Definitions for "Lateral water hazard"
a water hazard which has been marked with red stakes or line. Indicates that a drop can be made at the point at which the ball crossed the hazard line (with 2 club lengths relief). Similar to any lateral hazard (such as trees or fence line) which also would be marked by red stakes.
The reason the rules differentiate a "lateral water hazard" from a "water hazard" is that in the case of a lateral water hazard, the option to drop behind the hazard does not exist. Because the lateral water hazard runs along the side of the playing area, not across it. The official definition of "lateral water hazard" is a water hazard situated so that it is impossible or impractical (in view of the committee) to drop behind it - as you would do with a normal water hazard.
A water hazard that runs parallel to a hole or green.