Hundreds of millions of dollars in compensation for victims of the 2011 Queensland floods disaster is in limbo as the water authorities held responsible take the first steps to launch an appeal.

Key points: Thousands of victims won the class action in the NSW Supreme Court last month

Thousands of victims won the class action in the NSW Supreme Court last month Sunwater is moving ahead with an appeal despite saying "no formal decision has been made"

Sunwater is moving ahead with an appeal despite saying "no formal decision has been made" The State Government has ruled out appealing but says it isn't able to stop the authorities

Sunwater and Seqwater — which operate Wivenhoe and Somerset dams — and their owners, the Queensland Government, were found responsible for exacerbating flooding across South-East Queensland in a landmark decision by the New South Wales Supreme Court in November.

The court ruled in favour of the negligence claim by thousands of property owners, finding the dam operators failed to follow their own manual and did not make enough room for heavy rainfall until it was too late, heightening flood levels and damaging more properties.

Maurice Blackburn Principal Lawyer Rebecca Gilsenan said at the time the damages bill was expected to be in the "hundreds of millions" while the Insurance Council of Australia said insurers paid the 2019 equivalent of more than $1.5 billion in claims.

Both Sunwater and Seqwater said they would each lodge a "notice of intention to appeal" with the New South Wales Supreme Court, but also said they hadn't made a final decision on whether to launch an appeal.

In a statement, Sunwater said it continued to "carefully review the judgement and consider its options".

Seqwater said a final decision would be made ahead of the next court hearing on February 21, 2020.

The Queensland Government had already opted not to appeal the decision.

In a statement, shareholding ministers Treasurer Jackie Trad and Natural Resources Minister Dr Anthony Lynham said the water authorities had independent boards and each had its own insurance policy to consider.

"The relevant insurance companies now have a legal right to determine their next steps," they said.

"If a Ministerial Direction to Seqwater or Sunwater to not appeal the court decision could be given, it would not bind their insurers and it may compromise their insurance policies."

They have called upon the insurers of Seqwater and Sunwater to rule out an appeal.