Thousands of social housing tenants are being offered refunds by Southwark Council, after a high court judge found it had overcharged residents for water bills over three years.
The council’s announcement follows a legal dispute with Camberwell resident Kim Jones, represented by Deighton Pierce Glynn solicitors, which concluded on March 4.
The judge, Mr Justice Newey, gave a verdict that the council had breached laws on how it can sell water and sewage services, from Thames Water, to its tenants.
Judge Newey said the council contradicted the ‘2006 Water Resale Order’ as it had effectively “bought and re-sold water and sewage services” while making a profit.
Councillor Richard Livingstone, cabinet member for housing, stated after the hearing that they fundamentally disagreed with the outcome, but stopped short of saying the council would appeal the judge’s decision.
He has now confirmed that many of the council’s 37,000 social housing tenants may be eligible for refunds of up to £240.
Cllr Livingstone said: “Southwark Council has considered its options in relation to the recent ruling regarding the arrangement between the council and Thames Water over the administration of its tenants’ water bills.
“Having weighed up the options available and considered the cost to the public purse of a legal challenge, the council has decided not to appeal the decision.
“While we remain disappointed with the decision, clarity about this arrangement which is used across the country by landlords and water companies, is welcome, and we now want to move forward.
“The council is making arrangements to reimburse existing council tenants for the amount that the council mistakenly overcharged between April 2010 and July 2013.
“The council will also attempt to contact former tenants from that period, and we will set up a system where people can make claims, subject to proof of tenancy.
“The council estimates that tenants who were resident for the whole period will be eligible for an average refund of approximately £240. For any tenants who are in arrears, this refund will be used to reduce their debt.”
Speaking after the hearing in March, Kim Jones’s lawyer Gareth Mitchell told the News: “Thames Water and Southwark Council entered into a confidential agreement behind closed doors which none of the tenants who have been affected knew was happening.
“We only found out about this after obtaining a court order that they disclose the agreement.
“The courts decided approximately 37,000 households had been overcharged.”