Marcic v. Thames Water Utilities Ltd

The House of Lords held that claims in common law nuisance and a private Article 8/Article 1 First Protocol challenge under the Human Rights Act 1998 could not be used to circumvent the statutory enforcement scheme in the Water Industry Act 1991. Key provisions were sections 18 and 22 (the enforcement order procedure) and section 94 (the sewerage undertaker's duty to provide an adequate system of sewers). The court concluded that Parliament intended enforcement of the general drainage duty to lie primarily with the Director General of Water Services and that the statutory code, subject to judicial review, provides the appropriate forum for balancing competing public and private interests. Accordingly the House allowed the appeal, holding there was no room for the common law nuisance cause of action asserted and that the statutory scheme was compatible with Convention rights and provided the appropriate remedies.

Background and parties. Mr Peter Marcic owned 92 Old Church Lane, Stanmore, which suffered repeated external sewer flooding and occasional back flow of foul water from the public sewers serving the area. Thames Water Utilities Ltd was the appointed sewerage undertaker for the area. Mr Marcic commenced proceedings in May 1998.

Nature of the claims and relief sought.

• He sought an injunction restraining Thames Water from permitting use of its sewerage system so as to cause flooding, a mandatory order compelling Thames Water to improve the system, and damages.
• He advanced a common law nuisance claim and a claim under the Human Rights Act 1998 (section 6) asserting breaches of article 8 and article 1 of the First Protocol.

Procedural history. At trial Judge Richard Havery QC rejected the nuisance claim but upheld the Human Rights Act claim on preliminary issues. The Court of Appeal reversed on nuisance and upheld the Convention claim ([2002] EWCA Civ 64, [2002] QB 929). Thames Water appealed to the House of Lords.

Issues framed.

• Whether the common law of nuisance allows an individual to require a statutory sewerage undertaker to construct new or larger sewers (or obtain damages) where existing sewers are overloaded.
• Whether a private claim under the Human Rights Act 1998 (article 8 and article 1 of the First Protocol) could be maintained against a sewerage undertaker when the Water Industry Act 1991 provides an enforcement and regulatory scheme administered by the Director.
• Whether the statutory scheme itself was compatible with Convention rights and provided adequate remedies, or whether the courts should decide individual fairness/prioritisation issues.

Court’s reasoning. The House emphasised the statutory framework under the Water Industry Act 1991: section 94 imposes the general drainage duty on sewerage undertakers, while sections 18–22 create an enforcement code under which the Director may make enforcement orders and section 18(8) limits other remedies in respect of contraventions enforceable under that provision. The court held that allowing private nuisance actions to require capital expenditure on public sewerage undertakings would subvert Parliament's chosen regulatory balance. The Director is required to balance competing public interests (including financing and charging constraints) and has been entrusted with priority-setting; those decisions are subject to judicial review and are Convention-conscious. The House relied on the subsidiarity principle and recent Strasbourg authority (Hatton) in stressing that national regulatory choices and prioritisation are for domestic institutions. Although the court acknowledged the hardship suffered by Mr Marcic and pointed to the desirability of compensation arrangements for those awaiting remedy, it concluded that the statutory scheme was not incompatible with Convention rights and that Mr Marcic should have pursued the statutory route (complaint to the Director and, if necessary, judicial review).

Appeal allowed. The House held that (1) the common law nuisance claim seeking orders or damages to compel Thames Water to build new sewers was inconsistent with the Water Industry Act 1991 statutory enforcement scheme and therefore not available in this case; and (2) the Human Rights Act 1998 claim failed because the statutory scheme, administered by the Director General of Water Services and subject to judicial review, provided the appropriate mechanism for balancing private and public interests and was Convention-compliant in principle.

Trial (preliminary issues) before His Honour Judge Richard Havery QC (Technology and Construction Court): nuisance dismissed, HRA claim upheld. Court of Appeal (Lord Phillips MR, Aldous and Ward LJJ) allowed on both nuisance and HRA grounds ([2002] EWCA Civ 64; reported [2002] QB 929). House of Lords allowed Thames Water's appeal ([2003] UKHL 66).