Once agreed to, roof rights can be granted through either a lease or a license. A lease is accorded great statutory and legal protections, whereas, a license is more of a temporary permission to use a space.

From the tenant’s perspective, the tenant would prefer to have its roof rights granted through a lease. The lease provides more assurance that the tenant can have continued use of the roof and the antenna or satellite dish, and, unlike a license, the landlord usually cannot easily cancel the lease. Another advantage for these lease-granted roof rights is the added security to any of the tenant’s lenders. For example, with license-granted roof rights, the tenant might face difficulty in convincing a lender to secure a loan with the equipment on the roof. The lender might assume that there is less security in the equipment under a license if the landlord can summarily remove the equipment from the roof. From the tenant’s perspective, there are more advantages to the tenant to have its roof rights granted as part of the lease.

The landlord, however, is more likely to want to grant roof rights pursuant to a license. A license usually allows the landlord to quickly regain possession of the roof if the tenant defaults. The landlord may be able to declare the license in breach and force the tenant to immediately vacate the roof and remove its equipment. Thus, as a practical matter, if the landlord grants roof rights to the tenant in the lease, it should specify that violations of any roof rights are a material breach, which would place the tenant in default of the entire lease. Also, if the landlord grants roof rights through a license, it is important that the license does not look like a lease, or a court could find that it is a lease, and the landlord would lose the protections that the license offers. Thus, the landlord should grant the roof rights pursuant to a separate license in order to maximize control of the tenant’s actions on the roof.

With multiple antenna and satellite dishes for different tenants (and those of the landlord) on the roof, there is the potential for interference between one or more antenna or satellite dishes of one tenant and the equipment of another tenant. There are certain steps that the landlord and tenant can take to protect themselves in case of such interference. Many standard roof top agreements use a “first in time” clause as an interference standard. A “first in time” clause states that once a tenant has installed its equipment on the roof, the tenant is responsible only for interference that its equipment causes previously-installed equipment.

From the tenant’s perspective, a more thorough protection for the unimpeded use of its roof top equipment would be to negotiate a guaranty from the landlord stating that the landlord will not permit any other tenant to interfere with the tenant’s use of the equipment. As part of this guaranty, the tenant could provide a list of its frequencies to the landlord and have the landlord agree that it will not allow other tenants to use those same frequencies, or the landlord could agree to bar any other equipment on the roof that uses those same frequencies. While obtaining such a guaranty from the landlord would be a successful strategy for the tenant, the landlord would probably avoid it unless the tenant was the major lessee of the building or the tenant adequately compensated the landlord for its potential monopoly of the roof.

The landlord probably wants to avoid any obligation regarding interference and allow the tenants to resolve the issues. The landlord should include a clause in each roof right agreement indicating that any interference is a material breach of that tenant’s lease and will not be deemed to be a violation of any tenant’s right to possession and quiet enjoyment of the roof top rights. The landlord should also include a clause in each roof top agreement that interference from another tenant’s equipment is a material default of the roof top equipment in order to give the landlord further control over interference. Thus, if one tenant interferes with another tenant’s equipment, the interfering tenant must abate its interference or the landlord can terminate the tenant’s right to use its equipment on the roof. The landlord should make each tenant specifcally responsible for correcting any interference it causes with the equipment of another tenant before the tenant can resume its roof top operations, and agree to indemnify the landlord for the result of any interference.

If, however, the landlord takes the responsibility of policing interference among roof top antenna or satellite dish users, it may want to commit only to use reasonable commercial efforts to investigate any claimed interference, and avoid strict standards of abating any interference. The landlord should try to limit any obligations to those regarding “harmful” interference. The landlord should limit its obligations regarding interference to that which is, as the FCC defines harmful interference, an emission that “seriously degrades, obstructs or repeatedly interrupts” another signal. The landlord can be further protected by requiring that the tenant provide copies of any grants by the FCC or others permitting it to operate on certain frequencies and restricting the tenant from changing frequencies without landlord consent.

Commercial tenants and landlords should carefully structure their roof right agreements to reflect the best resolution of issues that affect each of them. Not only must a lease or license option be examined, but assessing responsibility regarding interference with other tenants’ equipment on the roof. The landlord should make each tenant specifically equipment must be part of the process. With technology, a building’s roof holds legal implications that are just as critical as any other portion.

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