Court of Appeal upholds appointment of new utility undertaker for major King’s Cross development

02/03/12

On 25 January 2012, the Court of Appeal (Laws, Tomlinson, Kitchin LJJ) dismissed an appeal by Thames Water Utilities Ltd from Mitting J's rejection of its claim for judicial review of a decision of the regulator, the Water Services Regulation Authority ("OFWAT"), to grant Independent Water Networks Ltd ("IWNL") a so-called ‘inset appointment' under section 7 of the Water Industry Act 1991. The effect of this appointment was to enable IWNL, and not Thames Water, to become water and sewerage undertaker for most of a 67-acre development site, owned and occupied by Argent (King's Cross) Ltd, a subsidiary of Argent Group plc, at King's Cross, London.

The grounds of the appeal were that Mitting J had been wrong to find that OFWAT, in granting IWNL an inset appointment, had not erred in law by finding:

i) that the "large user" criterion in section 7(4)(bb) and (5) of the 1991 Act; and
ii) (as to water) the "unserved status" criterion in section 7(4)(b) of the 1991 Act were satisfied.

In a judgment that promises to have important implications for other development sites too, the Court of Appeal rejected Thames Water's submissions, and held that OFWAT's conclusions both as to "premises" in section 7(4) and "customer" in section 7(5) were not legally flawed, and that IWNL had therefore been lawfully appointed as both water and sewerage undertaker to the relevant site, which is to be the subject of massive development over the next few years.

The judgment is here.