On 8 April 2010, the Flood and Water Management Act (the Act) received Royal Assent. Whilst the Act falls short of its original aim (to consolidate and update all existing legislation on water management and flooding, taking into consideration the Pitt Review (lessons learned from the 2007 floods)), it nevertheless introduces new requirements affecting the development and use of land.

Sustainable urban drainage - development approval and drainage adoption and connection

A key issue which the Act focuses on is the use of sustainable urban drainage systems (SUDS). SUDS include, for example, rainwater drainage systems (excluding public sewers, rivers and streams) designed to reduce damage from flooding and improving water quality. The Act provides the Secretary of State with powers to produce national standards governing SUDS. When such standards and relevant secondary legislation come into force (following public consultation), developers of projects which have the potential to affect the ability of land to absorb rainwater (including the laying of concrete surfaces such as patios, in addition to the construction of buildings) will be required to design and obtain local authority approval for SUDS prior to commencing construction. SUDS will be approved where they comply with the national standards. However, conditions may be imposed on the approval. For example, the developer may be required to provide a non-performance bond which will be forfeited if the drainage system is not constructed in accordance with the approval (or if it is unlikely to be completed) and released when it is adopted (see below).

Complementary to the SUDS requirement, the Act also makes provision for the adoption of SUDS and the ability to connect to a public sewer. Specifically, the Act guarantees that the relevant local authority will adopt (and take over responsibility for maintaining) SUDS, and that SUDS may be connected to the public sewer, if certain conditions are met. Conditions include, for example, that the drainage system was constructed and functions in accordance with the proposals approved by the local authority and that the proposals included an intention to connect to the public sewer.

Designation of structures and features - a restriction on development

Aside from drainage issues, developers and property owners will also need to be aware of the ways in which the Act has the potential to restrict development. The Act enables the Environment Agency, in addition to local authorities, to “designate” structures (e.g. sea walls) or features (e.g. natural embankments), owned by third parties, for protection on the basis that they affect flood and coastal risk management. A developer or landowner will not be able to alter, remove or replace a designated structure or feature without first obtaining consent from the relevant authority. Failure to obtain consent may result in the relevant authority serving an enforcement notice. If the enforcement notice is not complied with, the relevant authority will be entitled to carry out works and recoup the costs from the developer or landowner. The relevant authority will also be able to carry out works without first serving an enforcement notice in emergency situations (e.g. where a contravention immediately and materially increases a flood risk).

It should be noted that structures and features will not be automatically designated. Rather, the landowner will be notified that its asset has received a “provisional designation” and it will be entitled to make representations. When the asset’s designation is finalised, a local land charge highlighting the designation will be registered at the Land Registry. In addition, the relevant local authority will be required to keep a public register of structures and features likely to have a significant effect on flood risk in their area and a record about their ownership and state of repair. Compensation will be payable to the landowner should they suffer loss or disturbance as a result of the designation (the right to compensation will, however, be withdrawn if the landowner has altered, removed or replaced a designated asset without consent, or it has failed to comply with an enforcement notice).

Permitted flooding of third party land

The final issue of interest to the property industry is that the Environment Agency and local authorities have the power under the Act to carry out work which may cause flooding to third party land, an increase in water below ground, or coastal erosion. Such powers may, however, only be exercised where the works are deemed to be in the interest of nature conservation, the preservation of cultural heritage or people’s enjoyment of the environment or of cultural heritage. In order to provide some degree of protection to landowners, the Environment Agency or local authority will be required to consult with landowners (and other affected parties) prior to carrying out works. This power may have an impact on insurance policies as insurers become increasingly sensitive to flood risk factors.