Thames Water Utilities Ltd v Richardson & Ors

A bilateral agreement between a water undertaker and a landowner may be varied or discharged by mutual agreement under ordinary contractual principles, even where the change affects occupiers of supplied premises. Once such an agreement has been discharged, Water Industry Act 1991, section 144(1)(a) treats water supplied to occupiers as services provided to them, enabling the undertaker to recover charges under section 142. Liability to pay is not determined by responsibility for maintaining the private service pipe. Alleged inadequacy of the supply or maintenance burdens does not, without a properly pursued claim giving rise to set-off, constitute a defence to the statutory charges.

Thames Water Utilities Ltd v Richardson & Ors concerned claims by a statutory water undertaker for charges arising from water supplied through a private common service pipe to houses at Spring Coppice. The defendants relied on an agreement made between the predecessor undertaker, Buckinghamshire Water Board, and the West Wycombe Estate. They argued that the Estate remained liable for charges and that the statutory charging provisions therefore did not apply to them.

His Honour Judge Christopher Tyrer dismissed the claims in the High Wycombe County Court on 10 May 1999, holding that the supply remained a supply to the Estate. The central issue on appeal was whether the agreement had subsequently been discharged by agreement between the Estate and the undertaker.

Appeal allowed. Potter LJ gave the substantive judgment, with Thorpe LJ agreeing.

1. The correspondence established a bilateral contract under which the Estate was treated as the consumer and was liable for metered water supplied through the private service pipe. The agreement contained no fixed duration or notice provision. It could therefore be varied or discharged by agreement under ordinary common law principles.
2. The Estate’s letters made clear that it no longer owned the site and no longer required the supply to be treated as supplied to it. BWB’s letter of 30 March 1973 recorded that the Estate had discharged its direct responsibilities for the existing metered supply. The parties thereafter acted consistently with that release. The intended construction of a new mains extension was not a condition restricting BWB’s power to discharge the agreement.
3. The effect on the occupiers was a separate question. BWB continued supplying mains water and informed the occupiers that they would be charged at the normal domestic rate. After the agreement ceased to operate, no contrary agreement within section 144(1)(a) of the Water Industry Act 1991 displaced the statutory rule that water supplied to occupiers was treated as services provided to them. Thames therefore had power under section 142(1)(b) to demand and recover the charges.
4. Responsibility for maintaining the private service pipe did not determine liability for water charges under section 144. The defendants’ concerns about the adequacy of the supply and the maintenance burden were sympathetic but did not themselves provide a defence. No counterclaim for breach of statutory duty or set-off had been pursued, and the court expressed no view on the feasibility of such a claim.
5. The judgment below was set aside. Judgment was entered for Thames against the first defendant for £1,833.87 and against the second and third defendants for £1,324.51 each. Costs orders were made as stated in the order.

• Court of Appeal (Civil Division): In Thames Water Utilities Ltd v Richardson & Ors [2000] EWCA Civ 316, the appeal was allowed and the judgment below was set aside.
• High Wycombe County Court: His Honour Judge Christopher Tyrer dismissed Thames’s claims on 10 May 1999, holding that the supply remained a supply to the Estate.