Cornerstone Telecommunications Infrastructure Ltd v Gateway Properties Ltd & Anor

Where parties settle a reference but leave costs unresolved, the Tribunal should not ordinarily make no order for costs. It should decide whether a fair and sensible costs order can be made without disproportionate judicial time. Relevant factors include the practical result, the parties’ conduct and reasonable settlement offers. The Tribunal should determine who would have succeeded at trial only where that is tolerably clear or obvious.

Proceedings should be dismissed where no party is entitled to relief and dismissal is needed to bring the dispute definitively to an end. Under the Electronic Communications Code, the 28-day period following service of a notice provides an important opportunity to reach agreement before proceedings are commenced.

Two references under the Electronic Communications Code concerned CTIL’s attempt to obtain rights over a rooftop telecommunications site. The references followed CTIL’s successive applications for a new Code agreement, while rights under a continuing tenancy governed by the Landlord and Tenant Act 1954 remained in place.

The Tribunal’s preliminary jurisdiction ruling was upheld by the Court of Appeal and was then considered by the Supreme Court in the conjoined appeals, including Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates Ltd [2022] UKSC 18. The Supreme Court held that CTIL could seek new additional rights under Part 4 of the Code but could not renew or modify existing rights under the Code while rights under the 1954 Act continued. The references were remitted, and the parties subsequently settled the substantive dispute by a deed of variation. The remaining questions concerned dismissal of the references and liability for costs.

1. References dismissed. No evidence or argument entitled CTIL to relief at the final hearing. Dismissal also brought the proceedings definitively to an end and gave effect to the earlier order concerning APW’s costs.

2. Where parties settle their substantive dispute but not costs, the Tribunal should not assume that the appropriate order is no order for costs. It should first consider whether it can fairly and sensibly make a costs order without disproportionate expenditure of judicial time. If so, it should consider the result of the settlement, the parties’ conduct and reasonable settlement offers. It should decide who would have succeeded at trial only where the answer is tolerably clear or obvious, without conducting a full trial or deciding an important issue that no longer exists.

3. APW was the successful party overall. CTIL had not obtained the new Code agreement sought at the outset, and the modest additional rights incorporated into the existing tenancy did not represent the reason for which the references had been commenced. APW had defeated CTIL’s strategic contention that the existing Vodafone agreement could be replaced by a new Code agreement, while retaining the continuing tenancy under the 1954 Act.

4. CTIL was liable for the costs incurred before the amendment of its case, including the residual 25 per cent covered by the earlier order, and for the costs occasioned by its repleading. It was also liable for costs after remission because it continued to seek relief which the Tribunal could not grant until it identified the additional rights sought.

5. CTIL was liable for the costs of the later reference. Its amendment had preceded expiry of the 28-day period following service of the notices. That period was an important opportunity for agreement and, had CTIL waited, the additional reference would probably have been unnecessary. Indemnity costs were refused because CTIL’s conduct, though hard fought, was not out of the ordinary or deserving of disapproval.

6. The costs of the references were ordered to be paid by CTIL to APW, to be assessed on the standard basis if not agreed. No costs order was made for Gateway or Ashloch, as neither sought one.

• Supreme Court: The preliminary jurisdiction issue was determined in the conjoined appeals, including Cornerstone Telecommunications Infrastructure Ltd v Compton Beauchamp Estates Ltd [2022] UKSC 18. The reference was remitted to the Upper Tribunal.
• Court of Appeal: The Tribunal’s preliminary jurisdiction decision was upheld before the matter reached the Supreme Court.
• Upper Tribunal (Lands Chamber): The settled references were dismissed and CTIL was ordered to pay APW’s costs.