FTT Clarifies Contracting Out Under the Landlord and Tenant Act 1954 in EE Ltd and another v AP Wireless

The First-tier Tribunal Property Chamber (Residential Property) (“FTT”) recently decided on 11 references brought jointly by EE Ltd and another v AP Wireless II (UK) Ltd, concerning whether certain telecommunications agreements were validly contracted out of Part 2 of the Landlord and Tenant Act 1954 (‘LTA 1954’).

Background

The references involved disputes under the 2017 Electronic Communications Code (“the Code”) between the Claimants (EE Limited and Hutchison 3G UK Limited) and the Respondent (AP Wireless II (UK) Limited). The dispute centred on the renewal of agreements for telecommunications sites at eleven references, following the expiry of existing agreements.

The Claimants sought to renew these agreements under Part 5 of the Code, while the Respondent challenged the validity of the notices served and raised issues about the procedural compliance and abuse of process.

The references addressed whether the agreements at certain sites were validly contracted out of the LTA 1954.

Key Takeaways from the FTT’s decision

1.) Contracting out without perfection is still valid

The Tribunal held that a lease can effectively exclude the LTA 1954 protections even without an explicit reference to an agreement under section 38A, provided the wording clearly indicates that security of tenure provisions of Part 2 of the LTA 1954 do not apply. The decision confirms that while precision is ideal, absolute perfection is not required.

2.) Endorsements are sufficient evidence

Where a lease includes an endorsement confirming that the tenant received the statutory warning notice and made the necessary declaration under the Regulatory Reform (Business Tenancies) (England and Wales) Order 2003, it will be deemed sufficient evidence of compliance. The Tribunal found that production of the warning notice and declaration was unnecessary.

3.) Transitional provisions include pre-2003 contracting out

The Tribunal also clarified that agreements contracted out under the pre-2003 regime (i.e., by court order) also fall within the transitional provisions of the Code. This is by virtue of section 17(2)(b) of the Interpretation Act 1978, which preserves the effect of repealed legislation unless expressly excluded. This ensures Part 5 of the Code applies.

4.) Code notices remain valid despite legislative change

The Tribunal confirmed that the Paragraph 33 Notices served by the Claimants that were valid when served, remained valid. This is despite the fact that they did not include information about Alternative Dispute Resolution (ADR), which became a requirement after 7 November 2023 due to Section 69 of the Product Security and Telecommunications Infrastructure Act 2022. The Tribunal confirmed that the new requirements did not retrospectively invalidate notices served before this date.

5.) No abuse of process in serving notices without further action

The Tribunal rejected the Respondent’s argument that the Claimants serving Code notices without taking further steps constituted an abuse of process. While the Tribunal criticised the Claimants for their lack of timely engagement and that “radio silence is not acceptable”, it found both parties “equally at fault” as the Code gives both parties the ability to progress matters. It was found that the respondent suffered very little prejudice, as it continued to “receive a market rent” during the delay.

Conclusion

The FTT ruled in favour of the Claimants on key issues, confirming the validity of the notices and the Tribunal’s jurisdiction under Paragraph 33 of the Code. However, it criticised both parties for their lack of engagement and adherence to best practice. It urged them to follow the Code in engaging in “early, meaningful, and collaborative dialogue”, and wherever possible attempt to use ADR.

While FTT decisions do not create binding precedents in the same way as higher courts, this ruling offers valuable guidance on the practicalities of contracting out of the LTA 1954 in telecoms leases.

The case can be found here: EE Ltd and another v AP Wireless II (UK) Ltd (BIR/00CN/ECR/2024/0623 and others)

For more information, please contact Mary Brennan or Zoe McLean-Wells.