Water Resources Act 1991

4 (1) It shall be the duty of the Authority—

(a) to cause as little loss and damage as possible in the exercise of the powers conferred on it by section 163 of this Act; and

(b) to pay compensation for any loss caused or damage done in the exercise of those powers.

(2) For the purposes of sub-paragraph (1) above any extra expenditure—

(a) which it becomes reasonably necessary for any water undertaker, sewerage undertaker or public authority (other than the Authority itself) to incur for the purpose of properly carrying out any statutory functions; and

(b) which is attributable to any discharge of water under section 163 of this Act,

shall be deemed to be a loss sustained by the undertaker or public authority and to have been caused in exercise of the powers conferred by that section.

(3) Any dispute as to whether compensation should be paid under sub-paragraph (1) above, or as to the amount of any such compensation, shall be referred to the arbitration of a single arbitrator appointed by agreement between the parties to the dispute or, in default of agreement, by the President of the Institution of Civil Engineers.