What Does ‘Trade Effluent’ Mean? High Court Settles the Debate

In giving authorititive guidance on the meaning of the phrase ‘trade effluent’, as used in the Water Industry Act 1991, the High Court has rejected a company’s claim that it was overcharged millions by a utilities provider for the discharge of waste liquid from its premises over a period of more than 20 years.

Effluent flowing from the company’s factory was measured by a meter and charges were levied by the provider on the basis of its readings. The company argued that surface water, arising from ordinary rainfall, had also passed through the meter and that had resulted in it being overcharged from 1996 onwards. The company valued its claim against the provider at about £7.8 million.

In entering summary judgment in the provider’s favour, however, the High Court found that the company’s claim stood no real prospect of success. Taking into the account the words used in the Act, and the history, purpose and context of the legislation, the Court found that a blended liquid, formed by a mixture of effluent and surface water, fell within the definition of trade effluent. In those circumstances, the meter had correctly recorded the relevant volumes of trade effluent and the provider’s charges were thus lawfully imposed.