On Monday, one of the UK’s largest privatised water companies will argue in the Supreme Court that it should not be held responsible by private landowners and individuals for sewage discharged into the country’s waterways.
The case is part of a growing number of legal challenges faced by water companies and the government as concern increases over the mixture of stormwater and untreated sewage polluting rivers and coastal areas, posing a threat to both human and environmental health.
United Utilities, the company in question, claims that the owners of the 129-year-old Manchester Ship Canal cannot sue over the release of “untreated foul water” without permission and that only regulators have the authority to take action. The water company denies attempting to evade responsibility and asserts that it is seeking clarification of the regulatory position with regard to storm overflows.
Although the High Court has previously ruled in favour of United Utilities, the Environmental Law Foundation, backed by the Good Law Project, is intervening to support the Manchester canal, which is owned by Peel Ports, and to challenge the decision.
According to Emma Dearnaley, Legal Director at the Good Law Project, the case being heard in the Supreme Court will have significant implications for how water companies can be held accountable. It may create an opportunity to sue them and compel them to cease polluting rivers with substantial amounts of untreated sewage.
Colm Gibson, head of the economic regulation practice at Berkeley Research Group, commented that in addition to fines and prosecutions, utility companies are becoming more susceptible to class action claims. Gibson stated that customers are directly connected to the companies’ networks, and they have established structures for billing households, making it easier to satisfy the legal criteria for identifying who is part of a ‘class.’ He cited BT’s £600 million claim for alleged overcharging of 2.3 million landline-only customers as an example.
Leigh Day, which is also pursuing the “diesel gate” case against several car manufacturers in the High Court, has revealed that it is preparing to bring claims on behalf of UK water bill payers in the Competition Appeals Tribunal. The firm alleges that water companies are unlawfully discharging large volumes of untreated sewage into England’s waterways, and as a result, customers are being overcharged.
Economic consultancy Fideres has lodged a complaint with the Competition and Markets Authority, alleging that water companies have taken advantage of consumers’ inability to switch providers by delivering poor quality services. It claims that over the past six years, water companies may have overcharged consumers by £1.1 billion for sewage treatment services that were not provided since the effluent was dumped, rather than treated.
In another legal case, the Good Law Project is seeking to compel the government to revise its plan to reduce sewage discharged during high rainfall periods. It argues that the current plan is illegal since it allows water companies until 2050 to improve storm overflows and stop industrial-scale sewage dumping, while largely excluding coastal waters from protection.
This wave of legal action could transform the regulatory environment for water companies, which have already been required to increase transparency following previous court judgments. In 2012, Yorkshire Water and United Utilities argued in the European Court of Justice that England’s water monopolies were private firms rather than “public authorities” and therefore exempt from disclosing when or how much sewage they were releasing. Although the UK government supported their right to secrecy, the FishLegal fishermen’s charity ultimately triumphed. A second FishLegal case in 2015 compelled water companies to open themselves up to freedom of information-style requests.
Under pressure from the public, regulators including the Environment Agency and Ofwat have been setting more stringent targets, raising the possibility of legal action if these targets are not met, according to lawyers. The regulators are also conducting long-term investigations into whether companies have complied with environmental permits, which allow a specific amount of sewage to be discharged into watercourses during heavy rain.
Water UK, which represents the industry, stated that “water companies are committed to achieving the targets set by government and regulators. It is for them to determine the shape and pace of company obligations.”
