Who is liable for stormwater assets in Victoria?

A recent news article reported on a resident’s fears of ageing stormwater drains flooding, noting that "Council really need to be responsible for what they own to protect our home and our assets." But who is responsible for stormwater drains and wider assets?

According to section 198 of the Local Government Act 1989 (Vic), public sewers and drains are under the management and control of councils. However, Victorian legislation does not explicitly impose a positive statutory duty on councils to maintain their stormwater assets.

In 2023, the Victorian Government sought public input on a draft legislative instrument made under section 156 of the Environment Protection Act 2017 (Vic), which placed obligations on managers of land or infrastructure.

The draft instrument, termed the ‘OMLI’ (Obligations for Managers of Land or Infrastructure), sought to insert obligations and replace clauses within the former State Environment Protection Policy (SEPP). It also proposed to impose a duty on councils and Melbourne Water to:

• manage stormwater infrastructure and mitigate risk (Clause 5(1))
• renew or replace stormwater infrastructure when necessary (Clause 5(2))
• publish an urban stormwater management plan after consultation with stakeholders (Clause 6).

The OMLI’s regulatory impact statement published by Deloitte in April 2023 (RIS) noted that the requirements of clauses 34(3) (stormwater asset management) and 34(4) (stormwater management plans) of the SEPP would not be covered by any legislation after 30 June 2023. These clauses required owners of urban stormwater assets to manage them to prevent harm to both humans and the environment. As such, the RIS noted a potential gap in the regulation of stormwater assets for councils.

The RIS suggested that requirements for stormwater asset management and stormwater asset management plans be placed in guidance and into an OMLI (citing this was the preferred option, considering cost, clarity and effectiveness).

However, despite the RIS’s preference, clause 5 was removed when the OMLI was finalised. This decision was made on the basis that the EPA will publish guidance on how the General Environmental Duty (GED) applies to the management of stormwater assets. As such, there currently remains no positive statutory duty on councils to maintain urban stormwater assets.

Further, using an OMLI as a legislative instrument may not be the most appropriate vehicle for stormwater asset management. Given the importance of this issue, it raises the question of whether stormwater asset management should be governed by specific statutory provisions within water legislation, considering the nature of stormwater. Alternatively, in addition to the matter being addressed by a legislative instrument under the Environment Protection Act 2017 (Vic), it should also be addressed under water legislation, particularly as legal questions for stormwater asset management are complex and that water legislation already addresses the issue of a cause of action for liability for flow of water.

In this regard, the Water Bill 2014, drafted during the Baillieu-Napthine Government, sought to clarify councils’ duties in relation to stormwater asset management, namely by extending the modified liability regime in section 157 of the Water Act 1989 (Vic) to flow from council's stormwater infrastructure or infrastructure identified in a council water management scheme. The relevant provision is outlined in proposed clause 723, as excerpted below:

However, the Bill lapsed in November 2014, meaning that these proposed changes have not been implemented.

Is there a regulatory gap?

Victorian legislation currently remains silent on imposing a positive statutory duty on councils to maintain their stormwater assets in urban areas. While the Victorian Government has attempted to address this at various times, implementing such a duty would likely present challenges. Councils and other public authorities will need to allocate more resources to stormwater infrastructure management, in alignment with the demands of a positive statutory duty.

As a starting point, councils may wish to consider the current effectiveness of their stormwater asset management policies. If you or someone you know has any questions about stormwater assets, please contact our experienced team of lawyers below.

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.

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