EE Limited & Anor v Affinity Water Limited
Decision date: 17 January 2022
Neutral citation: [2022] UKUT 8 (LC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned the Tribunal’s determination of the financial terms for a new Electronic Communications Code agreement between EE/Hutchison and Affinity Water for occupation of a communications compound and use of a water tower under paragraph 34(6) (Part 5). The Tribunal held that paragraph 24 valuation assumptions apply and, for the notional market transaction, the site should be treated as vacant; applying a three-stage valuation approach and adjustments (including a 10% uplift for an annual break) it fixed the annual consideration at £3,300 and awarded £7,500 for the respondent’s professional costs. An order was made terminating the subsisting agreement and directing entry into the new agreement on those financial terms.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The binding ratio from the judgment is that in a paragraph 34(6) order under Part 5 the paragraph 24 statutory valuation hypothesis applies and, to reflect a notional arm’s‑length market transaction, the valuation may properly assume the site is vacant; the three‑stage valuation framework (considering alternative highest use, benefits to the tenant/operator, and burdens on the landowner) is an appropriate method to fix annual consideration under paragraph 24, applied broadly rather than with excessive granularity.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The Tribunal expressed obiter views that treating an actually occupied and equipped site as if equipped for the notional transaction warrants further consideration (the “consensus approach”), and that future facilities‑management upgrade costs are often better addressed as compensatable expenditure when incurred rather than by a pre‑emptive annual allowance. These observations were presented as guidance rather than definitive holdings.