The Manchester Ship Canal Company Ltd v United Utilities Water Plc
| Jurisdiction | England & Wales |
| Judge | Mr Justice Newey |
| Judgment Date | 14 February 2012 |
| Neutral Citation | [2012] EWHC 232 (Ch) |
| Date | 14 February 2012 |
| Court | Chancery Division |
| Docket Number | Case Nos: HC10C01046 & HC11C03842 |
[2012] EWHC 232 (Ch)
Mr Justice Newey
Case Nos: HC10C01046 & HC11C03842
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
The Rolls Building, Royal Courts of Justice,
7 Rolls Buildings, London EC4A 1NL
Mr Robert McCracken QC and Miss Rebecca Clutten (instructed by Bircham Dyson Bell LLP) for the Claimants
Mr Jonathan Karas QC, Mr Julian Greenhill and Mr James McCreath (instructed by Pinsent Masons LLP) for the Defendant
Hearing dates: 19 and 20 January 2012
These cases concern the Manchester Ship Canal and the Bridgewater Canal. The Defendant, United Utilities Water plc ("United Utilities"), which is a sewerage undertaker, discharges water into both canals via numerous outfalls. The Claimants ("the Canal Companies"), which are respectively the owners of the canals and a lessee of the Bridgewater Canal, allege that, as regards a large number of outfalls, United Utilities has no right of discharge. They seek declarations to that effect and also damages.
By the applications now before me, United Utilities seeks summary judgment in its favour as regards outfalls constructed before 1 September 1989. It argues that, whatever may be the position in relation to the other outfalls at issue, it has a right to discharge water through pre-1989 outfalls. In essence, what is said is that United Utilities has inherited powers of discharge which its predecessors enjoyed before the Water Act 1989 came into force.
Summary judgment
The applications before me are made pursuant to CPR Part 24. CPR 24.2 empowers the Court to give summary judgment against a claimant if it considers that the claimant has no real prospect of succeeding on a claim or issue and that there is no other compelling reason why the case or issue should be disposed of at a trial.
Mr Robert McCracken QC, who appeared with Miss Rebecca Clutten for the Canal Companies, argued that I should decline to rule on the applications. He relied in support of this submission on a passage from Lord Hope's speech in Three Rivers DC v Bank of England (No 3) [2001] UKHL 16, [2001] 2 All ER 513. At paragraph 95, Lord Hope said this:
"The method by which issues of fact are tried in our courts is well settled. After the normal processes of discovery and interrogatories have been completed, the parties are allowed to lead their evidence so that the trial judge can determine where the truth lies in the light of that evidence. To that rule there are some well-recognised exceptions. For example, it may be clear as a matter of law at the outset that even if a party were to succeed in proving all the facts that he offers to prove he will not be entitled to the remedy that he seeks. In that event a trial of the facts would be a waste of time and money, and it is proper that the action should be taken out of court as soon as possible. In other cases it may be possible to say with confidence before trial that the factual basis for the claim is fanciful because it is entirely without substance. It may be clear beyond question that the statement of facts is contradicted by all the documents or other material on which it is based. The simpler the case the easier it is likely to be [to] take that view and resort to what is properly called summary judgment. But more complex cases are unlikely to be capable of being resolved in that way without conducting a mini-trial on the documents without discovery and without oral evidence. As Lord Woolf MR said in Swain's case [2001] 1 All ER 91 at 95, that is not the object of the rule. It is designed to deal with cases that are not fit for trial at all."
For his part, Mr Jonathan Karas QC, who appeared with Mr Julian Greenhill and Mr James McCreath for United Utilities, referred me to ICI Chemicals & Polymers Limited v TTE Training Limited [2007] EWCA Civ 725. In that case, Moore-Bick LJ, with whom Ward and Buxton LJJ expressed agreement, said (at paragraph 12):
"It is not uncommon for an application under to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better."
Mr Karas argued that United Utilities' applications raise a short point of law and that I should "grasp the nettle" and decide it.
In the course of submissions, Mr McCracken accepted that the parties had had an adequate opportunity to address the issue that United Utilities asks me to decide. Further, he did not suggest that I lacked any relevant evidence. The thrust of his submissions was rather to the effect that I should refuse to decide the "short point of law" for reasons of case management, having regard to the overriding objective. He observed that the losing party would be very likely to challenge any decision I might arrive at. This, he said, could be expected to create practical problems given that the point of law does not affect all the outfalls in dispute and so cannot render a trial unnecessary.
Against that, the point that United Utilities wishes to have determined potentially affects some 106 of the 113 outfalls at issue in the Manchester Ship Canal case. A ruling on the point could thus have a substantial bearing on the length of a trial currently listed for 44 days. The point could also, I gather, be relevant to a majority of the outfalls in dispute in the Bridgewater Ship Canal case. In any event, I have now heard argument, over two days, on the legal question. That hearing would be wasted if I refused to rule on it.
In the circumstances, I have decided that I should proceed to consider the point raised by United Utilities.
Entitlement to discharge via pre-1989 outfalls
Sewerage and drainage functions have been successively fulfilled by local authorities, regional water authorities and water companies such as United Utilities.
It is convenient to consider in turn (a) the law before 1989, (b) the Water Act 1989, (c) the 1991 water legislation and (d) the decision of the Court of Appeal in British Waterways Board v Severn Trent Water Ltd [2002] Ch 25.
The law before 1989
The duties and powers of local authorities in relation to sewerage and drainage were addressed in the Public Health Act 1875. Section 15 required every local authority to "keep in repair all sewers belonging to them" and also to "cause to be made such sewers as may be necessary for effectually draining their district for the purposes of [the] Act". Section 16 empowered a local authority to carry any sewer "into through or under any lands whatsoever within their district", but section 17 imposed a restriction on the discharge of contaminated water. It provided:
"Nothing in this Act shall authorise any local authority to make or use any sewer drain or outfall for the purpose of conveying sewage or filthy water into any natural stream or watercourse, or into any canal pond or lake until such sewage or filthy water is freed from all excrementitious or other foul or noxious matter such as would affect or deteriorate the purity and quality of the water in such stream or watercourse or in such canal pond or lake".
By section 308, local authorities exercising "the powers of [the] Act" were obliged to make full compensation to anyone sustaining damage as a result provided that he was not himself in default.
In the 1930s the Public Health Act 1875 was, for relevant purposes, superseded by the Public Health Act 1936. Section 15 of the 1875 Act was replaced by section 14 of the 1936 Act and section 16 of the 1875 Act by section 15 of the 1936 Act. Section 30 of the 1936 Act was equivalent to section 17 of the 1875 Act, and section 278 of the 1936 Act corresponded to section 308 of the 1875 Act.
Neither the 1875 Act nor that of 1936 expressly empowered local authorities to discharge any water. In Durrant v Branksome UDC [1897] 2 Ch 291, however, such a power was held to be implicit in the legislation. At first instance, North J (at 295) considered that section 17 of the 1875 Act:
"recognises in the clearest way that, subject to complying with the provisions of that section, the local authority have a right to empty their drains into a natural stream or canal, pond, and so on".
His decision was upheld on appeal. Lindley LJ said (at 302) that the "inevitable inference" from sections 16 and 17 of the 1875 Act was that, but for the restriction imposed by section 17, "you might, under s.16, pour any water into any natural or artificial stream or watercourse, canal, pond, or lake". Similarly, Lopes LJ thought (at 303) that it was to be inferred from sections 16 and 17 that "if that which is conveyed does not contain those things which are prohibited, or, in other words, if it contains water free from those things, they are authorised to discharge it into the places mentioned". The third member of the Court, Chitty LJ, considered (at 305) that "authority is conferred by the three sections of the Act [i.e. sections 15, 16 and 17 of the 1875 Act]". The "better reading", he opined (at 305), is that the "power is conferred by the 16th section".
Local authorities were in other respects, too, held to have entitlements beyond those for which the legislation provided in terms. In In re...
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