Fine southern cathedral city (5)
I believe the answer is:
wells
'cathedral city' is the definition.
(cathedral city in Somerset)
'fine southern' is the wordplay.
'fine' becomes 'well' (similar in meaning).
'southern' becomes 's' (abbreviation).
'well'+'s'='WELLS'
(Other definitions for wells that I've seen before include "H. G. . . . . ., science-fiction writer" , "Flows upward; small city" , "Somerset cathedral city" , "Sources of water" , "Springs" .)