Thames Water Utilities Ltd v London Underground Ltd

London Underground Limited (LUL) was authorised by the London Underground Act 1992 and the London Underground Jubilee Act 1993 to construct the Jubilee Line Extension. Part of the Extension involved underground works in the vicinity of the Palace of Westminster. It was inevitable that the nature and scale of such works would interfere with the installations of other public utilities and that legislation must provide for the regulation of the conflicting interests of the various parties. Thames Water Utilities Limited (TWUL) is responsible for the provision and maintenance of a network of sewers in London. These include Low Level Sewer No 1, part of which lies beneath the ground in the same area of Westminster. There is no doubt that, as a result of its engineering works, LUL is required to compensate TWUL for the disturbance to Low Level Sewer No 1. The dispute between the parties is as to which of two statutory regimes governs the assessment of the compensation. LUL contends for the New Roads and Streetworks Act 1991 (the 1991 Act), TWUL for the London Underground Act 1992 (the 1992 Act) and the London Underground Jubilee Act 1993 (the 1993 Act). The practical implication is that the sum due if the 1991 Act applies is lower, amounting to 82% of that which would be payable if the 1992 and 1993 Acts apply. Upon the trial of a preliminary issue, Douglas Brown J held on 15 July 2003 that the applicable regime is that of the 1991 Act. TWUL now appeals against that decision.

Section 29 of the 1992 Act and section 22 of the 1993 Act incorporate, in identical terms, section 13 of the London Transport Act 1976 (the 1976 Act). The material parts of section 13 are as follows:

“(3)

The Executive shall comply with and conform to all reasonable orders, directions and regulations of the authority in the execution of the specified works and shall provide new, altered or substituted works in such manner as the authority shall reasonably require for the proper protection of, and for preventing injury or impediment to, a sewer of the authority by reason of the specified works and shall save harmless the authority against all expense to be occasioned thereby.

(4)

All such new, altered or substituted works shall, where so required by the authority, be done by or under the direction, superintendence and control of an officer of the authority duly appointed for the purpose at the cost, charge and expense in all respects of the Executive and all costs, charges and expenses to which the authority may be put by reason of such works, whether in the execution thereof, or in the preparation or examination thereof, or in the preparation or examination of plans or designs, or in such direction, superintendence or control as aforesaid, or otherwise, shall be paid to the authority by the Executive on demand.

(ii)

The Executive shall be liable to make good, or, if the authority so decide, to bear any expense incurred by the authority in making good, all injury or damage caused by or resulting from the construction of the specified works to any sewers, drains or works vested in the authority and the authority shall from time to time have the power to recover any expense so incurred by them from the Executive in any court of competent jurisdiction.”

If those provisions apply in the present case, with LUL as “the Executive” and TWUL as “the authority”, then, properly construed, they produce the result for which TWUL contends – in effect an indemnity.

Turning to the 1991 Act, the material provisions are as follows:

“84(1). Where an undertaker’s apparatus in a street is or may be affected by major highway works, major bridge works or major transport works, the highway, bridge or transport authority concerned and the undertaker shall take such steps as are reasonably required

(a)

to identify any measures needing to be taken in relation to the apparatus in consequence of, or in order to facilitate, the execution of the authority’s works;

(b)

to settle a specification of the necessary measures and determine by whom they are taken;

(c)

to coordinate the taking of those measures and the execution of the authority’s works,

so as to secure the efficient implementation of the necessary works and the avoidance of unnecessary delay.”

Applying this provision to the context of the present case, LUL would be “the transport authority” carrying out “major transport works” and TWUL would be “the undertaker” whose apparatus was affected. Section 85 then provides:

“(1)

Where an undertaker’s apparatus in a street is affected by major highway works, major bridge works or major transport works, the allowable costs of measures needing to be taken in relation to the apparatus in consequence of the works, in order to facilitate their execution, shall be borne by the highway, bridge or transport authority concerned and the undertaker in such manner as may be prescribed.

(2)

The regulations may make provision as to the costs allowable for this purpose.”

The relevant regulations are the Street Works (Sharing of Costs of Works) Regulations 1992, together with a Code of Practice entitled Measures Necessary where Apparatus is Affected by Major Works (June 1992). The crucial provision is then section 101 (1) of the 1991 Act which provides:

“Any special enactment passed or made before the commencement of this Part which makes or authorises the making of provision regulating the execution of street works in a manner inconsistent with the provisions of this Part shall cease to have effect; and unless a contrary intention appears no enactment passed or made after the commencement of this Part shall be construed as making or authorising the making of any such provision.”

Section 101 applies to “street works” which are defined in section 48(3) as

“works of any of the following kinds (other than works for road purposes) executed in a street in pursuance of a statutory right or a street works licence –

(a)

placing apparatus, or

(b)

inspecting, maintaining, adjusting, repairing, altering or renewing apparatus, changing the position of apparatus or removing it,

or works required for or incidental to any such works (including, in particular, breaking up or opening the street, or any sewer, drain or tunnel under it, or tunnelling or boring under the street).”

“Street” is itself a term of art, defined in section 48(1).

The 1976, 1992 and 1993 Acts are all “special enactments” for the purpose of section 101 of the 1991 Act by reason of the definition of that term in section 105(1) of the 1991 Act.

At this stage it is necessary to record the legislative chronology:

The complexity of the statutory provisions and their chronology gave rise to the preliminary issue which was formulated in this way:

“……whether section 101 of the [1991] Act operates to displace the effect of [the] express incorporation of section 13 of the [1976] Act into the [1992] Act and the [1993] Act.”

As I have related, Douglas Brown J resolved the issue in favour of the 1991 Act.

In concluding that the 1991 Act prevailed, Douglas Brown J reasoned as follows:

(1)

“The aim of the 1991 Act was to introduce for the first time a complete code for street works and any compensation they gave rise to.” (Para 28).

(2)

“The intention of the legislature as can be seen from sections 100 and 101 was that the 1991 Act alone would make provision in this field and private agreements would be of no effect (section 100) and, likewise, special enactments would cease to have effect”. (Para 28).

(3)

“The provisions of the 1991 Act, particularly section 101, should have been obvious to those promoting or considering opposition to the 1992 and 1993 Acts.” (Para 30)

(4)

“When the 1993 Act was enacted, section 13 [of the 1976 Act] had ceased to have effect by reason of section 101 of the 1991 Act.” (Para 33).

(5)

“Both section 101 [of the 1991 Act] and section 20(2) of the Interpretation Act 1978 contain the proviso ‘unless the contrary intention appears’. No contrary intention appeared in the 1993 Act.” (Para 34).

(6)

“Section 48(3) combined with section 105(2)(3) [of the 1991 Act] have the effect of bringing major transport works within the meaning of ‘street works’ which is a generic description of works governed by the 1991 Act”. (Para 36).

In seeking to persuade this Court to reach the contrary conclusion, Lord Kingsland QC makes the following submissions on behalf of TWUL.

On behalf of LUL, Mr. Harper QC readily concedes that it would be inappropriate for there to be differential compensation regimes and he supports the submission that the Court should come to the same conclusion about both Acts. However, that is where the common ground ends. Mr. Harper’s central submission is that the works carried out by or on behalf of LUL were “street works” within the meaning of the 1991 Act, notwithstanding the fact that they were also “major transport works”. The two categories are not mutually exclusive. In these circumstances, the 1992 Act and the 1993 Act are respectively caught by the two limbs of section 101 of the 1991 Act. This was the intention of Parliament in that Part III of the 1991 Act was conceived as a comprehensive and universal code applicable to “street works” in place of the complex situation which had previously arisen under the Public Utilities Street Works Act 1950. Mr. Harper developed this central argument in succinct oral and written submissions and I shall draw on those submissions hereafter.

I accept that the purpose of Part III of the 1991 Act is to provide a comprehensive code applicable to the activities which it covers in place of what had become the shambolic operation of the Public Utilities and Street Works Act 1950. In his book Highway Law (2^nd edn. 1997, paras 13-08 and 13-101). Mr. Stephen Sauvain QC states:

“Part III of the 1991 Act attempts to achieve a level of simplicity and flexibility by setting out only a legislative framework – leaving the detailed regulation on specified types of cases to regulations and codes of practice…..Part III of the Act, the regulations made under it and the Codes of Practice to be issued under it, are together to form a complete code for dealing with street works.”

(see also the Encyclopaedia of Highway Law, Vol 2. paragraphs 3-1957/1-1959 for an account of the historical context). The 1991 Act defines “street works” (section 48(3)), “major highway works” (section 86(3)) and “major transport works” (section 91(2)). Significantly, all these provisions fall within Part III of the Act which is headed “Street works in England and Wales”. In my judgment, it is clear from the structure, language and purpose of Part III that “major highway works” and “major transport works” are categories of “street works”. The definition of “major highway works” demonstrates that it is not confined to highway works of great magnitude. For example, it includes the construction or removal of a road hump (section 86(3)(e)) and the provision of a cattle grid in the highway (section 86(3)(g)), as well as tunnelling or boring under the highway (section 86(3) (h)). “Major transport works”, on the other hand, are “substantial works required for the purposes of a transport undertaking and executed in property held or used for the purpose of the undertaking” (section 91(2)).

I do not accept Lord Kingsland’s submission that “street works” do not include works of the kind carried out in the present case and that, being outside the category of “street works”, they are beyond the reach of section 101. The works carried out on behalf of LUL were plainly “street works” within the meaning of section 48(3). They involved “placing apparatus”, “inspecting, maintaining, adjusting, repairing, altering or removing apparatus” and works “required for or incidental to any such works (including, in particular, breaking up or opening the street, or any sewer, drain or tunnel under it, or tunnelling or boring under the street)”.

In reaching this conclusion, I also reject the submission that “street works” attract one compensation scheme via section 69 and “major works” another via sections 84 and 85. Indeed I do not accept that section 69 provides a compensation scheme at all. It provides:

“(1)

Where street works are likely to affect another person’s apparatus in the street, the undertaker executing the works shall take all reasonably practicable steps –

(a)

to give the person to whom the apparatus belongs reasonable facilities for monitoring the execution of the works, and

(b)

to comply with any requirement made by him which is reasonably necessary for the protection of the apparatus or for securing access to it.”

The remainder of the sections provides a criminal sanction for non-compliance. It would be stretching the words of section 69(1)(b) to impermissible limits and beyond to find a procedure or mechanism for compensation. Lord Kingsland suggests that, unless a mechanism for compensation in relation to “street works” is to be found in section 69, there is no access to compensation in relation to works that are not “major”. However, this is to ignore the generous definition of “major highway works” to which I have already referred. Moreover, if section 69 had been intended to embrace a compensation mechanism, I would expect it to include a provision equivalent to section 85.

In one sense, section 85 does not provide a compensation scheme in relation to “major works”. It is an enabling section which provides for the sharing of the allowable costs “in such manner as may be prescribed” and for the making of regulations. The relevant regulations in the present case are the Street Works (Sharing of Costs of Works) Regulations 1992. There is some force in a subsidiary submission of Mr. Harper to the effect that the very title of the Regulations shows that subject-matter – “major works” – comes within the scope of “street works”

I next turn to the effect of section 101 of the 1991 Act on the provisions of the 1992 Act. The 1992 Act was a “special enactment passed before the commencement” of Part III of the 1991 Act. From the coming into force of the 1992 Act on 16 March 1992 until the commencement of section 101 of the 1991 Act on 1 January 1993, the 1992 Act made or authorised the making of provision regulating the execution of street works in a manner inconsistent with the provisions of Part III of the 1991 Act. However, on 1 January 1993, as a result of the coming into force of section 101 of the 1991 Act, the relevant provisions of the 1992 Act simply ceased to have effect in relation to the execution of street works (but not otherwise). That is the plain meaning of the first limb of section 101. I do not doubt that, when passing the 1992 Act, Parliament was well aware of the 1991 Act. So much is obvious from the references to the 1991 Act in sections 3(3)(a) and 29(2)(b)(ii) in the 1992 Act. Moreover, it is not a case, as Lord Kingsland submits, of LUL promoting the 1992 Act at a time when it knew that it could later seek to resile from it. It is more a question of Parliament approving the 1992 Act in the knowledge that the incorporation of section 13 of the 1976 Act would almost certainly be short lived in relation to street works.

It follows from what I have said that I also reject the submission that the wording of the first limb of section 101 – “provision regulating the execution of street works” – does not embrace measures taken in consequence of the works. This distinction is said to be justified by the language of sections 84 and 85 of the 1991 Act but in my judgment it is false. Sections 84 and 85 are part of “the provisions of this Part” with which the 1992 Act is inconsistent after the commencement of the 1991 Act.

If Lord Kingsland’s submissions about the first limb of section 101 and the 1992 Act are incorrect, is his case any stronger in relation to the second limb and the 1993 Act? In particular, does the express incorporation of section 13 of the 1976 Act after the coming into force of section 101 of the 1991 Act manifest a “contrary intention” within the meaning of the second limb? In my judgment it does not. The incorporation of section 13 of the 1976 Act into the 1993 Act is expressly stated in section 22(1) to be “with necessary modifications” (as, indeed, was its incorporation into the 1992 Act by section 29 of the latter). I take the proper application of the second limb of section 101 in the present context to be that in relation to “street works” – but not in other respects – the incorporation of section 13 of the 1976 Act into the 1993 Act is modified and the 1993 Act is to be construed so as to avoid inconsistency with Part III of the 1991 Act. No contrary intention is apparent. Moreover, this is the only way of construing the 1993 Act so as to produce a result which is consistent with what I find to be the plain meaning of the 1992 Act and, as I have observed, both Lord Kingsland and Mr. Harper urge the desirability of reaching the same conclusion in respect of both Acts, whatever that conclusion may be.

In reaching these conclusions I have not acceded to Lord Kingsland’s invitation to construe the statutes in question as if they were contracts. I do not find the ambiguity which might otherwise call for such an approach. The authorities upon which he seeks to rely, such as Countess of Rothes v. Kirkcaldy Waterworks Commissioners (1882) 7 App. Cas. 694 and Herron v. Rathmines and Rathgar Improvement Commissioners [1892] AC 498 do not seem to me to be in point.

For the reasons I have given, I would dismiss this appeal. I am satisfied that, so far as “street works” are concerned, but not in other circumstances, section 101 ensures that the 1991 Act and the Regulations made under it now provide a comprehensive code, that the material parts of the 1992 Act ceased to have effect on the coming into force of section 101 and that the 1993 Act is to be construed in the same way.

I agree.

I also agree.