For an operator entering into a wayleave agreement, it is very likely that they will agree to pay the legal (and often surveyor) fees for the landowner. It is perfectly reasonable and acceptable for an operator to pay such fees because in most cases, a landowner should not be ‘out of pocket’ for entering into an agreement. However, the issues arise not from an operator paying these fees, but the level of fees that some law firms charge.
Wayleave agreements have a certain air of mystery attached to them. There seems to be a common view that when a wayleave agreement is required, or the process becomes “in wayleave” (a phrase I regularly hear from clients) that this process is akin to a black hole of mystery, and if we’re lucky, a completed wayleave agreement might appear a number of months down the line, or we might never see it again. Firstly, this is not an accurate perception of the process to complete a legal agreement and secondly, the importance of a wayleave agreement can often be overlooked and seen as an obstacle to installation, rather than a necessary legal agreement that provides the legal right to install apparatus on private land.
As a very brief overview, a wayleave agreement is an agreement that grants permission for an operator to install their apparatus on private land, and put simply, the wayleave agreement governs the relationship between the operator and the landowner. Wayleave agreements are usually not completed overnight because there are many factors attributed to them. There could be two parties involved, or there could be five parties involved, and each of these parties will have their own legal representation whose responsibility it is to agree the best terms they can for their respective client. The more parties involved, generally the more time the process takes because each party has to agree to the terms proposed by the other parties. Legal representatives will ordinarily report to their client on the proposed terms, and their client will need to agree to the legal advice, or perhaps further negotiation will be required if the advice is not agreed. Often, there are terms that cannot be agreed between the parties – usually because one party might insist on provisions that are above industry standard or are inconsistent with the provisions of the Code. Generally, although wayleaves take a little time to complete from start to finish, in most cases, they tend to require a few hours of work.
The issue I am becoming ever more aware of, and the issue that is the purpose of this article, is the uncapped legal fees that are quoted for wayleave agreements, and it is these fees I see as a big problem for telecoms operators. There are some firms who charge flat fees (net) of £2,000, or even as much as £2,500, or perhaps £3,000/£4,000+. When these fees are challenged, which I often do, and I ask for a breakdown of the hourly rate of the solicitor and how many of these hours are required to reach the total fees, this often tends to be clouded in secrecy. Seldom do I receive a clear answer, more often than not the answer is some vague explanation of “this is our standard fee for dealing with wayleaves”. It is also not uncommon to receive defensive answers that do not substantiate the fees being charged, and instead detail every step of the wayleave process, presumably to clarify that there are a number of steps involved (even if some steps are questionable, such as “investigating whether the operator is a Code operator”, which I have been advised of recently – the secret to this is it takes a few seconds to discover, if like me, you have the link to Ofcom’s ‘Register of persons with powers under the Electronic Communications Code’ saved as a favourite in your browser…).
Why is this a problem?
On one hand it could be suggested that negotiating wayleave agreements can be lucrative work for law firms, but on the other hand, the often-huge cost associated to high legal fees can be the difference between an operator being able to afford to install their network, or not, as the case may be. This could mean that the government’s gigabit target is more difficult to meet, and it can also mean that tenants are not provided with its choice of services (which coincidently is protected under the Communications Act, and a landlord cannot deny its tenants the choice of services or service provider). Ultimately, operator’s unable to afford to enter into wayleave agreements fly in the face of the target to future proof the UK with the fibre roll-out. It should be made clear that third party legal fees are only part of the costs to an operator. An operator will have their own legal fees to pay for entering into a wayleave agreement, then there are surveyors’ costs and equipment and installation costs. Where civils are involved, the costs can be even greater until the total is many thousands of pounds, just to connect a property. In the case of single dwelling units (SDUs), it is often commercially unviable for an operator to pay out many thousands of pounds, perhaps approaching five digit costs for a monthly services subscription of around £30 in return. The knock-on effect is that there will be many occupiers of properties that are effectively denied being connected to fibre, because an operator simply cannot afford to install.
What’s the answer?
Unfortunately, at present, there is not a quick fix I can suggest. The strongest thing we can do is to challenge high fees when they are presented. Even if an operator feels the fees are very high, but they have decided to pay them, there is nothing to be lost in challenging them. Accepting high fees and having a personal grumble about them to avoid further delay only sets a precedence that the level of fees are acceptable. I do not agree that it is acceptable to charge £2,000+ (plus VAT) as a set fee for a wayleave agreement and I believe it is reasonable for a law firm to provide an hourly breakdown of its fees, and the work involved – and charge for the time actually spent. To provide some recent examples of challenging fees, a client of Trenches was quoted an ‘initial’ fee of £2,500 for negotiating the terms of a wayleave agreement. Upon challenging these fees, I was advised the fees could be reduced to £1,500. At the other end of the spectrum, I recently challenged fees of £2,000 but was advised the time already accrued had almost reached this figure – and the draft wayleave agreement had not even been provided at this point. I was advised that the time taken in the correspondence to discuss the fees, in addition to some other admin type matters had accrued fees of almost £2,000… I do not accept this.
Regulatory Guidance and Accountability
The Solicitors Regulation Authority (SRA), which governs the conduct of solicitors in England and Wales, imposes clear obligations regarding the transparency, fairness, and justification of legal fees. Under SRA Principle 7, solicitors must act in the best interests of their clients, which includes providing clear, upfront, and ongoing information about costs. Additionally, the SRA Code of Conduct for Solicitors requires that clients be given accurate details about how fees are calculated, the likely total costs, and any factors that could lead to increases. The SRA Transparency Rules further reflect the expectation that law firms clearly explain their pricing structures, whether based on fixed fees or hourly rates. Where legal representatives quote substantial fees – often exceeding £2,000 for relatively standard wayleave agreements but fail to justify these charges with clear hourly breakdowns or meaningful explanations, there is a legitimate concern that such conduct may not meet the standards of accountability and fairness demanded by the SRA. Law firms are expected to keep accurate records that support the time billed and should be able to provide this information when requested. Failure to do so undermines trust in the profession and creates unnecessary financial barriers to infrastructure development, particularly when third-party operators are responsible for covering such costs.
What does Trenches Law do differently?
My final comments are not intended as a sales pitch, but I feel I should explain how Trenches Law does things differently, because it is this different approach that is the basis for writing this article. We charge hourly rates for ‘time spent’. We can agree fixed fees for some legal work (if our client requests this), but we usually just charge clients for the number of hours (or sometimes minutes) that we spend working for them. If a very simple wayleave agreement took us an hour to complete, or thirty minutes, our client is charged for that one hour of work, or thirty minutes, and no more. Many of you who are familiar with Trenches Law will be aware that we pride ourselves on doing things ‘differently’. This is not to say that we suggest we are remarkable or unique, but that we strongly believe in doing things differently to the traditional law firm model – this is not limited to how we charge our clients (for all the types of legal work we provide), but how we work and how we engage with our clients in addition to challenging things we see as unjust – such as the problem with legal fees for wayleaves. Trenches Law also provides fixed fee models for an end-to-end wayleave process, and this is often broken down by an inception fee and a success fee. We take a risk to a degree, but crucially, we adapt to the needs of our clients and the varying challenges of the industry.
