Not smelling of roses

Dobson & Ors v Thames Water Utilities Ltd (No 2) [2011] EWHC 3253 (TCC)

This is very late as a post. My excuse is that the judgment runs to well over 200 pages, it is very complex and, frankly, other stuff happened. This has sat as a part finished draft for ages. But finally here it is.

This is the finale of a long running saga, involving the High Court and Court of Appeal. At issue was Thames Water’s liability for alleged odours and mosquito infestations affecting people living in properties near the Mogden Sewage Treatment Works in Middlesex. As this hearing involves issues of liability and quantum for negligence, nuisance and the availability and assessment of damages under Section 7 Human Rights Act 1998 for Article 8 breaches, it is important for anyone looking at nuisance and Human Rights damages claims. While much of the case turns on the specific facts around the Mogden plant, Thames Water’s actions or lack of them and the specific evidence on the degree and effect of odour, there are broader principles involved and it is these I will focus on.

The claim was by some 1350 claimants for nuisance allegedly caused by Thames Water at the Mogden Sewage works through odour and mosquitoes. There were two classes of claimant, those who occupied property as owners of lessees, and those who occupied without any legal interest in the properties affected. Thames Water initially defended on the basis that “complaints about odour or mosquitoes from Mogden STW were complaints of a failure of its duties under the Water Industry Act 1991 (the “WIA”) and the Urban Waste Water Treatment Regulations and that there was no common law remedy or remedy under the Human Rights Act to enforce those duties, whether in nuisance, negligence or under the HRA because such causes of action were precluded by the decision of the House of Lords in Marcic v Thames Water Utilities Ltd [2004] AC 42″ (The Marcic defence). Thames also defended on arguments about limitation and damages.

A preliminary trial on the Marcic defence was held, Dobson & Ors v Thames Water Utilities Ltd & Anor [2007] EWHC 2021 (TCC), in which the Court held that the relevant acts or omissions by Thames Water did form part of their duties imposed by S.94(1) Water Industry Act 1991, only enforceable by Ofwat under s.18 of the Act, with no common law enforceability (Marcic) for a claim in nuisance only. However, where there was fault on the part of the sewerage provider and the proposed claim ‘did not subvert the regulatory scheme’ of the Act (by for instance requiring more or better sewerage facilities to be built as a remedy), then a claim framed in nuisance, negligence and under the Human Rights Act may be possible. But only if founded on negligence, as fault was required.

Some specific finding on damages under the HRA went on to the Court of Appeal. Our note of that decision is here, but the key findings were that:

i) While it may be possible for ‘top up’ damages under the HRA to be awarded where an award of damages for nuisance and negligence was lower than an award for breach of Human Rights, it was hard to imagine a situation in which this would be the case, Usually an award in nuisance should be considered sufficient;

ii) Where there are co-owners, if both are in occupation, the effect of the nuisance on each of them should have been considered in the assessment of damages, so splitting the award does each justice. Where one co-owner is not in occupation, for a loss of amenity claim, it would be inequitable for them to claim a share of the award;

iii) While an award in nuisance is only to the person with the right to claim in nuisance (i.e. with an interest in the property and in occupation) and the calculation may be based on loss of market value, this must take the personal experience of all the occupiers into account, not just that of the person with the proprietorial interest;

iv) Where there was a claimant under the HRA without a proprietorial interest (and so no nuisance claim) it would be relevant to any assessment of damages whether the household included a person who was making a claim in nuisance. If an award for nuisance was made to that person, on the basis of the experience of all the occupiers, this was to be considered in assessing whether damages under the HRA were necessary to accord ‘just satisfaction’, or whether a declaration of infringement would suffice.

The claim then finally reached trial in the High Court on test cases of 30 claimants from 10 properties for the period 1999 to 2009. Damages and an injunction were sought. The judgment is 112 pages long, so I’ll stick to the general issues and points of wider applicability.

On detailed historical and expert evidence, Thames Water were found to have negligently caused a nuisance in respect of odour to properties in the area, in regard to number of specific failings between 1999 and 2007: to have adequate plans to reduce odour, to take adequate steps to reduce odour from various parts of the plant and arising from particular practices; to have regard to the sewage plant’s location in a residential area; and to adequately repair or maintain certain parts of the plant. On a number of other allegations of negligence, Thames were found not negligent.

On specific allegations that Thames had negligently failed to push for funding to carry out adequate works and improvements to abate the odour, there was no finding of negligence. Thames had presented evidence of pushing for funds and it was not the case that Allen v Gulf Oil Refining Ltd [1979] 1 QB 156 negligence, approved by the House of Lords (in this case, that Thames Water had to carry out the work and conduct the operation at Mogden STW with all reasonable regard and care for the interests of other persons, including the Claimants) could extend to

a duty to apply to Ofwat for funding for work or projects at Mogden STW with all reasonable regard and care for the interests of other persons, including the Claimants. This, in my judgment, would be a new and major extension of negligence liability which, in principle, could open up claims by customers whose bills were increased by negligent applications or claims by a wide range of people, who might suffer if a water company does not apply for funding with reasonable regard and care for their interests. Such an extension cannot, in my view, be justified on the basis of the nuisance exception in Allen.

On whether odour could be an actionable nuisance, Thames argued that Marcic applied to assertions by the claimants that “in the case of the allegation that Thames Water should have covered the storm water tanks, it does not matter whether the allegation is that Thames Water should have made an earlier or better case to Ofwat or should have funded them out of their own resources or should have done earlier olfactometry to make a better case to Ofwat, all these are non-justiciable because they require Thames Water, in the words of Marcic to “build more sewers”. Further,

when an odour nuisance occurs by reason of their alleged failure to comply with their statutory duty, the first enforcement step under the statute is that Ofwat, as the regulator of the industry, will consider whether to make an enforcement order. It is in the context of enforcement that the potential for inconsistency lies, in particular a potential inconsistency between Ofwat’s liability and timing determinations and the court’s liability and timing determinations. Thames Water submit that, as in Marcic, the existence of a parallel common law right whereby individual householders who suffered an odour nuisance might themselves bring court proceedings when no enforcement order had been made, would set at nought the statutory scheme and effectively supplant the regulatory role that Ofwat was intended to discharge when questions of odour nuisance arose as a result of the omission to construct new capital works.

The Court held:

In approaching the question of negligence in this case, the relevant principle is that Thames Water had to carry out the work and conduct the operation at Mogden STW with all reasonable regard and care for the interests of other persons, including the Claimants. If they do so then they will not be liable in nuisance for the inevitable result of operating Mogden STW taking into account what is possible in terms of scientific knowledge at the time, practical feasibility and expense. In one sense the two matters are connected. In operating Mogden STW Thames Water must do so with all reasonable regard and care for the interests of others and in deciding what is reasonable in that context, such matters as state of the art, practicability and expense are potentially relevant matters. However, in principle, the question of negligence is a matter for the Claimants to establish but the question of inevitability is, as stated in Manchester Corp v Farnworth for Thames Water to establish. I note that Thames Water would wish to reserve their position on where the burden of proof lies on inevitability should the matter go further.

Thames Water also argued that odour was not an actionable nuisance because “the character of the neighbourhood is such that the inconvenience complained of is not regarded as actionable in law” (Sturges v Bridgman (1879) 11 Ch D 852). This being in effect the ‘If you live near a sewage works, it is going to be smelly’ defence. This didn’t get very far. While acknowledging the principle, upheld in Allen v Gulf Oil Refining Ltd [1979] 1 QB 156, that a locality may have some inevitable nuisance from an activity previously allowed or permitted in law, “r this does not mean that the mere fact that houses have been built around the boundary of the sewage treatment works at Mogden means that odour from the sewage treatment works cannot be a nuisance. It is a factor to be borne in mind in balancing the interests of the Thames Water and the Claimants as neighbours.”

The negligence claims were therefore justiciable, but only those in respect of failures that would not have fallen under the requirement to apply to Ofwat for approval of funding for capital works or that should properly have been dealt with by Ofwat under the statutory scheme.

The claim for nuisance from mosquitoes failed altogether. There was adequate inspection and treatment throughout the relevant periods, following the recommendations of an expert. Some degree of infestation was inevitable and reasonable steps had been taken to deal with it. A mosquito nuisance would have been a common law nuisance otherwise.

There was an actionable nuisance in respect of odour in respect of some of the properties involved in the claim, based upon witness evidence and expert evidence on prevailing wind conditions and odour levels. Some witness evidence was not congruent with the expert evidence and measurements and was not accepted on that basis.

Awards of damages were made.

Special damages were awarded purely for items related to odour nuisance. Where there was no supporting evidence for, e.g, deodorisers over the period claimed, the award was reduced between 50 and 90 percent.

On general damages, the basis for assessment were assessed on the following principles:

(1) That damages awarded for nuisance, where there has been personal discomfort, are assessed on the basis of compensation for diminution of the amenity value of the land rather than damages for that personal discomfort.

(2) That damages for diminution of amenity value are measured by reference to the size, commodiousness and value of the property not the number of occupiers.

(3) That damages for compensation for diminution of amenity value of the land may be reflected either in diminution of capital value or rental value.

(4) That damages for diminution in value frequently raise difficult issues of assessment which can usually be resolved by expert evidence. If such assessment is not reasonable or practicable then the principles on which damages are assessed are sufficiently flexible to do justice between the parties by arriving at a sum for general damages for loss of amenity.

Hunter v Canary Wharf Ltd [1997] AC 655, also applied.

In this case, monthly market rental values were taken as the basis for the awards. The Claimants had sought a diminution of 20%, but this was based upon their claim succeeding in all parts, which it had not.

I have sought to place the properties into four groups, ranging from those where the nuisance was most serious to those where the nuisance, whilst still significant, was comparatively the least serious. The percentages I have used are 5%, 3.75%, 2.5% and 1.25%.

The specific awards were:

 

 

Address/Claimant   1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total
133 Haliburton Road
1 Hilary Thomson
2 Ian Thomson

Rental/month
Percentage
Damages/year
 
£1400
1.25%
£210

£1400
1.25%
£210

£1400
1.25%
£210

£1400
1.25%
£210

£1400
2.5%
£420

£1400
2.5%
£420

£1400
1.25%
£210

£1400
1.25%
£210

£1400
0%

£1400
0%
£2100
95 Worton Road
6 Rachel Addis
Rental/month
Percentage
Damages/year
  £1050
5%
£630
£1050
5%
£630
£1050
5%
£630
£1050
5%
£630
£1050
5%
£630
£1050
3.75%
£472.50
£1050
2.5%
£315
£1050
1.25%
£157.50
£1050
0%
£1050
0%
£4095
2 Windemere House
8 Sandra Weston
Rental/month
Percentage
Damages/year
        £700
0%
£700
2.5%
£210
£700
2.5%
£210
£700
1.25%
£105
£700
2.5%
£210
£700
0%
£700
0%
£735
66 Weavers Close
9 Steve Taylor
10 Wendy Taylor
Rental/month
Percentage
Damages/year
£925
5%
£462.50
£925
5%
£555
£925
5%
£555
£925
5%
£555
£925
5%
£555
£925
5%
£555
£925
5%
£555
£925
3.75%
£416.25
£925
1.25%
£138.75
£925
0%
£925
0%
£4347.50
34 Arnold Crescent
12 Susan Ford
Rental/month
Percentage
Damages/year
  £1500
1.25%
£225
£1500
1.25%
£225
£1500
1.25%
£225
£1500
1.25%
£225
£1500
0%
£1500
1.25%
£225
£1500
0%
£1500
0%
£1500
0%
£1500
0%
£1125
179 Whitton Dene
16 Charles Edwards
17 Judith Edwards
Rental/month
Percentage
Damages/year
  £1300
1.25%
£195
£1300
1.25%
£195
£1300
1.25%
£195
£1300
1.25%
£195
£1300
0%
£1300
0%
£1300
0%
£1300
0%
£1300
0%
£1300
0%
£780
97 Mogden Lane
20 Phillipa Spurrell
Rental/month
Percentage
Damages/year
  £1100
2.5%
£330
£1100
2.5%
£330
£1100
2.5%
£330
£1100
2.5%
£330
£1100
5.0%
£660
£1100
3.75%
£495
£1100
2.5%
£330
£1100
2.5%
£330
£1100
0%
£1100
0%
£3135
45 Elmer Gardens
23 Marc Foord
24 Sharon Foord
Rental/month
Percentage
Damages/year
  £1350
1.25%
£202.50
£1350
1.25%
£202.50
£1350
1.25%
£202.50
£1350
0%
£1350
0%
£1350
0%
£1350
0%
£1350
0%
£1350
0%
£1350
0%
£607.50
86 Summerwood Road
27 Rodney Bayne
Rental/month
Percentage
Damages/year
  £900
1.25%
£135
£900
1.25%
£135
£900
1.25%
£135
£900
1.25%
£135
£900
2.5%
£270
£900
2.5%
£270
£900
1.25%
£135
      £1215
5 Worple Avenue
31 Paul Fisher
32 Shirley Fisher
Rental/month
Percentage
Damages/year
  £1100
1.25%
£165
£1100
1.25%
£165
£1100
1.25%
£165
£1100
1.25%
£165
£1100
2.5%
£330
£1100
2.5%
£330
£1100
2.5%
£330
£1100
2.5%
£330
£1100
0%
£1100
0%
£1980
 
Total
                     
£20,120.00

 

On the Human Rights Act claims, the Claimants argued that the Court should exercise the discretion under section 7(5) of the Human Rights Act 1998 to extend the limitation for such a claim from 1 year to 6, on the basis that this would be consistent with the limitation period on common law nuisance and that the one year period “was enacted as the primary period to reflect the fact that most HRA claims concern administrative actions in a similar way to judicial review claims”.

In addition there were children claimants.

Following the decision of decision of the ECHR in Fadeyeva v Russia [2007] 45 EHRR 10, the Claimants argued that an award of 850 euros per year in non pecuniary damages should be adopted as the base and any shortfall in nuisance damages should be ‘topped up’ to that amount.

The Court held that

i) Thames Water’s negligent acts could amount to an Article 8 breach.
ii) While acting under statutory authority, Thames Water could not thereby escape liability for such a breach under HRA Section 6(1)
iii) The limitation period would be extended to 6 years (in practice in this claim to October 2000 when the HRA came into force)
iv) However, and considering the claims bought by children and other occupiers, no award of Human Rights Act damages was made. The awards to the claimants with an interest in the property were made with a view to all those affected in the household.

Further, an award of damages unde rthe HRA was ‘a last resort’, Anufrijeva v Southwark London Borough Council [2004] QB 1124, approved by the House of Lords in R (Greenfield) v Secretary of State for the Home Department [2005] 1 WLR 673.

Thus, for example, in respect of one of the occupiers without an interest in the property:

I have to take into account all the circumstances. In this case those include the declaration of infringement, the remedies available under the sections 80 and 82 of the Environmental Protection Act 1990 by abatement notices and by way of a complaint to Ofwat under s. 94 WIA, the fact that damages have been awarded for nuisance and the fact that Clive Bannister lived at the property as a family member. On balance, I am satisfied that in those circumstances an award of damages is not necessary to afford just satisfaction to Clive Bannister.

The claim for an injunction was refused on the basis that Thames Water were carrying out significant works:

(1) I am not satisfied that, on my findings, there is a continuing nuisance caused by a breach of the Allen duty or that there will be when the order comes into force in at the end of 2012. Thames Water are taking steps to increase the capacity of Mogden STW and are carrying out work which may or may not be complete by the end of 2012.

(2) In any event, as the proposed order indicates, it would not come into effect until 31 December 2012 and by that date the plant at Mogden will have had further work carried out. It will therefore not be clear what the relevant nuisance would be which was prevented by the injunction.

(3) The exception in the proposed injunction for nuisances which are “the inevitable consequence of the Works being operated without negligence” introduces further uncertainty which makes breach difficult to ascertain and enforce.

(4) There could potentially be a conflict with the statutory scheme if and to the extent that compliance required Thames Water to carry out major capital works or projects.

(5) There is in existence the s.106 Agreement which, whilst not actionable by the Claimants, provides a mechanism for controlling the operations at Mogden STW.

The judgment does not detail any costs order. Given the immensely complex history of this case, and the final partial success of some of the claimants (others received no damages at all), the costs position looks to be highly complex.

About Giles Peaker

Giles Peaker is a solicitor and partner in the Housing and Public Law team at Anthony Gold Solicitors in South London. You can find him on Linkedin and on Twitter. Known as NL round these parts, and still is Nearly Legal on Google +.
Posted in Housing law - All, Nuisance.

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