Civil practice and procedure – Strike out – Estoppel – Abuse of process – Claimant bringing claim against defendant sewerage undertaker concerning discharges into canal – Defendant applying to strike out claim – Claimant applying to amend claim – Whether claim subject to cause of action estoppel and/or issue estoppel – Whether claim being abuse of process – Whether claimant entitled to amend claim – Application to strike out granted – Application to amend dismissed
The claimant was the owner of the Manchester Ship Canal, which it used for draining land under the Manchester Ship Canal Act 1885. The defendant was a sewerage undertaker for the purposes of the Water Industry Act 1991 and the owner and operator of Davyhulme Waste Water Treatment Works. The defendant was responsible for the discharge into the canal of water and sewage from an outlet pipe, drain or sewer (outfall 61). Pursuant to section 186(1) and (2) of the 1991 Act, the claimant sought a declaration that the discharge by the defendant of water and other materials into the canal through outfall 61 was a trespass against the claimant to the extent that the water and other materials so discharged included water and materials which originated from a sewer or sewers constructed or adopted by the defendant in or about 2007 to receive water from properties developed at or about that time at Marshbrook Drive, Manchester (the origin point).
The defendant applied for an order pursuant to CPR 3.4(2) striking out the claim, on the basis of the judgment of the Supreme Court in Manchester Ship Canal Co Ltd v United Utilities Water plc [2014] UKSC 40; [2014] 3 EGLR 81; [2014] EGILR 44 on a claim from 2010; and on the grounds that it was subject to cause of action estoppel and/or issue estoppel; and/or was an abuse of process under the principle in Henderson v Henderson 3 Hare 100; and/or had no realistic prospect of success at trial.
The claimant applied to amend the claim form to add a further ground that the consent of the claimant pursuant to section 186(1) of the 1991 Act had not been sought or obtained by the defendant. The defendant opposed the amendment.
Held: The application to strike out the claim was granted. The application to amend the claim was dismissed.
(1) In the light of the Supreme Court decision in the 2010 claim, there was no requirement for the claimant’s consent to discharge treated water and material via outfall 61, including that originating in the Marshbrook Sewer, and such discharge did not ipso facto amount to a trespass. Even if the Supreme Court decision was not strictly binding, the reasoning strongly supported a finding to that effect, so that there would be no real prospect of success in the present claim, as currently formulated. It would be difficult to argue that the Supreme Court decision did not decide that, provided the relevant outfall was already in use on 1 December 1991, the sewerage undertaker was entitled to continue to discharge from it, regardless of the source of the waste water and material. The Supreme Court was alive to the fact that sewerage undertakers were required to accept new connections to private sewers by virtue of section 106 of the 1991 Act, and that by virtue of section 116 flows from any sewer, including from new connections, could not be stopped without alternative arrangements being put in place: Manchester Ship Canal Co Ltd v United Utilities Water plc applied.
(2) The question whether the present claim constituted the same or a separate cause of action was not entirely straightforward. The defendant characterised the claim as encompassing a new legal argument, always available to the claimant, put forward in respect of the same subject matter (the discharge from outfall 61) to support the same tort (trespass) and the same relief (damages in lieu of injunction/a declaration). That analysis suggested that one was dealing, in substance, with the same cause of action as in the 2010 claim. On the other hand, the claimant adopted an approach which, on its face, was similar to that in Hoechst United Kingdom Ltd v IRC [2003] EWHC 1002 (Ch), and focused on the set of facts which entitled the claimant to relief, including the fact that the discharge complained of originated in a specific sewer which was not connected to the defendant’s network and/or was not adopted until after 1 December 1991. On close inspection the latter approach misapplied the principle in Hoechst, and was flawed. Taken at the highest level of abstraction, there was no difference of substance between the two claims. The cause of action in the present claim was essentially identical to the cause of action relied upon in the 2010 claim. There was an absolute bar to the present claim, as currently formulated: Virgin Atlantic Airways Ltd v Zodiac Seats UK Ltd [2013] UKSC 46 [2014] AC 160 applied.
(3) Issue estoppel arose where the cause of action was not the same in the later action as in the earlier one, but an issue necessarily common to both actions was decided on the earlier occasion. The decision on that issue was binding on the parties, except in special circumstances where injustice would be caused. Issue estoppel also operated as a bar to points which were not raised if they could with reasonable diligence and should have been raised. The present claim was based on the same cause of action as the earlier claim. In the circumstances, including the court’s findings in relation to cause of action estoppel, it was not necessary to deal separately with issue estoppel: Virgin Atlantic applied.
(4) The origin point should have been raised in the 2010 claim. The present claim was oppressive to the defendant and an abuse of process. There was no exceptional feature to justify the exercise of any residual discretion not to strike out a claim which could and should have been brought in earlier proceedings and was an abuse of process. The claim would be struck out pursuant to the principle in Henderson: Hoechst and Johnson v Gore Wood & Co (a firm) [2002] 2 AC 1 applied.
(5) The claimant’s application to amend the claim form would be dismissed as it sought to add a further ground which had already been decided and was an abuse of process. Furthermore, there would be injustice to the defendant if the claimant’s proposed amendment were allowed. It was not acceptable, and not within the spirit of the overriding objective, for litigation to be conducted in a linear manner, with different points being taken over the course of several years, rather than together at the appropriate time.
Charles Morgan and Nicholas Ostrowski (instructed by BDB Pitmans LLP) appeared for the claimant; Jonathan Karas QC, Julian Greenhill QC and James McCreath (instructed by Pinsent Masons LLP) appeared for the defendant.
Eileen O’Grady, barrister
Click here to read a transcript of Manchester Ship Canal Co Ltd v United Utilities Water Ltd
