Factual and Procedural Background
The Bridgewater Canal Co Ltd ("BCC") is the long-leaseholder of the Bridgewater Canal. Geo Networks Ltd ("Geo") maintains a duct under the canal, paying rent for it. One sub-duct is empty, and Geo wishes to install a further fibre optic cable by propelling it through the sub-duct using compressed air. Geo acknowledges it has no private law right to do so and thus relies on the Electronic Communications Code ("the Code") under the Telecommunications Act 1984, as amended by the Communications Act 2003, specifically paragraph 12 concerning "Linear obstacles". Geo gave BCC the required notice under paragraph 12(4), which BCC objected to under paragraph 12(5). Consequently, an arbitrator was appointed by the President of the Institution of Civil Engineers pursuant to paragraph 13(1).
The arbitrator issued an interim award on 7 August 2009, concluding that paragraph 13(2)(e) relates solely to the carrying out of the works and not to the granting of rights. BCC appealed with leave granted by Simon J, and the appeal was heard by Lewison J, who disagreed with the arbitrator, holding that the operator must pay for the right to carry out the works, which includes the right to keep the works on the land, and that the price must be fair and reasonable without including a ransom value. Lewison J set aside the arbitrator's award and remitted it for reconsideration in light of his judgment. Geo subsequently appealed from Lewison J's order with permission.
Legal Issues Presented
- Whether the consideration payable under paragraph 13(2)(e)(ii) of the Electronic Communications Code extends only to the right to carry out the works or also includes the right to keep the electronic communications apparatus on, under, or over the relevant land.
Arguments of the Parties
Appellant's Arguments (Geo Networks Ltd)
- The opening words of paragraph 12(1) confer the right to install and keep the line and apparatus, and the right to execute works is identical to the right to carry out works under paragraph 13(2)(e)(ii).
- Consideration payable under paragraph 13(2)(e)(ii) is only for the right to execute the works, not for the right to keep the apparatus after installation.
- The judge's construction would give a windfall to the person controlling the railway, canal, or tramway, as consideration might be payable multiple times (e.g., on installation and later repairs).
- Contrasting the special linear obstacle regime with the general regime, the latter clearly deals with three separate rights requiring agreement and consideration, whereas the special regime does not.
- The appointment of the arbitrator by the President of the Institution of Civil Engineers suggests the arbitration is not primarily concerned with land valuation issues.
Respondent's Arguments (Bridgewater Canal Co Ltd)
- The judge was correct in holding that consideration includes the right to keep the installation in situ, as BCC operates the canal and has a long leasehold interest.
- Geo would receive an uncovenanted benefit if allowed to maintain the installation for the remainder of the lease without payment.
- Paragraph 13 should be interpreted to avoid injustice by ensuring property is not burdened without payment.
- The award of compensation or consideration is discretionary, allowing an arbitrator to refuse payment for subsequent repairs if full consideration has already been paid.
- The special linear obstacle regime applies only to land under the control of railway, canal, or tramway undertakings; otherwise, the general regime applies, which requires consideration for the right to keep the apparatus.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The court began by examining the general structure and purpose of the Electronic Communications Code, emphasizing the overriding principle that no person should unreasonably be denied access to an electronic communications network or services. The Code distinguishes between a general regime and special regimes, including the linear obstacle regime relevant here.
The general regime requires the operator to obtain rights by agreement or court order, with consideration and compensation payable to all persons bound by the order, including for the right to keep electronic communications apparatus on land.
The special linear obstacle regime applies only to land used wholly or mainly as a railway, canal, or tramway, and the person in control of that land (not necessarily the owner) receives any compensation or consideration. The regime differs significantly from the general regime in terms of notice, objection, arbitration, and payment procedures.
The court rejected the argument that consideration under paragraph 13(2)(e)(ii) should include the right to keep the apparatus on the land. Instead, it interpreted the provision as relating solely to the right to carry out the works. The court reasoned that the right to install and keep the apparatus is conferred by paragraph 12(1) itself, while paragraph 13(2)(e)(ii) concerns consideration for executing the works only.
This interpretation avoids potential windfalls and anomalies, such as multiple payments for the right to keep the installation upon subsequent repairs or alterations. The court also found no support in the appointment of the arbitrator by the President of the Institution of Civil Engineers as indicating a limitation on the arbitrator's powers.
Ultimately, the court preferred the appellant's submissions and disagreed with Lewison J's reasoning and conclusion.
Holding and Implications
The court ALLOWED THE APPEAL.
The effect of this decision is that under the special linear obstacle regime of the Electronic Communications Code, the consideration payable under paragraph 13(2)(e)(ii) is confined to the right to carry out the works and does not extend to the right to keep the electronic communications apparatus on the relevant land. This limits the financial burden on operators crossing linear obstacles such as canals or railways and avoids multiple payments for the right to keep the installation. The decision does not establish a new precedent beyond the interpretation of the relevant Code provisions and their application to the facts of this case.