Law Report: Water company promise sufficient; 7 June 1995

Regina v Secretary of State for the Environment, ex parte Friends of the Earth Ltd and another. - Court of Appeal (Lord Justice Balcombe, Lord Justice Roch and Lord Justice Pill). 25 May 1995.
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To ensure that the United Kingdom fulfilled its obligations to meet European standards of drinking water quality, the Secretary of State for the Environment was entitled to accept undertakings to that effect from the water companies and was not required to issue enforcement notices against them.

The Court of Appeal dismissed an appeal by the applicants, Friends of the Earth Ltd and Christine Anne Orengo, against the decision of Mr Justice Schiemann ( [1995] 7 Admin LR 26) refusing their applications for judicial review of decisions by the Secretary of State to accept undertakings from Thames Water Utilities Ltd and Anglian Water Services Ltd, that they would take steps which appeared to him to be appropriate for them to secure or enforce compliance with their duties, under section 68(1)(a) of the Water Industry Act 1991, to supply wholesome drinking water.

Michael Beloff QC and Helen Mountfield (Bindman & Co) for the applicants; Stephen Richards and Christopher Katkowski (Treasury Solicitor) for the Secretary of State.

LORD JUSTICE BALCOMBE said European Council Directive 80/778 imposed a duty on member states to ensure that water intended for human consumption met certain minimum standards of wholesomeness. In the UK, this "primary obligation" was not affected by the transfer of property rights and liabilities of water authorities into private ownership.

It was common ground that the 1991 Act and the Water Supply (Water Quality) Regulations 1989 constituted a proper implementation of the legal framework required by the Directive. Section 18 of the Act empowered the Secretary of State to make an enforcement order to secure compliance by a water company with its statutory or other requirements. However, by section 19(1)(b) he was not required to make an enforcement order if he was satisfied "that the company has given, and is complying with, an undertaking to take all such steps as it appears to him for the time being to be appropriate ... for the purpose of securing or facilitating compliance ... "

In an action subsequently brought by the Commission, the European Court of Justice decided ([1992] 1 ECR 6103) that the UK had failed to fulfil its obligations "to ensure that the quality of water supplied in 28 supply zones in England conforms to the requirements of the Directive concerning nitrates". The court rejected the UK government's claim that since it had taken all practicable steps to secure compliance its failure to meet the standards was justified.The UK was now under a "secondary obligation" to rectify its breach of the primary obligation. The question was whether, in accepting undertakings from the water companies, under section 19 of the Act, to the effect that they would carry out the works necessary to improve drinking water quality, the Secretary of State had used the UK's legislative mechanism for rectifying its breach of the primary obligation in a manner consonant with its obligations, or whether he should have issued enforcement notices under section 18.

The applicants argued, inter alia, that the Secretary of State had approached his duty to enforce on the erroneous basis that it was a duty only to use his best endeavours to achieve compliance with the Directive by taking all practicable steps, and not a duty to achieve a result.

The judge accepted that the secondary obligation on the UK was to rectify the breach as soon as possible and not merely as soon as practicable. However, in a particular case it might not be possible to achieve a result earlier than was practicable. The evidence did not show that the Secretary of State had, in accepting the undertakings, adopted too leisurely an approach.

His Lordship agreed. The evidence filed on behalf of the Secretary of State indicated the practical complexities of bringing all drinking water up to the requisite standards. While the necessary plant was being constructed, it would still be necessary to maintain supplies to customers. It was obvious that considerations of practicability did enter into the equation of what was possible and no principle of law, European or domestic, required the court to ignore practicalities.

His Lordship also rejected the applicants' submissions that the undertakings were not specific or precise enough to enable the Secretary of State to monitor compliance or issue enforcement notices in case of breach. As the judge said, the proof of the pudding was in the eating.

Moreover, it was clear the Secretary of State's acceptance of the undertakings did not inhibit his powers to serve an enforcement notice at any time if he thought it right.