SSE Telecommunications Ltd v Millar
| Jurisdiction | Scotland |
| Judge | Sheriff Principal MM Stephen,Sheriff Principal CD Turnbull,Sheriff PJ Braid |
| Judgment Date | 16 May 2018 |
| Court | Sheriff Appeal Court |
| Date | 16 May 2018 |
| Docket Number | No 9 |
[2018] SAC (Civ) 14
Sheriff Principal MM Stephen QC, PSAC, Sheriff Principal CD Turnbull and Sheriff PJ Braid
Bocardo SA v Star Energy UK Onshore Ltd and anr [2010] UKSC 35; [2011] 1 AC 380; [2010] 3 WLR 654; [2010] 3 All ER 975; [2011] BLR 13; [2010] 3 EGLR 145; [2010] RVR 339; [2010] 31 EG 63 (CS); [2010] NPC 88
Cabletel Surrey and Hampshire Ltd v Brookwood Cemetery Ltd [2002] EWCA Civ 720
Mercury Communications Ltd v London and India Dock Investments Ltd [1994] 1 EGLR 229; (1995) 69 P & CR 135
Pointe Gourde Quarrying and Transport Co Ltd v Sub-intendent of Crown Lands [1947] AC 565; 63 TLR 486
Transport for London v Spirerose Ltd [2009] UKHL 44; [2009] 1 WLR 1797; [2009] 4 All ER 810; [2009] PTSR 1371; [2009] 3 EGLR 103; [2009] RVR 225; [2010] JPL 762; [2009] NPC 104
Bennion, FAR, Statutory Interpretation: A code (7th ed, LexisNexis, London, 2017), p 442
Heritable property and conveyancing — Wayleave — Telecommunication wayleave rights — Whether telecommunications network provider entitled to allow use of ‘dark fibre’ by third parties — Whether “fair and reasonable” consideration for compulsory statutory apparatus wayleave to be assessed by reference to value to occupier or value to the telecommunications network provider — Telecommunications Act 1984 (cap 12), sch 2 — Communications Act 2003 (cap 21), secs 31(1), 405
SSE Telecommunications ltd raised a summary application in the sheriffdom of Tayside, Central and Fife at Forfar against William Millar seeking orders in respect of electronic communications apparatus. Following a debate held before the sheriff (P Di Emidio), on 12 May 2017, the sheriff issued a decision finding in part in favour of both parties. The pursuer appealed and the defender cross-appealed against that decision to the Sheriff Appeal Court.
Schedule 2 of the Telecommunications Act 1984 (cap 12) (‘the 1984 Act’) provided a code for the operation of communications networks. Paragraph 2(1) of the code provided that the agreement of the occupier of any land was required for conferring on the operator rights for the statutory purposes to, inter alia, execute works for installation, maintenance, adjustment, repair or alteration of electronic communications apparatus. Statutory purposes were defined in para 1(1) of the code as the purposes of provision of the operator's network, which in turn was defined as so much of any electronic communications network or conduit system provided by that operator: as was not excluded from the application of the code under sec 106(5) of the Communications Act 2003 (cap 21). Paragraph 5 of the code provided that an operator might apply to a court, in the absence of the occupier's agreement, for an order conferring the rights set out in para 2(1). Paragraph 7 of the code provided that such an order would include, inter alia, “terms with respect to the payment of consideration in respect of the giving of the agreement, or the exercise of the rights to which the order relates, as it appears to the court would have been fair and reasonable if the agreement had been given willingly”.
The pursuer operated an electronic communications network in terms of the 1984 Act. The pursuer enjoyed rights under a wayleave argument to run telecommunications cables, including fibre optic cables, on an overhead transmission line. The pursuer leased fibres for customers' sole use, in which the customer would put their own electronic equipment at each end of the fibre, with the pursuer having no access to the customer's data. Such fibres were referred to as ‘dark fibres’.
In May 2016 the defender sent a notice requiring the pursuer to remove all electronic communications apparatus from his property. The pursuer applied to the sheriff court for an order granting it the rights to install, keep and store the electronic communications equipment apparatus for the statutory purposes on the property, without the defender's agreement.
After a debate, the sheriff held, inter alia, that (1) rights under the telecommunications code would not entitle the pursuer to lease dark fibres to third parties and (2) assessment of the appropriate level of consideration included an increase in value of the rights sought entirely due to the wayleave scheme itself. The pursuer appealed and the defender cross-appealed to the Sheriff Appeal Court.
Held that: (1) the telecommunications code entitled an operator to permit third parties to use dark fibres (para 32); (2) as the code provided for compulsory acquisition of rights, “fair and reasonable” consideration had to be assessed by reference to the value to the occupier, who was not entitled to be compensated for any value attributable solely to the underlying scheme (paras 47–49); and appeal and cross-appeal allowed in part.
Bocardo SA v Star Energy UK Onshore Ltd and anr [2011] 1 AC 380 followed.
The cause called before the Sheriff Appeal Court, comprising the Sheriff Principal MM Stephen QC, PSAC, Sheriff Principal CD Turnbull and Sheriff PJ Braid, for a hearing, on 6 and 7 February 2018.
At advising, on 16 May 2018, the opinion of the Court was delivered by Sheriff Principal CD Turnbull—
Opinion of the Court—
[1] This is the judgment of the court to which we have each contributed.
[2] This appeal is concerned with the proper interpretation and application of the telecommunications code, which is to be found within sch 2 of the Telecommunications Act 1984 (cap 12). In this opinion they are respectively referred to as ‘the code’ and ‘the 1984 Act’. Unless the context requires otherwise, references to sections are to sections of the 1984 Act; and references to paragraphs are to paragraphs of the code.
[3] As more fully explained in paras 18 and 19, the pursuer has appealed and the defender cross-appealed against the decision of the sheriff dated 12 June 2017. For that reason, we refer to the parties as the pursuer and the defender respectively.
[4] The pursuer operates an electronic communications network in terms of the 1984 Act. By virtue of para 1, they are the operator of that network, the code applying to the pursuer by virtue of a direction under sec 106 of the Communications Act 2003 (cap 21) (‘the 2003 Act’). The defender is the heritable proprietor and occupier of certain lands located near to Tealing, Angus (‘the property’).
[5] In 1959 an electricity wayleave agreement was entered into between the North of Scotland Hydro-Electric Board and the then heritable proprietors of the property. The electric lines over the property formed part of the overhead transmission line between Kintore and Tealing.
[6] In or around 1998 Scottish Hydro Electric plc installed a fibre optic cable over the property. This was installed in the earth wire within the existing overhead transmission line. The fibre optic cable was initially used by the pursuer's parent to control its electricity network.
[7] In or around 1998 a telecommunication wayleave agreement was entered into between Scottish Hydro Electric plc and the then heritable proprietors of the property. The pursuer is the successor to Scottish Hydro Electric plc in terms of that telecommunications wayleave agreement.
[8] The fibre optic cable that is in place over the defender's land has 24 individual fibre optic strands. The pursuer uses them in pairs with one fibre optic strand to transmit data and one to receive data. When the pursuer ‘lights’ the fibre cable, it is providing a transmission medium for its customer to transmit and receive their data. The pursuer has no access to the customer's data. Fibre which is not being used to transmit information is ‘not lit’ and therefore not in use. When the pursuer enters into a contract with a customer to lease a pair of fibres for their sole use, the customer puts their own electronic equipment at each end and will ‘light’ the fibre. Such fibres are termed ‘dark fibre’ as the pursuer owns, but has no visibility of, them.
[9] The defender's title to the property was registered on 25 August 2015, with a date of entry of 31 May 2015. In December 2015 the pursuer's agents wrote to the defender indicating their wish to enter into a new agreement with the defender, as the property owner. The pursuer proposed terms to the defender.
[10] On 24 May 2016, agents acting on behalf of the defender sent a formal notice to the pursuer's agents, intimating that the defender required the pursuer to remove all electronic communications apparatus from the property, under para 21(2).
[11] In response to the foregoing notice, on 31 May 2016, the pursuer served upon the defender a formal counter notice in terms of para 21(3). There followed negotiations between the parties in an attempt to agree a fresh wayleave. The negotiations between the parties were unsuccessful.
[12] On 29 July 2016 the pursuer gave notice to the defender in terms of para 5(1). The required agreement was not forthcoming in the requisite period of 28 days. The pursuer was thereafter entitled to apply to the court for an order conferring the proposed right or providing for it to bind any person on the interested land and (in either case) dispensing with the need for the agreement of the person to whom the notice was given, i.e. the defender (see para 5(2)).
[13] The pursuer commenced proceedings in Forfar Sheriff Court in October 2016. The pursuer's summary application seeks three orders from the court. First, to grant to the pursuer the right to install, keep and store the electronic communications apparatus for the statutory purposes on, under or over the property, together with a right to execute works in, on, over or across said lands for or in connection with installation, maintenance, adjustment repair, alteration or replacement of the electronic communications apparatus and, where...
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