Tenant's Cable Salad =
Landlord's Gordian Knot
Many landlords will be fitting up-to-date telecoms facilities -– cables and hubs for telephones and internet, wireless transmitters, satellite dishes, cable TV etc – for the benefit of their tenants. Those who aren't would do well to consider doing so. Leave it to your tenant and you could find yourself arguing with the telecoms company over how you use your own property.
This significant price for the fierce market for increased and enhanced access to the most up-to-date telecommunications services comes in the form of powerful statute-based rights that telecommunications operators can obtain over your property.
The main body of relevant law is the extensive and appallingly badly drafted Telecommunications Act 1984 (in particular the Code set out in Schedule 2 of the Act) amended by the equally unlovely Communications Act 2004.
Telecomms companies – "operators" - increasingly ask landlords at the request of tenants, to sign wayleave agreements to record the basis on which their apparatus is to be installed. A wayleave agreement is, in its simplest sense, a permission for the operator to run the equipment across or on your land. It is like an easement but differs in that while the benefit of an easement rests with a (usually adjacent) piece of land the benefit of the wayleave rests with the operator.
Wayleaves do not usually confer rights as strong as easements, but a telecoms wayleave made in accordance with the code can. The Code confers powerful statutory rights.
For example – amazingly, the Code allows an operator to install (and keep installed) equipment against the wishes of a landlord. The landlord does have a measure of protection: the operator would need an order of the court. But nevertheless even if the wayleave agreement allows the landlord to terminate the agreement (first drafts of such agreements rarely do) getting apparatus removed requires the landlord to serve a notice in the prescribed form – and then battle it out in court if the operator does not cooperate.
There are two such notices.
Paragraph 20 notices – used when the Landlord wants to develop the land; and Paragraph 21 notices – used in broadly any other situation. Assuming the operator does not wish to remove the apparatus (and why would they?) it can respond with a counter-notice.
If the original notice was under paragraph 20, the counter-notice can require the landlord to obtain a court order ordering the removal.
If the original notice was under paragraph 21, the operator can apply to court for an order dispensing with the need for the landlord's agreement to the apparatus remaining on the property. The court is obliged to make such an order if in its view the landlord can be compensated with money, or on balance if it is of greater benefit for end users to keep the apparatus in place and operational.
But these remedies such as they are are only available if the wayleave allows the landlord to seek removal – and as stated above many agreements don't.
That's the law. But what is likely to happen in practice?
Hopefully the operator will want to avoid bad publicity and will be pragmatic in dealing with landlords, but equally they may feel it is worth toughing it out if doing so prevents a competitor taking over a patch which the operator may have secured on good terms With growing competition between operators this is perhaps increasingly likely.
And what can Landlords do?
Much can be done with the wayleave agreement. For example, the agreement can, and should
- Specify the type of equipment to be installed.
- Set out terms of access for maintenance
- Impose some control over the way in which the operator must work
- Limit the operator's rights to carry out further work, including installing additional unspecified apparatus, perhaps serving other properties
Of course such agreements can provide very welcome benefits to the landlord and if managed properly, with very little inconvenience. But it is important to have an eye on the future, and in particular what it will mean to any future purchaser, or future lender looking for security over the property, not forgetting any existing mortgagee – agreements should always be cleared with them.
The advice must be – take care over the contract: do not simply sign what the operator sends to you, get it checked out first. It is likely to preclude other use of the property - for longer than the period of the wayleave agreement.
John McGeough, Partner
Commercial Property Practice
email [email protected]
tel 020 7591 3382