Section 104 Agreement Bond

It is the duty of the Water Corporation to provide a public sewer for domestic purposes when requested by the applicant. This agreement is detailed in section 98 of the Water Industry Act 1991. The obligation in this respect, in accordance with Section 104 of the Agreement, is calculated at 10% of the estimated cost of sewer construction (33% in Wales). Once satisfied with the condition of the sewers, the local sanitation authority issues a certificate of provisional completion. The applicant then remains responsible for the maintenance and repair of the sewers for an agreed period (usually 3 to 12 months), after which a final check is carried out. Once all the necessary repair work has been completed, a final certificate is issued and the loan is released. Another way to take care of sewers is another part of the Water Management Act, S102. This is a retroactive agreement that can be used to take over existing sewers in the absence of an S104 agreement. A smooth design and submission process often means that sewers can be taken care of more easily and attachment to the developer can be returned – which often leads to a faster and more cost-effective construction program. In order to have successfully approved water management strategies and concluded a Section 104 agreement, it is important to assess the needs of each site in order to provide the optimal solution.

For major developments (usually ten or more houses), the normal method used to achieve this transfer is Section 104 of the Water Industry Act (1991), generally referred to as Section 104 Agreement (or abbreviated S104 Agreement). This is an agreement between the developer and the water company that defines the acceptance criteria. In short, the developer agrees to build the sewers to an agreed standard and wait for them for some time after construction, usually a few years. After this period, in the absence of significant problems, the ownership is transferred to the water company, which is then responsible for the sewers. Interestingly, many lawyers will try to get a copy of these agreements. It has always been Severn Trent`s policy that S104 agreements are a confidential agreement between them and the developer and, as such, are not passed on to third parties. However, many developers provide them on request, which is why we always recommend contacting them instead….