London (Parliament News) – The Supreme Court ruled United Utilities can be sued for sewage pollution damage, potentially leading to more legal challenges from affected parties, marking a significant change in liability.
Are Legal Challenges Against Water Companies Increasing?
Water companies could encounter a spate of legal challenges from people and companies affected by sewage pollution after a milestone ruling discovered United Utilities can be sued by a private business for damage induced by the dumping of human waste.
Lawyers stated it was a “watershed moment” as the courts had previously ruled that penalties for water divisions were a matter for the regulator, and businesses could not sue firms for harm caused to their property by sewage pollution.
The Manchester Ship Canal Company has been pushing since 2010 to bring a successful lawsuit against United Utilities. It has alleged that shots from 121 sewage outfalls within its networks constituted a trespass.
In February 2012, the high court judged in favour of United Utilities, but this was later toppled by the court of appeal, and then repaired by the Supreme Court in 2014. Then, in March 2021, the high court ruled it was the position of regulators and not the courts to handle problems caused by sewage dumping.
Are Water Companies Liable for Pollution Damages Now?
The Environmental Law Foundation, sponsored by the Good Law Project, questioned this decision, arguing there should be legal alternatives to take for people directly affected by sewage pollution. But the court of appeal discovered against them and stated the only option to get recourse for problems caused by pollution was through the regulator, and that the law did not permit people or companies directly affected to bring private lawsuits against the water companies. The case then went to the Supreme Court, which toppled the previous rulings and found that United Utilities could be held to account for harm caused by discharges.
The court stated the 1991 Water Industry Act does not stop the company from bringing a claim for nuisance or trespass when a canal is contaminated by sewage discharges from United Utilities’ sewers, even if there has been no willful misconduct or negligence.
Lord Reed and Lord Hodge stated: “The Supreme Court unanimously permits the canal company’s appeal. It maintains that the 1991 act does not prevent the canal corporation from bringing a claim in irritation or trespass when the canal is polluted by bursts of foul water from United Utilities’ outfalls, even if there has been no oversight or deliberate misconduct.”
The Good Law Project’s interim director of legal, Jennine Walker, stated: “This is a sensational success. It gives us stronger legal tools to turn the tide on the sewage scandal and hold water businesses to account, after repeated disappointments from our toothless and underfunded regulators.”
A United Utilities spokesperson stated: “We are assessing the implications of the Supreme Court’s ruling and the clarification of the cases in which private owners could bring proceedings in respect of discharges. We comprehend and share people’s concerns about the demand for change and we have already created an early start on an ambitious presented £3bn programme to improve over 400 storm surges across the north-west which would cut falls by 60% over the decade to 2030. These proposals form part of our company plan which is currently under consideration as part of Ofwat’s price review process.”