The case of EE Ltd & H3G Ltd -v- AP Wireless Ltd [2024] UKUT 216 (LC) was determined in July by the Upper Tribunal Lands Chamber in England in respect of renewal of a radio mast site at Vache Farm in Buckinghamshire. In 2020, faced with a plethora of cases and competing arguments, the Tribunal had departed from the general valuation approach using market evidence and produced a table of rents in Affinity Water case [2022] UKUT 08 (LC) setting ‘bookmarks’ for rents based on previous decisions.

In Vache Farm the Upper Tribunal has now acknowledged that alternative use values are a relevant consideration, which reflect the real burdens of a telecoms lease compared to other “passive” rural agreements. They set a site payment of £1,750 a year, using comparable transactions for rents for unexceptional rural sites; a significant departure from earlier decisions which had previously determined a site payment of £750 for this type of site.

Feeling compelled to accept lower payments

Vache Farm was followed a fortnight later by the First Tier Tribunal decision in respect of Ewefields Farm (LC – 2023 – 000321) and 13 other sites which fixed rents of £1,750 – 2,000. The SLT in On Tower -v- MacLean fixed a rent of £2,000 for the renewal of a lease at Bank Hill near Peterhead based on Vache Since the introduction of the new Electronic Communications Code in 2017, many landowners have felt compelled to accept lower site payments at renewal due to pressures of legal action and terms which do not protect them against further loss. Those who have accepted such terms will rightly feel aggrieved in that they will have no recourse to update their payments to reflect these rulings as operators are not prepared to accept open market rent reviews. Vache, Ewefields and Bank Hill highlight the importance of agreeing appropriate lease terms to future proof and protect the landowners position, such as the ability to review site payments to the market level.

Ewefields is also important in that it casts doubt on the right of operators to share occupation. Previous decisions have granted such rights on the basis that paragraph 17 of the Code was a base not a ceiling. The right to share occupation is an extremely important facet for operators in that they can enjoy substantial income of up to £12,000 per operator for granting rights to third parties which is not reflected in the rents they are prepared to offer.

Another case, On Tower d -v- The Church of Scotland General Trustees [2024] LTS 21 was determined by the Scottish Lands Tribunal in respect of a telecommunications site at the Kay Park Parish Church in Kilmarnock. The Tribunal found that due to errors during multiple assignments of the lease, On Tower was not legally the tenant of the site.

Ramifications across industry

On Tower had served a paragraph 33 Notice to instigate a lease renewal but the Tribunal found this notice was invalid as On Tower was not legally the tenant, so its application failed.

This ruling is likely to have ramifications across the industry. Over the years operators have transferred sites between themselves apparently without properly considering the lease requirements.

This case illustrates how important it is for landowners to check who is the legal tenant of their site before progressing any lease renewal and it is likely many agreements will be affected by this ruling.

Any landowner facing a telecoms lease renewal is urged to take independent expert advice before acting. Operators are obliged to pay reasonable costs towards this.