Water companies in the United Kingdom may now be held liable for damages caused by sewage pollution following a landmark Supreme Court ruling. The decision allows people and organisations to sue water companies for pollution, in addition to facing tougher regulatory actions and fines.
On 2 July 2024, the Supreme Court of the United Kingdom unanimously upheld an appeal by Manchester Ship Canal Company Limited (MSCC). The ruling permits MSCC to bring a claim in nuisance or trespass when the canal is polluted by discharges of foul water from United Utilities’ (UU) outfalls, even in the absence of negligence or deliberate misconduct.
The Manchester Ship Canal, which runs from Manchester to the Mersey estuary, incorporates the rivers Irwell and Mersey in its upper stretches. This ruling arises from a prolonged dispute between MSCC, the canal's owner, and UU, which provides water and wastewater services in North West England. The conflict centred on unauthorised discharges of untreated foul water by UU into the canal.
UU had sought a court declaration that MSCC could not bring a private law claim in nuisance or trespass regarding these discharges unless there was an allegation of negligence or deliberate wrongdoing. The case revolved around whether the Water Industry Act 1991, which privatised the water sector, nullified the right of watercourse owners to pursue common law actions against water companies for pollution.
The High Court and the Court of Appeal had previously ruled in favour of UU. However, the Supreme Court's decision overturns these rulings, asserting that the 1991 Water Industry Act does not preclude the Manchester Ship Canal Company from seeking damages for unauthorised waste discharges.
UU owns a network of sewers, sewage treatment works, and associated infrastructure, much of which was constructed by its predecessors and acquired during the privatisation of the water industry under the Water Act 1989. The sewerage network includes approximately 100 outfalls that discharge material from sewers, sewage treatment works, and pumping stations into the Manchester Ship Canal. Under normal operating conditions, these discharges consist of surface water or treated effluent. However, when the system's hydraulic capacity is exceeded, discharges may include foul water.
The Supreme Court was informed that these discharges could be prevented if United Utilities invested in improved infrastructure and treatment processes. The 53-page judgment, delivered by Lord Reed and Lord Hodge, stated that "United Utilities is responsible for discharges of noxious effluent into watercourses from its sewers, sewage treatment works, and associated works, which occur as a result of its sewerage system operating as it is designed to do when its hydraulic capacity is exceeded".
The Environmental Law Foundation, supported by the Good Law Project, which had intervened in the case, hailed the judgment as a significant precedent with implications far beyond the Manchester Ship Canal. They noted that polluting water companies could now face private legal action, in addition to stricter regulatory measures and fines.
According to figures published by the Environment Agency, United Utilities has been the worst offending water company for sewage dumping since 2020, with 97,500 instances of untreated sewage discharges lasting over 650,000 hours in the previous year alone.
Jennine Walker, interim head of legal at the Good Law Project, described the judgment as a "sensational victory," stating that “it gives us stronger legal tools to turn the tide on the sewage scandal and hold water companies to account".