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Telecoms: What does the new Product Security and Telecommunications Infrastructure Act 2022 mean for site owners?
Telecoms: What does the new Product Security and Telecommunications Infrastructure Act 2022 mean for site owners?

After many months of passing through the Parliamentary legislative process the Product Security and Telecommunications Infrastructure Bill (“the Bill”) received royal assent on 6 December 2022 and is now called the Product Security and Telecommunications Act 2022 (“the Act”).

As reported in our earlier article “Telecoms: A better balanced Bill for site owners?“, the Lords sought to make some amendments to the Bill as it passed through Parliament to try to address some imbalances for site owners. One of the later amendments proposed by the Lords, but not covered in our earlier article, was an independent review of the Electronic Communications Code (“the Code”) to assess the extent to which the revisions to the Code in 2017 have secured progress towards telecommunications infrastructure targets and the balance of rights and responsibilities of landowners and operators. The Commons rejected this proposal.

Although the Bill has received royal assent the relevant sections of the Act dealing with telecommunications infrastructure (sections 57-75) have not yet come into force and we await regulations by the Secretary of State regarding commencement.

What this means for site owners

The key provisions of the Act for site owners are as follows:

1. The rights to upgrade and share apparatus will apply retrospectively to subsisting agreements and equipment installed before the 2017 Code.

The same provisions in the Code apply so that such sharing or upgrading must neither have an adverse impact on the land nor impose a burden on any person with an interest in the land. The operators must provide notice of their intention to share or upgrade and there is a caveat that this clause does not confer a right on the operator to enter onto land to upgrade or share the use of the equipment.

2. Amendments will be made to the Landlord and Tenant Act 1954 (“1954 Act”) to bring renewals of subsisting agreements within the Code’s valuation scheme.

This will mean that where previously site owners might have enjoyed higher rents under a renewal agreement governed by the 1954 Act, this is no longer the case as those renewals will fall under the Code’s valuation scheme. This applies to court/tribunal-imposed agreements and so there is still scope for site owners and Operators to negotiate higher rents. However, the likely outcome is that rents will fall further as there is no longer the threat of 1954 Act renewal proceedings to seek a higher rent for site owners.

3. A new procedure will apply under which operators can obtain Code rights more quickly over certain types of land where a site owner fails to respond to repeated requests for Code rights.

4. The operator will be under an obligation, if it is reasonably practicable to do so, to consider the use of alternative dispute resolution procedures to reach agreement before applying to court. Whilst this is not mandatory, the tribunal can penalise a party on costs where they have unreasonably refused to engage in alternative dispute resolution.

Conclusion

It remains to be seen when these provisions will come into effect and the scale of the impact they will have on site owners and rents but it is clear that the balance of power has shifted a little further in favour of the operators.

This article is for general information only and does not, and is not intended to, amount to legal advice and should not be relied upon as such. If you have any questions relating to your particular circumstances, you should seek independent legal advice.

Biodiversity Net Gain: What off-site solutions are available to developers?
Biodiversity Net Gain: What off-site solutions are available to developers?

In this article we will look at what the options are in terms of off-site solutions. For an overview of the basics of Biodiversity Net Gain (BNG) please consult our earlier publications:

Biodiversity Net Gain: the basics | Michelmores

Biodiversity Net Gain : An update for developers | Michelmores

As stated in our article on the basics of BNG, there are three options (or a blended approach) to providing BNG as follows:

  1. On-site provision.
  2. Off-site provision.
  3. Statutory credits.

In terms of off-site provision, a developer has the following options:

  1. Secure off-site BNG itself.
  2. Purchase non-statutory BNG units via “habitat banks”.
  3. Purchase habitat units from the national biodiversity credits scheme – although note that this is seen as an option of last resort.
  4. Proceed by way of a combination of the above options.

In considering the available options, developers must apply the mitigation hierarchy – see our publication for more information in this regard.

In this article we focus on off-site BNG and the purchase of non-statutory BNG units.

Securing off-site BNG

Off-site BNG gains must be secured through a planning obligation or conservation covenant. In practical terms, in order to secure off-site BNG, a developer would need to either buy further land to deliver BNG (greater value being attributable to nearby gains) or enter into an agreement with a landowner in respect of the delivery and management of the gain site. Off-site BNG will be secured for at least 30 years through a conservation covenant or a planning obligation. It may be possible for a developer to pass on long term legal responsibility for the management of the off-site habitat and reporting to the landowner. However, the involvement of any third party land outside the development site may cause delay and uncertainty in the transaction. The cost of providing and managing off-site BNG will need to be considered particularly whether that can be brought into account when determining the purchase price of a site pursuant to a conditional contract or option agreement.

It is thought that off-site delivery is the best outcome for nature as it can make a lasting change to biodiversity levels. This gives developers an opportunity to demonstrate that they are playing a crucial role to the recovery of the natural environment. There may be opportunity to work with a nature conservation organisation.

It is possible that, where a developer has the benefit of conditional contracts or options in respect of strategic sites which are not able to be successfully promoted for development, they could seek to use that land for the delivery of off-site BNG and developers may, therefore, wish to review their land banks with this in mind.

Purchasing non-statutory BNG units

The provision of offsite BNG and the use of “habitat banks” is a rapidly emerging market. DEFRA, as part of their consultation on BNG, has published a market analysis that uses a working assumption that 50% of BNG would be delivered off-site which creates an annual demand of 6,200 biodiversity units with an estimated value of £135,000,000. This indicates the size of the potential habitat banking market.

As habitat enhancement/creation eligibility is retroactive with habitat enhanced or created since 30 January 2020 being eligible for BNG agreements, landowners and habitat bank providers (and even local planning authorities) are able to start producing the BNG now ahead of the mandatory 10% net gain requirements coming into form in November 2023. There are providers who are already establishing a network of habitat banks with the aim of having BNG units available in all local planning authority areas. The acquisition of BNG units by a developer leaves the developer with no ongoing liability, the unit provider having arrangements in place with the relevant landowner for the creation and management of the habitat. In order to be able to sell BNG units, the relevant provider will need to have secured the habitat bank through conservation covenants or planning obligations and to have registered the habitat bank with the relevant local planning authority.

Website Terms

Please read these Terms and Conditions carefully before using this site

What’s in these terms?

These terms tell you the rules for using our website www.michelmores.com (our site).

Who we are and how to contact us

Michelmores LLP (“We”) own and operate the site www.michelmores.com. We are registered in England and Wales under partnership number OC326242 and have our registered office at Woodwater House, Pynes Hill, Exeter, Devon, United Kingdom, EX2 5WR. Our VAT number is 140 9928 55.

We are regulated by the Solicitors Regulation Authority (SRA authorisation number 463401).

We are a limited liability partnership.

A list of the members (all of whom are solicitors or barristers) is available for inspection at the registered office and at www.michelmores.com.

To contact us, please email enquiries@michelmores.com.

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By using our site, you confirm that you accept these terms of use and that you agree to comply with them.

If you do not agree to these terms, you must not use our site.

We recommend that you print a copy of these terms for future reference.

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These terms of use refer to the following additional terms, which also apply to your use of our site:

If you instruct us to supply goods or services via our site, our Terms and conditions of supply will apply to such supply.

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We amend these terms from time to time. Every time you wish to use our site, please check these terms to ensure you understand the terms that apply at that time.

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We may update and change our site from time to time to reflect changes to our offering, our users’ needs and our business priorities, or as required by any relevant regulation. We will try to give you reasonable notice of any major changes.

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Our site is made available free of charge.

We do not guarantee that our site, or any content on it, will always be available or be uninterrupted. We may suspend or withdraw or restrict the availability of all or any part of our site for business and operational reasons. We will try to give you reasonable notice of any suspension or withdrawal.

You are also responsible for ensuring that all persons who access our site through your internet connection are aware of these terms of use and other applicable terms and conditions, and that they comply with them.

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We may transfer our rights and obligations under these terms to another organisation. We will always tell you in writing if this happens and we will ensure that the transfer will not affect your rights under the contract.

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If you choose, or you are provided with, a user identification code, password or any other piece of information as part of our security procedures, you must treat such information as confidential. You must not disclose it to any third party.

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We are the owner or the licensee of all intellectual property rights in our site, and in the material published on it. Those works are protected by copyright laws and treaties around the world. All such rights are reserved.

You may print off one copy, and may download extracts, of any page(s) from our site for your personal use and you may draw the attention of others within your organisation to content posted on our site.

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You must not use any part of the content on our site for commercial purposes without obtaining a licence to do so from us or our licensors.

If you print off, copy, download, share or repost any part of our site in breach of these terms of use, your right to use our site will cease immediately and you must, at our option, return or destroy any copies of the materials you have made.

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You shall not conduct, facilitate, authorise or permit any text or data mining or web scraping in relation to our site or any services provided via, or in relation to, our site. This includes using (or permitting, authorising or attempting the use of):

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The provisions in this clause should be treated as an express reservation of our rights in this regard, including for the purposes of Article 4(3) of Digital Copyright Directive ((EU) 2019/790).

This clause shall not apply insofar as (but only to the extent that) we are unable to exclude or limit text or data mining or web scraping activity by contract under the laws which are applicable to us.

Do not rely on information on this site

The content on our site is provided for general information only. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.

Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date.

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Where our site contains links to other sites and resources provided by third parties, these links are provided for your information only. Such links should not be interpreted as approval by us of those linked websites or information you may obtain from them.

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This website may include information and materials uploaded by other users of the site, including to social media pages, video-sharing sites, bulletin boards and chat rooms. This information and these materials have not been verified or approved by us. The views expressed by other users on our site do not represent our views or values.

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If you have any feedback or concerns regarding any material which appears on our site please email enquiries@michelmores.com.

Our responsibility for loss or damage suffered by you

Whether you are a consumer or a business user:

  • We do not exclude or limit in any way our liability to you where it would be unlawful to do so. This includes liability for death or personal injury caused by our negligence or the negligence of our employees, agents or subcontractors and for fraud or fraudulent misrepresentation.
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If you are a business user:

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How we may use your personal information

We will only use your personal information as set out in our Privacy Policy.

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Whenever you make use of any feature that allows you to upload content to our site, or to make contact with other users of our site, you must comply with such contents standards as we may specify from time to time.

You warrant that any such contribution will comply with any such standards, and you will be liable to us and indemnify us for any breach of that warranty. This means you will be responsible for any loss or damage we suffer as a result of your breach of warranty.

Any content you upload to our site will be considered non-confidential and non-proprietary. You retain all of your ownership rights in your content, but you are required to grant us and other users of our site a limited licence to use, store and copy that content and to distribute and make it available to third parties. The rights you license to us are described in Rights you are giving us to use material you upload.

We also have the right to disclose your identity to any third party who is claiming that any content posted or uploaded by you to our site constitutes a violation of their intellectual property rights or of their right to privacy.

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When you upload or post content to our site, you grant us the following rights to use that content:

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We are not responsible for viruses and you must not introduce them

We do not guarantee that our site will be secure or free from bugs or viruses.

You are responsible for configuring your information technology, computer programmes and platform to access our site. You should use your own virus protection software.

You must not misuse our site by knowingly introducing viruses, trojans, worms, logic bombs or other material that is malicious or technologically harmful. You must not attempt to gain unauthorised access to our site, the server on which our site is stored or any server, computer or database connected to our site. You must not attack our site via a denial-of-service attack or a distributed denial-of service attack. By breaching this provision, you would commit a criminal offence under the Computer Misuse Act 1990. We will report any such breach to the relevant law enforcement authorities and we will co-operate with those authorities by disclosing your identity to them. In the event of such a breach, your right to use our site will cease immediately.

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You may link to our home page, provided you do so in a way that is fair and legal and does not damage our reputation or take advantage of it.

You must not establish a link in such a way as to suggest any form of association, approval or endorsement on our part where none exists.

You must not establish a link to our site in any website that is not owned by you.

Our site must not be framed on any other site, nor may you create a link to any part of our site other than the home page.

We reserve the right to withdraw linking permission without notice.

If you wish to link to or make any use of content on our site other than that set out above, please contact enquiries@michelmores.com .

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If you are a consumer, please note that these terms of use, their subject matter and their formation, are governed by English law. You and we both agree that the courts of England and Wales will have exclusive jurisdiction except that if you are a resident of Northern Ireland you may also bring proceedings in Northern Ireland, and if you are resident of Scotland, you may also bring proceedings in Scotland.

If you are a business, these terms of use, their subject matter and their formation (and any non-contractual disputes or claims) are governed by English law. We both agree to the exclusive jurisdiction of the courts of England and Wales.

Rights in respect of our trade marks

All rights in relation to the “MICHELMORES” name and our stylised marks are owned by Michelmores LLP. You are not permitted to use them without our approval, unless they are part of material you are using as permitted under How you may use material on our site.

Dated: March 2023

Telecoms: A better balanced Bill for site owners?
Telecoms: A better balanced Bill for site owners?

As reported in our earlier article “Telecoms: another top of the scales in favour of operators”, the Product Security and Telecommunications Infrastructure Bill is currently going through Parliament. The Bill has been through the House of Commons, has undergone its second reading and Committee stage in the House of Lords and is now awaiting Report Stage, likely to take place in September.

There are two particular areas of amendment being debated, which are likely to be of interest to landowners. We focus on these and also address some of the imbalances proposed by the Bill, whilst remaining mindful of the need for a quick and efficient roll-out of infrastructure.

Mandatory alternative dispute resolution

The initial draft of the Bill only made it optional for operators to consider using Alternative Dispute Resolution (“ADR”) before making an application to court. The Lords are now considering an amendment to make it mandatory for operators to engage in ADR before threatening to take a landowner to the tribunal for an agreement to be imposed.

This amendment is being tabled to try to address the imbalance between the apparently limitless resources of operators for dealing with disagreements in the tribunal, and landowners, who often do not have the means to resist such claims. The intention is to try to move away from the attritional conflict currently dominating the tribunal, especially now that case law has developed around the Electronic Communications Code (“the Code“), which could make ADR a feasible option.

Renewals – 1954 Act and the Electronic Communications Code

Although in its 2021 consultation the Government stated it did not intend to revisit the statutory valuation framework introduced by the Code, the provisions introduced by clause 61 of the Bill seem to do just that. This clause amends the basis for rent assessment of Code sites, on the renewal of a subsisting agreement under the Landlord and Tenant Act 1954 (“1954 Act“), to import directly the Code’s valuation provisions. This will mean that existing long-standing leases, which were freely negotiated between willing participants, will likely see demands for dramatically reduced rental values. The Government’s argument for this is consistency in valuation across the ways in which Code Rights can be granted; whether by a renewal under the 1954 Act or by way of a new Code agreement. 

As predicted by the Law Commission when the Government was looking to implement the Code, the dramatic fall in rents offered to landowners has resulted in a corresponding reduction in the number of new agreements reached between landowners and operators and has therefore not sped up the roll-out of digital infrastructure as intended.

If this were to apply to 1954 Act renewals, as well as to new agreements, it will neither encourage harmonious relationships between landowners and operators, nor will it help the intended roll-out. As a result, it has been argued in the House of Lords that renewal agreements under the 1954 Act should not be brought under the Code but should remain under the 1954 Act, to preserve existing property rights and to try to reintroduce the collaborative relationships, which were undermined by the 2017 Code amendments. An alternative amendment proposes that, if renewals are to be brought under the Code valuation system, there should be a limit in the reduction of rent sought.

Conclusion

Although the Bill still has some way to go before becoming law, these proposed amendments, which had cross-party backing in the Lords, should give landowners some comfort that a balance is being sought between their property rights and the ongoing need for a quick and efficient roll-out of digital connectivity across the country.  

For more information, please contact Dani West or Helen Hutton.

Purchasing a potentially contaminated site
Purchasing a potentially contaminated site
If you are looking to acquire a potentially contaminated site, you or your business could be at risk from having to pay for future remediation. 
 
Entering into an Indemnity Agreement is a potential way to apportion liability with the Seller. This article considers when an Indemnity Agreement may be appropriate but also considers the limitations of this type of agreement. 

When could an Indemnity Agreement be used? 

An Indemnity Agreement could be used to agree that the Seller retains liability for any ongoing remediation which may be required as a result of the contaminated land. 
 
On purchasing the site, an Enforcing Authority could seek to enforce against you under the Part 2A regime (Part 2A of the Environmental Protection Act 1990). You could have, for example, knowingly permitted the contamination to remain or introduced something on site which has created a pollution linkage. In this instance an Indemnity Agreement could be produced to the Enforcing Authority to demonstrate how liability between you and the Seller has been apportioned. 

Limitations to an Indemnity Agreement

Even if an Indemnity Agreement is entered into, the Seller could become liquidated, meaning there is no-one to enforce this Indemnity Agreement against, and leaving you (as the Purchaser) potentially exposed. Further complications may arise when ascertaining liability for contaminated land which is found following the transfer, or if environmental law changes post agreement. 
 
Given the limitations to Indemnity Agreements, here are some points to consider below: 
  • the consequences of acquiring an interest in contaminated land
  • due diligence (including searches and inquiries)
  • consider commissioning an independent report from environmental consultants
  • consider commissioning an independent valuation
  • obtain advice on contractual protection, including exclusion and indemnity clauses and apportionments, warranties, or consider making the contract conditional upon the seller complying with any remediation notices. 
It is therefore important that you get expert legal advice at the outset of any potential purchase. 
 
This article is for general information only and does not, and is not intended to, amount to legal advice and should not be relied upon as such. If you have any questions relating to your particular circumstance, please seek independent legal advice. 
 
For further information please contact Mark Howard, Head of Planning.
Michelmores advises Mama Bamboo and Paces Sheffield as both release opportunities for investors on the crowdfunding website Triodos Bank
Michelmores advises Mama Bamboo and Paces Sheffield as both release opportunities for investors on the crowdfunding website Triodos Bank

Michelmores’ Corporate team has advised the leading Cerebral Palsy charity, Paces Sheffield on its bond offer which is currently being promoted by Triodos Bank and was launched on their crowdfunding website in June. Investors are invited to support the specialist school which offers life-changing skills for children with Cerebral Palsy and other neurological motor disorders. The bond offer will raise capital to support the charity’s ambitious growth plans including a new premises which will enable the school to increase its capacity by 75%.

The team has also advised Mama Bamboo on its EIS share offer, likewise listed on Triodos’ website. Mama Bamboo’s award winning sustainable baby products are made using 100% compostable bamboo fibre and the company is the only UK nappy brand to be B-Corp certified. The company aims to raise over £500,000 to support the marketing and technology required to accelerate sales growth. As an early stage and growth company, Mama Bamboo’s share offer qualifies under the EIS tax relief scheme, as assured by HMRC in May.

Corporate partner, Alexandra Watson led the Michelmores team with support from Adam Quint and Jess Hopkins.

Alex said:  ‘It was a pleasure to support both Paces Sheffield and Mama Bamboo to bring their investment opportunities to market on the Triodos website. The response from investors has already been positive and we look forward to continuing to monitor the individual offers and seeing the progress made in the corresponding growth plans.’

Telecoms: A realistic rent for rural mast sites
Telecoms: A realistic rent for rural mast sites

The valuation of rural mast sites under the Electronic Communications Code (“New Code”) has been under the spotlight again with a new decision from the Upper Tribunal in the case of ON Tower UK Limited v JH & FW Green Limited [2020].

The site in question was let on a contracted out 1954 Act lease with provisions which allowed the operator to share and upgrade the site, subject to “payaway” terms to the landlord.

The landlord accepted that the operator had the right to a New Code agreement but the issues in contention were:

  • What equipment can the operator install;
  • Should the operator’s right to upgrade equipment be limited;
  • Should the operator’s right to share the site be limited; and
  • What is the correct rent taking these 3 issues into account.

Equipment

The operator wanted freedom to add equipment to the site, whereas the landlord wanted to maintain the status quo, having taken a careful inventory of current equipment.

The landlord was willing to allow sharing and upgrading, but only on a strict interpretation of para 17 of the New Code, so that the changes had to have a minimal adverse impact on the visual setting and impose no additional burden on the landowner (burden meaning an additional adverse effect on enjoyment of the land or loss, damage or expense).

However, these New Code rights only form the statutory skeleton for the agreement between the parties. They are restricted rights and if any meat was to be added to these bones it had to be by way of negotiation or direction of the Upper Tribunal.

The operator’s position was that they were in the business of providing the infrastructure for broadband and mobile phone connections. Upgrading and sharing without limitation was essential, because technology and the market were moving quickly and unpredictably. This concern was exacerbated by the Court of Appeal’s decision in Compton Beauchamp[1] where it ruled that an operator cannot go back to the Tribunal for additional rights once an agreement is imposed.

The landlord had obvious concerns about the roll out of 5G, which requires larger and noisier equipment. Given the operator’s desire to go beyond the basic statutory right, the Tribunal had to consider the evidence from both parties.

The operator acknowledged that the 5G roll out would require a new mast, but argued that the South Downs National Park status of the site would act as a sufficient control.  The landlord stated its concerns about additional traffic, security risks, disturbance, visual appearance and radiation.

The Tribunal had to engage in a balancing exercise to determine the terms of the agreement. Under the New Code it may (not “must”) grant a New Code right, providing that the relevant conditions were met. These conditions are set out in paragraph 21 and are that the prejudice caused to the landlord must be able to be compensated by money and be outweighed by the public benefit that will ensue from the grant of the right. Further, New Code rights are not absolute and may be the subject of terms to ensure that the “least possible loss and damage is caused by the exercise of the code right.”

In exercising this discretion the Tribunal were not convinced that the site’s appearance would change drastically with the upgrade to 5G given its small size (70 sq ft), although acknowledged the other concerns of the landlord were relevant, albeit exaggerated. In any event, disturbance, noise and access issues were addressed in the proposed new lease, so any breach would entitle the landlord to damages or, where necessary, injunctive relief. The Tribunal did not, therefore, see a need to modify the rights to cause the least possible damage to the landowner arising from the grant of upgrading rights, which go beyond the basic terms of paragraph 17.

Site sharing

The Tribunal then had to consider the right to share the site.  This could not be done on the same basis, as sharing is not a New Code right; the Tribunal has discretion to grant a right to share on such terms as are appropriate to ensure that the least possible loss and damage is caused to the landlord. A balance has to be struck between enabling the operator to share the site in order to provide a high quality telecommunications service and the objections of the landlord.;

The operator in this case was an infrastructure provider (rather than a network operator) so its equipment (masts, cabinets and other equipment) were passive. The operator had to be able to share with any network operator or it could not continue its business.  The Tribunal decided the landlord’s objections were not well founded, so granted the operator an unrestricted right to share. The paragraph 17 conditions were not required, given the same safeguards of planning law and lease terms explained above.

Consideration & Compensation

The Tribunal confirmed the approach taken in the Islington[2] case, where any compensation for predictable loss and damage was included in the assessment of consideration, to avoid inevitable subsequent claims. This does not stop a landowner making later claims under paragraph 25, but a second bite only exists for those litigating and is not available if a deal is reached by agreement.

The Tribunal continued in assessing consideration by adopting a framework previously used in the Hanover[3] and London and Quadrant[4]cases:

  1. Assess the alternative use value of the site, which would be the rental value of its current use or of the most valuable non-network use. This process would be heavily influenced by location and be a matter of evidence in each case;
  2. Add a rental value to reflect any additional benefits conferred on the operator – in Hanover, the site was protected by a manned security gate; and
  3. If the letting would have a greater adverse effect on the willing lessor, than the alternative use, on which the existing use value was based, then this should be reflected by a rental adjustment.

This case was the first one arising on a lease renewal, as opposed to a new agreement for a previously undeveloped site. The operator’s expert determined a rental value of £500 p.a. after carrying out the 3 stage process, with half the value attributed to stage 3, to reflect a rolling break clause after 5 years and a right to enter other landlord’s property.

Comparables

Comparable evidence of other rural sites on similar lease terms was also considered by the expert.  Of these 23 renewal agreements, 16 of them contained caveats which made clear that the operator in each case was agreeing a rent higher than that which would be determined by a Tribunal in accordance with paragraph 24 of the New Code.

As such, the expert considered the comparables to be unreliable in terms of arriving at a true paragraph 24 valuation. They were also considered to be too high because they were a blend of consideration and compensation, so the expert deducted the value of what he called an “incentive payment” made by the operators to oil the wheels of commerce.

These deductions were around £1,000 in each case and resulted in rental values of £500 for 16 sites and £1,000 for a further 4, with outliers at greater sums of £1500 and £3,000 for 4 further sites.

Landowner’s expert’s approach

The Landowner’s expert took two approaches to the valuation. The first was market value based on evidence of 15 transactions.  The Tribunal rejected 11 of these, as they were deals that were completed after the New Code came into effect, but implemented terms that reflected the old regime, to which the parties were contractually committed.

The Tribunal pointed out, that in both Hanover and London and Quadrant, evidence of this sort could not be taken as a reliable guide to no-network assumption valuations required by paragraph 24. The expert’s justification for persisting in presenting such evidence was that further research had shown that the rents were, despite the caveat, actually calculated on the basis of the New Code.

This argument was rejected by the Tribunal in terms that thinly disguised its exasperation at having to explain for a third time that such evidence is useless.

The remaining transactions were also not helpful, as they were either 1954 Act renewals to non-Code operators, urban sites or sites with significant alternative use value. The landowner’s expert figure was £5,500 based on these comparables, with an additional £1,500 pa to reflect the grant of access and use of a generator.

The second approach valued the alternative use of the site at £50, with an ultimate consideration of £7,800 pa. This was based on agreements granting access rights to third parties like Network Rail and Northumbrian Water, the granting of non-network benefits by the landowner and compensation to reflect health and safety concerns.

The Tribunal found the evidence presented by the landowner’s expert to be of very little help, with both his proposed valuations being higher than the passing rent. The Tribunal said that this told them that the expert had not accepted or understood the paragraph 24 valuation process.  Under lengthy cross examination the expert remained insistent that his evidence was relevant and the Tribunal fired a clear warning shot in saying that if this happened again, such evidence would be rejected without the need for further cross examination.

Operator’s expert’s approach

In contrast the operator’s expert evidence pointed to the fact that rents of £1500 or above were the norm, ignoring the effect of transitional incentive payments. These were commercial deals struck to avoid the cost of Tribunal proceedings and do not reflect the paragraph 24 reality.

However, the Tribunal considered that the operator was underestimating consideration values and overstating how much was paid as a commercial inducement – a doubling of the consideration was thought to be more realistic.

Tribunal’s approach

Taking the 3 stage approach set out above:

  1. The experts agreed a nominal £100 pa alternative use value;
  2. Additional benefits conferred on the operator included a right to keep a mast on the site, electric supply, right to enter other property of the landowner and tenant’s rolling break clause after 5 years. The operator said £400, the landowner said £1300 and the Tribunal ruled £600; and
  3. Adverse effect on landowner was considered by the Tribunal to be caused by the access rights (to the “heart of a private rural estate”) and the loss of amenity caused by likely replacement of the mast for 5G upgrade purposes. This was valued by the Tribunal at £500, although it stated that if rents of nearby properties were negatively affected, this could form the basis of a subsequent compensation claim.

The cumulative consideration was therefore £1200 pa, which seems right when considered against a comparable put in evidence comprising a consensual deal at £2,500 for a similar wooded site on a rural estate. Compensation was awarded for legal and professional fees. The legal fees were allowed in full but a breakdown of the valuer’s fees was required as the landowner was not entitled to be reimbursed for any litigation related expense.

[1] Cornerstone Telecommunications Infrastructure Limited v Compton Beauchamp [2019] EWCA Civ 1755

[2] EE Limited and Hutchison 3G Limited v London Borough of Islington [2019] UKUT 53 (LC)

[3] Vodafone Limited v Hanover Capital Limited [2020] EW Misc 18 (CC)

[4] Cornerstone Telecommunications Infrastructure Limited v London & Quadrant Housing Trust [2020] UKUT 82 (LC)

The International Integrated Reporting Council website
The International Integrated Reporting Council website

Our Natural Capital hub contains information and resources written by our team of experts as well as papers and online materials authored by a variety of sources including the UK Government, the UN, Conservation International and the World Forum on Natural Capital. 

The International Integrated Reporting Council (IIRC) is a global coalition of regulators, investors, companies, standard setters, the accounting profession, academia and NGOs. The coalition promotes communication about value creation as the next step in the evolution of corporate reporting. and in particular promotes Integrated Reporting <IR>.

Their mission is to establish integrated reporting and thinking within mainstream business practice as the norm in the public and private sectors. Their vision is to align capital allocation and corporate behaviour to wider goals of financial stability and sustainable development through the cycle of integrated reporting and thinking. The resources tab includes useful FAQs, and the International <IR> Framework which establishes the Guiding Principles and Content Elements for integrated reporting.

To access this resource please click here: ‘Integrated Reporting Council‘.  

If you have any questions about Natural Capital our Agriculture team would be pleased to hear from you: please click here for their full contact details.

To access our Natural Capital hub, please click here.

How compliant is your Academy’s website?
How compliant is your Academy’s website?

For Multi Academy Trusts (MATs), a variety of information must be published on its main website as well as each Academy’s website. Whilst some MATs are operating under multiple Funding Agreements, we recommend that you publish everything required under the latest DfE model Funding Agreement as well as the Academies Financial Handbook. This will need to include any charging information.

On the MAT website, an Academy must publish:

  • its annual accounts no later than the end of January following the financial year to which the accounts relate
  • its current Memorandum & Articles of Association and Master Funding Agreement
  • the required information relating to governance structures, including for example the structure and remit of the members, board of trustees, its committees and local governing bodies, and the full names of the chair of each (where applicable)
  • information about its Pupil Premium, including for example the amount of Pupil Premium allocation that it will receive during the Academy Financial Year
  • if received, information about its Year 7 literacy and numeracy catch-up premium funding
  • various details about its curriculum, including for example the content of the curriculum and its approach to the curriculum.

On the individual Academy’s website, you must publish:

If applicable, the Academy’s most recent Key Stage 2 results as published by the Secretary of State in the School Performance Tables:

  • average progress scores in reading, writing and maths
  • average ‘scaled scores’ in reading and maths
  • percentage of pupils who achieving the expected standard or above in reading, writing and maths
  • percentage of pupils who achieving a high level of attainment in reading, writing and maths

If applicable, the Academy’s most recent Key Stage 4 results as published by the Secretary of State under the following column headings in the School Performance Tables:

  • progress 8 score
  • attainment 8 score
  • percentage of pupils who achieving a strong pass (grade 5 or above) in English and maths
  • percentage achieving the English Baccalaureate
  • percentage of pupils continuing in education of training, or moving on to employment at the end of 16 to 19 study
  • information about where and how parents (including parents of prospective pupils) can access the most recent report about the Academy published by the Chief Inspector
  • information as to where and how parents (including parents of prospective pupils) can access the School Performance Tables published by the Secretary of State.

Finally, and by way of best practice, we recommend that each Academy’s website includes the following information: contact details, admissions arrangements, Ofsted reports, behaviour policies, values and ethos. Whilst this is not a legal requirement for academies, the information is both important and helpful!

ECJ rules that EU copyright infringement claims can be brought in any member state where the infringing website is accessible

The European Court of Justice (“ECJ”) has given a preliminary ruling on the jurisdiction of member states in relation to copyright materials published without the owner’s consent.

The Austrian case of Pez Hejduk v EnergieAgentur.NRW GmbH, Case C-441/13 concerned the use of photographs by a conference organiser on a website and the subsequent option to download these photos by website users. The owner of the photographs did not consent to this and sued the conference organiser for copyright infringement. It was argued that the Austrian Court did not have jurisdiction to hear the case on the basis that the conference’s organiser’s website had a .de domain name and was directed at German, not Austrian users.

The ECJ’s view was that under Article 5(3) of EC (44/2001) Brussels Regulation, proceedings could be brought in any member state where the relevant website was accessible. As set out in Pinckney v KDG Mediatech AG Case C-170/12, this was sufficient to seise the court, an activity did not need to be “directed” to that member state, i.e. through a country-specific, top-level domain name. However, the ECJ did make it clear that the courts where a website was accessible  could only determine damages which had been incurred within their own member states.

This ECJ decision widens the potential jurisdiction further than in previous case law as unlike in Pinckney, there is no requirement for hard copies to have been received to act as proof of damage in a jurisdiction – anyone can log onto a website and download online materials onto their own devices. It is anticipated that we will see an influx of online copyright infringement claims, as a result.

For potential claimants, this decision is likely to be welcomed as it enables claimants to rely on the jurisdiction of their own member state in order to bring a claim. However, where there has been significant damage, it is likely that the claimant would still be well-advised to sue in the defendant’s member state, to enable it to claim all damages, rather than just those in the claimant’s member state.

For website owners, this decision acts as a reminder to ensure that all content displayed and available for download  has the appropriate consents and licences in place.  This decision will be particularly significant for online users with territory-specific rights, who will now have difficulty arguing that they did not directly target an excluded territory. It is now clear that mere “accessibility” of content in an excluded territory could enable a claim to be made.

For more information please contact Charlotte Bolton, Solicitor in the Commercial Disputes & Regulatory team on charlotte.bolton@michelmores.com or on 01392 687745.

Drone flying over farmland
Navigating the skies: UAVs and air rights over private property

Above the vast patchwork of fields carpeting the UK, a silent revolution is unfolding in the skies. Unmanned Aerial Vehicles (UAVs), once confined to military applications and hobbyist pursuits, are being developed for new commercial purposes.

During the coronavirus pandemic, UAVs and drones gained attention for their trialled use by the medical sector, focused on the use of drone technology to deliver medical supplies to patients across Scotland. That organisation has now turned to the development and trial of the UK’s first national network of UAV/drone flight corridors, designed to connect hospitals, labs, GP surgeries and distribution centres.

Similar UAV/drone corridors are also under development in other sectors including logistics and agriculture. With the imminent arrival of widespread commercial use of UAV/drone technology, we consider the myriad legal considerations for private landowners.

Who owns the air above land?

Does a landowner have exclusive ownership of airspace rights over their land? Thirteenth century case law provided that a landowner owned their land “all the way to Heaven and all the way to Hell”. This very literal interpretation of ownership over the vertical column above one’s land cannot persist into the 21st century with the dawn of aircraft, satellites and drones.

The law changed in the 1970s[1] in a case involving an unmanned aircraft deployed to photograph homes with the aim of selling the photographs to homeowners.

The courts determined that landowners’ rights extended to such a height as is “necessary for the ordinary use and enjoyment of their land”.

Trespass and nuisance

UAV operators must obtain a landowner’s permission to land or take off on their land. It is less clear whether the act of flying a UAV over someone’s land amounts to trespass or nuisance in and of itself. It will likely depend upon the extent to which peaceable enjoyment of the landowner’s property is affected (height and frequency of activity, duration, noise, hovering etc.) having regard to the activity taking place on the ground.

Current legislation indicates that UAV users are exempted from liability where an operator pilots their drone over a person’s land in a reasonable manner, at a reasonable height, and in compliance with all other relevant laws and regulations (see s.76(1) Civil Aviation Act 1982). Of course, the meaning of reasonable is open to interpretation and is yet to be properly tested by the courts.

In addition, all UAVs must be flown in accordance with a general duty not recklessly or negligently to cause or permit them to endanger any person or property.

A landowner is more likely to have an actionable claim where a person causes a UAV to engage in an activity which could be considered a trespass or nuisance, such as landing without permission or causing property damage or personal injury.

Owners or operators of drones will be held to strict liability (liable regardless of one’s intention) for any surface damage, personal injury or damage to a person’s property caused by a drone[2].

Liability is channelled through the owner or operator of the drone and, unless the injury or damage is as a result of the victim’s own negligence, the victim must be compensated.

If a person intentionally or recklessly hits someone or their property with a UAV, they could also be liable for a criminal offence such as battery or criminal damage.

The Civil Aviation Authority (CAA) is the UK’s primary statutory regulator for aviation, including UAVs. Most prosecutions against errant drone operators are conducted by the CAA, although the police have taken an increasingly active role in pursuing prosecutions against individuals.

It should be noted that landowners can also be held responsible for accidents that take place on their land if they have given the drone operator permission to take off or land on their property.

Data protection and privacy

Landowners are also likely to be concerned about the risks UAVs pose to their privacy, particularly those with sophisticated cameras and sensors which process personal data. This may lead to confidentiality and privacy issues if a drone captures footage of, for example, people, vehicles or signage over land.

In the UK, processing of personal data is subject to the GDPR and Data Protection Act 2018. The Information Commissioner’s Office (ICO) is the UK data protection regulator in charge of enforcing legal requirements. Any drone with a camera should be registered with the CAA. Where a drone operator contravenes data protection rules, the ICO can pursue enforcement action, including fines.

What can landowners do if they are affected by UAVs/ drones?

It can be difficult for landowners to regulate unwanted UAV/drone behaviour. However, there are a number of things they can do. Collecting good records and evidence such as recordings and photos of drone use can be helpful. Reporting incidents to the police and making enquiries of the CAA should also be considered. In more persistent cases, landowners can employ drone tracking technologies. Concerned landowners may also want to register their land as a no-fly zone with the No Fly Drones website.

[1] Bernstein of Leigh v Skyviews & General Ltd [1978] 1 QB 479

[2] Section 76 (2) Civil Aviation Act 1982