A landmark Supreme Court judgment ruled that individuals and private landowners can sue water companies for sewage discharged into UK waters.
The lawsuit is one of many that water companies are facing as the anger grows over the storm water and raw sewerage mixtures pouring into rivers, coastal waters and threatening the health of humans and the environment.
United Utilities argued that owners of the 129 year-old Manchester Ship Canal were not entitled to seek compensation for the release “untreated foul-water”. They claimed that the 1991 Water Industry Act privatised the industry and only regulators were able to take action.
The Supreme Court ruled unanimously on Tuesday that Manchester Ship Canal Company Limited is entitled to damages for sewage pollution.
Andrew Ross, partner of Charles Russell Speechlys, said that owners of waterways could consider taking legal action against sewerage undertakings for polluting the water. It is possible that this type of claim will increase.
The Environmental Law Foundation and the Good Law Project intervened in support of the Manchester Ship Canal owned by Peel Ports to try to reverse the decision.
Jennine Walker is the interim head of the Good Law Project’s legal department. She said, “We hope that this landmark ruling empowers individuals and businesses to use courts to challenge industrial polluters such as United Utilities who have placed profits and shareholder interests over protecting our environment.”
Feargal Sharkey, an environmental campaigner, said that the ruling was “massive”. He wrote on X that it would allow “1,000s” of claims from fishing clubs, swimmers and riparian owners against water companies.
A flurry of court cases could change the regulatory landscape of water companies. They have already been forced by previous court rulings to increase transparency.
In 2012, Yorkshire Water, and United Utilities, went to the European Court of Justice, claiming that England’s water companies were not “public authorities” but private businesses and therefore should be exempted from having to disclose when and how much sewage was released.
FishLegal won the case. The UK government supported the fishermen’s “right to secrecy”. In 2015, FishLegal won a second case that forced water companies in the UK to respond to Freedom of Information requests.
Lawyers said that the Environment Agency, which is the regulator, and Ofwat, the regulator, have both set tougher targets in response to public pressure. This could lead to claims if they are not met.
Regulators have been investigating for years whether companies are complying with permits that allow a certain volume of sewage into watercourses when there is heavy rain.
Water companies may find it more difficult to raise capital from investors if they are concerned about legal action. Thames Water, which is the largest water utility and fighting to survive, needs at least £3bn in funding by 2030. It has already requested leniency on fines from Ofwat, including those for sewage pollution.
United Utilities stated: “We are examining the implications of Supreme Court’s decision and clarifying the circumstances under which private owners can bring proceedings relating to discharges.”
The statement continued, “We share and understand people’s concerns regarding the need for a change.”
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