Developer requiring a supply of water to two estates near Banbury held by majority to be liable to contribute towards cost of a 27-in trunk main laid along the 20 miles from Woodstock to Banbury–Leave to appeal to the House of Lords granted
This was an
appeal by the Oxfordshire & District Water Board from a judgment of Mocatta
J on May 11 1973 declaring in favour of the respondents, Banbury Borough
Council, that the board were not entitled under the provisions of the Water Act
1945 to levy a contribution towards the cost of constructing a 27-in trunk main
running for about 20 miles between Woodstock and Banbury and intended in part
to supply council houses proposed to be erected by the respondents.
Mr M Mann QC
and Mr H Donovan (instructed by Lewin, Gregory, Mead & Sons) appeared for
the appellants, and Mr G E Moriarty QC (instructed by Jaques & Co)
represented the respondents.
Giving
judgment, EDMUND DAVIES LJ said that in 1971 the plaintiffs were minded to
erect a number of council houses on land which they owned within their borough.
At Penrose Close they planned to build four bungalows, 12 flats and warden’s
accommodation, and at Ruscote 16 bungalows. In June 1971 they inquired of the
defendants, the statutory body empowered to supply water to the district, about
the supply of water to these two sites. In July the defendants said that the
estimated cost of laying the mains needed to serve the Penrose Close
development was £1,434, being £1,060 for a main from the development to the
existing mains network in the borough and £374 as a contribution towards the
cost of a 27-in diameter trunk main between Woodstock and Banbury; and that the
corresponding estimated cost in respect of the Ruscote development was £1,227,
made up of the sums of £875 and £352. There was no dispute about the
plaintiffs’ liability for the sums of £1,060 and £875, but a declaration was
sought to settle the question whether the defendants could lawfully demand, as
they had done, one-eighth of each of the sums of £374 and £352. The items
involved totalled a mere £90.75, but it was common ground that the issue raised
was one of considerable importance. Its resolution depended on the construction
of section 37 (1) of the Water Act 1945, which provided as follows:
Where an
owner of land proposes to erect thereon buildings for which a supply of water
for domestic purposes will be needed, he may require any statutory water
undertakers within whose limits of supply that land is situated to construct
any necessary service reservoirs, to lay the necessary mains to such point or
points as will enable the buildings to be connected thereto at a reasonable
cost and to bring water to that point or those points, and thereupon the
undertakers shall, subject as hereinafter provided, comply with that
requisition: Provided that the undertakers before complying with a requisition
under this subsection–
(a) may require the owner to undertake to pay in
respect of each year a sum amounting to one-eighth of the expense of
constructing the necessary service reservoirs and providing and laying the
necessary mains (less any amounts received by the undertakers in respect of
water supplied, whether for domestic or non-domestic purposes, in that year
from those mains) until the aggregate amount of water rates payable annually in
respect of the buildings when erected and in respect of any other premises
connected with the said mains at the rates for the time being charged by the
undertakers equals or exceeds such sum as aforesaid or until the expiration of
a period of 12 years whichever first occurs; and
(b) except where the owner is a local or public
authority, may also require him to deposit with the undertakers as security for
payment of the said annual sums, such sum, not exceeding the total expense of
constructing the service reservoirs and providing and laying the mains, as the
undertakers may require.
Certainly not
later than February 1970, the defendants had planned to construct a 27-in
diameter trunk main from the outskirts of Woodstock to an existing service
reservoir at Banbury, the distance being 20 miles and the cost £940,000, and by
the time the matter came before Mocatta J the necessary works were already
under way. The new trunk main was required, as the learned judge had found, to
maintain at all times a proper supply of domestic water to Banbury users
existing in 1971 and also to the plaintiffs’ two proposed developments. The
size of the particular main installed was such that it would in fact be capable
of conveying to Banbury additional quantities of water far in excess of the
needs of 1971 users supplemented by the plaintiffs’ proposed developments; it
would accordingly be able to cater for greatly increased demands for water in
the borough. The question for decision was whether this trunk main could as a
matter of law be a ‘necessary main’ within the meaning of section 37 (1), for
if not, the defendants could not require an undertaking from the plaintiffs to
pay the £90.75.
The Act did
not define ‘necessary main,’ though it contained definitions of ‘main’ and
‘trunk main.’ Mocatta J had upheld the
plaintiffs’ contention that while a main could be either a trunk main or what
had been called a distributing main, a trunk main could never be a necessary
main for the purposes of section 37 (1). It was clear that the undertaking
dealt with by the proviso to the subsection could not exceed a proportionate
part of such works as the developer might lawfully require the undertaker to
carry out for the purpose of ensuring ‘a supply of water for domestic purposes
. . . needed’ by the proposed buildings. Then could a developer ever require an
undertaker to lay a trunk main? It was
unsatisfactory to answer only that if such were the intention, section 37 (1)
would have said so; it could be argued with more force that wherever the
statute intended to exclude trunk mains this would have been made clear.
Equally unsatisfactory was the stress laid by counsel for the plaintiffs on the
fact that the reference in section 37 (1) to the laying of necessary mains was
immediately preceded by a reference to the construction of ‘any necessary
reservoirs.’ This had led counsel to
submit that the undertaking required of a developer could not relate to the
cost of any works further back than a service reservoir, and even to make the
unqualified submission that if there was no service reservoir there could be no
trunk main. As a general proposition, this was unacceptable; in the present
case there already existed a service reservoir, but the fourfold definition of
‘trunk main’ in the Act made clear the untenable nature of the proposition. In
a case where no service reservoir existed, how far back might one go for the
purpose of determining what works were relevant to the calculation of the
amount of the undertaking extracted from the developer? It might be said that one should not go
beyond the point at which the distributing mains leading to the point at which
the development could be connected to them were themselves connected to the
undertaker’s bulk supply. But as counsel for the defendants had pointed out, a
new developer might require water to be brought in bulk, and any main
constructed for that purpose would be within the definition of ‘trunk
main.’ Counsel submitted, as he (his
Lordship) thought convincingly, that ‘necessary mains’ must include all species
of mains and so embrace both trunk and distributing mains. Counsel had argued
that the underlying philosophy of the Act was that those requiring water should
not be allowed to impose on existing consumers and at no cost to themselves the
burden of laying any necessary mains, and that for the
at its species. He (Edmund Davies LJ) preferred the submissions of counsel for
the defendants, and would allow the appeal.
STEPHENSON LJ
delivered a concurring judgment.
Dissenting,
SIR GORDON WILLMER said that the question to be decided was restricted to the
particular trunk main relevant to the case; and one must ask whether in the
context this was a ‘necessary main.’ A
developer of land could require the water undertakers (a) to construct any
necessary service reservoirs, (b) to lay the necessary mains to such point or
points as would enable the proposed buildings to be connected thereto at a
reasonable cost, and (c) to bring water to that point or those points (the
‘delivery point’). The service reservoirs and the mains which the undertakers
could be required to construct must be ‘necessary’ to meet the need in
question. The laying of mains from a service reservoir to the delivery point
was clearly necessary to meet that need. He (his Lordship) could however find
no words in section 37 (1) which enabled the developer to require the laying of
mains or other constructional work beyond the service reservoir, or, if there
were no service reservoir, beyond the point at which the mains leading to the
delivery point could themselves be connected to the undertakers’ bulk supply.
The fact that without the trunk main in question Banbury users, including those
in the plaintiffs’ new houses, would at times be in danger of having no water
went no distance towards showing that the necessary mains to enable the
buildings to be connected to the delivery point must be construed as including
whatever trunk main was required to ensure the bulk supply of water on which to
draw. The definition of ‘trunk main’ in the Act covered (a) a main constructed
for the purpose of carrying water from a source of supply to a filter or
reservoir, (b) a main constructed for the purpose of carrying water from one
filter or reservoir to another filter or reservoir, (c) a main constructed for
the purpose of conveying water in bulk from one part of the limits of supply to
another part of those limits, and (d) a main constructed for the purpose of
giving or taking a supply of water in bulk. He (Sir Gordon) was quite unable to
see how the laying of ‘the necessary mains to such point or points as will
enable the [proposed] buildings to be connected thereto,’ as envisaged by
section 37 (1) of the Act, could be fitted into any one of these four
categories of trunk main. A contrary conclusion could lead to quite absurd
results utterly repugnant to commonsense. The owner of the land desiring to
erect a building a few yards away from where a trunk main was in course of
being laid could be required to contribute not only to the expense of laying
the necessary main to the point at which his proposed building could be
connected thereto but also to the expense of laying the whole trunk main,
whatever its size and however long it might be. Any ordinary person would
require a good deal of persuasion that Parliament ever intended such a bizarre
result. The appeal should be dismissed.
The appeal
was allowed with costs above and below, and a declaration made accordingly.
Leave to appeal to the House of Lords was granted.
