In today’s society, mobile phones are almost as much of an obligatory possession as our house keys and wallets. The prevalence of mobile communications is driving demand for the installation of telecommunications equipment, such as masts and aerials, within our communities to ensure we receive the uninterrupted service that we have come to expect. The rooftops of schools and colleges have become some of the more practical locations for the installation of such telecommunications equipment.
On conversion of a school to an academy, due diligence is carried out to establish the existence of any third party interests in the school site. The local authority is obliged to disclose any documentation entered into that grants rights over the site and if this disclosure reveals any type of agreement to install telecommunications equipment belonging to a telecommunications provider (whether or not that document is termed a lease, licence or otherwise) there are important legal issues to consider which may impact upon how the academy can use the affected land post-conversion.
On the face of it, such agreements would seem to benefit the academy, as the academy trust will, upon conversion, step into the position of landlord or licensor in place of the local authority or governing body and the rental payments, although unlikely to be particularly high, will typically be subject to ‘upwards only’ RPI rent review provisions and may form a useful and regular source of revenue. Any revenue received by an academy trust must be dealt with in accordance with relevant charity law provisions but there are also two key areas of legislation in favour of the telecommunications provider that need to be considered:
- The Electronic Communications Code (which is contained in Schedule 2 of the Telecommunications Act 1984, as amended by the Communications Act 2003) (“the Code”):
Notwithstanding the existence of any clause in an agreement which purports to grant the landlord/licensor a right to terminate the arrangements, the telecommunications provider (if it is registered with OfCom as a licensed operator), has certain protection under the Code. The protection is a form of security of tenure, meaning that the academy may be unable to require the telecommunications equipment to be removed or relocated (for example to make way for any redevelopment) without an order from the County Court – and even then it is ultimately a decision of the Court whether to require the removal of the equipment.
The Code sets out a detailed regulatory notice procedure that needs to be adhered to before the existing arrangements may be brought to an end. This is a complex process with rigid requirements as to the timings to be followed and the permitted grounds that can be relied upon by the party seeking to end the arrangements. Advice should be sought from an experienced telecommunications surveyor or lawyer before instigating the termination process under the Code.
- Landlord and Tenant Act 1954:
The agreement in question may be referred to as a ‘licence’. However, since the telecommunications provider is likely to have exclusive possession of the part of the site that it occupies, the legal relationship may be deemed by a court to be a lease rather than a licence. The implications of this are that the telecommunications provider may have gained a secure business tenancy under the Landlord and Tenant Act 1954. If this is the case, as with the Code, there are only certain grounds upon which the landlord can seek to terminate the arrangements.
The most commonly claimed ground is ‘Ground F’, for which the landlord must be able to demonstrate a genuine and defined intention to redevelop the site. This is an onerous burden and a high level of proof is required to support the claim. Often the redevelopment project must be practically underway for the claim to be successful!
Clearly the implication of any “security of tenure” that the telecommunications provider might have gained is that the academy’s use of its site may be substantially inhibited. Therefore, very careful consideration should be given before entering into any new arrangements of this type and we recommend that you seek advice from an experienced lawyer before entering into any agreements.
If there are already existing agreements in place, the academy trust should ensure that it understands the specific nature of the legal documentation affecting the school site and manage those arrangements closely so that no unintended rights arise.
To assist, we set out below a few key points to consider when managing existing arrangements or considering whether or not to enter into any new arrangements:
- Rent: are there any outstanding reviews? Is advice needed on the market rate?
- Alienation: Consider resisting the ability of the telecommunications provider freely to assign or share possession of the premises unless consent is obtained.
- Rights to Alter, add equipment: Ensure alterations/additions are prohibited/restricted to avoid unintended third party rights arising.
- Landlord and Tenant Act 1954 (“the Act”): Consider whether the Act should be excluded (although protection under the Code will still be effective). Exclusion of the Act will ensure that only one legal procedure needs to be followed to regain possession, which will save costs and time.
- Definition of “term”: Consider carefully the definition of the term - the Act cannot be properly excluded if the term of the lease is defined as including any period of ‘holding over” and this will cause delays in seeking to remove any telecommunications equipment.
- Rights to relocate: Ensure there is a right to relocate the equipment elsewhere on site if redevelopment is needed (relocation would usually be at the cost of the academy trust).
- Break provision: In principle, notices to terminate served in accordance with the Code will not be effective unless the landlord already has a right to recover possession (aside from Code protection). Consider a flexible landlord break option where possible and particularly where future redevelopment is likely.
- Expiry of existing leases: If a tenant remains in occupation after the expiry or termination of a lease, there is always a risk that a new periodic tenancy will arise by implication. In such circumstances, the new implied lease will attract protection under the 1954 Act even if the old lease was contracted out. We recommend you closely monitor the expiry of telecommunications leases and consider the options well in advance of any relevant expiry date(s).