Vodaphone Ltd v Potting Shed Bar and Gardens Ltd & Anor

Where a code-right agreement is a lease, a concurrent lessee entitled to its benefit and burden is a party to the agreement for the purposes of Part 5 of the Code. This is so even though the concurrent lessee is not a successor in title under paragraph 10(2)(a) of Schedule 3A to the Communications Act 2003; its interest falls within paragraph 10(2)(b). Paragraph 10(3) is not an exhaustive definition of who may be a party to a code agreement. The Code should be construed by considering how its regime is intended to work, while applying ordinary landlord-and-tenant law where relevant. The concurrent lessee may therefore invoke the termination and modification procedures in paragraphs 31 and 33.

Vodafone held a lease of part of a building for telecommunications equipment. The lease was treated under transitional provisions as an agreement under the Electronic Communications Code, and its rights continued after the contractual term expired. The freeholder later granted AP Wireless II (UK) Ltd a concurrent lease, giving it the benefit and burden of Vodafone’s lease.

Vodafone served alternative notices under Parts 4 and 5 seeking renewed rights. The Upper Tribunal held that AP Wireless was bound by the existing code rights but was not a party to the agreement, and that Vodafone’s route was under Part 4: [2022] UKUT 223 (LC). The appeal concerned whether AP Wireless was a party or successor in title, and whether Part 4 was available.

Appeal allowed. Lord Justice Nugee gave the leading judgment. Lord Justices Phillips and Lewison agreed.

1. AP Wireless was not a successor in title under paragraph 10(2)(a). That provision concerns succession to the interest held by the original grantor when the code right was conferred. AP Wireless had never acquired the freehold. Its concurrent lease was a new interest created after the original agreement and derived from the freehold owner’s successor’s interest, so it fell within paragraph 10(2)(b).
2. That conclusion did not determine whether AP Wireless was a party to the code agreement. The Code distinguishes between parties to agreements and persons merely bound by code rights, but paragraph 10(3) does not state exhaustively who may be a party. The Code also treats an assignee of an operator’s agreement as a party, although paragraph 16 contains no express deeming provision.
3. The Code must be interpreted by considering how the regime is intended to work. Where a concurrent lease gives the lessee the benefit and burden of a lease conferring code rights, the concurrent lessee has stepped into the site provider’s shoes for the duration of that lease. It must therefore be treated as a party to the agreement.
4. AP Wireless could invoke paragraph 31, and both it and Vodafone could invoke paragraph 33 by serving notices on each other. This interpretation allowed the person currently entitled to the benefit and burden of the agreement to exercise the relevant Part 5 rights, and was consistent with the ordinary law of landlord and tenant. The Code was not a legal vacuum, despite being a substantially self-contained regime.
5. The alternative question whether Part 4 could be used where the existing agreement continued under paragraph 30(2) did not arise after the first ground succeeded. The court noted that such an approach appeared anomalous, but declined to decide it.

The Upper Tribunal’s decision was reversed to the extent necessary to hold that AP Wireless was a party to the agreement for Code purposes.

• Court of Appeal (Civil Division) allowed AP Wireless II (UK) Ltd’s appeal and held that it was a party to the code agreement for the purposes of the Code.
• Upper Tribunal (Lands Chamber) rejected AP Wireless’s arguments that it was a party to the agreement or a successor in title, but held that Vodafone could proceed under Part 4: [2022] UKUT 223 (LC).