One of Britain’s biggest privatized water companies is set to appear in the High Court on Friday in a landmark case where it will argue that private landowners and individuals are not responsible for sewage released into UK waterways.
The legal challenge is one of several facing water companies and governments amid anger over a mixture of stormwater and raw sewage flowing into rivers and coastal waters, threatening human health and the environment.
United Utilities said the owners of the 129-year-old Manchester Ship Canal could not seek compensation for releasing “untreated foul water” without a permit, and that only the regulator could take action.
“This case never shirks responsibility,” the water company said. “The purpose is to clarify the regulatory position on storm surges.”
Although the High Court had previously ruled in favor of United Utilities, the Environmental Law Foundation, supported by the Good Law Project, intervened to support the Manchester canal, owned by Peel Ports, in an attempt to overturn the decision.
“This case will have significant consequences for how we can enforce water companies – by opening up the opportunity to sue them and force them to stop polluting our rivers with so much raw sewage,” said Emma Dearnaley, legal director at the Good Law project.
Colm Gibson, head of Berkeley Research Group’s economic regulation practice, said that in addition to fines and prosecutions, utility companies are increasingly vulnerable to class action lawsuits.
“Customers are physically connected to the company’s network and have a standard structure for filling households, so it is easier to pass the legal test to determine who belongs to the ‘class’,” he said.
Gibson cited as precedent the £600 million claim BT faced for allegedly overcharging 2.3 million landline-only customers.
Leigh Day, which also prosecuted the “dieselgate” case against a number of car manufacturers in the High Court, has announced it is preparing a claim to be brought in the Competition Appeal Tribunal on behalf of UK water bill payers.
It said the water company was “unlawfully dumping large volumes of raw sewage into UK waterways, and customers are being overcharged”.
Fideres, an economic consultant, has also appealed to the Competition and Market Authority arguing that water companies have exploited the inability of consumers to switch away by providing poor quality services.
It says water companies may have charged consumers more than £1.1 billion over the past six years for sewage treatment services that have not been provided since effluent was dumped rather than treated.
In other cases, the Good Law Project aims to force the government to rewrite its plans to reduce the amount of waste discharged during periods of high rainfall. It says the government’s current plan is invalid because it gives water companies until 2050 to improve storm runoff and stop industrial-scale waste disposal, but all but exclude coastal waters from protection.
The deadly legal case threatens to reshape the regulatory landscape for water companies, which have been forced to increase transparency as a result of previous court decisions.
In 2012, Yorkshire Water and United Utilities went to the European Court of Justice to claim that the UK’s water monopoly is a private business, not a “public authority”, and should be exempt from announcing when or how much waste is released.
The UK government backed “privacy rights” but FishLegal, a fishing charity, eventually prevailed. A second case by FishLegal in 2015 forced the water company to open a freedom of information style request.
In the face of public pressure, regulators the Environment Agency and Ofwat have also set tougher targets, increasing the likelihood of lawsuits for not meeting them, lawyers say.
Regulators also have a lengthy investigation into whether the company has complied with its environmental permit, which allows some sewage to be poured into waterways during heavy rains.
Water UK, which represents the industry, said: “Water companies are focused on delivering the targets set by the government and regulators. They must decide on the form and pace of the company’s obligations.