” and “at a time when …” [emphasis added]. The argument is that, whereas the first alternative envisages a period of time during which the day specified can fall, the second requires a particular time – a particular date – on which the day must fall. Since the termination of a lease running on tacit relocation can only be effected by notice served against an anniversary of the ish of the lease (Rankine, Law of Leases in Scotland, 3rd ed page 602; Paton & Cameron, pp 221-223), that date must be the date specified for the purposes of para 33(2)(b) and any other date renders the notice and, consequently, an application to the Tribunal on the basis of the notice, incompetent and irrelevant.
16. Counsel submitted that a clear principle of law, such as that a lease running on tacit relocation can only be terminated on an anniversary of its ish, could only be displaced by clear, definite and positive legislative enactment; per Lord Atkinson in Leach v R at page 311; M7 Real Estate Investments Partners VI Industrial Propco Limited v Amazon UK Services Limited, at para 22. There was no such enactment here and the common law requirements of tacit relocation therefore applied.
Additional submission re EE Ltd v Trustees of the Firm of John Gilmour & Sons
17. This application was said to be incompetent and irrelevant because notice of the intended termination had been addressed to an entity which no longer existed. The original agreement had been with Allan Gilmour and Irene Elizabeth MacAlpine Gilmour as Partners of and Trustees for the Firm of John Gilmour and Sons. The notice served under para 33(1) had purportedly been served on Mr & Mrs Gilmour in that capacity. However, Mr Gilmour had died on 7 November 2001, resulting in the termination of the partnership; Partnership Act 1890, sec 33(1); Bell, Comm II page 524; Inland Revenue v Graham’s Trustees. The Land Court case of Gordon v A C & J Craig showed how strict the requirements in this area of law were and the argument was unaffected by the decision of the Inner House in Scottish Pension Fund Trustees Ltd v Marshall, Ross & Munro. The notice and application were therefore incompetent.
18. Mr Upton also drew attention to some doubt as to the title on which the Gilmours had held the land. Initially it had been thought that title took the form of a 1963 Bond and Disposition in security in favour of the Bank of Scotland, then that, in terms of a title granted in 1974, it was held by Mr & Mrs Gilmour as partners of and trustees for the firm, whereas it now appeared that it had been held by them as individuals, in terms of a disposition in their favour by Falkirk District Council recorded on 10 May 1976. That title would be produced if necessary. Mr Upton was, however, at pains to explain that his argument did not depend on the title position: it depended, rather, on the partnership position and was based on the proposition that the notice had been given to a party no longer in existence.
Particular submission re EE Ltd and Hutchison 3G UK Ltd v Woodland Investment Management Ltd
19. Neither of the parties to this application was a party to the original lease which was between the telecom operators Orange and a Mr Angus Young and had been entered into in 2002. That lease contained a prohibition of assignation without the landowner’s consent. The applicants aver that Orange’s interest in that agreement was assigned to them on 12 September 2014 with the consent of Mr Young. However, as Mr Upton explained, in the interim the land had been sold to the present respondents whose title was registered in the Land Register on 29 December 2008. So, by 2014, Mr Young was no longer the landowner and could not, competently, have consented to the assignation. There being no averments of intimation of the assignation to the present respondents nor of their consent thereto, the application was incompetent. If there was an agreement between the present parties it was not the original agreement. Tacit relocation could only operate with the consent of the original parties; Coates v Logan, per Lord Ross at pages 225-6, Stephen v Cawdor Trustees, per Lord Justice-Clerk Gill at para 25. The original agreement was therefore at an end and could not found an application under para 33.
Mr Entwistle’s submissions
20. Mr Entwistle adopted Mr Upton’s submissions in addition to his own Note of Argument. What follows, therefore, is largely a note of things particular to his case.
21. The lease by his clients, The Trustees of Grangemouth Rugby Football Club, in favour of Hutchison 3G UK Limited (a sub-lease as it happens, but nothing turns on that) was entered into in 2003 and, on the applicants’ pleadings, expired on 30 October 2017. It has been running on tacit relocation since then. The notice served under para 33(1) specified that the lease should be terminated on 30 December 2019.
22. Mr Entwistle argued, essentially, that the date given for the expiry of the lease was wrong, or at least called for an explanation in the applicants’ pleadings. That was for the following reasons. The lease was for a period of 15 years. The “Term Commencement Date” was defined in the lease as either the second anniversary of the “Effective Date” (itself defined at 27 September 2002) or the date on which a planning pre-condition was satisfied, if earlier. Nothing is said in the applicants’ pleadings as to when the pre-condition was satisfied and, therefore, the Term Commencement Date would be expected to be 27 September 2004 (the second anniversary of the “Effective Date”). That would mean that a term of 15 years would expire on 26 September 2019 – that would be the ish – and the lease could only be terminated on an anniversary of it. So, on the face of it, the lease could not have been terminated on the date specified in the notice, which was 30 December 2019. Even if the true anniversary of the ish was 30 October, as the applicants’ averred, the notice was still invalid because the applicants were relying on the second limb of para 33(3)(b), which, as we have seen, required that the date in a notice under para 33(1) must (as well as falling not less than six months from the date on which the notice is given) fall “at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider”. A lease running on tacit relocation could only be terminated on an anniversary of its ish and 30 December 2019 was not such an anniversary. The applicants’ pleadings were therefore irrelevant.
23. Moreover, even if the correct date had been specified, the application was irrelevant because it did not aver the existence of a ground (one of those specified in para 31(4)) on which the respondent could have brought the agreement to an end.
Mr Barne’s response
(i) No written agreements
24. This argument, said Mr Barne, had been inspired by the Arqiva v AP Wireless case, which turned on aspects of the English law of leases which do not apply in Scotland. The applicants here had “subsisting agreements”, within the meaning of the transitional provisions, when the new code came into force. These were the original written agreements prolonged by tacit relocation. Tacit relocation did not create new agreements; Gill, Agricultural Tenancies, at para 10-04, Paton & Cameron at pages 221-222, McAllister, Scottish Law of Leases, 4th ed, para 10.17. The critical point was that it was inherent from the outset of a contract of lease that it could be extended by tacit relocation.
(ii) Whether the site provider has to be able to terminate the agreement both at common law and under the Code
25. The argument that para 33(3)(b) required a site provider to be in a position to terminate the agreement did not make sense. A site provider could terminate an agreement only on one of the grounds set out in para 31(4). It was illogical that an operator who was in breach of an agreement, such that the agreement was terminable, could apply to the Tribunal under para 33(5) for a new agreement. The flaw in Mr Upton’s argument was that it failed to take account of the words “apart from paragraph 30” in para 33(3)(b). It was para 30(2) which allowed an operator to continue to exercise code rights after the agreement conferring them, or binding the site provider, had expired. That provision was to be left out of account when considering para 33(3)(b). The result was that the reference in para 33(3)(b) to the time at which the code agreement “could have been brought to an end by the site provider” was a reference to the point in time when the site provider could have brought it to an end at common law or in terms of contract (as by a break provision).
(iii) The absence of relevant grounds for termination by the Tribunal
26. Mr Upton’s argument ignored the terms of the Code and misunderstood the policy behind it. The Explanatory Notes to the transitional provisions explained (at para 513) that the reason for which Part 3 of the new code was not to apply to subsisting agreements was to avoid giving paras 16 (assignation of agreements) and 17 (site sharing) of the new code retrospective effect. Parliament had not wanted to rewrite parties’ contracts for them. Paragraph 514 of the Notes likewise explained that the disapplication of sub-para (d) of para 34(13) of the new code by para 7(4) of the transitional provisions was “so that the basis of consideration, once a new agreement is agreed or imposed under the new code, … is applied without reference to the consideration agreed under the different provisions of the existing code”.
27. None of that meant that Parliament had intended that operators under old code agreements should be permanently locked out of new code benefits: all that Parliament was doing was ensuring that certain provisions of the new code were not automatically and retrospectively written into subsisting agreements. That said nothing about Parliament’s intentions as to the approach to be taken to operators seeking to convert expired old code agreements into new code agreements, with all the benefits (to operators) which that would provide.
28. The Code did not stipulate grounds on which an operator could require a site provider to enter into a new contract: it simply provided them with an unqualified right to seek a new contract and, in the event of failure to agree its terms, the right to apply to the Tribunal for an order to that effect. This was consistent with the policy of the 2017 Act which was to allow operators with subsisting agreements to access the benefits of the new code.
29. In deciding whether to order that a new agreement be entered into, the Tribunal had to consider “all the circumstances of the case” (para 34(13)), which was a wide provision, not to be curtailed by general principles of statutory interpretation as contended for by the respondents. A desire by an operator to replace an expired agreement with one that complied with the new code was clearly a relevant circumstance, which the Tribunal required to take into account.
30. Pressed as to what the need was for new agreements in these cases, Mr Barne said that the operators’ business needs encompassed the need to have new agreements that confer the full benefits available to operators under the new Code. The applicants’ averments specified aspects of subsisting agreements, such as the lack of assignation, sharing and upgrading rights, which were incompatible with the new code and which the applicants therefore required to have changed. It could not, therefore, be said that the applications were irrelevant in that respect.
31. In Mr Barne’s submission, proportionality did not come into play at this stage but at the later stage of deciding the terms of the new agreements.
32. In any event, proportionality, as explained by the Inner House in Main v Scottish Ministers, per the Lord Justice-Clerk at paras - and Lord Drummond Young at para , was about striking a balance between the effect the measure in contemplation had on a person’s rights and liberties and the public policy objectives the measure had in view. In testing proportionality it sufficed that the measure was “within the range of measures that [could] reasonably be considered as required to fulfil the policy objective” (Lord Drummond Young at para ). Parliament, in enacting the new code, had considered its provisions to be proportionate to the policy objective in view. One of the powers it conferred on the Tribunal was to impose agreements on operators and site providers. The Tribunal, being a specialist tribunal, was well placed to impose terms which were proportionate. What Mr Upton’s argument came to was that any new code agreement was disproportionate. That was an untenable position.
Mr Barne’s submissions re the cases of Duncan, Filshie, First Grandchildren’s Fund, John Gilmour & Sons and Woodland Investment Management Ltd
33. Mr Barne confirmed that it was the second limb of para 33(3)(b) which was being relied upon. The first, he said, applied where the agreement had actually come to an end. The second dealt with a hypothetical situation and referred to a time when the agreement could have been brought to an end by the site provider. The point of it was to ensure that the 40 day notice required at common law for termination of leases running on tacit relocation was given.
34. The fact that the leases could only be terminated on an anniversary of their ish dates did not mean that the date specified in the notice given under para 33(1) had to be such an anniversary: as long as it was on or after that date, that was all that was required. Mr Upton and Mr Entwistle were wrong to argue that “at a time” in 33(3)(b) meant “on the date” when the agreement could have been brought to an end by the site provider. That was not the language used; an ish was a specified date, it did not “fall at a time”. Moreover, comparing the two limbs of 33(3)(b), there was no reason why, where notice to quit was actually given (the first limb) the date specified could be later than the ish but where no notice was actually given (the second limb) it had to be the date of the ish. There was a symmetry as between these two limbs which should be given effect to.
35. A notice served against an anniversary of the original ish was not the only way in which a lease could be terminated by the site provider. It could also be terminated where the operator was in breach in terms of para 31(4). The words “after a time” (being the words used in the first limb of 33(3)(b)) would not be apt to cover a situation of continuing, ongoing breach. That was probably the reason why “at a time” had been used in the second limb.
36. Mr Barne also sought report for his argument in sub-para (15) of para 33, dealing with rent due for the period between a code right ceasing to be exercisable or from which a code agreement could have been terminated and the making of an order by the court or tribunal. The language used in the second limb there is “the date … from which … the code agreement could have been brought to an end”, so it was not necessarily the ish. Mr Barne pointed out that the same wording is used in para 35(1)(a), dealing with arrangements which can be made in relation to payment of consideration pending determination of an application under para 32(1)(b) or 33(5). Although the language used in these provisions is different from that of 33(3)(b), it was addressing situations which would not arise if the respondents were correct.
Mr Barne’s submissions on the Grangemouth Rugby Club case
37. Mr Barne pointed out the applicants’ pleadings, at para 4.2, identified the date on which it was being said the lease expired and the date on which it could have been brought to an end. Enquiries as to whether these dates were correct were ongoing – this point having been raised only in the respondents’ note of argument – but, as a matter of specification or relevancy, nothing more was required.
Mr Barne’s submissions on the John Gilmour & Sons case
38. Although a number of legal propositions were advanced in his note of argument, Mr Barne’s position was that the arguments peculiar to this case could not be disposed of at this stage. Further enquiry was needed in relation to the way in which title to the land was held and the possibility that the partnership had continued despite the death of Mr Gilmour. The latter matter was not amenable to disposal at debate in any event, since issues of fact would arise.
Mr Barne’s submissions on the Woodlands Investments case
39. This also required further investigation involving why Mr Young had signed a purported consent, describing himself as owner, in 2014 if in fact, as was now being said, the land had been disponed to the respondents in 2008. The only reason the case was before the Tribunal at this stage at all was because it had been added late in the belief that it raised only arguments common to the other cases, whereas the assignation argument was different. Like the Gilmour case, it should be held over and dealt with separately.
Mr Upton’s response
40. Mr Upton made some brief points in response, which we can summarise as follows:
(i) He doubled-down on his argument that there was an exact analogy with Arqiva Services Ltd v A P Wireless II. The result was no written contract and it was the policy of the Code to favour certainty, which required written agreements.
(ii) With reference to whether a ground on which the site providers could terminate the agreement had to be pled, while para 33(3)(b) said “apart from paragraph 30” it did not say “apart from paragraph 31”.
(iii) The argument about what orders could or should be pronounced under para 34 was not about the scope of that paragraph but about whether enough had been pled to justify termination of the existing agreement. It would be possible to plead such a case where certain things, such as site sharing, were required on a case-specific basis, but that had not been done here.
(iv) The argument that the transitional provisions had disapplied Part 3 of the Code in relation to subsisting agreements because of retrospectivity was mere semantics. The fact was that it had been disapplied and the Tribunal should not give operators something which Parliament had said they shouldn’t have.
(v) The fact that the Tribunal was not to have regard to the amount of the consideration payable by the operator under an existing agreement (para 34(13)(d)) meant that operators were not allowed to found on it as a reason for replacing the existing agreement.
(vi) If in doubt on any matter we should adopt the construction which protected the existing rights of the landowners.
(vii) Whilst it was agreed that para 33 covered a range of situations, the question was how it applied here. Here the common law principle that agreements running on tacit relocation could only be terminated at their ish favoured the respondents’ position: it was consistent with that principle that the specified date for the purposes of para 33(2) and (3)(b) should to be the ish. The flaw in Mr Barne’s argument was that it took “at” to mean “after”.
(viii) Mr Barne’s had spoken of the symmetry of 33(3)(b) but there was no such symmetry: the two limbs were dealing with two different situations, the first set in the real world, where an agreement had actually come to an end, and the second in a hypothetical world, where nothing had actually happened but the agreement could have been brought to an end.
Mr Entwistle’s response
41. Mr Entwistle likewise made a number of points, as follows:
(i) There was no need for symmetry between the two limbs of 33(3)(b) because they were dealing with different things, the first limb with the termination of a right and the second with termination of the whole agreement.
(ii) The thinking behind 33(3)(b) was as explained at paras 6.117 and 6.103 of the Law Commission’s Report, where it was made clear that the intention was to capture cases where code rights in a lease would have come to an end by effluxion of time or could have been terminated by notice.
(iii) Proportionality applied at this stage as well, not just when deciding the terms and conditions of a new agreement.
(iv) Specification of the wrong date for the ish of the lease was enough to render the applications incompetent and irrelevant.
(i) whether there was a subsisting agreement
42. We are satisfied that in Scots law the effect of tacit relocation on a lease is to extend the existing lease, not to create a new tenancy. Although the passage from Paton & Cameron relied on by Mr Upton refers to tacit relocation involving a new contract, it goes on to make plain that this does not mean there is a new lease. The new contract appears to be simply the agreement of parties, inferred from their tacit assent, to a continuation of the existing lease for another year. There is not a word in any of the literature or authorities on the subject to suggest that what happens in tacit relocation is that a succession of new leases comes into being as year succeeds year. Rankine at page 598 refers to tacit relocation as “a constructive renewal of a lease”. The passage from Gill, Agricultural Tenancies (supra) relied on by Mr Barne for the proposition that there is no new lease, cites two authorities for that proposition. One is Smith v Grayton Estates Ltd, in which Lord President Clyde said, at page 354 “In considering this matter, it is of importance to realise that in the present case the tenants were occupying under tacit relocation, in other words, that the tenancy was being prolonged from year to year beyond the stipulated terms in the lease, but that otherwise the conditions in the lease continued to operate”. But it is in the second case cited that the matter seems to have been authoritatively decided. That, like Smith, is an agricultural law case, Cowe v Millar, which is reported only in Connell, The Agricultural Holdings (Scotland) Acts, 2nd ed, at p 349 and it is worth quoting from the opinion of the (first) Lord President Clyde in that case at some length (pp 357-358):
“The ground upon which [a particular argument] was submitted to us was this, that when a tenant continues to sit on under a tacit relocation, there is really and truly a new letting of the subjects upon terms borrowed, as it were, from those of the former lease in so far as they will fit the case of the annual tenancy … My lords, I do not think that that argument is consistent with the real meaning and effect of a tacit relocation. When a tacit relocation occurs under a lease, what truly takes place is a prolongation of the tenancy. There is not really a new tenancy created at all. Indeed, the expression is often used, and quite correctly (the expression involved, indeed, in the phrase “tacit relocation”) that the lease is renewed by tacit consent. That is a perfectly fair and proper way of expressing it, if you remember, as Lord Watson said in Nelson v Summerlee, that the effect of the tacit renewal is that all the stipulations and conditions of the original contract remain in force in so far as these are not inconsistent with any implied term of a year’s renewal. In other words, it is the old contract that remains; it is not displaced; it is prolonged.”
The argument the Lord President was rebutting there was an argument that the tenant’s obligation to keep the buildings and fixed equipment on the farm in good repair was only prestable for the year on which the lease had continued on tacit relocation, not by reference to the condition of the buildings at the start of the lease. The Court rejected that argument and held that there was a single lease comprising the original term and the period for which it had run on tacit relocation.
43. The other point which is worth emphasising is the reference in Cameron & Paton on which Mr Barne relied, to the effect that “from the first there is inherent in the bargain [i.e. in the lease] an implied agreement that, whatever may be the stipulated period of endurance, that period may be extended by tacit agreement of the parties” (words taken from the opinion of Lord Justice-Clerk Cooper in Douglas v Cassillis and Culzean Estates at page 361). Accordingly the root of tacit relocation is found in the original agreement itself, a consideration reinforced by the fact that tacit relocation becomes operative as soon as it becomes too late to serve notice terminating the original agreement; Paton & Cameron at page 222.
44. Although these cases (Smith, Cowe and Douglas)are all agricultural law cases and both the Agricultural Holdings (Scotland) Acts of 1923 and 1949 contained statutory provisions on tacit relocation, there is no suggestion that what was being discussed was something different from the common law doctrine. Accordingly, we are entirely satisfied that the agreements in force in the present cases when the new code came into effect were the original leases and, since those were in writing, they qualified as subsisting agreements for the purposes of the transitional provisions. The “black hole” with which the Upper Tribunal in Arqiva was faced (see paras 81-82 of the judgment) does not materialise in Scotland. The plea of no jurisdiction therefore fails.
(ii) Whether the leases had to be terminable by the site providers under para 31
45. The key provision here is para 33. Whereas para 31 sets out how a site provider can bring a code agreement to an end and para 32 tells us how an operator can oppose that, para 33 envisages an ongoing relationship, after the contractual term of an agreement has expired, but one or other, or both, parties wish a change in the terms of the agreement or its complete replacement. The party wishing such a change must serve on the other party a notice which must comply with the formalities set out in sub-para (2) which lists things which such a notice must specify, including, at (iv) (where replacement of the whole agreement is desired), the day on which it is proposed that the existing code agreement should be terminated and the new one should take effect.
46. As we have seen, sub-paragraph (3) then provides that the day so specified must fall:
“(a) after the end of the period of 6 months beginning with the day on which the notice is given, and
(b) after the time at which, apart from paragraph 30, the code right to which the existing code agreement relates would have ceased to be exercisable or to bind the site provider or at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider.”
47. Paragraph 30 is the one which entitles an operator to go on exercising code rights which would otherwise have ceased to be exercisable or to bind the site provider or are vulnerable to being brought to an end by the site provider. It is to be ignored for the purposes of para 33(3)(b).
48. We have not found the wording of sub-para (b) straightforward. It has two limbs, the first of which deals with the expiry of a code right and the other with the possible termination of the whole agreement. We agree with Mr Entwistle that those are references to two different things and – as both sides of the bar agreed – that it is the second limb which applies here. Most of the difficulty arises only in relation to the cases of Duncan, Filshie, First Grandchildren’s Fund, John Gilmour & Sons, and Woodland Investment Management Ltd and we will come to it in due course below. For the moment, we are concerned only with Mr Upton’s and Mr Entwistle’s submission that for the second limb of para 33(3)(b) to apply the site providers must be entitled to bring the agreement to an end on one of the grounds specified in para 31(4).
49. As Mr Barne pointed out, that interpretation leads to a remarkable result: that only an operator who is in substantial breach of its obligations under an agreement, or has been persistently late with its payments or is no longer entitled to the code agreement because the public benefit test in para 21 is not met can take advantage of para 33. That is a perverse result which Parliament cannot have intended. Mr Upton sought to defend it on the ground that, unless an operator is vulnerable to having his tenure terminated on one of the prescribed grounds, he has no need to resort to para 33. That seems wrong to us. An operator whose tenure is not precarious is just as likely to have business or technical needs justifying an order from the Tribunal under para 34 as one whose tenure is vulnerable.
50. Mr Upton made the point that, whereas para 33(3)(b) disapplies the protection offered by para 30, it does not disapply para 31. That is true but nor does it expressly include para 31. The relevant part does not read “at a time when, apart from that paragraph, the code agreement could have been brought to an end by the site provider under paragraph 31”. A provision to that effect would not make sense since, where an agreement is terminated under para 31, para 30 would not apply in any event. That is made clear by 30(1)(b)(ii) which says that sub-para (2) applies where the site provider may bring the code agreement to an end under the terms of the agreement. It does not apply to termination on the basis of the grounds specified in the Code. If these grounds are made out the court or tribunal must order the agreement to come to an end an end and there is no role for para 30. Moreover the wording of the second limb of para 33(3)(b) is the same as is used in par 31(1)(3)(b). That provision relates to the date which has to be specified in a notice by a site provider who wants to terminate an existing agreements on one of the grounds listed at 31(4). In that context the words can only refer to a time when the agreement could have been brought to an end by the site provider in some other way, i.e. in accordance with its terms, as by the exercise of a break provision or notice to quit. It cannot refer to a time at which the agreement could have been terminated on one of the grounds specified in 31(4) because that would only mean that grounds for termination must exist before notice of termination is given, which is mere tautology.
51. What is being contemplated in the second limb of 33(3)(b) is the same situation as is being contemplated in 31(1)(3)(b), a situation where the lease can be terminated under its terms, but for para 30. A lease running on tacit relocation can be terminated by notice. That would be termination under its terms, since the possibility of tacit relocation is, as we have seen, an implied term of the lease. That is the sort of situation which is being contemplated. Paragraphs 31 is dealing with something very different from para 30. It makes perfect sense for para a 30 to be referred to in 33(3)(b) whereas it makes no sense for para 31 to be referred to: it is simply not engaged at all.
52. We are therefore satisfied that a valid notice under para 33 does not require that the agreement is terminable by the site provider on one of the grounds specified in para 31(4).
(iii) Whether a relevant ground for an order under para 34(6) has been pled
53. It was suggested to us by Mr Upton and Mr Entwistle that para 34 provided us with a menu or buffet (as Mr Entwistle put it) of orders from which we could choose. That seems to be supported by the opening words of para 34(13), which read “In determining which order to make under this paragraph, the court must have regard to all the circumstances of the case …”. There are a number of circumstances in which such a choice would arise. One example is where the applicants asked for modification of the agreement as an alternative to its wholesale replacement. Another would be where the respondents had a crave of their own and we had to choose between the two. A third might be where there was sufficient information before us which would allow us to assess for ourselves whether some lesser remedy might be appropriate. However, we do not think such a choice is available to us in the circumstances of these applications where the applicants peril their case on an order under sub-para (6), without a fall-back position, and there is no material on which we could decide to grant some other order instead. In that situation much of the law referred to on the exercise of judicial discretion falls away. The only discretion we have is as to whether to grant or refuse the order sought – not to make another order instead of it - and that discretion only arises if a relevant case has been pled.
54. As well as urging us to be careful in the exercise of our discretion, Mr Upton urged us not to undo what Parliament had done in deciding not to apply certain provisions of the new code to existing agreements. It is worth saying something about that before we consider the relevancy of the applicants’ pleadings.
55. Although Parliament did not innovate on existing agreements to the extent of imposing Part 3 of the new code, it clearly wished to provide a means whereby alterations and innovations could be made once the contractual term of these agreements had expired: that is what para 33 is about. Moreover Parliament, or, at all events, the government of the day, envisaged the gradual replacement of expired agreements under the old code with agreements under the new. The following passage from the government’s response to the consultation on the new code is worth quoting for the light it sheds both on its reasons for not innovating on existing agreements and what it envisaged happening to those arrangements once they had run their stipulated endurance:
“We have, …, concluded that the revised Code should only apply to new agreements [a position from which they subsequently moved to an extent but not wholly]. Government has not been sufficiently convinced that the public benefits of retrospective application are such that they outweigh interference with carefully negotiated arrangements made under the existing Code. We believe that it is not practicable or appropriate for the revised Code to override existing arrangements because this would lead to uncertainty and disruption to the agreements which parties have sought to secure.
As new Code arrangements are made and the existing agreements come to an end, the existing Code will eventually become obsolete, over time. This will ensure for a steady phasing in of new Code rights, while preserving better investment incentives on new site from day one. Government will however, bring forward a clear and robust set of transitional provisions to set out how and when existing agreements transition to the new Code.” [Department for Culture Media & Sport, A New Electronic Communications Code, May 2016, pp 21-22.]
56. In our view Mr Upton’s argument does not pay sufficient regard to the fact that para33 is dealing with agreements which have expired. Parliament set limits to the extent to which existing agreements were to be affected by the new code but it also provided a mechanism for the alteration of these agreements once they had expired (in the sense of their stipulated endurance having come and gone). In our view, at this stage, when existing agreements are continuing beyond their contractual term, anything is possible, as the range of orders made available to the Tribunal by para 34 shows. But the particular order sought must be justified and the first step towards that is to plead a relevant case, a matter to which we now turn.
57. The applicants say that they have a business need to be able to take advantage of the new code. What they say in support of that is much the same in all nine cases, so it will suffice to quote this passage from the application by the joint applicants against John Stewart Duncan:
“As matters stand, in terms of clause 10.1 of the Lease, the Applicants are prohibited from assigning their rights under the Lease without the consent of the Respondent. The Applicants are not permitted to share the Site with third party operators. The rent payable in terms of the Lease is not consistent with paragraph 24 of the Code. The 18 month notice period in paragraph 31 of the Code would not apply to any notice under that paragraph.”
58. The other applications contain similar averments, varying according to the extent to which the existing agreements are out of step with the new code on matters such as assignation, sub-letting, sharing, rent and the requisite period of notice for termination. It is not averred that there is any particular need in relation to any particular site. For instance it is not said that a third party wants to install apparatus at a site and the applicants are prevented from allowing it by the current agreement, or that the applicants wish to assign a particular agreement and are prohibited from doing so.
59. There is no doubt that the new code is an attractive option for operators: it was in order to make things easier and cheaper for them (in the public interest) that it was introduced. Given a choice, they would always opt for a new code agreement over an old code one. But did Parliament intend that they would be able to have old code agreements replaced by new code agreements for the asking, which is pretty much the applicants’ positon in these cases? If it did, why did it not say so? If it did, why did it set the bar as high as “need”?
60. We have to bear in mind that the business and technical needs of the operators is only one of the circumstances to which we must have regard: para 34(13) enjoins us to have regard to all the circumstances of the case. These include that the present agreements have been in place for periods varying from 15 to 22 years and there is no suggestion that any change is required in order to give them business or technical efficacy. Furthermore there is no suggestion that consumers of telecommunication services served by the various sites to which the applications relate will be one whit better served by replacement of these agreements than they are at the moment.
61. In our view more requires to be pled, in the way of particular agreements being unduly onerous or restrictive, in order to justify what Mr Upton described as “judicial cancellation of existing contracts”. Obviously, in enacting paras 33(1)(d) and 34(6), Parliament envisaged that there would be some cases where existing agreements would be so unfit for purpose that complete replacement was justified. Frankly, it is hard to envisage what such an agreement would look like but, whatever it might look like, we don’t recognise it in any of the subsisting agreements in this case.
62. Mr Barne said that the effect of refusing the orders sought would be to lock the applicants into the existing agreements forever, which would be contrary to the policy of the code. Our response to that is twofold. First, that there is nothing wrong with an operator who can’t justify the replacement of an old code agreement remaining bound by it. Secondly, whether what Mr Barne says is so depends on whether an operator already in occupation of a site can obtain code rights under para 20, one of the questions which has been exercising the Upper Tribunal and the Court of Appeal south of the border in the cases of CTIL v Compton Beauchamp, CTIL v Ashloch Ltd and A P Wireless II (UK) Ltd and Arqiva. Although the law as interpreted by the Court of Appeal in the Compton Beauchamp case is that an operator in occupation cannot obtain code rights under para 20, that may not be the last word on the subject (see the decision of Judge Cooke in Arqiva and what she says about possible appeals in her final paragraph) and it may well yet be possible for sitting operators to apply for new agreements under para 20, a procedure which might very well be more attractive than using Part 5 of the new code, because it would be free from the constraints of having to consider all the circumstances of the case, including the terms of the existing agreement, as para 34(12) requires.
63. For these reasons, we have come to the conclusion that no relevant case has been pled for the orders sought and that the applications must, therefore, be dismissed. Were we approaching this as an open question for the exercise of our discretion and not as a matter of relevancy, the outcome would, of course, be the same. Not enough is pled to persuade us to exercise our discretion in the applicants’ favour.
64. Given the conclusion we have just come to, it is unnecessary to say very much under this head. Had we held the applicants’ pleadings to be relevant we would not have refused to grant the orders because of lack of proportionality. If the terms and conditions of an agreement are significantly hindering the provision of telecommunication services, termination of that agreement is not disproportionate. The public interest in a first-class telecommunications network is a strong one. It justifies robust measures designed to make it make it happen. The extent of intrusion on the individual landowner’s rights and liberties will vary from case to case but it will seldom exceed inconvenience. In the present circumstances Parliament has decided that the provisions of the new code are justified by the foresaid public interest and we tend to agree with Mr Barne when he said that what Mr Upton was really arguing was that the whole of the new code was disproportionate.
The argument in the Duncan, Filshie, First Grandchildren’s Fund, Gilmour and Woodland Investment cases
65. This is the argument that the date specified in a notice under para 33 must be an anniversary of the ish of the lease and it brings us back to para 33(3)(b).
66. As we have seen, that provision requires the notice seeking termination to specify a day which falls “at a time when, [apart from para 30] the code agreement could have been brought to an end by the site provider”. In the present cases the site providers could, but for para 30, have brought the agreements to an end by common law notice to quit served on a 40 day induciae against any anniversary of the ish of the lease. The words “could have” appear to be a clear reference to a point in the past when this could have happened. It does not say that the day must fall after the next occasion on which the agreement could be brought to an end.
67. On this view, the terms of the second limb of para 33(3)(b) have already been satisfied and all that is required is notice of not less than six months. Only where the first point at which the agreement could be brought to an end lay in the future would regard have to be had to it for the purposes of a para 33(1) notice. This approach would seem to satisfy the purpose of the provision as explained by the Law Commission at para 6.117 of their report, where the provision is described as “capturing the cases where Code Rights in a lease would have come to an end by effluxion of time or could have been terminated by notice (whether under a break clause in a fixed term lease, or by giving notice to quit in the case of a periodic tenancy)”. However it does not work for para 34(15) which requires a date on which the agreement could have been brought to an end by the site provider to be identified. If there are several dates on which an agreement could have been ended, as we have here in the form of successive anniversaries of the ish of the leases, which date applies?
68. There may also be other reasons for which the approach tentatively suggested above cannot be right. Certainly it was not the approach taken by counsel and Mr Entwistle, who were agreed that the provision was describing the next point in time at which the leases could be brought to an end, in other words the next anniversary of each ish, provided it was more than 40 days away and the only disagreement between then was as to whether only a notice which specifies that date (where it is beyond the six months required by para 33(3)(a)) is valid.
69. On that point we have not found the submissions of either counsel entirely convinicing. We are not persuaded by Mr Upton’s submission that “fall at a time” must, in contrast to “fall … after the time”, mean a particular day. That is because the words “fall … at a time” are not apt to mean a single, specific date. “A time” is a period of time. If Parliament had intended a single, specific date it could easily have said so, but it has not. Nor is it easy to see any reason of logic or principle as to why a particular date should be specified.
70. Mr Barne’s interpretation is not without its own difficulties. It does not explain satisfactorily the different language used in the two limbs of the sub-paragraph. It can also be said of it that if Parliament intended “fall on a day on or after the date on which the code agreement could have been brought to an end by the site provider”, it could have said so. He sought some support for his position from paras 34(15)(a) and 35(1)(a) but we have not found these references illuminating.
71. In that state of affairs we think we should take a purposive approach. We do not see that any useful purpose is served by insisting that the date specified be an anniversary of the ish of the lease. If the point of 33(3)(b) is to ensure that the operator gets the notice of termination to which it would have been entitled at common law, that purpose is served by a notice which specifies the anniversary of the ish or any later date. Accordingly we repel this challenge to the relevancy of these applications.
Mr Entwistle’s argument in the Grangemouth Rugby Football Club case
72. Although the information provided by Mr Entwistle in his written and oral argument as to the commencement date of the lease calls into question the accuracy of the date pled by the applicants as the ish of the lease, that does not render the applicants’ pleadings on the point irrelevant. The point is not made by the respondents in their pleadings, so the applicants have had no cause to adjust their pleadings to meet it. As matters stand they offer to prove that the lease terminated on a certain date. As a matter of relevancy that is all that they are required to do. We have dealt with Mr Entwistle’s other arguments along with Mr Upton’s above.
The cases of the Firm of John Gilmour & Sons and Woodland Investment Management Ltd
73. Mr Barne invited us to hold those over for investigation but that does not arise given our decision that they are irrelevant on another ground
74. The result is that all nine applications fall to be dismissed for want of a relevant case for the termination of the subsisting agreements having been pled.
75. We have allowed a period of 21 days for motions and submissions on expenses.