Reading the BBC item it becomes clear that the accused was using the connection from his car. My assumption is that he went looking for open connections, by driving around with wireless "sniffer" software actively searching for a link.
Your chum has opened the box, turned it on, and hey presto. Not much of a defence, but a defence of a sort. I'd be surprised if Plod would do more than slap a wrist if he was called in.
FWIW I don't encrypt/restrict my network, on the basis that anyone who has got 600m down the track from a little lane to AA Towers, with a laptop, and wants to use it, is welcome.