Supreme Court decision: Manchester Ship Canal v United Utilities

This case looked at whether Manchester Ship Canal Company Ltd (the Canal Company) can bring a claim in nuisance or trespass when the canal is polluted by discharges of foul water from outfalls maintained by the statutory sewerage undertaker, United Utilities Water Ltd (United Utilities).

 

Background

United Utilities is the statutory sewerage undertaker for the Northwest of England. Its sewerage network includes around 100 outfalls from which material emanating from sewers, sewage treatment works and pumping stations is discharged into the canal. United Utilities accepted that when its system’s hydraulic capacity is exceeded, at least some of the outfalls discharge foul water into the canal.

As a consequence, the Canal Company threatened to bring a claim against United Utilities for nuisance and trespass. In response, United Utilities asked the court to make a declaration that the Canal Company had no right of action.

Importantly, the Court was not asked to decide whether the Canal Company would be successful on its facts, but simply whether a claim in nuisance and trespass could be brought as a matter of law, or whether it would be barred by the statutory scheme for regulating sewerage established by the Water Industry Act 1991 (1991 Act) (which is what United Utilities argued).

Both the High Court and the Court of Appeal made the declaration sought by United Utilities. The implication being that no owner of a canal (or other watercourse or body of water) could bring a claim based on nuisance or trespass against a sewerage undertaker in respect of polluting discharges into the water, unless the sewerage undertaker is guilty of negligence or deliberate wrongdoing.

The Canal Company appealed to the Supreme Court which heard the matter in March 2023 and handed down judgment over a year later, in July 2024.

 

Decision

The Supreme Court unanimously allowed the Canal Company's appeal and determined that the 1991 Act does not prevent a claim in nuisance or trespass when the canal is polluted by discharges of foul water, even if there has been no negligence or deliberate misconduct.

 

Reasoning for the Decision

The starting point is that the owner of a canal (or other watercourse) has a property right in the watercourse, including a right to preserve the quality of the water. That right is protected by the common law. The discharge of polluting effluent into a privately-owned watercourse is an actionable nuisance at common law if the pollution interferes with the owner’s use or enjoyment of its property unless it has been permitted by statute.

Pursuant to the 1991 Act, sewerage undertakers do not have statutory authority to discharge untreated sewage into watercourses.

 

The implications

This decision means that the owners of private watercourses will be able to bring private law claims against sewerage companies for unauthorised discharges of foul water into their waterways. Whether they will be successful in any claim will always depend on the facts.

Where a claimant can establish a nuisance or trespass, Courts will need to consider carefully what the appropriate remedy might be, and whether an injunction preventing future discharges is appropriate. The Supreme Court accepted that the award of injunctions may well disrupt the regulatory scheme governed by the 1991 Act. However, even where an injunction is not appropriate, damages may still be awarded.

There is no doubt that the state of the country's waterways has been a hot topic in the media of late. Whether this case will result in a flood of claims is still yet to be seen.