“Crowne”- ing Glory – Tribunal refuses new Code rights on redevelopment grounds
The First-Tier Tribunal Property Chamber (Residential Property) has dismissed a telecoms operator’s application for the imposition of new rights under the Electronic Communications Code (“Code”) on the rooftop of the Crowne Plaza hotel on Kings Cross Road, London.
In the first decision of its kind, the Tribunal held that the site provider’s genuine redevelopment plans could not reasonably proceed if the operator’s request for Code rights was granted.
This decision demonstrates that the redevelopment defence to an application for new Code rights under paragraph 21(5) of the Code is a potent and legitimate mechanism for resisting the imposition of Code rights by operators, provided the requisite threshold to satisfy the test can be met.
The decision also provides useful guidance on what is required to satisfy the redevelopment ground under the Code and establishes important points of principle once the redevelopment ground has been made out for site providers and operators alike.
Background
The dispute concerned a congested rooftop space of a hotel in central London, where the operator sought to install a mast and other telecommunications equipment to address coverage and capacity issues in the local area.
In July 2024, following previous site surveys that had been carried out in 2021, the operator, Cornerstone Telecommunications Infrastructure Limited gave the proposed site provider, the Crowne Hotel (Firoka (Kings Cross) Limited), a notice requiring the hotel to confer Code rights on it.
Prior to receiving the notice, the hotel had been receiving complaints from its guests since 2022 regarding the heating and cooling of the hotel. This stemmed from equipment that was installed on the roof of the hotel in 1992 and was in need of replacement.
Works conducted in 2023 had not rectified the issues with the heating and cooling and therefore, as a precursor to more extensive works that would be needed to the system long term, the hotel sought planning permission to extend the existing plant room on the rooftop. This application for planning permission was made in April 2025 and was granted in May 2025.
The hotel then embarked on the feasibility and design phases of a larger project to replace the aged heating and cooling system throughout the hotel, including the equipment on the roof.
Prior to the hearing before the Tribunal in October 2025, the hotel gave an undertaking to the Tribunal that, if the operator’s request for Code rights was refused, it would undertake the development authorised by the planning permission that had been granted.
The operators contended that the hotel only had an intention to begin limited works, which did not go far enough to satisfy the redevelopment defence under the Code. The operator also characterised the hotel’s conduct as “tactical” and submitted that the Code rights they were seeking, which included a “lift and shift” clause, ought to be imposed accordingly.
Issues Before the Tribunal
The Tribunal needed to address:
- Whether the hotel had a firm, settled and unconditional intention to redevelop within paragraph 21(5) of the Code, and reasonable prospects of achieving that intention.
- Whether redevelopment could not reasonably be carried out if the order imposing Code rights was made.
- Whether a “lift and shift” clause could solve the incompatibility.
- In the alternative, if the redevelopment ground was not made out, how the paragraph 21 public benefit and prejudice test under the Code would be applied and the consideration payable for the Code agreement.
Redevelopment intention and prospects
Following the decision of the Upper Tribunal in EE Limited and Hutchinson 3G UK Limited v Sir James Chichester and others as Trustees of the 1968 Combined Trust of Meyrick Estate Management [2019] UKUT 164 (LC), which adopted the two-stage test for redevelopment originally set out in Cunliffe v Goodman [1950] 2 KB 237, the hotel needed to prove, as at the date of the hearing, that:
- It had a reasonable prospect of being able to carry out their redevelopment project; and
- it had a firm, settled and unconditional intention to do so.
Whilst the undertaking given by the hotel did not cover the longer term proposed works (i.e. those to replace the whole system within the hotel including the plant and equipment on the roof), the Tribunal accepted this as strong evidence (albeit not conclusive evidence) of the genuineness of the hotel’s intention to carry out its proposed redevelopment.
The Tribunal also determined that, following the grant of planning permission, and having the requisite financing and board approval, the hotel had all that was necessary to carry out its redevelopment. Therefore, the Tribunal found that the hotel had the requisite intention to carry out these works and a reasonable prospect of achieving that intention within a reasonable time frame, with the works due to commence within nine months of the hearing.
Whilst the operator had not expressly run an argument that the hotel’s intention to carry out its proposed works was conditional on the Tribunal refusing to grant the Code rights being sought, i.e. relying on the decision in S Franses v Cavendish Hotel (London) Limited [2018] UKSC 62, the Tribunal was in no doubt that the hotel intended to carry out the same works even if the operator was not seeking Code rights in any event.
Could the hotel reasonably carry out the works if the Code rights sought were granted?
The Tribunal found that the works permitted by the planning permission were fundamentally incompatible with the telecommunications apparatus that the operator proposed to install on the roof.
Whilst the works permitted by the planning permission could have been amended to accommodate the apparatus, the Tribunal was clear that the operator could not compel the hotel to cooperate by revising its designs for the reasons given in Franses.
In written submissions after the hearing, the operator proposed a new lift and shift clause to be included in the Code agreement to be granted. Having considered the clause, and the hotel’s response, the Tribunal ultimately determined that that proposed clause:
“interferes with the private property rights of [the hotel] in circumstances where it has made out, on the balance of probabilities, a firm, settled and unconditional intention to redevelop.”
Stating further that, as a matter of principle:
“Once a site provider has made out its firm, settled and unconditional intention it should be free from further interference with its plans.”
As a result, the Tribunal rejected the proposed lift and shift provision and found that the hotel could not reasonably carry out its proposed development works if the proposed Code rights were granted.
Alternative analysis: public benefit, prejudice, and consideration
If the Tribunal was wrong to determine that the redevelopment ground under paragraph 21(5) of the Code had been satisfied, it went on to consider whether the so called “paragraph 21 test”, i.e. whether the imposition of Code rights would satisfy both of the following conditions and therefore ought to be granted, would have been met:
- That the prejudice caused to the relevant person by the order is capable of being adequately compensated by money; and
- That the public benefit is likely to result from the making of the order outweighs the prejudice to the relevant person (and in deciding this the Tribunal needs to have regard to the public interest in access to a choice of high-quality electronic communications services).
The Tribunal was not persuaded by the hotel’s submissions of the “terrifying prospect” of structural collapse due to the installation of apparatus, or the claimed extraordinary potential financial losses if the upgrade works could not be carried out. The Tribunal therefore confirmed that any prejudice to the hotel could be compensated in money, and the public benefit in improved communications would outweigh that prejudice. Therefore, the paragraph 21 test was met.
On the question of consideration, it preferred the operator’s expert evidence and approach and that consideration, were it to be ordered, would have been in the amount of £6,950 per annum. This was opposed to the £6.393m - £30.8m proposed by the hotel – the latter of which being a consideration connected to the alleged annual net profit losses that would be incurred if the Code agreement was imposed.
However, as the Tribunal had ultimately determined that the redevelopment ground in the Code had been satisfied, it dismissed the operator’s application accordingly.
Comment and practical steps
The Tribunal’s reasoning underscores that the redevelopment defence to installation of new Code rights under paragraph 21(5) of the Code is both available and potent where a site provider can evidence a genuine, funded and permissioned scheme with a realistic programme and technical viability.
The decision also makes it clear that once a site provider has proved a firm, settled and unconditional intention to redevelop, it should not be required to adapt or dilute its scheme or plans to accommodate an operator’s requirements.
Further, “lift and shift” provisions will not act as a rescue mechanism for operators to justify the imposition of Code rights where the test in paragraph 21(5) of the Code has been made out.
Whilst each case will naturally tern on its own facts, and it remains clear that if a site provider cannot establish its redevelopment intention under paragraph 21(5) of the Code, then Code rights are likely to be imposed, this decision demonstrates that where the redevelopment ground in paragraph 21(5) of the Code can be evidenced then the Tribunal will enforce it.
Both site providers and operators alike will therefore need to be aware of this in any future negotiations in a proposed redevelopment situation and to act (and react) accordingly.
For further information, please email the authors or your usual CMS contact.
For a different outcome in a recent case on a similar issue, please see here.
