New Electronic Communications Code decision: indemnity terms in MSV agreements
In EE Ltd & H3G Ltd v Hackney LBC [2021] UKUT 0142 (LC) (“Shoreditch House”) the Tribunal (Martin Rodger QC, Deputy Chamber President (“DCP”)) has rejected an attempt by the site provider – relying on the DCP’s earlier dictum in EE Ltd & H3G UK Ltd v Islington LBC (No. 1) [2018] UKUT 0361 at [48] that the terms of an agreement imposing interim Code rights should “put the full risk of the operation on which the operator wishes to embark on the operator and none of the risk on the site provider”, and the requirement in para 23(5) to include the terms appropriate to minimise loss and damage caused by the exercise of Code rights to relevant persons – to require the inclusion of a term in an MSV agreement sought by the operators that would have obliged the operators to give a wide-ranging indemnity against all liabilities, costs, expenses, damages and losses arising out of or in connection with the agreement.
In doing so the Tribunal accepted the submissions on behalf of the operators that the agreement, modelled on the somewhat complex form preferred by the site provider, already included “appropriate” safeguards for an MSV agreement inasmuch as it gave detailed and quite elaborate protections for the site provider in the form of restrictions on those who would be permitted to access the land; requirements as to supervision of access; and obligations on the operators to make good any damage caused and carry out all investigations with due care, in compliance with legislation and necessary consents.
Further, the site provider would be entitled to seek compensation for any loss or damage caused by the exercise of the rights in accordance with paragraph 25 of the Code – subject to the restrictions Parliament has seen fit to impose on that right, including as to ordinary principles of causation, remoteness and mitigation, which the proposed indemnity would side-step.
To paraphrase an observation of the DCP at the hearing: in paragraph 25, Parliament has given site providers a right to compensation, not a blank cheque.
Accordingly, the scope of the disputed indemnity clause was narrowed to cover only third party claims made against the site provider (in keeping with OFCOM’s Standard Terms).
James appeared for the successful operators, instructed by Winckworth Sherwood LLP and MBNL.
The full decision can be found here.
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