First court appearance for five UK water companies  

Anglian Water, Northumbrian Water, Severn Trent Water, United Utilities and Yorkshire Water are accused of underreporting sewage incidents and overcharging customers.

Five UK water companies have appeared in court for the first time over allegations of under-reporting pollution incidents and over-charging customers as a result.

Anglian Water, Northumbrian Water, Severn Trent Water, United Utilities Water, and Yorkshire Water are accused of failing to reveal the true scale of sewage discharges and spills made into UK waterways.

They also are alleged to have breached competition law because any under-reporting could have affected the price they could charge customers.

Professor Carolyn Roberts, an environment and water consultant, who is bringing the claims on behalf of an estimated 20 million affected customers, said:

‘In England and Wales there is growing anger about the state in which sewage discharges leave our rivers and beaches. I hope that the legal claims I am bringing on behalf of 20 million customers could be the start of desperately needed change in the water industry.’

Law firm Leigh Day, which is representing Professor Roberts, said households could receive a share of up to £800 million in compensation if successful.

Today’s hearing agreed that the ‘certification’ hearing will take place over a week from 23 September. This is the first major hurdle in taking the companies to trial.

If certified, the claims can proceed to a full trial, which Leigh Day estimates will take at least two to three years.

A claim is also being brought against Thames Water, but the firm was not involved in the hearing on Tuesday since those proceedings are not as not as far along compared to the other five firms.

UK water companies accused of underreporting sewage spills

The claims accuse water companies of breaking competition law by misleading the Environment Agency and Ofwat as to the number of pollution incidents – discharges or spills of untreated sewage – they made into rivers, lakes, coastal areas, and other waterways causing damage to the environment.

The number of pollution incidents a company reports to regulators is a key factor in determining the price they can charge consumers for their services. The legal claims argue that customers have been overcharged as a result of the companies’ underreporting.   

‘Water companies are required to report pollution incidents accurately as part of their legal duties and responsibilities, but it appears many such incidents go unreported,’ Roberts said.

‘If these companies had correctly reported the number of pollution incidents, Ofwat would have applied performance penalties, reducing how much these companies could charge their customers. 

‘Instead, customers have been, and continue to be, overcharged, and England’s waterways continue to be polluted.’ 

First environmental collective action cases

These are the first collective action cases where the competition abuse focuses on compliance with environmental laws and reporting responsibilities to regulators.  

Zoë Mernick-Levene, head of Competition Practice and partner at Leigh Day, the law firm behind the claims, said:  ‘For the first time in English law, legal action is being taken against six of the largest water companies, on behalf of more than 20 million household customers.’

Responding to the outcome of today’s hearing, she said: ‘This is brings us a step closer to securing redress for millions of impacted consumers.’

The claim comes the same day as Leigh Day launches a multi-million pound claim against Avara – one of the UK’s biggest food producers. The claim aims to compensate thousands of Herefordshire residents who have allegedly been affected by pollution in the River Wye caused by industrial-scale chicken farming.

Could I be entitled to compensation?

Anyone who has paid for a water bill to one or more of these water companies from April 2020 may be entitled to compensation if the cases are successful. Severn Trent Water customers may be entitled to compensation if they paid for a water bill from April 2017. 

All qualifying water company customers will be automatically included in the claim for free unless they follow specific steps to opt out.

‘As well as providing individual compensation and justice, opt-out proceedings also act as a deterrent to future misconduct, as companies know that consumers can act collectively to hold them to account for any rule breaking,’ Mernick-Levene said.

If the cases are successful, it is expected that any compensation would be paid by the relevant water company and its shareholders. 

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Water regulator attends hearing

Ofwat was asked by the Tribunal to attend as a ‘friend of the court’ to help the court better understand the sewage system.

It will also help the court understand how the claims being brought by Professor Roberts relate to its own investigations and enforcement actions. These remain subject to tight confidentiality restrictions. 

Mr Justice Marcus Smith – the lead judge at the hearing – also set a date for a second hearing from January 13 2025, to cover any additional issues due to the complex questions around Ofwat’s own investigations and powers under the Competition Act.

The judge said: ‘The process is clearly not going to be as straightforward as the usual certification process.’

He later added: ‘We may not neatly resolve everything in the week allocated as ‘week one’. We very much anticipate and hope to do so but these are knotty issues and we are at an early stage, so we want to have that adverse contingency covered off.’