Background
Roger and Suzanne Brookhouse own The King’s Lodging, a 15th-century Grade II listed timber-framed house with a private river dock on the River Stour in Sandwich, Kent. In 2014 the Environment Agency constructed a flood defence wall along the property’s river frontage. A prior deed between the parties dated 6 November 2014 governed preparatory obligations and addressed restoration of the garden and swimming pool. In the years following construction, the garden suffered repeated flooding from below ground, with expert analysis establishing that a flow path had developed beneath the dock wall, raising groundwater levels at the property by between 0.5 and 1 metre.
In a liability decision issued in November 2023 (Brookhouse v Environment Agency [2023] UKUT 282 (LC)), the Tribunal found that the Agency’s works had damaged and would continue to damage the property through raised groundwater, affecting the historic wooden foundations and structure, the garden, and probably the swimming pool. That decision left quantum entirely undetermined. The present decision followed an eight-day hearing in March 2026 at which seven pairs of experts gave evidence across the disciplines of hydrology and drainage, architecture and conservation, structural engineering, horticulture, swimming pools, valuation, and quantity surveying.
The claimants amended their case to seek, in addition to any diminution in value, the full cost of remediation — including restoring groundwater levels, repairing the house, restoring the garden, replacing the pool, and recovering investigative and pre-reference costs — under both Schedule 21 to the Water Resources Act 1991 and the contractual Deed. By consent, the parties also referred the Deed disputes to the Tribunal sitting as arbitrator under section 1(5) of the Lands Tribunal Act 1949.
The Court’s Holding
The Tribunal confirmed that the standard for “full compensation” under paragraph 5(1) of Schedule 21 to the Water Resources Act 1991 is to put the claimants “fairly and reasonably in the position in which they were before the damage occurred, so far as a pecuniary award can do so,” applying the formulation endorsed in Ward v Cannock Chase District Council [1986] 1 Ch 546. The parties agreed that the cost of remediation — rather than diminution in value — was the applicable measure for virtually all heads of claim; the respondent reserved only that compensation for restoring groundwater levels could not exceed the unblighted value of the property. The Tribunal found that the remediation cost did not exceed that ceiling, so the alternative measure did not arise.
On the unblighted market value of The King’s Lodging, the Tribunal preferred a figure of £1,850,000 (as at October 2025, assumed current at the date of determination), applying a rate of £320 per sq ft to the agreed gross internal area of 5,790 sq ft. The respondent’s expert’s figure of £1,400,000 was rejected as an outlier unsupported by the comparable evidence; the claimants’ expert’s figure of £1,900,000 was reduced slightly to account for the relatively small kitchen and a pool nearing the end of its functional life.
The Tribunal worked through the competing heads of claim under the statute and the Deed. On the core house remediation the parties had agreed £36,742, with the main dispute being the substantially larger associated costs (preliminaries, professional fees, contingency). On the dominant issue — which drainage scheme to adopt to restore pre-works groundwater levels — the claimants sought £1,810,803 for a new dock wall installation while the respondent argued for a lesser scheme at £145,797–£247,662. The Tribunal assessed the competing quantity surveying evidence, noting that the respondent’s expert (Mr Steel, who had not visited the property) tended to underestimate complexity, while the claimants’ expert (Mr Dunne) was inclined toward Rolls Royce provision, requiring a middle-ground assessment on disputed items. Garden restoration under the Deed was agreed at £728,828 with further disputed sums, and the swimming pool replacement was disputed both as to liability and quantum (£213,988 v £150,000). Pre-reference costs of £275,000 were agreed.
Key Takeaways
- “Full compensation” under Schedule 21 to the Water Resources Act 1991 means restoring the claimants to their pre-damage position; cost of remediation is the primary measure where remediation is reasonable and proportionate, capped at loss in value only where a specific head of remediation cost exceeds the unblighted value of the property.
- Where two competing remediation schemes are advanced, the Tribunal must assess which is the reasonable course of action rather than simply choosing the cheaper option; an expert’s failure to visit the site or understand heritage constraints will reduce the weight given to their cost evidence.
- The Tribunal determined the unblighted market value of the historic Sandwich property at £1,850,000, providing the ceiling against which groundwater remediation costs were measured — and finding that they did not exceed it.
- Contractual and statutory claims can be heard together where the parties consent to Tribunal arbitration of Deed disputes, enabling a single consolidated quantum determination across all heads of loss.
- Pre-reference investigative and legal costs incurred before formal proceedings are compensable under the 1991 Act where they are foreseeable, not too remote, and not unreasonable; £275,000 was agreed on that head.
Why It Matters
This decision provides rare detailed guidance on the quantification of “full compensation” for property damage caused by statutory flood-defence works under the Water Resources Act 1991. It illustrates how the Tribunal weighs competing expert evidence across multiple technical disciplines in a heritage property context, and confirms that the cost-of-remediation measure will normally prevail over diminution in value unless a specific item of remediation cost exceeds the property’s unblighted worth. For landowners along defended watercourses — and for the Environment Agency — the case demonstrates that liability for raised groundwater can generate compensation claims of well over £1 million even where the initial damage may appear limited.
The decision also highlights the practical difficulties facing claimants whose historic properties sustain ongoing groundwater damage while litigation proceeds: the Brookhouses lived with unrestored damage for over twelve years from the Agency’s 2014 works to this final quantum determination, with no remediation possible until the compensation framework was settled. The Tribunal’s acknowledgment of that burden, alongside its confirmation that the respondent had acted fairly throughout, underscores the systemic tension between statutory public-works powers and the rights of individual property owners whose homes are uniquely affected.