LONDON (Reuters) – British water companies are at increased risk of lawsuits over pollution after a landmark ruling from the United Kingdom’s Supreme Court on Tuesday, amid public outrage over discharges of raw sewage in Britain.
The Manchester Ship Canal, which owns the Victorian-era canal in northern England, won an appeal that means it can sue United Utilities over discharges of water contaminated with untreated sewage.
A United Utilities spokesperson said the company was considering the implications of the Supreme Court’s ruling, adding that United Utilities had made an early start on a proposed 3 billion pound ($3.80 billion) programme to cut spills by 60% over the decade to 2030.
United Utilities shares were down 1.4% at 1325 GMT.
Water companies, which were privatised under Margaret Thatcher’s Conservative government in 1989, have repeatedly dumped raw sewage into Britain’s waterways in recent years.
They have prompted public anger, as well as separate lawsuits valued at hundreds of millions of pounds for allegedly overcharging customers following under-reporting of sewage discharges.
United Utilities had twice won in lower courts, which ruled the canal company effectively could not bring a lawsuit for nuisance or trespass unless the polluting discharges were the result of negligence or deliberate wrongdoing.
But the Supreme Court unanimously allowed the Manchester Ship Canal’s appeal, potentially opening up other companies to similar litigation.
The court noted in its written ruling: “Discharges of foul water from the outfalls could be avoided if United Utilities invested in improved infrastructure and treatment processes.”
A spokesperson for industry body Water UK said water companies are seeking approval from regulator Ofwat to invest 100 billion pounds “to ensure the security of our water supply and end sewage entering our rivers and seas”.
An Ofwat spokesperson said the regulator was considering the judgment’s implications.
The Good Law Project, a campaign group which supported the Environmental Law Foundation in intervening in the appeal, said the ruling could prompt “a deluge of legal action”.
($1 = 0.7897 pounds)
(Reporting by Sam Tobin; additional reporting by Yadarisa Shabong; editing by Barbara Lewis)
