I had an idea that "under" was an error converting the original Latin to English. I found the original

and chipped away at it some then thought to ask AlexP who participates in the WorldBuilding stack. His emailed answer to me is excellent in many ways. It would be a shame not to share the whole of it.
Willk 11:39 AM (8 hours ago) to AlexP
Hello AlexP. I hope all is well with you. Here is a diversion for me
I thought might divert you as well.
middle ages - What is meant by this medieval reference to combat
'under-ground'? - History Stack Exchange
I had the idea that Stow's survey of London mistranslated the
original. Or as seems more likely to me now, could not read it. I
found the original here https://www.gla.ac.uk/myglasgow/library/files/special/images/chaucer/H215_0149rwf.jpg
You are full of surprising knowledge. Maybe some paleography? What
do you read in the line after "tria duella"?
Best - WIllk
AlexP 4:11 PM (3 hours ago) to me
Hello William,
The text is from the Calendar of Letter-Books of the City of London,
volume C, 1291-1309, folio c.xxx.iv. b. It is published online by
British History Online (BHO), which is said to reproduce the edition
published by Her Majesty's Stationery Office, London, 1901. I don't
know about that edition. They say that they made the electronic
edition by double rekeying from the 1901 printed edition, so the text
should be somewhat trustworthy. Neverthelss, there are glaringly
obvious transcription errors in the online version of the BHO, so it
is unusable.
A good online copy of the 1901 edition edited by Reginald R. Sharpe
and printed by order of the Corporation of the CIty of London under
the direction of the Library Committee is available onlie at
Archive.org as https://archive.org/details/ccalendarofletter00londuoft. In R. R. Sharpe's edition
the relevant passage reads:
Temporilbus Knwti Regis Anglorum fuerunt tresdecim Milites regi et
regno multum amabiles qui quandam terram in orientali parte London' ab
incolis pro nimia servitute derelictam a rege pecierunt quatenus
predictam terramn et Gilde libertatem imperpetuum eis concederet.
Quibus Rex libenter concessit condicione qua sequitur videlicet quod
quilibet eorum tria duella scilicet super terram subtus et in aqua
victoriose perageret. Et postea certo die in campo qui rnodo vocatur
Estsmithfeld contra quosque aduenientes ipsimet hastis decertarent
quodque gloriose factum est.
meaning, as far as my rusty and always unreliable Latin goes,
In the time of Knuth King of the English, there were thirteen knights,
much beloved by the king and the kingdom, who petitioned the king to
concede to them in perpetuity and with Guild liberty a piece of land
in the eastern part of London, which had been abadoned by the
inhabitants because of the excessive obligations. To whom the King
gratiously conceded [the request] on condition that any one of them
win three duels, namely on land, below ground, and in water. And then
in a certain field called Estsmithfeld the very same fought with
lances against whoever came forward, which was gloriously done.
Coming specifically to the specific question, I read
quilibet eorum tria duella super terram subtus et in aqua
where rum, ter, and et are pretty ordinary scribal abbreviations.
OK, the ter abbreviation is maybe a bit unusual, but you can see the
same word terram with the same bewildering appearance in the second
line from the top: tis amabiles qui quandam terram in orientali parte:
ter -- round -- script a bit squished - .
There is a statue of a knight in Devonshire Square in London, with a
plaque which reads
King Edgar (959–75) granted this derelict land to thirteen knights, on
condition that they each perform three duels, one on land, one below
ground, one on the water. These feats having been achieved, the King
gave the knights, or Cnihtengild, certain rights over a piece of land
etc.
Or at least so says Flickr user Jim Linwood, who took a photograph of
it in 2010. The photograph is available on Wikimedia under the
Creative Commons Attribution 2.0 Generic license.
A bad PDF copy of Adriano Cappelli's canonical Elements of
abbreviation in medieval Latin paleography (English translation by
David Heimann and Richard Kay, 1982) is floating on the internet; for
example, I found it at https://core.ac.uk/download/pdf/213385262.pdf
Ah, and I strongly believe that the "under ground duel" refers to a
fight on foot, in a pit or a ditch; which pit or ditch could then be
filled with water for the third duel. In this case, the first "above
ground" duel would have been on horseback. The document says that the
trial was held in an open field against all comers, and was gloriously
done, which, I would say, means that onlookers could appreciate the
sport, with the knights demonstrating a complete set of combat skills.
All the best, AlexP
Willk 5:13 PM (2 hours ago) to AlexP
Gloriose factum est! More than I could have hoped for, with
additional references to look at and commentary on the hard-to-read
writing. If I answer that question on history stack now it will be
largely cribbed from your insights. Given how often that happens on
WB stack one would think I would be ok with it. Sort of ok with with.
But if you would like to post this as an answer that would be
wonderful - it has everything I hoped my answer would have.
AlexP 5:26 PM (2 hours ago) to me
Hello,
I don't intend to post an answer on History SE. I do not participate
to that Stack. If you want to, the please go ahead.
And I realized that I forgot to say that in that passage, per is also
a scribal abbreviation. (Much more common that the ter.)
AlexP
It would make sense for a fight for spectators to be in a pit, so everyone could see. That is how they did with bear baiting and other blood sports, so it would make sense for a show duel too. I found references to the water duel as a sort of tilting but people would be in fast moving boats aiming for targets instead of on horseback. http://www.larsdatter.com/water-joust.htm