High Court decision prompts council to repay £28.6m water charges
On 7 June 2016, Southwark Council decided it would make refunds of £28.6m to tenants it had unlawfully overcharged for water and sewerage services. Southwark’s decision comes in the wake of the High Court’s judgment in Jones v Southwark LBC  EWHC 457 (Ch), 4 March 2016. In that case, Southwark was found to have overcharged tenants between 1 April 2001 and 23 July 2013, in breach of the Water Resale Orders.
Southwark’s initial response was to announce that, for limitation reasons, it would only pay refunds from April 2010 to July 2013. However, after the correctness of that position was queried by Ms Jones’s solicitors, a report to a meeting of Southwark’s executive on 7 June 2016 explained that, having taken further legal advice on limitation, refunds for the whole of the period of 1 April 2001 to 23 July 2013 were recommended.
This recommendation was adopted by Southwark’s executive, which also decided that the council should consult tenants on terminating its relationship with Thames Water. The report estimates that 74,000 current and historic tenants will be entitled to refunds.
Commenting on Southwark’s decision, Ms Jones’s solicitor, Gareth Mitchell (pictured) of Deighton Pierce Glynn, said: ‘For tenants in occupation for the whole of the 2001 to 2013 period, refunds of £600 to £700 are expected, with the exact amount dependent on rateable value. These refunds will make a significant difference to a large number of very low income households.’
‘As to the proposed termination of Southwark’s agreement with Thames Water, this is good news for tenants. All too often tenants have faced eviction by Southwark not for rent arrears but for arrears of water charges. This practice will cease if the tenants become direct customers of Thames Water.’
‘It will also mean there will be significant opportunities for tenants to reduce their water bills by opting for Thames Water’s alternative tariffs. These include the “assessed household charge”, which is applied where water meters are requested but cannot be installed (for example, in blocks of flats) and the “watersure tariff”, a discounted charge for those with disabilities or large families.’
• See May 2016 Legal Action 18 for the case note of Jones v Southwark LBC.