England and Wales High Court (Administrative Court) Decisions

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Cite as: [2000] EWHC Admin 406

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QUEEN and ENVIRONMENT AGENCY ex-parte ANGLIAN WATER SERVICES LIMITED [2000] EWHC Admin 406 (24th October, 2000)

IN THE HIGH COURT OF JUSTICE Case No: CO/430/2000
QUEEN'S BENCH DIVISION
CROWN OFFICE LIST
Royal Courts of Justice
Strand London
WC2A 2LL
24th October 2000

Before:
THE HON MR JUSTICE TOMLINSON
THE QUEEN
and

THE ENVIRONMENT AGENCY
Respondent

-ex-parte-

ANGLIAN WATER SERVICES LIMITED
Applicant
- - - - - - - - - -
(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
- - - - - - - - - -
Gerard Clarke (instructed by Anne Brosnan, solicitor, the Environment Agency) for the Respondent
Beverley Lang QC (instructed by Richard McAdam, solicitor, Anglian Water Services Ltd) for the Applicant


JUDGMENT

(As Approved by the Court)
Crown Copyright

Introduction
1. The Environment Act 1995 introduced new provisions into the Water Industry Act 1991 which impose upon sewerage undertakers duties which are of potentially wide ambit. They relate to the provision of public sewerage in areas hitherto unserved in that way. The cost of such provision is obviously substantial and capital expenditure incurred by the water and sewerage undertakers is, in principle, recoverable from their customers pursuant to complex arrangements and subject to the agreement of the industry financial regulator, OFWAT. Whilst therefore it might appear that the issues debated in this case determine the expenditure which will be required of the sewerage undertaker, in reality the burden of that expenditure will fall upon the undertaker's customers generally-see sections 142 (3A) and 143(3A) of the Water Industry Act 1991 as inserted by the Environment Act 1995.
2. The Applicant is a water and sewerage undertaker within the meaning of the Water Industry Act 1991. The Environment Agency, the Respondent in these proceedings, is a body corporate established under Section 1 of the Environment Act 1995. I shall refer to it hereafter as "the Agency". It has had transferred to it the functions of the National Rivers Authority, of waste regulation and disposal authorities and of many others besides. Under the new provisions to which I have referred the Agency is invested with a duty to determine disputes between sewerage undertakers and owners or occupiers of premises as to whether the undertaker is under a duty to provide a public sewer.
3. In point of form the present proceedings seek an order of certiorari to quash four decisions of the Agency made in this capacity. Those decisions are:-
(i) Dated 10th November 1999, that the Applicant is under a duty to provide a public sewer to serve the village of Little Bentley;
(ii) Dated 22nd November 1999, that the Applicant is under a duty to provide a public sewer to serve the village of Chetwode;
(iii) Dated 30th November 1999, that the Applicant is under a duty to provide a public sewer to serve the village of Bent Hill;
(iv) Dated 22nd December 1999, that the Applicant is under a duty to provide a public sewer to serve the whole of the village of Wretton (rather than the major part of it) and to start carrying out the works no later than mid 2001.
An order of mandamus is also sought requiring the Agency to hear and determine the disputes underlying those four decisions according to law. However the parties to the application have sought guidance generally on the meaning and effect of the new provisions and as to the proper manner in which they should be implemented. Conscious of the risk of acceding to such an invitation I shall nonetheless attempt to do so, but only to the extent which is necessary either to dispose of the application or to inform the reconsideration of the matter where reconsideration will be the outcome of my decision.
4. I should perhaps stress that this is for the Agency a new jurisdiction and thus a new procedure. It would be possible to dispose of the application so far as concerns two of the decisions on the basis alone of shortcomings in the procedure. That is not of itself a matter for reproach where both the Agency and the undertakers are feeling their way in a new field. However it very soon became apparent to me that many of the problems which have arisen in fact arose through simple failures in communication between the Agency and the undertaker concerned in these four cases. Perhaps in any field but particularly in a new field where the ground rules are unclear and the precedents few, it must undoubtedly assist good decision making if the disputants are aware of the points on which they are expected to address the decision maker and if the decision maker lets it be known if he has not been addressed, or sufficiently addressed, on points which he regards as critical to the decision.
The Statutory Framework.
5. Under section 98 of the Water Industry Act 1991, a sewerage undertaker is under a duty to provide a public sewer for drainage for domestic purposes of premises in a particular locality in its area where it is required to do so by a notice served upon it by one or more persons entitled to make such a demand. This is described as a requisition notice. It may be served by an owner, occupier, local authority or other public corporation. Where a sewer is requisitioned, the sewerage undertaker may require contribution to the cost from the person requisitioning the sewer. See sections 98 (1) (c) and 99. It is worth setting out part of Section 98 because some of the language of the newly introduced Section 101A with which I am immediately concerned may have been borrowed from the earlier section. Section 98, so far as material, provides as follows:-

"CHAPTER II
PROVISION OF SEWERAGE SERVICES
Requisition of public sewer

98 Duty to comply with sewer requisition

(1) It shall be the duty of a sewerage undertaker (in accordance with section 101 below) to provide a public sewer to be used for the drainage for domestic purposes of premises in a particular locality in its area if-
(a) the undertaker is required to provide the sewer by a notice served on the undertaker by one or more of the persons who under subsection (2) below are entitled to require the provision of the sewer for that locality;
(b) the premises in that locality the drainage of which would be by means of that sewer are-
(i) premises on which there are buildings; or
(ii) premises on which there will be buildings when proposals made by any person for the erection of any buildings are carried out; and
(c) the conditions specified in section 99 below are satisfied in relation to that requirement.

(2) Each of the following persons shall be entitled to require the provision of a public sewer for any locality, that is to say-
(a) the owner of any premises in that locality;
(b) the occupier of any premises in that locality;
(c) any local authority within whose area the whole or any part of that locality is situated;
(d) where the whole or any part of that locality is situated in a new town, within the meaning of the New Towns Act 1981-
(i) the Commission for the New Towns; and
(ii) ... the development corporation for the new town...;
and
(e) where the whole or any part of that locality is situated within an area designated as an urban development area under Part XVI of the Local Government, Planning and Land Act 1980, the urban
development corporation."
6. With effect from 1st April 1996, section 101A of the Water Industry Act 1991, as inserted by section 103 of the Environment Act 1995, imposed upon sewerage undertakers a duty to provide a public sewer to be used for the drainage for domestic sewerage purposes of premises in a particular locality in its area if certain specified conditions are satisfied. Whereas under sections 98 and 99 the cost of provision may be levied directly from the customer or customers who benefit from the use of the public sewer provided in accordance therewith, there is no corresponding provision in section 101A. The cost falls upon the undertaker's customers generally as I have already set out. I set out section 101A in its entirety:-
"Provision of public sewers otherwise than by requisition
Further duty to 101A.-(1) Without prejudice to section 98 above, it shall be the duty
provide sewers. of a sewerage undertaker to provide a public sewer to be used for the
drainage for domestic purposes of premises in a particular locality in its area if the conditions specified in subsection (2) below are satisfied.
(2) The conditions mentioned in subsection (1) above are-
(a) that the premises in question, or any of those premises, are
premises on which there are buildings each of which, with the exception of any shed, glasshouse or other outbuilding appurtenant to a dwelling and not designed or occupied as lving accommodation, is a building erected before, or whose erection was substantially completed by, 20th June 1995;
(b) that the drains or sewers used for the drainage for domestic
sewerage purposes of the premises in question do not, either
directly or through an intermediate drain or sewer, connect with a public sewer; and
(c) that the drainage of any of the premises in question in respect of which the condition specified in paragraph (a) above is satisfied is giving, or is likely to give, rise to such adverse
effects to the environment or amenity that it is appropriate, having regard to any guidance issued under this section by the Secretary of State and all other relevant considerations, to provide a public sewer for the drainage for domestic sewerage purposes of the premises in question.

(3) Without prejudice to the generality of subsection (2)(c) above, regard shall be had to the following considerations, so far as relevant, in determining whether it is appropriate for any sewer to be provided by virtue of this section-
(a) the geology of the locality in question or of any other locality;
(b) the number of premises, being premises on which there are buildings, which might reasonably be expected to be drained by means of that sewer;
(c) the costs of providing that sewer;
(d) the nature and extent of any adverse effects to the environment or amenity arising, or likely to arise, as a result of the premises or, a the case may be, the locality in question not being drained by means of a public sewer; and
(e) the extent to which it is practicable for those effect to be
overcome otherwise that by the provision (whether by virtue of this section or otherwise) of public sewers, and the costs of so overcoming those effects.
(4) Guidance issued by the Secretary of State under this section may-
(a) relate to how regard is to be had to the considerations mentioned in paragraphs (a) to (e) of subsection (3) above;
(b) relate to any other matter which the Secretary of State considers may be a relevant consideration in any case and to how regard is to be had to any such matter;
(c) set out considerations, other than those mentioned in paragraphs (a) to (e) of subsection (3) above, to which (so far as relevant) regard shall be had in determining whether it is appropriate for any sewer to be provided by virtue of
this section;
(d) relate to how regard is to be had to any such consideration as is mentioned in paragraph (c) above;
(e) without prejudice to paragraphs (a) to (d) above, relate to how a sewerage undertaker is to discharge its functions under this section.
(5) Before issuing guidance under this section the Secretary of State shall consult-
(a) the Environment Agency;
(b) the Director; and
(c) such other bodies or persons as he considers appropriate;
and the Secretary of State shall arrange for any guidance issued by him under this section to be published in such manner as he considers appropriate.
(6) Subject to the following provisions of this section, the duty of a
sewerage undertaker by virtue of subsection (1) above shall be
enforceable under section 18 above-
(a) by the Secretary of State; or
(b) with the consent of or in accordance with a general
authorisation given by the Secretary of State, by the Director.
(7) Any dispute between a sewerage undertaker and an owner or occupier of any premises in its area as to-
(a) whether the undertaker is under a duty by virtue of
subsection (1) above to provide a public sewer to be used
for any such drainage of those premises as is mentioned in that subsection;
(b) the domestic sewerage purposes for which any such sewer
should be provided; or
(c) the time by which any such duty of the undertaker should
be performed, shall be determined by the Environment Agency, and may be referred to the Environment Agency for determination by either of the parties to the dispute.
(8) The Environment Agency-
(a) shall notify the parties of the reasons for its decision on any dispute referred to it under subsection (7) above; and
(b) may make any such recommendations, or give any such guidance, relating to or in connection with the drainage of the premises or locality in question as it considers appropriate.
(9) The decision of the Environment Agency on any dispute referred to it under subsection (7) above shall be final.
(10) A sewerage undertaker shall only be taken to be in breach of its duty under subsection (1) above where, and to the extent that, it has accepted, or the Environment Agency has determined under this section, that it I under such a duty and where any time accepted by it, or determined by the Environment Agency under this section, as the time by which the duty is to that extent to be performed has passed."
7. As will be seen, pursuant to section 101A (2) (c) it is mandatory to have regard to any guidance issued under the section by the Secretary of State. Under section 101A (4) the Secretary of State may issue guidance. If he does so he must consult before issuing guidance and his guidance must be published-section 101A (5).
8. The Secretary of State issued guidance under section 101A of the Water Industry Act 1991 on 1st April 1996. The Guidance instructs sewerage undertakers as to the carrying out of technical and economic assessments for the purpose of determining whether they have a duty under section 101A. Undertakers are instructed to consult local authorities, health authorities and the Agency as appropriate. Paragraph 4 of the letter under cover of which the Guidance was sent to the Managing Directors of the Sewerage Undertakers in England reads;
"One concern expressed during consultation was that the new duty might be misconstrued as introducing a general right to a public sewer in place of existing arrangements. I should emphasise that the new duty to provide first time sewers does not replace the power to requisition a sewer under section 98 of the Water Industry Act 1991. It is only in respect of those cases which can be shown to meet the criteria and factors set out in the Guidance that the new duty to provide a public sewer will arise."
The Guidance itself reads, so far as material, as follows;
"1.4 Under the conditions set out in section 101A, sewerage undertakers have a new duty to provide public sewers for the drainage for domestic purposes of premises in any locality in its area (not restricted to rural areas only) if there are buildings on any of the premises which were existing or substantially completed by 20 June 1995. The definition of buildings excludes any shed, glasshouse or other outbuilding not designed or occupied as living accommodation. The duty does not arise if there is only one building.
1.5 This provision does not require the sewerage undertaker to automatically provide a public sewer in all circumstances. The duty will only arise where there are environmental or amenity problems arising or are likely to arise from the existing arrangements for dealing with sewage, and provision of a new public sewer is the appropriate solution. This provision does not affect the general duty of the sewerage undertaker to provide, improve and extend public sewerage under section 94 of the 1991 Act as supplemented by regulation 4 of the Urban Waste Water Treatment (England and Wales) Regulations 1994 (S.I.1994/2841). In considering whether the existing arrangements could be rectified cost effectively by repair, proper maintenance or reconstruction of the existing system(s) to solve the problem in the long term (See paragraph 3.3(c) below). Under this provision, it is not, however, the intention to relieve the sewerage undertaker of its duty to provide a public sewer on the grounds that the problem can be overcome with a similar private sewer.
1.9 In determining whether it is appropriate to provide a public sewer under section 101A, sewerage undertakers must take account of all relevant circumstances and, in particular, have regard, so far as relevant, to the considerations set out in section 101A(3) and in the Guidance. This Guidance seeks to amplify and give indications on how to apply considerations which may be relevant.
2.3 The assessment of cases should cover "technical" criteria and "economic" factors. The criteria and factors set out in this Guidance are not exhaustive; nor do they all necessarily apply to every case. The need or otherwise of providing a public sewer should be judged on the balance of the totality of the evidence available from all sources and that which can be gathered in accordance with the sewerage undertaker's procedures and policies, which should take into account this Guidance and any other guidance or direction from bodies such as the Environment Agency.
2.4 In accordance with the considerations laid down in section 101A(3), the duty to provide a public sewer will be deemed to have arisen if:
a) by virtue of one or more technical criteria set out in paragraph 3 below, it can be demonstrated that the actual or likely adverse effect on the environment and amenity cannot be overcome practicably by repair, proper maintenance or reconstruction of the existing system(s) to solve the problem in the long term other than by the provision of a private sewer (see also paragraph 1.5 above), and then;
b) by reference to the economic factors in paragraph 4 below, it can be shown that a public sewer is the cost effective solution.
3. TECHNICAL CRITERIA
As referred to in paragraph 2.4(a) above, the criteria set out in paragraphs 3.1 to 3.3 below may be material to demonstrate that adverse effects on the environment and amenity are such that there is a need for a public sewer.
3.3 Practical and engineering
a).............
b).............
c) Any authoritative engineering assessment to show that it is not feasible to overcome the pollution and nuisance problem by undertaking remedial works to the existing systems which will provide a long term satisfactory solution e.g. by repairing existing septic tanks and cesspools and/or by following recommended procedures for operating and maintaining them. Where such remedial works and/or measures are considered not appropriate to resolve the environmental or amenity problems, the assessment should be extended to examine the feasibility of reconstructing (like with like) the existing non main drainage septic tanks and cesspools. (Section 101A(3) (e))
4. AN ECONOMIC ASSESSMENT
In addition to the environmental and amenity consideration, the economics of providing a public sewer and of practicable alternative means of overcoming the problem should be assessed. The extent of this assessment should be in proportion to the overall scale of the works involved. This assessment should, as necessary, be based on the likely costs and benefits, both quantitative and qualitative, arising from proposed works included in each case. Detailed guidance on appropriate appraisal methodologies can be found in publications such as "Economic Appraisal in Central Government (The Green Book)", theDepartment of the Environment's "Policy Appraisal and the Environment".
4.1 Economic assessment factors
As referred to in paragraph 2.4(b) above, the factors which may be material to an economic assessment should, where applicable, include:
a) use of authoritative information, data and analytical procedures;
b) costs and benefits of public sewer provision to be assessed against:
i) the base case i.e. retaining the existing system with the inclusion where relevant, of any enforceable essential remedial works; and
ii) costs and benefits of adoption of improved operation and
maintenance to acceptable standards of the existing non-main
drainage systems; and
iii) costs and benefits of reconstructing (like with like) the existing non main drainage septic tanks and cesspools;
(Section 101A(3) (c))
The factors which will not be material to an economic assessment should include:
g)........
h) the availability or otherwise of funding in the sewerage undertaker's budget for the cost of the proposed works;
......."
The Decisions
9. In three of the four cases Anglian Water decided that it was not under a duty to provide first time sewerage since the statutory conditions were not met. In two of those cases, Chetwode and Little Bentley, Anglian Water decided that cesspools were the appropriate solution. In Bent Hill, it decided that a common private package plant was the most appropriate solution. In Wretton, Anglian Water decided that it would only provide first time sewerage in certain parts of the village.
The residents of all four villages applied to the Agency for determinations under section 101A in respect of these four decisions.
The Agency decided against Anglian Water in all four cases, and determined that Anglian Water was under a duty to provide public sewerage as summarised in paragraph 3 above.
10. Anglian Water makes a number of specific challenges to the individual decisions. There are however a number of common threads.
1. In relation to the possibility of recommending the use of cesspools in Chetwode and Little Bentley, Anglian Water contends that the Agency;
(1) Unlawfully fettered its discretion by adopting an inflexible policy discouraging the use of cesspools;
(2) Failed to inform Anglian Water of its policy discouraging the use of cesspools, thereby preventing Anglian Water from being able to make proper representations as to the particular features of each case; and
(3) Took into account irrelevant considerations, i.e., DETR Circular 3/99, in formulating and justifying its policy.
2. Anglian Water contends that the Agency either applied a policy in favour of requiring public sewerage whenever an existing private system could not adequately be improved or, if they did not apply a policy in that regard, nonetheless their decisions were informed by a general disposition against non-public sewerage, manifesting itself in a refusal to countenance the replacement of one form of private sewerage with another form of private sewerage.
3. Anglian Water contends that the Agency erred in its approach to the practicability test in section 101A (3) (e): specifically, that in relation to the possibility of the use of private treatment package plants in Chetwode and at Bent Hill the Agency;
(1) Wrongfully imposed upon Anglian Water the burden of showing that land was available for a private treatment plant; and
(2) Misdirected itself by accepting that the residents of a locality could impose a duty on Anglian Water to provide a public sewer by refusing to co-operate between themselves.
4. Anglian Water contends that the Agency has erred in its approach to the ambit of the duty imposed by section 101A and in particular that it has enlarged that duty by reference to the concept of the "locality" overlooking that the duty is to provide a public sewer to be used for the drainage of premises rather than to provide a public sewer for the drainage of a locality.
11. As to the specific challenges, I will set those out when I come to deal with the individual decisions. It is however convenient to begin with some general observations. Before doing so I should record that in addition to the material placed before me by the Applicant and the Respondents I have also received and taken into account two Witness Statements of Robert Drinkwater, dated 26th June 2000 and 18th July 2000 respectively and a letter from Aylesbury Vale District Council dated 19th July 2000. Mr Drinkwater is a resident of Bent Hill and thus an interested party. He is also well qualified to comment on the technical and practical aspects of the provision of sewerage to Bent Hill. Through no fault of his own however he has not appreciated the limitations of the role of the Court in judicial review. The Court is not concerned with the merits of the decisions, only with the route by which they were reached. Moreover the Court cannot resolve disputed issues of fact. It is because of the essentially limited nature of the Court's task that I shall make no further reference to Mr Drinkwater's evidence, relevant though it may be to issues which the Agency, but not the Court, has to decide. Aylesbury Vale District Council is the owner of three of the seven houses at Chetwode in respect of which application for the provision of public sewerage was made. They have made general observations on the desirability of cesspools to which I shall refer hereafter.
12. The Agency has itself from time to time issued or adopted Policy Statements. So far as I am aware these documents were not in the public domain prior to the decisions which are impugned in these proceedings, although it is apparently the case that the Agency's policy on cesspools was sent in draft form to an engineer at Anglian Water. I shall revert to that point as necessary. Guidance or policy issued by the Agency includes:-
GUIDANCE NOTE ON THE FIRST TIME SEWERAGE DUTY UNDER SECTION 101A OF THE WATER INDUSTRY ACT 1991
When considering whether it is appropriate for the sewerage undertaker to provide a public sewer, the Agency will have regard to the Ministerial Guidance and all other relevant considerations and documents e.g. DETR
(03/99)/WO (10/99) Circular Planning Requirements in respect of the Use of Non- Mains Sewerage incorporating Septic Tanks in New Development.
PART IV-TECHNICAL GUIDANCE

6.0 GENERAL
6.1 The Agency take the view that the level of investigation carried out in
assessing the technical case must be sufficient to establish the facts of the case.
It is not for the applicant to prove the case; rather the onus is on the sewerage undertaker to gather sufficient evidence to enable a decision to be made on the facts.
6.2 The duty to provide a public sewer will not arise where the environmental problems can be practicably resolved, in the long-term, by repair, proper maintenance or reconstruction of the existing systems. However, the Ministerial Guidance emphasises that such reconstruction must be `like with like', i.e. septic tank with septic tank, package plant with package plant, etc.
6.3 The Agency takes the view that section 101A, as amplified by the Ministerial Guidance, precludes a sewerage undertaker from deciding that the duty to provide a public sewer does not arise on the basis of a comparison of
the cost-effectiveness of a public sewer with a private not `like with like'
solution. An example could be where the decision was based on replacing
septic tanks with cesspools, or with private sewage treatment plants.
7.0 AGENCY VIEWS
In determining disputes the Agency will use the following definitions as referenced in section 101A and the Ministerial Guidance:
7.1 `Like with like'
The Agency's interprets `like with like' in the Ministerial Guidance to mean
reconstruction of the same system alone, not other options, in order to solve
the environmental/amenity problem. Thus a new or improved septic tank can
be reconstructed from an existing septic tank, but the septic tank cannot be
replaced by a cesspool. Reconstructing like with like only comes into play
when repair or remedial work will not overcome the environmental problems.
How far like with like extends can only be assessed on a case by case basis. Replacing a small septic tank with a bigger one would constitute like with like so too would reconstructing a septic tank in a different locality within reason (e.g. on the same owner's land) or relocating the existing soakaway(within the owner's land) to another better drained or larger area.
7.2 Premises in a Particular Locality
Particular locality is not defined in the Guidance. If there was a discrete area where there are a number of premises, this would be a locality. The size of the locality will vary depending on the circumstances. If premises are geographically separate, then they may not constitute a particular locality, e.g. premises in a town two miles apart. The Agency will judge each set of circumstances on their own merits. The Agency does not believe a particular locality is coterminous with a sewerage catchment, but again, if two premises would be in different catchments, the economic criteria may militate against providing first time sewerage. Since localities can vary from an isolated hamlet or village to part of a town, the location of the premises is important in assessing whether the premises form a particular locality. Locality could be quite a large area, e.g. a whole village where 3 or 4 premises satisfy the first time sewerage duty, which would then apply to all the premises in the village,since the duty arises if any of the premises meet the criteria. It would be for the Agency to decide, in the event of a dispute, whether an area of dwellings was or was not "premises in a particular locality".
7.3 Timescales
The Agency takes the view that the determination of an application under
section 101A should be within a timescale appropriate to the circumstances,
considering the nature and scale of the technical issues involved in each case.
In determining a dispute for non-determination of an application, the Agency will consider whether the time taken is reasonable, taking into account the
technical issues involved.
In determining a dispute on the timescale for providing a sewer (where the
duty has been accepted), the Agency will take a view on the reasonable time
needed to provide a sewer, based on technical factors alone.
7.5 Investigations
In determining a dispute, the Agency will take into account whether the
sewerage undertaker has carried out sufficient investigations on which to base its decision not to provide a public sewer.
The Agency interprets paragraph 2.4 of the Ministerial Guidance to mean that the duty to provide a sewer will be deemed to have arisen firstly if it can be demonstrated that actual or likely adverse effects on the environment and
amenity cannot be overcome practically by repair, proper maintenance or
reconstruction of like with like existing systems, which would be a long term
solution to the problem other than by the provision of a private sewer and secondly by reference to the economic factors, it can be shown that the public sewer is the cost effective solution.
It is a two-stage process to decide whether the duty is deemed to have arisen.
This does not mean that the sewerage undertaker does not have to provide a sewer on the grounds that the problem can be overcome with a similar private sewer. The presumption will be that where environmental problems cannot be overcome by repair, maintenance and reconstruction a public sewer should be provided so long as it is the cost effective solution. Paragraph 2.4 only refers to where the public sewer duty is deemed to have arisen; there will be other circumstances where that duty may arise having considered all the factors in section 101A(3) and in the Ministerial Guidance.
Appendix 5:
Example dispute determination document
The dispute determination is one document with annexes if necessary. It should consist of a letter to the appellant, copied to the sewerage undertaker. It will follow the basic structure given below.
The Dispute
Paragraph giving outline details of the dispute.
Grounds of Dispute
History of the application and determination by the sewerage undertaker.
Nature of the dispute i.e. which of the 3 categories of dispute does it come under.
Agency Determination
Where the dispute concerns the duty of the sewerage undertaker, this section will consist of an explanation as to why the duty does or does not arise e.g. evidence of pollution and how this can be overcome. The section must include an assessment of all private options and the reasons for dismissing them (if the decision is for a public sewer). The appropriateness of public sewer provision (or not) must be linked to the extent of the environmental problem. Consideration of all the factors in s101(3) must be included, and regard must be had to the Ministerial Guidance, however it will not be sufficient to simply rely on the wording in the Guidance. Independent reasoning of the merits of all options (private and public) must be included, reliance on dismissing the arguments of the applicant and/or sewerage undertaker is not satisfactory.
Appendix 6:
Discouraging the use of cesspools as a sewerage option
Policy statement
The Agency does not accept the promotion or proliferation of cesspools as a viable long-term sewerage option, in view of potential environmental, amenity or public health problems arising from inadequate operation and maintenance.
DETR Circular 3/99 (WO 10/99), Planning Requirement in respect of the use of Non-Mains Sewerage incorporating Septic Tanks in New Development, refers to Section 101A of the Water Industry Act 1991 which was specifically introduced to deal with the problems outlined above. The Circular provides advice on the exercise of planning control and also discourages the use of cesspools. Agency staff should, where appropriate, refer potential developers and Local Planning Authorities to this advice.
In certain circumstances, such as dwellings where there is no suitable or viable alternative option, the use of cesspools may be acceptable.
Policy Guidance
Introduction
It is the view of many practitioners within the Agency that proliferation of cesspools as a long term sewerage option, as an alternative to provision of a public sewer or other private sewerage options such as package plants, should not be encouraged in anything other than exceptional circumstances, on the grounds of pollution prevention, environmental protection and sustainability.
The Agency currently has no policy on the use of cesspools as a sewerage option and needs to clearly define its policy with regard to the promotion of cesspool use.
1.0 Cesspools, Pollution Prevention and Environmental Protection
1.1 Old or incorrectly maintained cesspools cause pollution via contamination of ground, and sometimes surface, water with crude (and often septic) sewage leaking from the tank. Leakage can often remain undetected for many years and is very difficult to trace due to the slow rate of flow of groundwater.
1.2 Cesspools are vulnerable to misuse that is extremely difficult to prevent or detect once it has occurred, and which will result in pollution. This misuse involves disposal of the contents of a cesspool down a manhole or drain, rather than legitimately by a licensed waste carrier for the proper treatment at a sewage works.
1.3 The financial cost to householders of emptying cesspools every two to three weeks is substantial, and does not encourage regular emptying, which is essential to prevent pollution occurring. The Agency is unable to use its powers to promote regular emptying unless pollution can be proven from the installation, which is very difficult, as described above.
1.4 Policing pollution from cesspools is therefore very difficult and the Agency does not encourage their use in anything other than exceptional circumstances for new installations from a pollution prevention perspective. The Agency should refrain from any promotion of the use of cesspools.
2.0 Cesspools and Sustainability
2.1 In terms of the Agency's duty relating to sustainable development, policies or practices that promote unsustainable long-term options are not acceptable. Promotion of the use or proliferation of cesspools is therefore unacceptable, because cesspools require regular maintenance and emptying in order to operate effectively. They also need to be installed correctly, and any damage to the fabric of the cesspool (i.e. holes developing) needs to be rectified immediately in order that pollution of groundwater does not occur.
2.2 One of the main objections to the use of cesspools in the long term, is the requirement for frequent emptying. This generates the need for tankers to visit (on a two to three weekly basis) private dwellings, often in rural areas with small roads, to take away the effluent for treatment and disposal at a sewage works. The more cesspools that are installed in rural areas, the greater the environmental cost of transporting the effluent in terms of noise, dust, congestion, additional fuel consumption and CO2 emissions. BS COP for Design and Installation of Small Sewage Treatment Works and Cesspools (BS6297: 1983) notes that `an average household of three persons will produce 7m3 (the capacity of a typical tanker) in about 3 weeks, necessitating some 17 journeys per annum. Each journey may involve the haulage of 7t of material a distance of several miles.
2.3 BS COP for Design and Installation of Small Sewage Treatment Works and Cesspools (BS 6297: 1983) reinforces the Agency's view, stating `It is emphasised that a multiplicity of small sewage treatment works in a limited area, particularly for single houses, is undesirable.'
3.0 Current guidance on cesspool use
3.1 DETR's circular 03/99 (WO 10/99) Planning Requirement in respect of the Use of Non Mains Sewerage incorporating Septic Tanks in New Development (1 April 1999) does not indicate that cesspools are an acceptable sewerage option and takes a stance which discourages their use. The circular `provides advice.... so as to avoid environmental, amenity or public health problems which could arise from the inappropriate use of non-mains sewerage systems'. On cesspools in particular, it states `In principle, a properly constructed and maintained cesspool is unlikely to lead to environmental, amenity or public health problems. However, in practice, it is known that such problems occur due to poor maintenance.....When considering a scheme proposing the use of cesspools, therefore, the local planning authority may wish to adopt the same process of considering the possibility of significant problems arising and whether these problems can be overcome by the attachment of suitable conditions to a planning permission.'
3.2 Environment Agency policy on groundwater (Policy and Practice For The Protection of Groundwater, 1998) considers that cesspools are acceptable as a sewerage option in certain circumstances, with a list of requirements including conditions on planning permission for the construction of a sealed system to approved standard and, via Section 106 obligations, the keeping of adequate record of maintenance and emptying.
3.3 A planning appeal in NRA We Region in 1992 was dismissed when the risk of the contents of a cesspool being emptied down a manhole was considered to be unacceptable. As a result NRA and subsequently Agency practice was reviewed and proposals to site cesspools in publicly sewered areas were subsequently objected to.
4.0 Cesspools as a "Practicable Alternative" to other sewerage options
4.1 Water Industry Act 1991 Section 101A: Section 101A is welcomed as it provides a framework in which the technical case for a public sewer and its cost effectiveness is assessed. A duty to provide a public sewer is established where the criteria laid down in the Section, as amplified by Ministerial Guidance, are met. Some water companies are interpreting section 4 of the Guidance, i.e. `the economics of providing a public sewer and of practicable alternative means of overcoming the problem should be assessed' as enabling them to cost private solutions (in particular replacement of septic tanks with cesspools) against the cost of a public sewer, and reject applications on economic grounds because the provision of cesspools is a cheaper alternative.
4.2 There is a degree of confusion in the interpretation of the Ministerial Guidance in relation to whether private options (such as cesspools or private sewage treatment plants) can be proposed by water companies as an alternative to a public sewer, and whether applications can be rejected if the private solution is found to be cheaper. Environment Agency Wales wrote to DETR/WO in order to clarify this point (letter and reply from WO attached as Annex 1) and has written again with the Agency's interpretation of this additional guidance (letter attached as Annex2) to check that DETR/WO are in agreement.
4.3 Should private options be deemed acceptable as an alternative to public sewers the Agency will need to use its powers of enforcement in order to ensure that householders make the necessary investment to prevent further pollution from occurring. As discussed in section1, for cesspools these powers are extremely difficult to use. This could have a serious impact on the intended success of Section 101A for solving pollution problems in unsewered areas.
ANNEX 1: LETTER TO DETR/WO REQUESTING CLARIFICATION ON "PRACTICABLE ALTERNATIVES"
Eich cyf/Your ref:
Ein cyf/Our ref: L/AG/JPD/SOO2
Dyddiad/Date: 3 August 1998
Welsh Office Department of Enviroment, Transport & the
Environment Division Regions
Cathays Park Water Supply & Regulation Division
Cardiff Romney House
CF1 3NQ 43 Marsham Street
LONDON SW1P 3PY
FAO Mr R D Macey
Dear Sir
SECTION 101A WATER INDUSTRY ACT 1991
The Environment Agency Wales is currently considering a number of disputes between Dwr Cymru Welsh Water and the owners/occupiers of premises which the Agency has a duty to determine pursuant to S101A(7) Water Industry Act 1991.
The Department of the Environment and the Welsh Office issued guidance on the provision of a public sewer under Section 101A Water Industry Act 1991 in April 1996 which the Agency has been consulting in considering its determinations. However, the Agency has encountered some difficulties in reconciling elements of the guidance and particularly in respect of paragraph 2.4 when read in conjunction with paragraphs 1.5 and 1.6.
The Agency would therefore be interested in the department's comments upon how best to interpret the guidance in paragraph 2.4 in the light of the following sentence in paragraph 1.5:-"Under this provision, it is not, however, the intention to relieve the sewerage undertaker of its duty to provide a public sewer on the grounds that the problem can be overcome with similar private sewer."
If you have any queries please do not hesitate to contact me.
Yours faithfully
ANDREW GRAVES
ASSISTANT SOLICITOR
----------------------------------------

REPLY FROM WO
Y Swyddfa Gymreig Welsh Office
Parc Cathays Cathays Park
Caerdydd CF1 3NQ Cardiff CF1 3NQ
Mr Andrew Graves Eich cyf/Your Ref
Assistant Solicitor 1/AG/JPD/SOO2
Environment Agency Wales Ein cyf/Our Ref
Rivers House PAE 59-9-2
St Mellons Business Park
St Mellons 10th September 1998
Cardiff CF3 0LT
Dear Mr Graves
SECTION 101A WATER INDUSTRY ACT 1991-FIRST TIME SEWERAGE
I refer to your letter dated 3rd August, addressed to Mr Macey concerning the guidance issued by the Department of the Environment and the Welsh Office on the provision of a public sewer under Section 101A of the Water Industry Act 1991. I have sought advice from colleagues in DETR.
The original intention behind the drafting of paragraph 1.5 of the Guidance was the removal of the possiblilty of an undertaker being able to resist providing a public sewer on the grounds that the problem could be resolved by the construction of a new `private sewer', which is not normally built to the same exacting standard as a public one. Seen in this context, hopefully paragraphs 1.6 and 2.4 will make then make more sense.
With regard to the queries on economic asessment, it is important that the assessment should not be unduly complex and is kept in proportion to the work involved, as is stated in paragraph 4 of the Guidance. Basically, the Guidance is calling for a comparison of the costs of providing a new public sewer against other practicable and legally enforceable options which offer long-term solutions to the amenity and environmental problems. These options include rectifying any deficiencies such as the periodic emptying and cleaning of septic tanks, repair to damage, and recontruction where they are beyond repair, as is indicated in paragraph 1.5. By `public sewer' we mean here, the most cost effective system for which the undertaker is/would be responsible taking into account connection to either an existing remote treatment works or to a new local treatment plant.
If you need further clarification please let me know.
Yours sincerely
Mrs C S Clarke
Environment Division
--------------------------------

ANNEX 2: LETTER TO WO WITH AGENCY VIEW ON THE ECONOMIC ASSESSMENT
Ein cyf/Our ref: PPC/WQ/H20/CL
Eich cyf/Your ref: PAE 59-9-2
Dyddiad/Date: 30 November 1998
Mrs C S Clarke
Environment Division
Welsh Office
Cathays Park
Cardiff
CF1 3NQ
Dear Mrs Clarke
SECTION 101A WATER INDUSTRY ACT 1991-FIRST TIME SEWERAGE
I refer to the letter of 3 August 1998 from Andrew Graves to the Welsh Office seeking clarification on sections of the Section 101A Ministerial guidance (Ref. L/AG/JPD/S002) and your reply of 10 September. Thank you for your reply which has helped to guide our interpretation. The Agency's interpretation of the Ministerial guidance on the economic assessment in the light of your answer is set out below. The Agency will proceed with determination of the disputes which have been referred to it using this interpretation, unless you advise otherwise.
Environment Agency view on Economic Assessment
The Agency takes the view that Section 101A, as amplified by the Ministerial Guidance, precludes a Sewerage Undertaker from deciding that the Duty to provide a public sewer does not arise on the basis of a comparison of the cost-effectiveness of a public sewer solution with a private non "like with like" solution. For example, this could be where the judgement was based on replacing septic tanks with cesspools, or with private sewage treatment plants at the expense of the applicant. In other words (referring to the Agency's letter of 3 August), the sewerage undertaker must compare just private like-with-like solutions for repair and replacement of existing systems (if that will solve the problem) against a public sewer and a range of other public options.
Thank you for your assistance. If you have any queries please do not hesitate to contact me.
Yours sincerely
Dr MELS BARTON
Consents and Compliance Manager Wales.
cc: Mr A Wells, DETR, Water Supply & Regulation Division, 43 Marsham Street, London
Andrew Graves, Environment Agency Wales,
National WIA `91 s 101A Group Member."
13. DETR Circular 03/99, dated 1 April 1999, which was I think a public document, is headed;
"Planning Requirement in respect of the Use of Non-Mains Sewerage incorporating Septic Tank in New Development."
As its title suggests it is concerned with Septic Tanks in new developments and not, therefore, as is Section 101A, with the provision of sewerage to premises which existed prior to 20 June 1995. Paragraph 8 of Annex A provides;
"Whilst this Circular primarily deals with Septic Tank drainage systems, the attention of developers and local planning authorities is drawn to the implications of the use of cesspools. In principle a properly constructed and maintained cesspool, being essentially a holding tank with no discharges, should not lead to environmental, amenity or public health problems. However, in practice, it is known that such problems occur as a result of frequent overflows due to poor maintenance, irregular emptying, lack of suitable vehicular access for emptying and even through inadequate capacity.
These problems can be exacerbated by unsuitable conditions, such as some of those listed in paragraph 6 above. When considering a scheme proposing the use of cesspools, therefore, the local planning authority may wish to adopt the same process of considering the possibility of significant problems arising as described in paragraph 6 above, and whether these problems can be overcome by the attachment of suitable conditions to any planning permission."
"Like for Like"
14. It is convenient to deal first with the question whether section 101A precludes a sewerage undertaker from deciding that the duty to provide a public sewer does not arise on the basis of a comparison of the cost effectiveness of a public sewer solution with a private solution which is not however a "like for like" solution. In other words, is a sewerage undertaker precluded from suggesting that replacement of an inadequate private system, e.g. cesspools, by another private system, e.g. septic tanks or private treatment plants, is more cost effective than the provision of a public sewer. It is plain that the Agency in its own Guidance or policies has taken the view that section 101A, as amplified by the Ministerial Guidance, does preclude assessment of a private non "like with like" solution. The Agency has now accepted that that approach is in error, but the point remains relevant (a) because the fallacious approach is referred to in the Agency's Cesspools Policy and (b) because Anglian Water contends that the Agency's decisions have in fact been informed by the discredited approach.
15. The point arose in two cases involving Welsh Water. Two decisions of the Agency dated 9 February 1999 and 1 March 1999 were challenged on the basis that the Agency had wrongly applied the approach enunciated in its letter dated 30 November 1998 which I have set out above. Those were cases in which there were before the Agency three possibilities: First, the existing option of septic tanks, with repair, maintenance and/or reconstruction; Second, the option of a public sewer, requested by the complainants; Third, the option of replacing septic tanks with cesspools, suggested by Welsh Water, or some other, and cheaper, private sewerage option.
The Agency rejected the proposed option of replacement with cesspools or any other private sewerage option as "not valid." An application having been made for judicial review, the Agency consented to the quashing of its two decisions. The Consent Order agreed by the Agency recited;
"(iv) A material factor in this determination was that it was not an option open to the Applicants to replace septic tanks with cesspools. The explanation for this view was that any comparison of the cost-effectiveness of a public sewer option could not be compared with a private sewerage option, because it would not be a "like for like" comparison. In making the determination the Respondent purported to follow Ministerial Guidance issued by the Department of the Environment and the Welsh Office in April 1996. It is accepted that the Guidance given was not intended to have the effect it seemed to have or that it was wrong.
(v) Section 101A (3)(e) specifies one of the matters which the Respondent was required to consider namely;
"....the extent to which it is practicable for those effects to be overcome otherwise than by the provision....of public sewers and the costs of so overcoming those effects."
(vi) It is accepted by the Respondent that the statutory requirement does require it to consider other private sewer options if they are available and
practicable. The decisions of 9th February 1999 and 1st March 1999 by
precluding the possibility were flawed."
16. Mr David Gallagher is employed by the Agency as a Regional Water Quality Planner. He was personally involved in each of the decisions challenged in these proceedings. He has asserted that in each of those determinations the issue in the Welsh Water case never arose and thus the discredited policy was not followed. He says that none of the cesspool options put forward by Anglian Water were put forward as an alternative to another existing private sewerage option and they were not rejected on this basis, i.e. because they did not constitute a "like for like" replacement, but on the basis that they did not constitute a long term practicable sustainable solution.
This is not factually accurate, nor does it meet the point. In Chetwode the applicants were using existing septic tanks and Anglian Water proposed cesspools as a replacement. At Bent Hill four of the applicants were using septic tanks and Anglian Water proposed their replacement by another form of private sewerage, viz., a private package treatment plant. The question which I shall have to determine is whether in either case the proposed private alternative was rejected simply on the basis that, not being "like for like", it did not rank for consideration. It is plain that such an approach could not be justified.
17. The Consent Order to which I have referred above states that the Ministerial Guidance was not intended to have the effect it seemed to have or that it was wrong. I was told that it is intended to issue revised guidance but not until after the outcome of this judicial review is known. The relevant passages in the Guidance are paragraphs 1.5 and 2.4. They are not entirely easy to understand, the more so since it is not entirely clear what is meant by the expression "private sewer." I am indebted to Mr Geoffrey Ward, the Regulation Solicitor for Anglian Water, for his researches and for his assistance given to the Court on this and other aspects. I believe that a "private sewer" properly so called should serve more than one property-see sections 102,104,179 and 219 of the Water Industry Act 1991, but I doubt whether the expression is used in this sense in the Ministerial Guidance. As I read paragraphs 1.5 and 2.4 of that document they are saying in terms that the replacement of an existing private system by a different type of private system, e.g. replacement of septic tank by cesspool or vice versa or replacement of either by private package treatment plant, is not an option which can be considered. Whether the Guidance was intended to have that effect is beside the point. As the Agency has recognised, the Guidance is in this respect wrong. The approach enjoined simply cannot be derived from the Act. In each of the decisions impugned the Agency has referred to this Guidance as setting out the test to be applied, and in Chewode it has done so specifically in connection with its consideration of the possible replacement of septic tanks by a private sewage treatment plant. I shall have to consider whether, as Mr Gallagher asserts, in each case the alternative private options proposed were rejected on their merits rather than by reference, conscious or unconscious, to the discredited Guidance. First however I propose to consider the Agency's Cesspool Policy.
18. An initial question is to what extent the Agency's Cesspool Policy is itself informed by the discredited "like for like" approach. It is possible that paragraph 4.2 can be regarded as as indication that cesspools can simply be rejected where they are proffered as an alternative to an existing private system of a different type. That is plainly unlawful for the reasons already given. Paragraph 4.3 seems to envisage that cesspools might have to be considered although whether it envisages them as an alternative to an existing private system of a different type is a moot point. Looked at as a whole however, I do not believe that the Agency's policy is underpinned by the "like for like" approach- rather it is informed by a free-standing autonomous objection to cesspools on environmental grounds. That objection is cogently stated by Aylesbury Vale District Council in the letter to which I have referred which reads, in part:-
"The Environmental Health profession has experience in dealing with cesspools and it is well acknowledged within the profession that cesspools are a basic mode of waste disposal and can entail high financial costs on individuals on a regular basis through the cost of emptying the effluent to tankers. It is the experience within the profession, that a number of owner/occupiers do not maintain their cesspools which subsequently allow the ingress of ground and surface water, thus allowing effluent to leak into the environment, which can be extremely difficult to trace. Additionally if the costs of emptying the effluent imposes a great financial burden on the owner/occupier, outlet pipes or holes are often made into the structure, so allowing the effluent to escape untreated into the ground, thus reducing the householder's financial burden.
Experience dictates that cesspools are not regarded as a modern method of sewage disposal. Due to the high running costs of frequent emptying and the problems sometimes experienced with maintenance, pollution is therefore likely if cesspools are not emptied and maintained as required."
To those objections one might add the environmental objection to the necessity for tankers to make regular visits often to rural areas through narrow roads, as enunciated in the policy itself.
19. Miss Lang QC for Anglian Water submitted that it was difficult to conceive that the Agency could in its quasi-judicial role as opposed to its administrative role have any policy which favours or appears to favour one form of sewerage over another. The problem with such a policy is, she submitted, that such a policy appears to eliminate cesspools as an option. She also points to the fact that the Act gives to the Secretary of State power to give guidance and submits that it must be questionable whether Parliament intended that the Agency should itself have an ability to adopt policies over and above those published by the Secretary of State after the process of statutory consultation. It would be both surprising and unfortunate, she suggested, if the Agency can adopt a policy without consultation or publication in circumstances where the Secretary of State must both consult and publish. This of course tied in with her independent complaint of failure to consult and publish prior to application of the policy in the instant cases.
20. Miss Lang also attempted to persuade me by reference to various materials that I should regard the Agency's policy on cesspools as out of line with current thinking and, I suppose, although she did not quite say this, as irrational. I do not consider that I should be drawn into this debate. Miss Lang was, I think, inviting the Court to make an environmental judgment which it should not do. It perhaps suffices to say that I could not possibly regard the Agency's policy as irrational unless, properly understood, it precluded consideration of cesspools (including the installation of a new cesspool to replace another and different type of private system) in any circumstances. It is plain that it does not so provide. It seems to me that there can in principle be no objection to adoption of the policy provided that it admits of exceptions and does not have the effect of, effectively, shutting the ears of the decision maker to consideration of a proposal which involves departure from the policy-cf Lord Reid's approach in British Oxygen Company Ltd -v- Minister of Technology [1971] AC 610 at 625.
21. Miss Lang's challenge to the policy on grounds of lack of consultation is put as a breach of the requirements of natural justice. I do not consider that the fact that a draft of the policy was apparently sent to an individual officer of Anglian Water is an answer to this point. Whatever the circumstances in which that was done, it was plainly not a formal notification and it did not, for example, reach Mr Cartwright who was the appraisal engineer for Chetwode and Bent Hill. Nor did I find at all convincing the Agency's reliance on their decisions in the Singleborough, Braceborough and Oasby determinations as indicative of their adoption of the policy.
The Singleborough and Braceborough decisions actually precede the adoption of the policy on 21 May 1999. The Singleborough decision discusses the merits and demerits of a cesspool solution albeit in a general way whilst the Braceborough decision identifies site specific considerations, e.g. the introduction of amenity problems where none previously existed. The consideration of the point in the Oasby case give no clue as to the existence of the policy.
22. However I accept Mr Clarke's submission for the Agency that there was here no duty to consult to be derived from the statute or rooted in public law principles. The point is put as a failure to conform with the requirements of natural justice. If this point had stood alone I am not sure that I would ultimately have felt justified in intervening. It seems to me that anyone in the water and sewerage industry would be likely to realise that there is an informed body of opinion within the industry and amongst those concerned with it which regards cesspools as in principle an unsatisfactory method of sewage disposal. Anglian Water would therefore have realised, or at any rate ought to have realised, that there would be an onus of persuasion on them in that regard. The real question to my mind is whether in the making of the determinations any real consideration was given to the cesspool option or whether the policy was inflexibly applied.
23. Before turning to that question I should deal with DETR Circular 03/99. That Circular deals with the provision of sewerage for buildings in new developments. Strictly speaking it is therefore of no relevance to the formulation of policy so far as concerns the provision of sewerage to existing premises. On the other hand the considerations mentioned in the Circular as to the use of cesspools are, for the most part, as relevant to existing properties as to new properties. I consider that in formulating its policy on existing properties the Agency could legitimately have regard to Ministerial discouragement of the use of cesspools in connection with new properties-always provided that the Agency remained willing to consider the matter on its merits on each occasion, ready to accept that there might be existing properties in respect of which sewerage by cesspool drainage, even involving the construction of a new cesspool in place of an existing but different type of private system, would in all the circumstances be the appropriate solution. So again the question as it seems to me is whether the policy has been inflexibly applied.
24. In that latter regard I am not greatly assisted by reference to the Agency's determinations in the Langdon Hills and Denton cases both of which were prayed in aid by the Agency as examples of the flexibility of its approach to cesspools. Indeed although Mr Gallagher said of the latter determination that in it the Agency had approved the use of cesspools, the Agency's preferred option was in fact expressed to be the reconstruction of existing septic tank and soakaway arrangements. It is true that the Agency went on to say that if that proved impossible at two of the three properties then other private options could be considered as an alternative, which it is plain must include cesspools. Langdon Hills was a case where the Agency approved the repair/reconstruction of existing cesspools as the most cost-effective solution.
25. Turning to the determinations in the present cases, cesspools were put forward as an option in each case except Wretton, although only in Chetwode and Little Bentley were cesspools the preferred solution of Anglian Water. In each determination the Agency rejected cesspools in identical language;-
"Agency Policy dated 21 May 1999 did not accept cesspools as a viable long-term sewerage option. In applying this Policy cesspools are not an appropriate solution in this case. The Policy is also supported by DETR Circular 3/99(WO10/99)."
The determinations contain no other discussion of the cesspool option. In my judgment the natural reading of this curt paragraph is that cesspools have simply been ruled out as a matter of policy. The language used does not suggest to me that any consideration has been given to the question whether, in the instant cases, there might exist exceptional circumstances rendering the use of cesspools the appropriate solution. The contrast with the language used in the Braceborough and Oasby decisions is rather striking. In both of those cases the topic was dealt with at considerably greater length, with certain site-specific issues separately addressed. Of course it can be said that the policy itself does envisage that there may be circumstances in which the use of cesspools is acceptable and that what the determinations indicate is that the policy has been applied which must by definition include a consideration whether those exceptional circumstances exist. It is a short point but in my judgment the language admits of only one fair reading. Cesspools have been ruled out without consideration whether in the particular circumstances of these cases their use might be the appropriate solution.
26. The Agency sought to supplement the determinations with further evidence in the shape of Mr Gallagher's two Witness Statements. Mr Gallagher suggests that in each of the two cases where it was the preferred option of Anglian Water the Agency considered the cesspool option in terms of practicability, sustainability and amenity and that none of the three cases appeared to be the sort of unusual case where cesspools would be appropriate. He suggests that in the determination those considerations were condensed into the statement which I have already set out. So far as concerns Bent Hill, where Anglian Water's preferred option was a private package treatment plant, Mr Gallagher does not in his first, definitive, witness statement suggest that the Agency gave any consideration at all to the cesspool option, which was option 3, albeit it was not cost-effective, being the most expensive of the three options. Anglian Water contends even in relation to the Bent Hill decision that in rejecting the option of individual cesspools for the reasons it gave the Agency made an error of law. Anglian Water does not however ask the Court to quash the Bent Hill decision on this ground since it recognises that there were lawful grounds upon which the Agency could have rejected this option in the particular circumstances of the case, viz. that it was not cost effective, being as I have indicated the most expensive of the three options put forward. In my judgment the fact that in reporting the Bent Hill decision on the cesspool option the Agency has used precisely the same language as in the Chetwode and Little Bentley decisions serves only to reinforce the impression that no consideration was in fact given to this option, an impression which is yet further strengthened by Mr Gallagher's failure to refer to the cesspool option at all in his description, or amplification, of the decision making process so far as concerns Bent Hill.
27. It was not suggested that I should not admit or consider the evidence of Mr Gallagher in this respect. Mr Clarke submitted that I should, in accordance with established principle, assume Mr Gallagher's evidence to be correct. It seems to me that Mr Gallagher's evidence on this point is suggestive of ex post facto rationalisation and indeed I regard his evidence so far as concerns the Chetwode and Little Bentley decisions as on this point inconsistent with the determinations themselves. For that reason alone I must subject the evidence to careful scrutiny and in my judgment it does nothing to save those two decisions from the conclusion that they cannot stand. They must be quashed in order that the Agency may give proper consideration to the question whether the provision of cesspools may in those cases be an appropriate solution. Of course I express no view as to what the outcome of that consideration may be. It is of course perfectly possible that it will be concluded, when all of the relevant considerations are taken into account, that the provision of cesspools is not the appropriate solution. That is for the Agency. I have not overlooked that Mr Gallagher also deals with this issue in general terms in his second Witness Statement. What is said there does not detract from my conclusion.
The Practicability Test
28. I have set out the issue here in paragraph 3 above. It arises in relation to the Chetwode and Bent Hill determinations. In the former determination, where Anglian Water did not in fact recommend the private treatment plant option, the Agency ruled, at paragraph 17:-
"For Option 4, Private Sewage Treatment Plant, Section 1.5 of the Guidance issued by the Secretary of State states: "...it is not, however, the intention to relieve the sewerage undertaker of its duty to provide a public sewer on the grounds that the problem can be overcome with a similar private sewer." The Company does not provide any evidence that land is available for a private treatment plant. Furthermore there is no evidence that agreement could be reached by the residents on the location, maintenance or operation of the plant. The Company states that although this is the least cost option it requires the community to take responsibility for the works and this cannot be assumed. For this reason the Company did not recommend this option. The Agency finds that Option 4 can therefore not be considered as a practicable solution."
In relation to Bent Hill the Agency determined:-
"15. No evidence has been provided by the Company that land is available for a private treatment plant. Furthermore there is no evidence that agreement could be reached by the residents on the location, maintenance or operation of the plant. Option 2 cannot therefore be considered as a practicable solution. Paragraph 16 Agency Policy dated 21 May 1999 does not accept cesspools as a viable long-term sewerage option. In applying this Policy cesspools are not an solution in this case. The Policy is also supported by DETR Circular 3/99."
29. Paragraph 17 of the Chetwode determination is puzzling. The first sentence appears to be an invocation of the discredited and now discarded policy of not countenancing a non "like for like" private solution. In fact there are passages in paragraphs 12, 13 and 20 of the determination which seem to lead to the same conclusion. On the other hand the Agency did consider a non "like for like" solution-private package treatment plant in place of septic tanks, and rejected it as impracticable. I will revert to the question whether these passages evidence the adoption of an approach inimical to private sewerage, as Anglian Water contends. However in seeking to convey that the Agency has paid proper regard to considerations of practicability the first sentence of paragraph 17 of the Chetwode determination is not a promising start.
30. The question is whether it is lawful for the Agency to impose upon the sewerage undertaker the burden of proving that land is available for a private package treament plant and that residents would agree on the location, maintenance and operation of it. The challenge is the stronger in the case of Bent Hill since in relation to Chetwode Anglian Water itself indicated in its submission that it could not be assumed that the community would assume responsibility for the works.
31. In his skeleton argument on behalf of the Agency Mr Clarke said this at paragraph 28:-
"It is fallacious to suggest that the Agency has simply allowed residents to impose a burden on Anglian Water by choosing not to co-operate. It should
be borne in mind that Section 101A imposes a prima facie obligation upon the sewerage undertaker in respect of public sewerage where the drainage of premises is having an adverse effect on environment or amenity. When considering whether a public sewer is appropriate, the Agency has to have regard to the practicability or, as here, impracticability of other solutions."
I do not know whether the approach to Section 101A advocated by Mr Clarke informed the Agency's decisions in this regard although I suspect that it did. It is in my view wrong. The section has a much more complex structure than the imposition of a prima facie obligation where the drainage of premises is having an adverse effect on environment or amenity. The obligation to provide a public sewer for such premises only arises where it is appropriate. The conclusion whether it is appropriate is in turn informed by a consideration of the practicability test in sub-section 3(e). It is therefore simply wrong to speak of a prima facie obligation on proof of adverse environmental or amenity effects.
32. That being the case it cannot in my judgment be correct to approach the matter on the footing that there is in this respect an onus on the sewerage undertaker which it must discharge. There is also another consideration which is that such a burden would, in my judgment, in most if not in all cases be simply impossible for the sewerage undertaker to discharge. For so long as there is the prospect of the provision of public sewerage at "public expense," it seems to me inevitable that the residents concerned are bound to indicate that no one of them is prepared to make land available for the construction of a private plant and they are bound to indicate that co-operation as to sharing of the costs of construction, maintenance and operation will not be forthcoming. I do not mean that such indications would be given other than in good faith-they would represent the reality of the situation until such time as it became clear that a public sewer would not be provided and another solution would have to be sought.
33. Furthermore it seems to me plain that the Agency's approach to this issue proceeds upon the assumption that the residents of affected premises can impose upon sewerage undertakers a duty to provide them with public sewerage simply by refusing to co-operate amongst themselves. This however overlooks that the Agency wearing its different, regulatory and enforcement hat has powers to compel those residents to remedy the unlawful discharges from their properties. Mr Clarke asked the question rhetorically-which is the better way of dealing with an environmental problem-coerced compliance or public provision for which all users will pay? That is not a question for me to answer. But the choice presented involves a false contrast. Coerced compliance involves only the affected persons. Public provision will be at the expense of all users in the sewerage undertaker's area. What is to my mind clear is that the Agency cannot rule out private provision as inappropriate on the ground alone that it can only be brought about by coerced compliance. Section 101A has been enacted against the background of the Agency's regulatory and coercive powers and Parliament must be taken to have envisaged that the Agency would, where practical, proportional and appropriate, use those powers. To rule out a private solution simply because its achievement would or might require coercion prejudges the outcome of the enquiry whether, in this case, a public sewer is appropriate and in particular prejudges the enquiry whether there is some other cost-effective means by which it is practicable to overcome the adverse environmental or amenity effects.
34. So far as concerns Chetwode I have already concluded that the determination must be quashed and thus the Agency must reconsider this aspect also in the light of this judgment. It is in my judgment plain from the wording of the determination that the Agency erred by imposing on Anglian Water a burden which Section 101A does not sanction. I must however in this regard refer also to Mr Gallagher's evidence on this point. Referring to the Chetwode determination he states as follows:-
"27. When considering the next most cost-effective option, Option 4, the Agency took the following into account:
(i) Commitment would be required between the householders to a new plant additionally Anglian Water itself stated that: "this option requires the community to take responsibility for the works which cannot be assumed, and was therefore not commended to CMG."
(ii) Ministerial Guidance states "...it is not, however, the intention to relieve the sewerage undertaker of its duty to provide a public sewer on the grounds that the problem can be overcome with a similar private sewer."

28. The Agency therefore took the view that Option 4 would not be considered practicable and that therefore Anglian Water was under a duty to provide first time sewerage."
On the face of it this seems to indicate clearly that the Agency on this point took into account a part of the Ministerial Guidance which is either accepted to be flawed or which I have in any event found to be flawed.
35. The situation at Bent Hill is more complex. It is plain that this option received greater consideration than it did at Chetwode. Mr Gallagher deals with this as follows:-
"30. This dispute was received on 18 March 1999. In this case Anglian Water took the view that the installation of a common private package plant was the most cost-effective solution.
31. Again Anglian Water accepted that there were environmental and amenity problems and considered three options:
(i) Option 1; the provision of a gravity sewer from Bent Hill to Buckingham Industrial Park. Total live cost £87,434.00.
(ii) Option 2; the residents to install and maintain a package treatment plant. Total live cost £13,336.00.
(iii) Option 3; to replace the existing Septic Tanks with cesspools. Total live cost £94,658.00.
32. Anglian Water's preferred option was Option 2.
33. In considering all the options the Agency requested further information and clarification from Anglian Water in letters dated 28 May 1999 and dated
15 September 1999. In considering Option 2 the Agency took the following into account:
(i) Anglian Water stated in their letter of 28 September 1999 "it has been assumed that a private treatment plant would be sited on land presently owned by one or more of the householders currently contributing to the problem. For this reason no allowance has been made for costs associated with land purchase. No precise site for the location of such a plant has been identified."
(ii) The applicant's [Mr Drinkwater's] letter of 6 July 1999 recognises that "There are major legal considerations to be take into account when providing a communal system and, should it be found that the Environment Agency/Anglian Water reject our applications then single individual plants will be the preferred option."
(iii) Paragraph 1.5 of the Ministerial Guidance states that "Under this provision, it is not the intention to relieve the sewerage undertaker of its duty to provide a public sewer on the grounds that the problem can be overcome with a similar private sewer."
34. In view of the absence of an identified or agreed location for the suggested plant, or full costings for this, the Agency determined that Option 2 was not a practicable solution and that Anglian Water was [under] a duty to provide first time sewerage."
Anglian Water's view on this was that it was apparent that there was sufficient land in the ownership of the residents on which to site a plant, and that it was not for Anglian Water to tell them where to site it. The Agency says that Anglian Water should at the very least have given them a clue as to where it might go but that they failed to do even that bare minimum.
36. It is important that the Court should not be drawn into the merits of the dispute. It may be that it is not practicable to construct a private package treatment plant at Bent Hill but I am quite satisfied that the Agency has not as yet properly considered that question. It must do so with an open mind bearing in mind the existence of its regulatory and enforcement powers, and bearing in mind also that, in my judgment, Parliament in enacting this complex section cannot be assumed itself to have been expressing a disposition towards public provision of sewerage. Parliament has sought to strike a balance and has entrusted the Agency with the task of weighing the factors. Parliament could very easily have said that where there are adverse environmental or amenity effects then there will be an obligation on the sewerage undertaker to provide public sewerage. It has not done so. Parliament must be taken to have envisaged that there will be cases in which private sewerage remains the appropriate cost-effective option. Furthermore it should not necessarily be assumed that coercion will in such circumstances be necessary, although no doubt it is there is reserve in case of need.
In many if not most cases those who are producing the adverse environmental or amenity effects will themselves be suffering therefrom and may be very ready to take the appropriate steps or where necessary to co-operate amongst themselves once it is clear that public sewerage will not be provided. The Bent Hill decision must be quashed, as would also have been Chetwode on this ground had I not already determined that for other reasons it cannot stand.
The Locality Point
37. I identified this point at paragraph 10(4) above. It arises in relation to the Wretton and Little Bentley determinations. In each of those cases there are discrete albeit related reasons why those determinations must in my judgment also be quashed- in the latter case additional to the cesspool point on which alone I would in any event quash the Little Bentley determination. It may assist in understanding the point if I first outline briefly how it arose in each case, and explain my reasons for thinking that neither determination can stand. I will then deal with the point of principle which underlies each determination and which will have to be addressed by the Agency in the light of such guidance as I am able to give.
Wretton
38. By an application dated 9th December 1996 Kings Lynn and West Norfolk Borough Council applied to Anglian Water (on behalf of 145 residents) for provision of a public sewer for the village of Wretton.
39. In its Report attached to the application the borough council stated that Wretton was included in the Council's rolling programme of first-time sewerage provision and was notionally scheduled for requisition under Section 98 of the Water Industry Act 1991 by the year 2002.
40. On 6th January 1998, in the course of its appraisal procedure, Anglian Water wrote to the Agency, following a meeting on that day, attaching a plan showing pollution problems found in four areas in Wretton, and a plan of a proposed sewerage scheme, and requesting the Agency's comments. With respect to Area C the letter stated
"Pollution of the ditch to the south of Emmerdale Farm has been observed. We believe this pollution to be a localised issue as percolation tests in the area have indicated that septic tanks should operate effectively."
41. By a letter dated 6th February 1998 the Agency replied to Anglian Water as follows:-
"FIRST TIME SEWERAGE APPLICATION- WRETTON
Thank you for your letter and meeting with David Batterham of our Kings Lynn office on 6th January 1998 to discuss the above.
...Area C indicates minimal pollution arising probably from one dwelling only, can be dealt with accordingly by the Agency and does not need tobe addressed within the proposed scheme.
The Agency therefore has no objection to your proposals...."
It should be noted that the Agency says of this letter that it was sent by an area office, which is perfectly correct, and that it was not sent in the context of a Section 101A determination, which is not correct. The letter of 6th February 1998 was a response to a letter of 6th January 1998 the heading and first sentence of which read:-
"Environment Act 1991-Section 101A First Time Sewerage Application, Wretton.
I refer to our meeting today at Wereham to discuss the Section 101A First Time Sewerage Application for Wretton."
42. Further, in the course of its appraisal procedure Anglian Water sent questionnaires to residents. Mr Gathercole of Emmerdale [which was within the area described as "Area C"] replied stating that he had a septic tank which was emptied 6 monthly, and that he suffered no environmental or amenity problem.
43. On 7th May 1998 Anglian Water completed its appraisal. It accepted the duty to provide a public sewer to Areas A, B and D of the village. With respect to Area C it stated:-
"Pollution of the ditch to the south of Emmerdale Farm has been observed. We believe this pollution to be a localised issue as percolation tests in the area have indicated that septic tanks should operate effectively (see letter from E A in Appendix E)."
The letter to E A to which reference was made and which was included in Appendix E was the Agency's letter of 6th February 1998 the material parts of which I have already set out above.
44. Under "Review of Possible Options" Anglian Water's appraisal stated;
"Investigations have identified that only part of the village has a problem which cannot be easily rectified, namely the properties in Areas A, B and D.
Options to solve the problems in these areas have been termed "minimum duty" options. Options for a complete village scheme have also been considered to enable any possible "minimum duty" solution to be compatible with future expansion."
45. Anglian Water's NPV(net present value) costings of the public sewerage options were;
(i) Vacuum Sewerage Minimum Duty (Areas A, B and D):£765,422.00.
(ii) Vacuum Sewerage Complete Village (including Area C):£1,223,538.00.
(iii) Gravity Sewerage Minimum Duty (Areas A, B and D):£713,250.00.
(iv) Gravity Sewerage Complete Village (including Area C):£1,612,496.00.
46. Anglian Water accordingly recommended and accepted a duty to provide gravity sewerage for Areas A, B and D. Anglian Water so informed Kings Lynn and West Norfolk District Council on behalf of the residents by a letter dated 20th August 1998, and further stated:-
"The next stage is for the detailed design to be carried out and the scheme will then be prioritised into Anglian Water's capital programme. Unfortunately at this stage it is not possible to give an accurate date when work will start on site but it is unlikely to be before mid 2001."
47. Kings Lynn and West Norfolk District Council referred to the Agency disputes as to (a) the extent of the duty (contending for inclusion of the whole village) and (b) the timing (contending for an earlier start date).
48. By letter dated 22 April 1999 the Agency asked Anglian Water for further information about the proposed start date. On 7th May 1999 Anglian Water replied;-
"A draft programme for accepted Section 101A applications was recently produced being part of this company's AMP 3 submission to OFWAT for funding for the period April 2000 to March 2005. It is assumed that as further Section 101A schemes are approved, there will be a need to continuously review priorities and less urgent schemes could be relegated. Currently, Wretton is ranked No 8......out of fifty in that submission. When the full extent of funding in AMP 3 is known, I will be in a better position to advise you."
49. For each five year period, Anglian Water produces an Asset Maintenance Plan ("AMP") for the purpose of the level of funding and price limits set by its economic regulator, OFWAT. AMPs submit information on maintaining existing service levels, meeting projected growth and achieving new quality targets. The Agency produces a Guideline for identifying environment improvements qualifying for AMP investments. AMP 3 covers the period 2000-2005. Among the items to be included in AMP 3 were Section 101A sewerage schemes which had either been accepted or were to be appraised as at 31st December 1998.
50. By a letter dated 26th July 1999 the Agency asked Anglian Water for further information, including information relating to the timing and prioritisation of the Wretton scheme. On 17th September 1999 Anglian Water repeated what it had said in its letter of 7th May and in addition stated:-
"(f) Anglian Water applies a scoring system to assess its results. This is designed to ensure that, where a duty under Section 101A exists, communities and premises considered to be causing more serious adverse effects are provided with sewerage in priority over those causing less effects. Earlier Section 101A schemes have been carried out in accordance with this method of prioritisation and Anglian Water believes that this agrees with the intended spirit of Section 101A: to serve those localities which have been identified with a high environmental need. Size and complexity of a proposed scheme is not considered as a criteria for prioritisation above the environmental impact scoring system.
......(i) The priority given by the environmental assessment suggests that unless there is any deterioration in the maintenance and operation of existing disposal systems, the proposed delay to provision of the scheme will not cause any serious impact to the area other than what already exists in some areas of the village."
Anglian Water referred to information from the Agency and Environmental Health
Department and continued;-
"(j) the medium problem rate, identified by residents, is reflected in the
medium to high impact which existing domestic systems were found to have on the environment by Anglian Water's own assessment. This, combined with all other evidence, justifies the position of the Wretton sewerage system in Anglian Water's long term Section 101A programme. Flexibility within a Section 101A programme is considered to be necessary in order to allow schemes, that have been assessed and found to have a high priority need, to be integrated to suit an appropriate timescale."
51. By its decision dated 22nd December 1999 the Agency determined:-
"19. The Agency finds that Area C is part of the village of Wretton and are premises in a particular locality for the purposes of this determination.
20. For the reasons set out above the Agency finds that the duty to provide a public sewer applied to the village of Wretton and that the Company is under a duty to provide a public sewer.
21. The duty to provide First Time Sewerage is independent of the AMP 3 submission and the Company should provide a start date for the scheme no later than mid 2001."
52. Leaving on one side for the moment the question whether the approach to questions of locality is correct, there are two main grounds upon which Anglian Water challenge this decision. Firstly, it says that the Agency has acted inconsistently and unfairly by ignoring or departing without notice from its own instruction dated 6th February 1998 that Area C "does not need to be addressed within the proposed scheme." Secondly, in determining that Anglian Water must provide a start date for the Wretton scheme of no later than mid 2001 the Agency, so Anglian Water contends, erred in law by;-
(i) Misdirecting itself that the AMP 3 submission was irrelevant when, as it well knew because it so directed, First-Time Sewerage schemes under section 101A (including Wretton Areas A, B and D) were included within that submission;
(ii) Failing to have any regard to Anglian Water's careful and proper scheme for prioritisation of its various duties and its reasons therefor;
(iii) Failing to have any regard to the fact that if Anglian Water was required to adhere to a rigid start date for the Wretton scheme other schemes which might have a higher priority would be delayed;
(iv) Failing to have any regard to the fact that, by directing Anglian Water
to include Area C within the scheme, it had more or less doubled the cost of that scheme;
(v) Acting wholly unreasonably and without regard to the evidence before it and without regard to its own knowledge as an expert Agency appointed by Parliament.
53. On the first point the Agency submits, as I have already indicated, that the letter was only sent by an area office and not sent in the context of a Section 101A determination. They say that Anglian Water's appraisal and submission should have addressed this issue in detail and that it did not. They say that the letter did not constitute an instruction and was merely advisory. They also say both in relation to this first point and in relation to the second, timing, point that Anglian Water cannot have derived any legitimate expectation from the terms of the letter-cf R -v- North East Devon Health Authority, ex parte Coughlan [2000] 2WLR622.
54. The riposte of the Agency on the prioritisation/timing point is that the Agency is not required to be and is not an expert in the design, planning and building of sewerage systems. It submits that it was for this reason that it asked Anglian Water for further information as to timing and prioritisation, but in response thereto, contends the Agency, Anglian Water provided only the most slender details of its internal prioritisation system without sending a copy of its policy document, appraisal document or scoring system. This, submits the Agency, was inadequate if it was to constitute the entirety of the undertaker's submission on timing. The Agency suggests that the start date of mid 2001 was chosen because of the initial assertion by the undertaker that a start date of around that date could be given. The Agency says also that it took a view, doing the best it could on the limited information made available to it by Anglian, that a start date of mid 2001 would give about 18 months from the determination date which would constitute a reasonable time period for the planning and design stages of the works. The Agency maintains that according to the Ministerial Guidance the availability or otherwise of funding is not a factor to be taken into account in deciding whether or not the duty to provide a public sewer exists. The Agency's own AMP 3 Guidance on First Time Sewerage proposes "logging up", which allows for the funding of schemes for which plans were not originally made.
The Agency's response to the five particular allegations by Anglian Water as to the respects in which the Agency erred in law is as follows:-
1. The AMP 3 submission is a means whereby the applicant is allowed by OFWAT to recover the cost of certain expenditure. As a process it should not be used to inhibit the commitment of funds to new projects in accordance with statutory duties. Where new duties are imposed upon an applicant then it can apply to OFWAT to log up such expenditure for subsequent pass- through to its customers.
2. Details of this "careful and proper scheme" were not included in Anglian
Water's submission despite a request from the Agency for more information on timing.
3. The start of one scheme may delay another but the Agency cannot fetter its discretion by simply acceding to a prioritisation scheme established by the undertaker, without consideration of the detailed facts of each case.
4. Cost is but one factor.
5. Anglian Water seems to envisage that the Agency will act as an expert and bring to bear its own expertise by carrying out an assessment or appraisal rather than by acting as an arbitrator in the manner adopted by the Planning Inspectorate. There is no provision in the legislation or guidance for the Agency to act in this role and it will be extremely unusual for a statutory decision maker to have to act in this way.
55. I have to say that I find the Agency's stance on the Wretton determination surprising. It is true that in its letter of 26th July 1999 the Agency indicated that the Borough Council had referred the dispute which related both to partial acceptance of the duty and timescale. However, Anglian Water's reply of 17th September 1999 included a copy of the Agency's Area Office letter of 6th February 1998. Elementary fairness in my view required the Agency to put Anglian Water on notice if it intended to adopt another approach in its determination. This is with all respect to Mr Clarke a very long way from what he described as the dangerous suggestion that because of an "ex cathedra" pronouncement by an Area Office the Agency is precluded from doing its statutory duty. There is no suggestion that the Agency is bound for all time by the pronouncement-but at the very least it should have given notice of its intention to approach the matter differently, so that Anglian Water could address the issue. It is no answer to this that Anglian Water included costings which themselves included Area C. Anglian Water should have been put on notice that they needed to satisfy the Agency, contrary to its earlier assessment, that it was unnecessary to make provision for Area C. Very similar considerations apply to the timing issue. The most that Anglian Water had ever said was that work on the site was unlikely to start before mid 2001. That as the Agency would or should have realised was on the basis of works not including Area C. The Agency would have known, because its own guidance compelled it, that by the end of 1998 Anglian Water would have applied for funding for the lesser, August 1998 scheme. The Agency also would or should have known that the AMP 3 determination was due to be made by OFWAT in November 1999 so that anything said by Anglian Water on the topic in September 1999 would of necessity be vague and tentative because Anglian Water did not know the outcome of its AMP 3 application. Having in such circumstances elevated a most tentative start date ("unlikely it can start before") into a suggested start date (see Mr Gallagher's first Witness Statement at paragragh 52) the Agency then added insult to injury by insisting that there should start on that date a scheme which was more or less twice as expensive (and correspondingly more demanding of resources) than that to which they had hitherto directed their enquiries.
56. I agree with Miss Lang that there is little difficulty in analysing this in terms of Lord Woolf's judgment in Coughlan. The Agency in its letter dated 6th February 1998 made a clear representation that Area C did not need to be addressed. Anglian Water relied on that statement to its detriment by :-
1. Not including Area C in the scheme which it proposed;
2. In its appraisal, dealing very shortly with the reasons for the exclusion of Area C on the assumption that its exclusion had already been accepted by the Agency;
3. Placing the "minimum duty" Wretton scheme (i.e. excluding Area C) in the programme for accepted Section 101A applications and submitting it to OFWAT, and ranking it 8 out of 50, on the assumption that, in terms of the scope of the works and the cost of the works, it would not include Area C. The inclusion of Area C enormously increases the costs and the amount of work, because of its location. To include Area C in public sewerage would cost an extra £899,246.00 for gravity sewerage, more than the whole cost of the scheme for Areas A, B and D or £488,116.00 for vacuum sewerage, almost an extra 90% of the cost for the scheme for Areas A, B and D. The result of the Agency determination is that the OFWAT submission would have to be changed, and the addtional cost has an impact on the availability of capital funds for other schemes.
4. Indicating in its decision letter of 20th August 1998 that
"The scheme will then be prioritised into Anglian Water's capital programme. Unfortunatley at this stage it is not possible to give an
accurate date when work will start on site but it is unlikely to be before mid 2001."
The Agency then decided that the work had to commence no later than mid 2001 and now states that the choice of dates was based on Anglian Water's own decision letter. However, this date estimate was given by Anglian Water relying on the fact that Area C would not be included. It did not give an alternative date estimate based upon the alternative assumption that Area C would be included, which would entail a much larger project. Now that the Agency has changed it stance, Anglian Water is faced with finding the necessary capital to commence the much larger and more expensive "complete village" scheme at this early date.
Applying the approach in Coughlan, the Agency has in my judgment erred in law in two distinct respects. Firstly it did not bear in mind before deciding whether to change its stance in relation to Area C the previous representation which it had made on that topic nor, in my judgment, did it give proper weight to the implications of changing its stance. This amounted to Wednesbury unreasonableness. Secondly, by changing its stance in relation to Area C without giving Anglian Water any advance warning that it might do so and without considering the potential detrimental effect on Anglian Water, the Agency acted so unfairly towards Anglian Water that it abused its power. The Agency has not shown any overriding interest which could possibly justify its action.
57. I therefore have no doubt that for these reasons alone the Wretton decision should be quashed, unless it can be said that it is the only decision which could have been reached having regard to the proper approach to the "locality" point, although even then the timing aspect would plainly have to be revisited. I will revert to the "locality" issue after dealing with the Little Bentley Determination.

Little Bentley
58. By an application dated 27th November 1997 Mrs Maureen Hart applied to Anglian Water for first-time sewerage under Section 101A of the Water Industry Act 1991 for herself and 24 other residents of Little Bentley.
59. Anglian Water conducted an appraisal in accordance with the Guidelines. It sent questionnaires to some 50 properties in Little Bentley, receiving a 72% response. It carried out various other investigations and found:
(i) That the predominant sewage system in the village was by septic tank, with some cesspools and package treatment plants;
(ii) That there was evidence of visual and odour pollution from foul effluent dishcharges;
(iii) That the problems were caused by 19 properties;
(iv) That septic tanks were not suitable for the area;
(v) That two of the 19 properties at which problems were found (3 Jubilee Cottages and 2 Manningtree Road) were situated at extremities of the central envelope of the village and had disposal systems causing only minor odour problems.
60. In the course of its appraisal Anglian Water was informed by the Agency on 24th March 1998 that the areas of particular concern in Little Bentley were Rectory Road and Church Road. The Agency further stated:
"The incidence of the Agency prosecuting a cesspool or septic tank overflow, especially in the absence of an alternative available foul sewage system in the locality, is rare since most householders respond to the Agency's requests to make alternative arrangements. Nevertheless, it is a possibility."
61. In considering public sewerage options Anglian Water excluded 3 Jubilee Cottages and 2 Manningtree Road on the ground that, by reason of their relative isolation from the other problem properties and the lie of the land, extension to them of a public sewer would greatly increase the costs. Anglian Water accordingly costed various public sewerage options per property for the 17 other problem properties, and costed the option of individual sealed cesspools for the same number of properties. In addition, Anglian Water costed a more limited public sewerage option for 11 central properties. Anglian Water found that individual sealed cesspools were the most cost-effective solution, and accordingly determined that it had no duty to provide a public sewer and so informed Mrs Hart on behalf of the resident-applicants by letter dated 31st March 1999.
62. Anglian Water determined the NPV costs of the practicable options as follows:-
(i) Individual sealed cesspools; £24,000.00 per property.
(ii) Option 3a: Public gravity sewers and pump to off-site STW at Tendring Green: £43,000.00 per property, total £735,000.00.
(iii)Option 3b: Public gravity sewers and on-site STW adjacent Holland Brook, Tendring Road: £30,000.00, total £513,000.00.
(iv) Option 3c: Public gravity sewers and on-site STW opposite Pump Farm: £29,000.00, total £499,000.00.
(v) Option 3d: Public gravity sewers and on-site STW serving Rectory Road
only (11 grouped properties):£30,000.00 per property, total £334,000.00.
63. The residents acting by Mr King of Little Bentley parish council referred the dispute to the Agency for determination.
64. Following notification of the reference, Anglian Water explained to the Agency why it had excluded Jubilee Cottages and Manningtree Road from the catchment area for which it had determined public sewerage options.
65. By a decision dated 10th November 1999 the Agency determined that Anglian Water was under a duty to provide a public sewer to the whole of Little Bentley, including Jubilee Cottages but making no reference to Manningtree Road.
66. Having rejected Option 3d on account of its limited scope the Agency determined:
"19. Option 3c Gravity Sewers and On-Site STW (Opposite Pump Farm) appears to be the most cost-effective option offered by the Company. This does not include Jubilee Cottages.
20. .....The cost-effective solution is the provision of First Time Sewerage to the whole village.
21. The Agency finds that Jubilee Cottages are part of the village of Little Bentley and are premises in a particular locality for the purposes of this determination.
22. For the reasons set out above the Agency finds that the duty to provide a public sewer applies to the village of Little Bentley and that the Company is under a duty to provide a public sewer."
67. Mr Gallagher deals with the decision making process in the following passage in his Witness Statement:-
"41. The Agency therefore considered the remaining options detailed. In reaching the decision that first time sewerage was appropriate for the whole of the village, including Jubilee Cottages, the following were taken into consideration:
(i) Jubilee Cottages were included as part of the application and the occupants responded to AW's questionnaire about environmental problems and therefore were considered in the Agency's determination process.
(ii) Tendring District Council state "Little Bentley is a small village comprising less than 30 dwellings in two small but compact housing groups on Church Road and Rectory Road..... There is no significant centre to the village although the small triangular green opposite the Bricklayers Arms does form a focal point." Jubilee Cottages is located on Rectory Road.
(ii) Jubilee Cottages was reported as having odour problems (an amenity issue), further confirming that it should be included in the determination.
(iv) Anglian Water had themselves rejected a proposed option to resolve the problem at Little Bentley on the grounds that this option (3d) did not take into account all the premises in the locality which were the subject of the application and which had been identified as properties giving rise to adverse
effects. This included Jubilee Cottages. By implication they were accepting that the solution would need to address the adverse effects at these properties and therefore accepting that they were premises in the locality for the purposes of the determination.
42. The Agency therefore concluded that Jubilee Cottages were part of the village of Little Bentley and are premises in a particular locality for the purposes of the determination.
43. The provision of first time seweragewas the only option remaining. AW had provided a number of First Time Sewerage Options, Options 3a, 3b, 3c, 3d and 3e.
44. The Agency considered all of these options and noted that only one option, Option 3e addressed all of the premises where advere environmental and amenity problems had been identified. We noted that Option 3a identified reasons why premises at Number 3 Jubilee Cottages and Number 2 Manningtree Road should be excluded from first time sewerage. However, these reasons were addressed technically in Option 3e which provided a more cost-effective solution to sewering of all relevant premises. Accordingly we preferred Option 3e to Option 3a and it was establised that a complete technical solution was possible.
45. Option 3d did not address all of the properties where adverse environmental impacts had been identified. In fact it only addressed just over 50% of these properties. Accordingly we rejected this option.
46. We were left comparing Options 3b, 3c and 3e. Only Option 3e provided a complete technical solution i.e. Options 3b and 3c whilst cheaper did not address how problems at the excluded properties were to be addressed. Accordingly we found that Option 3e, first time sewerage, to the whole of the village of Little Bentley was the appropriate solution as stated in our determination."
68. This evidence of Mr Gallagher is for two reasons quite remarkable. Firstly, the Agency did not have before it an Option 3e. Option 3e was costed and prepared for the purpose of these proceedings and it was in that context that the Agency received it.
The determination makes no reference to Option 3e let alone its comparison with other options. Whatever the explanation for Mr Gallagher's error, and confusion is the only one which I need consider, this episode alone casts some doubt on the reliability of the methods used by Mr Gallagher to reconstruct the decision making processes of which he speaks. For present purpose what is clear is that the Agency simply cannot have considered what was the most appropriate cost-effective solution to deal with such problems as existed at Jubilee Cottages-rather it has adopted a mechanistic approach to the question what is included in "the locality" and then, having identified that it was appropriate to overcome problems at some premises within the locality, it has proceeded straight to a determination that it is appropriate to provide public sewerage to all premises within the locality.
69. The second remarkable feature of Mr Gallagher's evidence is his treatment of the locality issue itself. Firstly, in quoting from the Tendring District Council document Mr Gallagher omits the most relevant passage. The full passage reads:-
"Little Bentley is a small village comprising less than 30 dwellings in two small but compact housing groups on Church Road and Rectory Road with additional dwellings elsewhere in the inset area. It is the smallest of the defined settlements in Tendring district. There is no significant centre to the village although the small triangular green opposite the Bricklayers Arms does form a focal point."
Furthermore the District Council's own map did not show Jubilee Cottages at all-they are "off the map." They lie considerably to the west of the group of Rectory Road houses shown on the Council's map, as can be seen from the plans submitted by the residents. As for Mr Gallagher's paragraph 41(iv) this is a most remarkable piece of special pleading. It had already been made clear in the document to which Mr Gallagher refers that No3 Jubilee Cottages and No2 Manningtree Road were situated at extremities of the central envelope of the village and were found to have disposal systems causing only minor odour problems. The particular passage to which Mr Gallagher refers rejects Option 3d because it caters for 11 only of the remaining 17 affected properties. There is simply no justification whatever for the assertion that Anglian Water was accepting that the solution would need to address the adverse effects at 3 Jubilee Cottages and 2 Manningtree Road-on the contrary the document as a whole makes clear that Anglian Water's approach was to exactly opposite effect. As to the suggestion that Anglian Water was accepting that these were premises in the locality for the purposes of the determination, it is plain that Anglian Water was not addressing any such question.
70. The upshot is that I am left in doubt as to the basis upon which the Agency concluded that it was appropriate to provide public sewerage to Jubilee Cottages, unless it is on the purely mechanistic basis that Jubilee Cottages are part of the village of Little Bentley. The Agency had no materials on the basis of which it could have given any let alone proper consideration to the question whether the provision of public sewerage to Jubilee Cottages was the appropriate solution. The decision cannot therefore stand unless, having regard to the proper approach to the locality issue, there is in fact no other conclusion to which the Agency could have come.
71. The Agency's determination in the Wretton case is flawed in precisely the same way. The Agency merely decided that Area C is part of the locality for the application. It gave no consideration to the question whether public sewerage was the appropriate solution to the problems in Area C, which were evidently of a very minor nature. The Agency does not exlain on what grounds it concluded that it was appropriate to provide public sewerage for the whole village other than that one can infer a process which, having found that it is the appropriate solution for some premises in the village, then proceeds mechanistically to a conclusion that it is the appropriate solution for all premises in the village because the village is the locality for the purposes of the application.
72. In February 1998 the Agency gave an indication of its thinking on the locality issue. By letter of 25th February 1998 addressed to Mr A Maskell, Regional Sewerage Manager of Anglian Water, it wrote as follows:-
"WATER INDUSTRY ACT 1991 s101A
At our meeting of 11th February, a number of issues came out of the legislation and DoE guidelines regarding the extent of the duty and responsibilities. The issues have been discussed with Anne Brosnan and
the following opinions confirmed by the Head Office lawyer advising nationally on 101A.
ISSUE 1
If the application relates to lots of properties (say 50) but the problems are with only a few (say3), does the duty apply to the whole village or just the properties causing the problem?

Opinion

WIA'91 101A (1) refers to ".....the duty ....for.... premises in a particular locality .... where the conditions..... in subsection (2) below are satisfied." 101A (2) goes on to refers to `premises in question', `any of those premises' and `any of the premises in question.'
If any of the premises satisfy all the tests in 101A (2) and the guidance, then the duty to provide first time sewerage under 101A applies to all the `premises in the locality'.
To apply this to some examples:
Example A: An application relates to a village of 50 properties with 3 premises (not together) that satisfy the tests,then the duty must be considered
for all 50 properties. However, if the 3 problem properties were all in a discrete bit of the village, then these could be considered as `premises in a particular locality' and the duty applied only to the 3.
Example B: An application relates to 4 discrete hamlets located fairly close to each other. Problems, which satisfy the tests, are found only in one hamlet and the duty would then apply to the single hamlet as `premises in a particular locality'."
73. This approach is reflected in paragraph 7.2 of the Agency Guidance which I
have set out above. The Ministerial Guidance is silent on this issue.
74. It would seem that in both the Wretton and the Little Bentley determinations the Agency has given no consideration to the question whether Area C or 3 Jubilee Cottages could be considered to be a discrete part of the village. The Agency has thus failed to address an issue which it has itself regarded as relevant. However the broader question is whether the Agency is correct to approach matters on the footing that if any premises satisfy all the tests in Section 101A (2) and the guidance (by which presumably is meant the balancing exercise in sub-section(3)) then the duty to provide first time sewerage under Section 101A applies to all the premises in the locality.
75. In my judgment the Agency's approach to this question has not been justified in terms of the section. The Agency's approach involves that so far as concerns the identification of a "locality" it has a discretion entirely at large, unfettered by the section, the exercise of which is challengable only on Wednesbury grounds of reasonableness. I cannot accept that this is the correct approach. The Agency's approach has most startling consequences. It involves that even if only a few houses in a village are suffering from adverse enviromental or amenity effects then the relevant sewerage undertaker may be compelled to provide public sewerage to the whole village provided only that the Agency cannot be held to have acted unreasonably in reaching the conclusion that the village constitutes a locality. This would mean that the statutory conditions and tests set out in sub-sections (2) and (3) of section 101A might never fall to be considered so far as concerned the majority of premises in respect of which public sewerage was in this manner required. This seems a long way from the intention of the section.
76. The argument which is said to justify the Agency's approach proceeds as follows. "The premises in question" to which reference is made in sub-section (2)(a) can only be "premises in a particular locality"-see sub-section (1). Sub-section (2)(c) it is suggested provides that if the statutory criteria are met for any of the premises in question then the duty will arise to provide public sewerage for all the premises in the locality.
77. In my judgment the section and in particular sub-section (2)(c) does not have this effect. The starting point in sub-section (1) is that a duty may arise to provide a public sewer to be used for the drainage of premises in a particular locality. It is sufficient in sub-section (2)(a) that any of the premises in question are those on which there are buildings not completed by 20th June 1995. It is therefore contemplated that there may be a duty to provide sewerage under this provision even to premises erected since 20th June 1995. However the test of appropriateness in sub-section (2)(c) applies in my judgment to all of the premises in question. Thus the sewerage undertaker, or the Agency if called on to do so, has to ask itself if the drainage of any of the pre-June 1995 premises is giving or is likely to give rise to such adverse enviromental or amenity effects that it is appropriate to provide a public sewer for the drainage of all of the premises in the locality. In considering the question of the appropriateness of provision of a public sewer to serve the entire locality, regard has to be had to the considerations in sub-section (3). That sub-section makes it to my mind clear that the sewerage undertaker or the Agency must consider not just the question whether the provision of public sewerage to what I might call the directly affected properties is appropriate but also the wider question whether it is in the circumstances appropriate to extend public provision further. Sub-sections (3)(c), (d) and (e) seem plainly to contemplate that it might be concluded that whilst it is appropriate to require the provision of public sewerage to certain premises within a locality, it is not appropriate to extend it to all the premises within the locality because, for example, the additional cost is disproportionate or because it is practicable and/or more cost effective to overcome any adverse enviromental or amenity effects in some part or parts of the locality otherwise than by the provision of a public sewer. Thus I would expect there to be cases in which the conclusion is that it is appropriate, because the additional cost is proportionate, to extend public sewerage to premises within a locality where existing private sewerage is entirely adequate or can be made adequate. By the same token however I would expect there also to be cases in which the conclusion is that whilst it is appropriate to require the provision of public sewerage to some premises within a locality, it is not appropriate to require it to be extended to other premises within the same locality because so to do would involve disproportionate cost or because such adverse enviromental effects, if any, as may be present at those other premises can in fact be dealt with in a practicable and cost-effective manner by private provision.
78. I can understand why the language of section 101A has led some to believe that the obligation to provide sewerage is locality-based, although I believe that the logical result of such an approach would be that the conclusion in any case would be, as it were, all or nothing, i.e. either it is appropriate to provide a public sewer for all of the premises in the locality, or it is not, and if the latter, then there is simply no duty to provide public sewerage in a locality at all. What I find impossible to conclude from the section is that it is intended that there should be a duty to provide public sewerage to any premises without consideration of the question whether it is appropriate to require public sewerage for those premises. In other words I see no warrant for what one might term parasitic entitlement. Moreover if the section were so construed i.e. as involving parasitic entitlement, it would be likely in my judgment to have ill effects which would manifest themselves both in cases of public sewerage being denied where objectively it is appropriate according to the criteria and in cases of sewerage undertakers being required to undertake at general expense schemes more extensive than is appropriate according to the criteria. Sub-section (3) in my judgment makes it clear that the criteria themselves involve consideration of the circumstances as they affect all of the premises within the locality, and that it is not intended that the conclusion must in every case be one of provision for all or provision for none. The error in the Agency's approach as spelled out for example in its letter of 25th Februrary 1998 which I have set out at paragraph 72 above is I believe to think that any premises can satisfy all of the tests in sub-section (2) without regard to the position of the other premises in the locality and indeed the locality itself. The considerations to which regard must be had in enquiring whether the sub-section (2) conditions are met include an enquiry which embraces the locality in which the premises are found. I am relieved to be able to reach this conclusion for were the position as the Agency has contended it would mean that the question whether public sewerage should be provided would in many if not all cases be determined not by the considerations prescribed by the statute but by an enquiry into the concept of locality which enquiry would be quite unconstrained by any statutory criteria. For the reasons I have given I would expect such an approach to give rise to the real possibility of results which must be regarded by reference to the statutory criteria as capricious.
79. It follows that the Little Bentley determination must be quashed. The Wretton determination would have been quashed on this ground also had it stood alone-as it is I have already concluded that that determination cannot stand.
80. The foregoing is, I hope, more than sufficient to dispose of this application. In the upshot I have not found it necessary to consider whether the Agency's entire decision-making process has been affected by a general disposition against non-public sewerage, a point which Mr Clarke contended was not fairly open to Anglian Water on this application. I would merely remark that the cumulative effect of the errors in approach which I have found would almost inevitably be such as to give to a sewerage undertaker the impression of such a disposition, however unfounded that suspicion might in fact be.
81. There remain only two points with which I should deal. Firstly, timing. This problem arose in relation to Wretton, as I have discussed above. The Agency recorded that, according to the Ministerial Guidance, the availability or otherwise of funding is not a factor to be taken into account in deciding whether or not the duty to provide a public sewer exists. This is so-see paragraph 4(1)(h) set out above, and certainly the section gives no indication that the availability of funding should be regarded as relevant to the existence of the duty as such. However I do not believe that it follows from this that, as the Agency has prescibed in its own Guidance Note (see paragraph 7.3) in determining a dispute on the time scale for providing a sewer the Agency should take a view on the reasonable time needed to provide a sewer, based on technical factors alone. The statute is silent on this point save only that it is clear from sub-section (7)(c) that Parliament specifically envisaged the possibility of disputes as to the time by which any duty of a sewerage undertaker which might be established should be performed, and invested the Agency with power to determine such disputes. The availability of funding to a sewerage undertaker is a complex matter, dependent on procedures which have to be agreed and determined as between the sewerage undertakers and the industry regulator OFWAT. There was a suggestion by the Agency that, at any rate so far as concerns the period with which I am concerned, and the Wretton determination in particular, there was available to sewerage undertakers a procedure known as "logging up" which would enable a sewerage undertaker to secure approval for funding of a scheme for which no provision had been made in the Asset Maintenance Plan relevant to the period within which the Agency required the work to be done. The Court was not fully informed as to the ramifications of the logging-up procedures and in any event it is clear that the procedures agreed between the sewerage undertakers and OFWAT may and do change from one period to another. It is sufficient and I hope helpful if I merely indicate that, in my judgment, it cannot have been the intention of Parliament that the timescale within which the duty to provide a public sewer should be performed should be assessed on the basis of technical factors alone, without regard to the availability of funding. It is simply unrealistic to think that Parliament intended that the timescale for what is potentially major capital expenditure should be fixed without reference to the ability of the sewerage undertaker to fund such projects during the relevant period. Of course, funding issues may go wider than simply the ability to levy charges in the future but I would regard any determination on a timing issue which failed to take into account on that issue the availability of funding in the widest possible sense as capable of being struck down on Wednesbury grounds. Of course, quite how the availability of funding will impact in any given case will be a matter to be explored between the Agency and the sewerage undertakers on a case by case basis, and no doubt further guidelines and procedures may evolve. It is an area in which the industry regulator will inevitably be involved. Since however I am asked myself to give guidance, I should indicate that it seems to me axiomatic that in principle availability of funding must be relevant to timing.
83. Lastly Mr Clarke submitted that in some or all of the cases with which I am concerned the appropriate remedy might be to require proper and adequate reasons rather than to require a fresh decision. It will be apparent that in my view in all four cases the matter must be completely reconsidered in the light of the judgment of the court.
- - - - - - - - - -

MR JUSTICE TOMLINSON: Before I formally deliver judgment in this case, I should point out that, to my regret, there was a computer induced corruption in the text of the judgment that was handed to the parties a couple of days ago. No one seems to have spotted it.

The problem arose on page 37 of the judgment that you had. There appeared eight lines which had mysteriously found their way into the middle of paragraph 32 from paragraph 33. How that happened I do not know. There was then a second paragraph 32 which missed out the relevant lines.

The passages affected are paragraphs 32 and 33. The problem which arose was in paragraph 32 as in the version handed down which read:
"There is in this respect onus on the sewerage undertaker which it..."
That passage then continued:
"that the twist presented a false contrast."
It should have said, "there is in this respect an onus on the sewerage undertaker which it must discharge."
It then continued:
"There is also another consideration..."
I hope you now have that in paragraph 32. In paragraph 33 it should say, after my recording Mr Clarke's rhetorical question "which is the better way of dealing with an environmental problem-coerced compliance or public provision for which all users will pay."
Having said that was not a question for me to answer, I should have gone on to say, as I hope I now do in paragraph 32 that,
"But the choice presented involves a false contrast. Coerced compliance involves only the affected persons. Public provision will be at the expense of all users in the sewerage undertaker's area. What is to my mind clear is that the Agency cannot rule out the private provision as inappropriate on the ground alone that it can only be brought about by coerced compliance. Section 101A has been enacted against the background of the Agency's regulatory and coercive powers and Parliament must be taken to have envisaged that the Agency would, where practical, proportional and appropriate, use those powers."

I hope that the versions of paragraphs 32 and 33 you now have, Miss Lang and Mr Clarke are in the form I have just indicated.

MISS LANG: My Lord, they do, but can I apologise on behalf of both of us for not picking up the error ourselves, I think Mr Clarke did notice it this morning.

MR CLARKE: I was away and only received the judgment this morning.

MR JUSTICE TOMLINSON: Quite how it happened, I do not know.

MISS LANG: Word processors have a life of their own.

MR JUSTICE TOMLINSON: There were also two small typographical errors of no consequence which my clerk has taken the opportunity to correct as well.

Subject to that glitch, I now formally give judgment in the terms which appear in the formal printed judgment, a draft of which was made available to the parties and the definitive version of which has just now been made available to counsel and I give judgment accordingly.

MISS LANG: I apply for costs to be assessed on a detailed assessment.

MR CLARKE: My Lord, I cannot oppose that.

MR JUSTICE TOMLINSON: So it be. Thank you both very much indeed. The issues which this slightly unpromising material raised proved to be rather interesting.
*****************
Friday, 27th October 2000

MR JUSTICE TOMLINSON: Before I formally deliver judgment in this case, I should point out that, to my regret, there was a computer induced corruption in the text of the judgment that was handed to the parties a couple of days ago. No one seems to have spotted it.

The problem arose on page 37 of the judgment that you had. There appeared eight lines which had mysteriously found their way into the middle of paragraph 32 from paragraph 33. How that happened I do not know. There was then a second paragraph 32 which missed out the relevant lines.

The passages affected are paragraphs 32 and 33. The problem which arose was in paragraph 32 as in the version handed down which read:
"There is in this respect onus on the sewerage undertaker which it..."
That passage then continued:
"that the twist presented a false contrast."
It should have said, "there is in this respect an onus on the sewerage undertaker which it must discharge."
It then continued:
"There is also another consideration..."
I hope you now have that in paragraph 32. In paragraph 33 it should say, after my recording Mr Clarke's rhetorical question "which is the better way of dealing with an environmental problem-coerced compliance or public provision for which all users will pay."
Having said that was not a question for me to answer, I should have gone on to say, as I hope I now do in paragraph 32 that,
"But the choice presented involves a false contrast. Coerced compliance involves only the affected persons. Public provision will be at the expense of all users in the sewerage undertaker's area. What is to my mind clear is that the Agency cannot rule out the private provision as inappropriate on the ground alone that it can only be brought about by coerced compliance. Section 101A has been enacted against the background of the Agency's regulatory and coercive powers and Parliament must be taken to have envisaged that the Agency would, where practical, proportional and appropriate, use those powers."

I hope that the versions of paragraphs 32 and 33 you now have, Miss Lang and Mr Clarke are in the form I have just indicated.

MISS LANG: My Lord, they do, but can I apologise on behalf of both of us for not picking up the error ourselves, I think Mr Clarke did notice it this morning.

MR CLARKE: I was away and only received the judgment this morning.

MR JUSTICE TOMLINSON: Quite how it happened, I do not know.

MISS LANG: Word processors have a life of their own.
MR JUSTICE TOMLINSON: There were also two small typographical errors of no consequence which my clerk has taken the opportunity to correct as well.

Subject to that glitch, I now formally give judgment in the terms which appear in the formal printed judgment, a draft of which was made available to the parties and the definitive version of which has just now been made available to counsel and I give judgment accordingly.

MISS LANG: I apply for costs to be assessed on a detailed assessment.

MR CLARKE: My Lord, I cannot oppose that.

MR JUSTICE TOMLINSON: So it be. Thank you both very much indeed. The issues which this slightly unpromising material raised proved to be rather interesting.

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