Changeflow GovPing Courts & Legal Owners Strata Plan No 87231 v 3A Composites Gmb...

Routine Enforcement Amended Final

Owners Strata Plan No 87231 v 3A Composites GmbH - Consumer Class Action

Australia Federal Court Latest Judgments

Filed March 27th, 2026

Detected March 27th, 2026

Summary

The Federal Court of Australia dismissed a consumer class action brought by a strata corporation against a foreign manufacturer of building cladding. The court found that the Australian Consumer Law and Trade Practices Act did not apply to the foreign manufacturer, and that the products were not of acceptable or merchantable quality. The claims for misleading conduct and damages were also not established.

View original document View source feed page

What changed

The Federal Court of Australia, in Owners Strata Plan No 87231 v 3A Composites GmbH (No 10) [2026] FCA 351, dismissed a consumer class action concerning building cladding. The court ruled that the Australian Consumer Law and the Trade Practices Act 1974 did not apply to the foreign manufacturer, 3A Composites GmbH, as it was not deemed to have engaged in impugned conduct in Australia or carried on business in Australia. Claims related to the guarantee of acceptable quality (s 54 ACL) and actions for unmerchantable quality (s 74D TPA) were dismissed because the products were not found to be of acceptable or merchantable quality at the time of supply, nor were they inherently defective. Claims of false or misleading representations (s 29 ACL) and misleading conduct (s 33 ACL) were also dismissed.

This judgment has significant implications for foreign manufacturers supplying goods into Australia, particularly concerning the extraterritorial reach of Australian consumer protection laws. It clarifies that simply having a product distributed in Australia may not be sufficient to establish liability for the foreign manufacturer. The decision also highlights the complexities of applying consumer protection laws to goods that are affixed to buildings and the importance of individual assessments of specific buildings and circumstances when determining product quality and compliance. Regulated entities, especially foreign manufacturers and their Australian distributors, should review their supply chain agreements and marketing materials to ensure compliance with Australian consumer law, paying close attention to where business is conducted and the nature of representations made about product safety and quality.

What to do next

Review international supply chain agreements for compliance with Australian consumer law.
Assess marketing materials for representations regarding product safety and quality, especially for goods affixed to buildings.
Consult legal counsel regarding the application of Australian Consumer Law to foreign manufacturers.

Source document (simplified)

Original Word Document (1.7 MB) FEDERAL COURT OF AUSTRALIA

The Owners – Strata Plan No 87231 v 3A Composites GmbH (No 10) [2026] FCA 351

| File number(s): | NSD 215 of 2019 |
| | |
| Judgment of: | ANDERSON J |
| | |
| Date of judgment: | 27 March 2026 |
| | |
| Catchwords: | REPRESENTATIVE PROCEEDINGS – representative proceeding under Part IVA of the Federal Court of Australia Act 1976 (Cth) – consumer class action – action brought by strata corporation on behalf of entities with a (former) proprietary interest in a building with Alucobond PE or Alucobond Plus cladding.

CONSUMER LAW – where product manufactured by foreign corporation and supplied in Australia by Australian distributor – whether Australian Consumer Law (‘ACL’) and Trade Practices Act 1974 (Cth) (TPA) apply to foreign manufacturer – whether foreign manufacturer engaged in impugned conduct in Australia – whether foreign manufacturer carried on business in Australia

CONSUMER LAW – guarantee of acceptable quality in s 54 of the ACL – actions in respect of goods of unmerchantable quality in s 74D of the TPA – whether products supplied in trade or commerce – whether products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption –whether products were “supplied” to a “consumer” – whether strata corporations derived title to the products “through or under” the developers of the relevant buildings – whether the products were consumer goods – whether product affixed to building by professionals can be a consumer good – consideration of passive use – whether a third party used up or transformed the products – whether products were of acceptable or merchantable quality at time of supply – whether products were capable of being used safely and in compliance with the legislative requirements during the relevant period – relevance of theoretical possibility of use compared with practical likelihood of use in all the circumstances including cost – relevance and role of professionals involved in the acquisition and affixation of products and design and construction of buildings – relevance of knowledge of professional intermediaries – where legislative framework and expert evidence demonstrates safety and compliance of products can only be determined through individual assessment of specific buildings - Where products not inherently defective – claim not established.

CONSUMER LAW – false or misleading representations about goods or services contrary to s 29 of the ACL - misleading conduct as to the nature etc. of goods contrary to s 33 of ACL – materially the same as ss 53 and 55 of the TPA – whether marketing material published by one or other of the respondents alleged to have been misleading – whether foreign manufacturer liable for material published by Australian distributor – when task of assessing if conduct was misleading is approached by reference to a class of persons or requires assessment of individual circumstances if monetary damages sought by specific person or persons – where voluminous marketing material relied on which is in materially the same terms – marketing material alleged to have conveyed that products were safe and compliant – allegation of failure to provide warnings – whether representations were as to future matters – where a representation as to an inherent quality of a product cannot be a representation as to a future matter – consideration of context and knowledge of professionals – claim not established.

DAMAGES – whether applicant and sub-group representative suffered loss or damage because of non-compliance with statutory guarantee – where issue specific to each applicant and group member – consideration of requirements of s 272(1)(b) of the ACL – whether inferential case of causation sufficient – consideration of proportionality in establishing fact – Necessity of evidence of actual reliance on alleged misleading conduct.

PRACTICE AND PROCEDURE – whether pleading amendments take effect from date of commencement of proceeding or date of amendments – where amendments to class definition in representative proceeding – where default position is that amendments to group definition in representative action take effect from the time the definition is changed – where additional cause of action added – where amendments do not arise from the same or substantially the same facts as those which had already been pleaded – Amendments take effect from date of amendment.

LIMITATION OF ACTIONS – issue individual to applicant – ACL s 236(2)– times that causes of action arose – whether requirement for applicant to undertake reasonable inquiries – no requirement to know of specific defect of product – sufficient to have knowledge that consumer guarantee has not been complied with – – applicant’s consumer guarantee claim brought within time – s 273 of the ACL, s 82(2) of the TPA – when link between the physical manifestation and the underlying defect is known or ought to be known – relevant knowledge is as to actual physical defect in the structure, not legal responsibility for the cause of the defect – applicant’s misleading conduct claim time barred. |
| | |
| Legislation: | Constitution s 51

A New Tax System (Goods and Services Tax) Act 1999 (Cth) s 177-12

C ompetition and Consumer A ct 2010 (Cth) (the Australian Consumer Law) s 5(1), sch 2 (the Australian Consumer Law) ss 2, 3, 7(1), 8, 11,18, 29, 33, 54, 59, 236, 258, 262, 271, 272, 273

Federal Court of Australia Act 1976 (Cth) ss 33C, 33K, 33M, 33ZE, 33ZF,

Trade Practices Act 1974 (Cth) (repealed) ss 4(10, 4B(1), 5(1), 51A, 53, 55, 65F, 74A, 74D, 74J, 75AD, 75AG, 82

Trade Practices Amendment Act (No. 1) 2001 (Cth)

Trade Practices Amendment Act 1977 (Cth)

Trade Practices Amendment Bill (No 2) 1978 (Cth)

Federal Court Rules 2011 (Cth) rr 1.32, 1.34, 1.35, 821, 16.51, 16.53

Building Act 1993 (Vic)

Building Act 2016 (Tas)

Building Products (Safety) Act 2017 (NSW)

Building Regulations 2006 (Qld)

Building Regulations 2012 (WA)

Design & Building Practitioners Act 2020 (NSW)

Development Regulations 2008 (SA)

Environmental Planning and Assessment Act 1979 (NSW)

Environmental Planning and Assessment Regulation 2000 (NSW)

Home Building Act 1989 (NSW)

Law Reform (Miscellaneous Provisions) Act 2005 (NSW) s 5(1)

S trata S chemes (F reehold D evelopment) A ct 1973 (NSW) ss 18, 20 , 24

S trata S chemes D evelopment A ct 2015 (NSW) ss 8, 28

S trata S chemes M anagement A ct 1996 (NSW) ss 8, 11

S trata S chemes M anagement A ct 2015 (NSW) s 24(2)

Consumer Guarantees Act 1993 (NZ)

Fair Trading Act 1986 (NZ) (repealed) |
| | |
| Cases cited: | Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470 at 503

Actol Pty Ltd v Rise Products [2022] NSWCATCD 150

Agtrack (NT) Pty Ltd t/as Spring Air v Hatfield (2003) 7 VR 63; [2003] VSCA 6

Air Link Pty Ltd v Paterson (No 2) (2003) 58 NSWLR 388; [2003] NSWCA 251

Alcan Gove Pty Ltd v Zabic (2015) 257 CLR 1

Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd (2018) 259 FCR 514; [2018] FCAFC 6

Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (1999) 9 BPR 17,315

Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (No 2) (1998) 9 BPR 16,515

Australi an Competition and Consumer Com mission v Birubi Art Pty Ltd [2018] FCA 1595

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73

Australian Competition and Consumer Commission v Flight Centre Travel Group Ltd (2016) 261 CLR 203; [2016] HCA 49

Australian Competition and Consumer Commission v HJ Heinz Co Australia Ltd (2018) 363 ALR 136; [2018] FCA 360

Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672

Australia n Compe tition and Consumer Commis sion v Meriton Property Services Pty Ltd (2017) 350 ALR 494; [2017] FCA 1305

Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; [2014] HCA 53

Australian Competition and Consumer Commission v Valve Corporation (No 3) (2016) 337 ALR 647; [2016] FCA 196

Australian Competition and Consumer Commission v Woolworths Group Ltd (2020) 281 FCR 108; [2020] FCAFC 162

Australian Securities and Investments Commission v Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed) (No 2) [2013] FCA 409; (2013) 213 FCR 289

Baldry v Jackson [1976] 2 NSWLR 415

Barton v Croner Trading Pty Ltd (1984) 3 FCR 95

Bed Bath ‘N’ Table Pty Ltd v Global Retail Brands Australia Pty Ltd (No 3) [2024] FCA 226

Bellgrove v Eldridge (1954) 90 CLR 613

Blatch v Archer (1774) 1 Cowp 63; 98 ER 969

Body Corporate Number DPS 91535 v 3A Composites GmbH (2023) 16 TCLR 719; [2023] NZCA 647

Body Corporate Number DPS 91535 v 3A Composites GmbH [2022] NZCCLR 4; [2022] NZHC 985

Body Corporate Number DPS 91535 v 3A Composites GmbH [2024] NZSC 53

Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (2008) 166 FCR 494; [2008] FCAFC 38

Breskvar v Wall (1971) 126 CLR 376

Bunnings Group Ltd v Laminex Group Ltd (2006) 153 FCR 479; [2006] FCA 682

Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592

Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304, 319

Campbell v Gebo Investments (Labuan) Ltd (2005) 190 FLR 209; [2005] NSWSC 544

Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45

Capic v Ford Motor Co of Australia Pty Ltd (2021) 154 ACSR 235; [2021] FCA 715

Capic v Ford Motor Company of Australia Pty Ltd (2024) 419 ALR 437; [2024] HCA 39

Capic v Ford Motor Company of Australia Pty Ltd (S upplementary Common Questions and Other Issues) [2026] FCA 38

Carpet Call Pty Ltd v Chan (1987) ASC 55-553

Cassidy v Saatchi & Saatchi Australia Pty Ltd (2004) 134 FCR 585; [2004] FCAFC 34

Castlemaine Perkins Ltd v McPhee [1979] Qd R 469

Chief Executive Officer of Customs v Adelaide Brighton Cement Ltd (2004) 139 FCR 147; [2004] FCAFC 183

Colley's Patents Ltd v Metropolitan Water Board (1912) AC 24

Commonwealth of Australia v Shaw (2006) 66 NSWLR 325; [2006] NSWCA 209

Commonwealth v Amann (1991) 174 CLR 64; [1991] HCA 54

Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594

Cook v Pasminco Ltd (2000) 99 FCR 548; [2000] FCA 677

Cyril Smith & Associates Pty Ltd v The Owners-Strata Plan No. 64970 [2011] NSWCA 181

David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265

Downey v Carlson Hotels Asia Pacific Pty Ltd [2005] QCA 199

Elders Trustee & Executor Co Ltd v EG Reeves Pty Ltd (1987) 78 ALR 19

Ethicon S à rl and Others v Gill and Others (2021) 288 FCR 338; [2021] FCAFC 29

Ethicon Sàrl v Gill (2018) 264 FCR 394; [2018] FCAFC 137

Ezy Fit Engineering Group Pty Limited v Microm Nominees Pty Limited [2024] FCA 441

Facebook Inc v Australian Information Commissioner (2022) 289 FCR 217; [2022] FCAFC 9

First Mortgage Managed Investments Ltd v Oberlechner [2006] NSWSC 1397

Ford Motor Company of Australia Pty Ltd v Capic (2023) 300 FCR 1; [2023] FCAFC 179

Gardam v George Wills & Co Ltd (1988) 82 ALR 415 at 427

Gardez Nominees Pty Ltd v NSW Self Insurance Corporation [2016] NSWSC 532

Gibson v Malaysian Airline System Berhad [2016] FCA 1476

Gill v Ethicon Sàrl (No 5) [2019] FCA 1905

Gould v Vaggelas (1985) 157 CLR 215

Graham Barclay Oysters Pty Ltd v Ryan (2000) 102 FCR 307; [2000] FCA 1099

H Lundbeck A/S v Sandoz Pty Ltd (2022) 276 CLR 170; [2022] HCA 4

Hawkins v Clayton (1988) 164 CLR 539

Henville v Walker (2001) 206 CLR 459; [2001] HCA 52

Impiombato v BHP Group Ltd (2025) 308 FCR 250; [2025] FCAFC 9

Jillawarra Grazing Company v John Shearer Ltd (1984) ATPR 40-441

Kain v R&B Investments Pty Ltd [2025] HCA 28; 423 ALR 413

Karpik v Carnival plc (2023) 280 CLR 640; [2023] HCA 39 at [41]

Kirby v Coote [2006] QCA 61

Luckins (Receiver and Manager of Australian Trailways Pty Ltd) v Highway Motel (Carnarvon) Pty Ltd (1975) 133 CLR 164

Magman International Pty Ltd v Westpac Banking Corporation (1991) 32 FCR 1

McGraw-Hill Financial, Inc v Clurname Pty Ltd (2017) 123 ACSR 467; [2017] FCAFC 211

Medtel Pty Ltd v Courtney (2003) 130 FCR 182; [2003] FCAFC 151

Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145; [2011] FCAFC 128

Metropolitan Water Board v Colley’s Patents Ltd [1911] 2 KB 38

Metropolitan Water Board v London, Brighton & South Coast Railway Co [1910] 1 KB 804

Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; [2010] HCA 31

Moore v Scenic Tours Pty Ltd (2020) 268 CLR 326; [2020] HCA 17

Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37

Murphy Operator & Ors v Gladstone Ports Corporation (No 9) [2023] QSC 035

Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388; [2004] HCA 3

Norcast S. ár.L v Bradken Ltd (No 2) (2013) 219 FCR 14; [2013] FCA 235

Overlook v Foxtel (2002) ATPR (Digest) 46-219; [2002] NSWSC 17

Owners SP 92450 v JKN Para 1 Pty Ltd [2023] NSWCA 114

Peterson v Merck Sharpe & Dohme (Aust) Pty Ltd (2010) 184 FCR 1; [2010] FCA 180

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355

Purkess v Crittenden (1965) 114 CLR 164 at 168; [1965] HCA 34

Rasell v Cavalier Marketing (Australia) Pty Ltd [1991] 2 Qd R 323

RB (Hygiene Home) Australia Pty Ltd v SC Johnson & Son Pty Ltd [2020] FCA 1783

Reiffel v ACN 075 839 226 Ltd (2003) 132 FCR 437

Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53; [2003] HCA 75

Scarcella v Lettice (2000) 51 NSWLR 302

Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 277 CLR 186; [2023] HCA 8

Sportscorp Australia Pty Ltd v Chief Commissioner of State Revenue (2004) 213 ALR 795; [2004] NSWSC 1029

Strata Plan 88695 v Metlege [2025] NSWSC 535

Street v Luna Park Sydney Pty Ltd [2006] NSWSC 230

Sutherland Shire Council v Heyman (1985) 157 CLR 424

Sydney Subdivision Pty Ltd (in liq) v Chow [2023] FCA 8

Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272; [2009] HCA 8

Tanah Merah Vic Pty Ltd v Owners Corporation No 1 of PS613436T [2021] VSCA 72

Taylor Construction Group Pty Ltd v Strata Plan 9288 t/as The Owners Strata Plan 9288 [2021] NSWSC 1315

The Owners – Strata Plan No 91086 v Fairview Architectural Pty Ltd (No 3) [2023] FCA 814

The Owners - Strata Plan No 91322 v Trustees of the Roman Catholic Church for the Archdiocese of Sydney [2019] NSWCA 89

The Owners-Strata Plan No 87231 v 3A Composites GmbH (No 2) [2020] FCA 333

Theo Holdings Pty Ltd v Hockey (2000) 99 FCR 232; [2000] FCA 665

Toyota Motor Corporation Australia Limited v Williams (2023) 296 FCR 514; [2023] FCAFC 50

Valve Corporation v Australian Competition and Consumer Commission (2017) 258 FCR 190; [2017] FCAFC 224

Vautin v BY Winddown, Inc. (formerly Bertram Yachts) (No 4) (2018) 362 ALR 702; [2018] FCA 426

Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538

W & A McArthur Ltd v Queensland (1920) 28 CLR 530

Ward Group Pty Ltd v Brodie & Stone Plc (2005) 143 FCR 479; [2005] FCA 471

Wardley Australia Ltd v Western Australia (1992) 175 CLR 514

Webb Distributors (Aust) Pty Ltd v Victoria (1993) 179 CLR 15

Williams v Toyota Motor Corp Australia Ltd (2024) 419 ALR 373; [2024] HCA 38

24 February 2026 (First Respondent)

Applicant | |
| AND: | 3A COMPOSITES GMBH

First Respondent

HALIFAX VOGEL GROUP PTY LTD

Second Respondent | |

1. The parties confer and, on or before 4:00pm on 24 April 2026, submit to the chambers of the Honourable Justice Anderson draft orders to answer the common questions and questions of commonality and give effect to the reasons for judgment published today.

2. In the event the parties are unable to reach agreement, the parties are to file, in mark-up, draft orders identifying the points of difference each proposes together with written submissions limited to 10 pages in support of their respective positions.

3. The proceeding be stood over for case management at 9.30am on 8 May 2026.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

| 1. INTRODUCTION | [1] |
| 2. BACKGROUND | [14] |
| 2.1 The products: Alucobond PE and Alucobond Plus | [14] |
| 2.2 Regulatory regime | [29] |
| 2.3 Manufacture and supply of Alucobond | [42] |
| 2.4 Shore Building | [51] |
| 2.4.1 Construction | [51] |
| 2.4.2 Discovery of Alucobond PE | [59] |
| 2.4.3 Removal of cladding | [70] |
| 2.4.4 Loss incurred by the Shore OC | [76] |
| 2.5 Five Dock Building | [78] |
| 2.5.1 Construction | [81] |
| 2.5.2 Proposed removal works | [92] |
| 2.6 Fire science concepts | [104] |
| 3. OVERVIEW OF CLAIMS | [117] |
| 4. LAY EVIDENCE | [133] |
| 4.1 Mr Michael Sheils (Shore Building) | [134] |
| 4.2 Dr Joachim Werner (3A) | [139] |
| 4.3 Other lay evidence | [145] |
| 4.3.1 Margaret Lynette Hall (Shore Building) | [146] |
| 4.3.2 Mr Bill Filippopoulos (Five Dock Building) | [150] |
| 5. EXPERT EVIDENCE | [154] |
| 5.1 Expert Group 1 – Chemists | [158] |
| 5.2 Expert Group 2 – Fire behaviour experiments | [207] |
| 5.3 Expert Group 3 – Fire engineers (academics) | [243] |
| 5.3.1 Principles of a fire - safe design | [250] |
| 5.3.2 Alucobond PE | [278] |
| 5.3.3 Alucobond Plus | [341] |
| 5.3.4 Shore Building and Five Dock Building | [383] |
| 5.4 Expert Group 4-5 – Fire engineers (practising professionals) | [402] |
| 5.4.1 What “Performance Requirements” were applicable to the use of combustible ACPs as part of or as an attachment to an external wall or building element on Class 2 to 9 Buildings? | [408] |
| 5.4.2 What was the role and involvement of FSE s in designing, constructing and certifying buildings in respect of combustible ACPs in Australia during the relevant period? | [414] |
| 5.4.3 How did FSE s assess the proposed use of combustible ACPs as part of or as an attachment to an external wall or building element (and did this change during the relevant period)? | [419] |
| 5.4.4 What information did FSE s rely upon and/or could they properly rely upon when assessing the suitability or compliance of ACPs for use on a building, including product information provided by manufacturers and/or suppliers of ACPs? | [459] |
| 5.4.5 Did the local and international fire tests used in the marketing material support the use of Alucobond PE or Alucobond Plus as part of a Performance Solution? | [509] |
| 5.4.6 How (if at all) could Alucobond PE have been used on the Shore Building, and how (if at all) could Alucobond Plus have been used on the Five Dock Building, as part of a Performance Solution such that the buildings complied with the BCA? In answering this question, please address Mr Davis’ proposed Performance Solutions | [512] |
| 5.5 Expert Group 6 – BCA compliance experts | [535] |
| 5.5.1 Could Alucobond PE or Alucobond Plus have been used on a Class 2 to 9 Building during the relevant period as a “bonded laminate” pursuant to C1.12(f) (or, from 1 March 2018, C1.9(e)(vi)); or as an “attachment” pursuant to cl 2.4 of Specification C1.1? | [540] |
| 5.5.2 Could Alucobond PE or Alucobond Plus have been used in conformance with a CodeMark Certificate of Conformity during the relevant period (and if so, in what circumstances)? | [582] |
| 5.5.3 Could Alucobond PE or Alucobond Plus have been used on a low-rise building of Type C construction during the relevant period? | [606] |
| 5.6 Expert Group 7 – Architects and building professionals | [613] |
| 5.6.1 Objections to evidence given by Mr Quigley and Mr Incoll | [619] |
| 5.6.2 What advantages are offered by the use of ACPs? | [630] |
| 5.6.3 What uses of ACPs did you observe during the relevant period | [631] |
| 5.6.4 During the relevant period, what role would a reasonably prudent architect, developer, builder/contractor, or superintendent (together, the “Building Professionals”) have played in the selection of materials (including ACPs) for use on the façade of a building? | [633] |
| 5.6.5 In performing that role, would a reasonably prudent Building Professional have had regard to marketing material provided by manufacturers and/or suppliers of ACPs? If so, in what way(s)? | [641] |
| 5.6.6 During the relevant period, would a reasonably prudent Building Professional have considered Alucobond PE or Alucobond Plus safe and fit for purpose if it is assumed for the purposes of the question that both products: (a) were combustible; (b) were not capable of being used in a manner that met the deemed-to-satisfy provisions of the BCA; and (c) had the fire-risk properties identified in paragraph 14 of the Second Further Amended Statement of Claim? | [654] |
| 5.6.7 Could a reasonably prudent Building Professional have adopted or approved the Performance Solutions proposed by Mr Davis for the Shore Building and Five Dock Building? | [658] |
| 5.7 Mr Stephen Abbott | [663] |
| 5.7.1 Were the rectification costs regarding the Shore Building reasonable? | [670] |
| 5.7.2 How much would the complete Alucobond Plus cladding removal work at the Five Dock Building cost? | [675] |
| 5.7.3 Cost assessment of Mr Davis ’ remedial Performance S olution s | [682] |
| 5.8 Mr David Youssef | [697] |
| 6. WHETHER THE TPA AND ACL APPLY TO 3A’S CONDUCT | [714] |
| 6.1 Issue 1 – Did 3A engage in the impugned conduct in Australia? | [717] |
| 6.1.1 Consumer guarantee claim | [717] |
| 6.1.2 Misleading conduct claim | [770] |
| 6.2 Issue 2 – Was 3A carrying on business within Australia? | [791] |
| 6.2.1 Legal principles | [795] |
| 6.2.2 Consideration | [801] |
| 7. CONSUMER GUARANTEE CLAIM: THRESHOLD REQUIREMENTS | [832] |
| 7.1 Issue 3 – Whether 3A supplied the Alucobond products to HVG “in trade or commerce”: TPA, s 74D(1)(a) | [841] |
| 7.2 Issue 4 – Whether the Alucobond products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption: TPA, s 74A(2)(a); ACL, s 3(1)(b) | [850] |
| 7.2.1 Submissions | [852] |
| 7.2.2 Evidence | [870] |
| 7.2.3 Consideration | [876] |
| 7.3 Issue 5 – Whether a person “supplied” Alucobond PE or Alucobond Plus to a “consumer”: TPA, s 74D(1)(b); ACL, s 54(1)(a) | [943] |
| 7.3.1 To whom was a relevant supply made? Issue 5(a)(i) and 5(b)(iii) | [953] |
| 7.3.2 The price limb – Issue 5(a)(ii)(A) and 5(b)(i) | [1027] |
| 7.3.3 The consumer goods limb - Issue 5(a)(ii)(B), 5(b)(ii) | [1048] |
| 7.4 Issue 6 – Whether the Applicants derived title to the Alucobond products through or under the developers? | [1052] |
| 7.5 Issue 7 – Third party products | [1083] |
| 8. WHETHER THE ALUCOBOND PRODUCTS WERE NOT OF MERCHANTABLE OR ACCEPTABLE QUALITY: ACL, S 54(2)-(3); TPA, S 74D(2)-(3) (ISSUE 8) | [1086] |
| 8.1 Legislation | [1086] |
| 8.2 The pleaded claim | [1089] |
| 8.2.1 Fire Risk | [1091] |
| 8.2.2 BCA N on-compliance | [1099] |
| 8.3 Legal principles | [1106] |
| 8.4 The Applicants’ merchantable and acceptable quality case | [1117] |
| 8.5 Findings regarding Material Fire Risk Properties | [1121] |
| 8.5.1 The core of Alucobond Plus | [1123] |
| 8.5.2 The c ore of Alucobond PE | [1160] |
| 8.5.3 Do the cover sheets protect the core of Alucobond PE or Alucobond Plus? | [1162] |
| 8.5.4 Risks associated with the fire behaviour of Alucobond PE and Alucobond Plus | [1174] |
| 8.5.5 Summary of Material Fire Risk Properties | [1185] |
| 8.6 Findings regarding BCA compliance | [1190] |
| 8.6.1 CodeMark Certificates | [1194] |
| 8.6.2 DtS pathways | [1211] |
| 8.6.3 Performance Solution | [1250] |
| 8.6.4 Summary of BCA Non-compliance Properties | [1298] |
| 8.7 The Purposes for which Alucobond PE and Alucobond Plus were commonly supplied | [1303] |
| 8.8 Role of Qualified Professionals | [1313] |
| 8.8.1 FSEs | [1320] |
| 8.8.2 Building c ertifiers/building surveyors | [1325] |
| 8.8.3 Architects/other building professionals | [1329] |
| 8.9 Findings on the merchantable or acceptable quality of Alucobond PE or Alucobond Plus | [1350] |
| 8.10 Issue 9 – Defences | [1361] |
| 8.10.1 Acts or omissions of third parties: ACL s 271(2)(a) | [1363] |
| 8.10.2 Other defences | [1377] |
| 9. MISLEADING CONDUCT CLAIM | [1379] |
| 9.1 Introduction | [1379] |
| 9.2 Issue 10 – Positive misrepresentation case | [1385] |
| 9.2.1 The Positive Representations | [1389] |
| 9.2.2 Who made the representations? | [1392] |
| 9.3 The Relevant Class | [1430] |
| 9.4 Whether the marketing material conveyed the alleged Positive Representations (Issue 10(d))? | [1454] |
| 9.4.1 Generation One: The Face of Tomorrow, Today (2004 to 2013) | [1460] |
| 9.4.2 Generation Two: Vision Materiali z ed (2009-2013) | [1489] |
| 9.4.3 Generation 3: At a Glance (2013-2015) | [1520] |
| 9.4.4 Generation 4: Beyond Facades (2017-2018)) | [1546] |
| 9.4.5 Alucobond Plus brochures | [1567] |
| 9.4.6 Fire Protection Guide (2017-2018) | [1578] |
| 9.4.7 Websites | [1585] |
| 9.4.8 Architecture Review (2015) | [1600] |
| 9.4.9 N A TSPEC Product Partners Booklet (2015) | [1607] |
| 9.4.10 Architectural Product News | [1616] |
| 9.4.11 Alucobond.com.au website – Home page (2009) | [1618] |
| 9.4.12 Alucobond AU website - Homepage (2015) | [1623] |
| 9.4.13 Alucobond AU website - Homepage (2016) | [1624] |
| 9.4.14 Alucobond AU website - Homepage (August 2017) | [1626] |
| 9.4.15 Alucobond AU website - Homepage (November 2017) | [1627] |
| 9.4.16 Alucobond.com – Products – Alucobond (PE) – Processing | [1628] |
| 9.4.17 Alucobond.com – Products – Alucobond (P lus) – Processing | [1631] |
| 9.4.18 Other website pages | [1633] |
| 9.5 Issue 11 – Were the representations misleading? | [1635] |
| 9.5.1 Legal principles | [1635] |
| 9.5.2 Generation 1: The Face of Tomorrow, Today (2004 - 2013) | [1643] |
| 9.5.3 Generation 2: Vision Materialized (2009 - 2013) | [1678] |
| 9.5.4 Generation 3: At a Glance (2013-2015) | [1683] |
| 9.5.5 Other brochures | [1685] |
| 9.5.6 Plus Co mposition Representation | [1688] |
| 9.5.7 Websites | [1690] |
| 9.6 Representations as to future matters | [1695] |
| 9.7 Issue 12 – Failure to warn case | [1701] |
| 9.8 Conclusion on misleading conduct claim | [1716] |
| 10. CAUSATION AND LOSS | [1717] |
| 10.1 Issues 13 and 14 – Loss and causation (consumer guarantee claim) | [1719] |
| 10.1.1 Loss or damage and reasonable foreseeability | [1725] |
| 10.1.2 Shore Building – Causation and reasonable foreseeability | [1730] |
| 10.1.3 Five Dock Building – Causation and reasonable foreseeability | [1769] |
| 10.2 Issues 15 to 17 – Loss and causation (misleading conduct claim) | [1802] |
| 10.2.1 Shore Building - causation | [1813] |
| 10.2.2 Five Dock Building - causation | [1822] |
| 11. LIMITATION DEFENCES | [1829] |
| 11.1 Issue 18 – The date the amendments take effect | [1831] |
| 11.1.1 Submissions | [1837] |
| 11.1.2 Consideration | [1840] |
| 11.2 Issue 19 – The consumer guarantee claim: s 273 | [1865] |
| 11.2.1 Submissions | [1868] |
| 11.2.2 Mr Sheils ’ evidence and findings | [1871] |
| 11.2.3 Consideration | [1877] |
| 11.3 Issue 20 – Whether 14 February 2019 or 3 March 2020 (whichever is applicable) is within 6 years after the day on which the Applicants’ causes of action under s 236(1) accrued: ACL s 236(2)) | [1884] |
| 12. DISPOSITION | [1907] |
| Annexure A – COMMON QUESTIONS AND QUESTIONS OF COMMONALITY | |
| ANNEXURE B – GLOSSARY OF TERMS | |
ANDERSON J:

1. INTRODUCTION

1 This matter is a representative action brought by the applicant, The Owners – Strata Plan No 87231 (Shore OC), against the first respondent, 3A Composites GmbH, and the second respondent, H alifax V ogel G roup Pty Ltd.

2 The claim concerns two aluminium composite panel (ACP) products, with the brand names “Alucobond PE” and “Alucobond Plus” (together termed the Alucobond products).

3 ACPs have been implicated in a number of high-profile fires, including the “Lacrosse” building fire in Melbourne in November 2014 (Lacrosse Fire), and the “Grenfell” building fire in London in June 2017 (Grenfell Fire).

4 The Shore OC is the owners corporation of a residential building in Dolls Point, NSW, which for the purposes of this case is called the Shore Building. The Shore OC represents in this proceeding persons who, as at the date of 10 August 2022, had or had previously had, either an ownership or a leasehold interest in a building in Australia fitted with Alucobond PE, where the product was first supplied to a consumer in the period from 14 February 2009 to 14 February 2019 (being the relevant period).

5 A sub-group representative has also been appointed, The Owners – Strata Plan 98297 (Five Dock OC). The sub-group representative is the owners corporation of a residential building located in Five Dock, NSW, which for the purposes of this case, is called the Five Dock Building. The Five Dock Building was, at the time of the initial trial of this proceeding, fitted with Alucobond Plus. The sub-group representative represents persons meeting the same criteria as set out above at [4 ], save that the relevant building must have been fitted with Alucobond Plus rather than Alucobond PE.

6 3A is the German manufacturer of the Alucobond products. HVG is the Australian supplier of the products.

7 This judgment will refer to the Shore OC and Five Dock OC collectively as the Applicants, and to 3A and HVG collectively as the Respondents.

8 The Applicants rely primarily on two causes of action. The first is what I will refer to as the “consumer guarantee claim”, which is that the Alucobond products were not of merchantable or acceptable quality within the meaning of s 74D of the T rade P ractices A ct 1974 (Cth) and s 54 of Sch 2 to the C ompetition and C onsumer A ct 2010 (Cth) (the A ustralian C onsumer L aw). This claim is progressed on two main bases: first, that the Alucobond products presented an unacceptable risk of fire spreading on and into buildings to which they were affixed; and secondly, that the Alucobond products did not comply with the B uilding C ode of A ustralia when used as advertised. The second cause of action, which I will refer to as the “misleading conduct claim”, is that the Respondents each engaged in misleading conduct when advertising and promoting the Alucobond products.

9 The initial trial before me was set down to determine the entirety of the claims by the Applicants, together with the common questions and questions of commonality arising from their cases. As there are a total of 76 questions for determination, the common questions and questions of commonality have been extracted in Annexure A to these reasons.

10 It is also relevant to note what was not the subject of any claims in this proceeding. The Applicants did not make claims against the professionals involved in the design and construction of the Shore Building and the Five Dock Building. There were no claims advanced by the Applicants that those involved in the design and the construction of the Shore Building and the Five Dock Building were negligent or in breach of any other common law, equitable or statutory cause of action. Any such claims would, by their nature, be building specific to the Shore Building and the Five Dock Building and not able to satisfy the threshold requirements of s 33C of the F ederal C ourt of A ustralia Act 1976 (Cth) to commence a representative proceeding. That may provide one explanation as to why the parties did not seek to put on any evidence of the design and building professionals who were involved in the design and construction of the Shore Building and Five Dock Building.

11 3A filed a cross-claim, on 20 September 2021 against the builder, façade installer, architect, certifier and developers of the Shore Building. 3A also filed a cross-claim, on 22 July 2021, against each of the: builder; design architect; contractor architect; BCA consultant; façade engineer; fire engineer (company and a representative); the principal certifying authority; and the certifier, of another building (known as the Concourse) which at least at the time was owned by Willoughby City Council, another group member.

12 By the respective cross-claims, 3A sought a declaration that if it is found liable to the Shore OC (or any group member) then 3A is entitled (pursuant to s 5(1) of the Law Reform (Miscellaneous Provisions) Act 2005 (NSW), to contribution from each of the cross-respondents in such amount as the Court finds to be just and equitable. 3A also sought further or alternatively, a declaration that, if it is found liable to the Shore OC or any group member it is entitled in equity to recoupment or alternatively to contribution from each of the cross-respondents, and an order that the cross-respondents pay such amount to 3A. In each cross-claim 3A made claims against the various cross-respondents for breach of statutory warranties and duties in the Home Building Act 1989 (NSW), the Design & Building Practitioners Act 2020 (NSW) and the E nvironmental P lanning and A ssessment Act 1979 (NSW), as well as claims in negligence and for misleading and deceptive conduct contrary to s 18 of the ACL.

13 The Concourse cross-claim was discontinued against all cross-respondents (in stages) by 2 November 2021. The Shore Building cross-claim was discontinued (in stages) by 6 October 2023, after the filing of defences by some of the cross-respondents and replies. The reasons for the discontinuance of the cross-claims are not known to the Court.

14 What is apparent is that the claims brought by the Applicants on behalf of the group members are not well suited to a representative proceeding as they raise highly individual factual issues.

2. BACKGROUND

2.1 The products: Alucobond PE and Alucobond Plus

15 Alucobond PE and Alucobond Plus consist of two external aluminium layers (or cover sheets) with a core material of another lighter substance. The external aluminium cover sheets are usually 0.5 mm thick and bonded to the core with a thin layer of adhesive.

16 The different combinations of core materials distinguish ACPs from one another. The only material difference between Alucobond PE and Alucobond Plus is the composition of their core.

17 Alucobond PE and Alucobond Plus could be purchased in different thicknesses, with the core material having a nominal thickness of between 2–5 mm depending on the product purchased.

18 Alucobond PE’s core is comprised entirely of linear low-density polyethylene. Polyethylene (PE) is a highly combustible polymer, with a calorific value (ie, the total amount of energy that is available to be released from a material that is also known as the “heat of combustion”) which is comparable to derivatives of petroleum.

19 Alucobond Plus’ core on the other hand, comprises a mixture of combustible ethylene vinyl acetate (EVA), PE, and a non-combustible mineral filler of aluminium(tri)hydroxide (ATH). Generally, the core of Alucobond Plus was said to contain no more than 30% “plastic binders”, and therefore, to consist of at least 70% non-combustible mineral filler. There is a dispute between the parties as to whether the core of the Alucobond Plus panels were in fact constituted by at least 70% mineral filler. This issue is considered in further detail later in these reasons.

20 It is worth noting at this early stage that it is common ground that both Alucobond PE and Alucobond Plus are “combustible” (as that term is defined under the BCA). However, given the non-combustible mineral filler in Alucobond Plus, the panel has a lower heat of combustion and calorific value relative to Alucobond PE. Alucobond Plus therefore exhibits a slightly different reaction-to-fire behaviour compared to Alucobond PE. These issues are discussed in further detail in the context of the consumer guarantee claim.

21 ACPs such as the Alucobond products were used extensively in Australia throughout the relevant period (ie, from 2009 to 2019). During the relevant period, ACPs were mainly used for external cladding on a wide range of buildings. This could include medium or high-rise buildings, institutional buildings such as hospitals or universities, low-rise buildings such as retail and shopping centres, or residential buildings.

22 ACPs were used as the envelopes of buildings for weatherproofing, either as a sealed system which provided the primary waterproofing or as part of a rainscreen system where the weatherproof wall sat behind the rainscreen. ACPs were also commonly used as an attachment to a building, such as a perforated sunscreen. Other uses of ACPs also included soffit linings, internal wall cladding, rooftop features, and signage. The use of the Alucobond products as external cladding on buildings is primarily what this proceeding relates to.

23 ACPs provided a number of comparative advantages compared to other products which may explain the wide uptake and variety of applications for which ACPs were used during the relevant period. In particular, ACPs allowed a high-quality flat finish to be achieved, had lower material supply and fabrication costs, could be more easily fabricated (either in the factory or on-site), were relatively lightweight and easy to form, and were more thermally efficient than aluminium or steel panels.

24 As mentioned earlier in these reasons, ACPs have been implicated in a number of high-profile fires in Australia and internationally, including the Lacrosse Fire and Grenfell Fire. These two incidents are important to understand the broader context of the proceeding and also because both incidents are raised by each party’s case.

25 The Lacrosse Building is a 23-storey residential apartment building in Docklands, Melbourne. The building was clad with an ACP with a 100% PE core, which ran vertically from the ground floor to the top of the building. The panels were located next to balconies on the building and wrapped into the interior of the balconies.

26 The fire, which was suspected to be caused by a cigarette, started on the balcony of an apartment on level eight around 2 am on 25 November 2014. There were approximately 400 occupants. Within five minutes of the initial emergency calls, fire crews first arrived on the scene and saw the fire was spreading up the outside of the building. Within a further six minutes, the fire reached the roof above the 21 st floor via the external façade of the building. There were no significant injuries or fatalities. However, the fire reflected how the presence of ACPs could contribute to the rapid spread of fire. Although the ACP on the Lacrosse Building was a different brand (Alucobest), the product, like Alucobond PE, had a 100% PE core. The Victorian Court of Appeal decision in Tanah Merah Vic Pty Ltd v Owners Corporation No 1 of PS613436T [2021] VSCA 72, relates to damage caused by the Lacrosse Fire. The experts in that case agreed the 100% PE core of the Alucobest panels was the necessary condition for the ignition of the panels: at [224]-231.

27 The Grenfell Fire occurred on 14 June 2017 at the Grenfell Tower in London. The Grenfell Tower was a 24-storey residential apartment building in London. The building was originally constructed in 1972-1974, with its exterior walls consisting of a combination of precast and cast-in-place concrete. In 2015-2016, a ventilated rainscreen overcladding system was installed on the building. The cladding consisted of a PE-cored ACP effectively similar to Alucobond PE.

28 The Grenfell Fire started in a refrigerator on the fourth floor. The fire grew within the apartment and eventually spread to the external cladding of the building. The fire then spread rapidly up and around the entire building, breaking into individual apartments as it went. The principal factor which led to the rapid spread of the fire was the PE core of the ACP cladding.

29 The way in which compartmentation of the fire was inhibited by its rapid spread throughout the building compromised fire suppression, smoke control, evacuation, and fire and rescue services intervention. Ultimately, the tragedy resulted in 72 deaths, along with significant property damage.

2.2 Regulatory regime

30 Construction in Australia is regulated through the BCA. The BCA is maintained and published by the A ustralian B uilding C odes B oard and forms part of the broader N ational C onstruction C ode. The NCC provides a uniform set of technical provisions for the design and construction of buildings throughout Australia, with the intention of achieving nationally consistent minimum necessary standards of relevant safety (including fire safety).

31 The BCA is adopted in each of the States and Territories through State and Territory legislation.

32 The BCA is a performance-based building code. In practical terms, this means that the BCA identifies specific “performance requirements”, being the level of performance a building must meet. Different performance requirements can apply to different buildings, depending on how they are classified under the BCA.

33 The BCA classifies buildings into different classes determined by the purpose for which the building is designed. This is relevant to these proceedings as the claims brought by the Applicants apply to specific classes of building. In particular, part of the consumer guarantee claim – which claims that use of Alucobond PE and Alucobond Plus was non-compliant with the BCA – is specific to Class 2 to 9 buildings as defined in the BCA.

34 Class 2 to 9 buildings include apartments and other multi-occupancy residential buildings (Classes 2 and 3), office buildings and retail shops such as restaurants, cafes and bars (Classes 5 and 6), factories and warehouses (Classes 7 and 8), and public buildings, hospitals and aged care buildings (Class 9). It does not include single dwellings or small boarding houses (Classes 1a and 1b), or non-habitable buildings or structures such as a garage or fences.

35 A building, or part of a building, may be designed, constructed or adapted for multiple purposes and have more than one classification.

36 The BCA also prescribes three “types of construction” being Type A, B and C. The type of construction is dependent on a building’s rise in storeys and its classification.

37 Type A construction generally comprises buildings that are three or four, or more storeys in height (depending on classification). Type C is the lowest, covering buildings between one or two storeys in height. Type B construction sits in the middle.

38 Each type of construction is naturally subject to varying degrees of stringency in terms of fire resistance. Type A construction has the most stringent fire resistance requirements whereas the least stringent requirements apply to Type C construction. The following table extracted from the BCA tabulates the relationship between the rise in storeys and a building’s class, to derive the type of construction.

39 The performance requirements of the BCA can be satisfied through one of three possible routes. The first route is what is referred to as a “ D eemed- t o- S atisfy Solution”. This involves a number of provisions in the BCA, compliance with which is deemed to satisfy the relevant performance requirement. The second route is what is referred to as a “Performance Solution”. A Performance Solution is effectively where the required level of performance is achieved without relying on the DtS Provisions of the BCA. As a construction under a Performance Solution is not deemed to satisfy the relevant performance requirements, it is necessary to satisfactorily demonstrate that the relevant Performance Solution used in a particular building successfully complies with the performance requirements. The third route is a combination of the two, with some performance requirements being met through the DtS Provisions and some being met through a Performance Solution.

40 The specific performance requirements, DtS Provisions, and Performance Solution requirements which are relevant in the context of using the Alucobond products as external cladding are discussed in further detail in the context of Expert Groups 3, 4–5 and 6, and when considering the Applicants’ “BCA Non-compliance” claim.

41 In addition to the general regulation of construction under the BCA, following the Grenfell Fire, there was significant regulatory intervention by the States and Territories specifically in relation to the use of ACPs in construction. The States and Territories introduced what were effectively product bans on the usage of particular ACPs.

42 The specifics of these regulations differ across the States and Territories. They are summarised in the table below:

| State/Territory | Regulation |
| NSW | On 10 Aug 2018, a “ban notice” was issued under s 9(1) of the B uilding P roducts (S afety) Act 2017 (NSW) (the product ban). The notice prohibits the use of ACPs with a core comprised of greater than 30% PE by mass in any external cladding / wall / insulation, façade or rendered finish in Class 2, 3, 5, 6, 7, 8 and 9 Buildings with Type A or Type B construction (as defined in the BCA).

The product ban was subject to two exceptions: (i) where the product is not deemed combustible in accordance with AS 1530.1-1994 testing; or (ii) the building product and proposed external wall assembly has successfully passed a test for both external wall fire spread and building-to-building fire spread classifications in accordance with AS 5113, where the test has been carried out by an accredited testing laboratory, and a statutory declaration is provided that the product will be installed in a manner identical to the tested prototype wall assembly or façade. |
| Victoria | On 13 March 2018, a Minister’s Guideline (MG-14) was issued pursuant to s 188(1)(c) of the Building Act 1993 (Vic).

The guideline provided that when considering to issue a building permit in relation to a Type A or B construction, the relevant building surveyor should not be satisfied that a proposed building work which includes the installation of a “Prescribed Combustible Product” as part of an external wall (or attachment) would comply with the Building Act (Vic) unless the application includes a determination of the Building Appeals Board that the installation of the product complies with the Building Act (Vic).

“Prescribed Combustible Products” were defined to mean a panel that comprised of a PE core bonded to one or more sheets of metal panels, including ACPs. PE core was defined to mean a core comprised of 30% or more PE by mass.

On 1 February 2021, MG-14 was revoked and replaced with a declaration under s 192B(1) of the Building Act (Vic) which prohibited ACPs with a core of less than 93% inert mineral filler by mass in external cladding as part of a wall system, in connection with Type A or Type B construction. |
| Queensland | The Queensland government issued “Queensland Development Code, Mandatory Part 2.5 – Use of external cladding” which took effect from 18 October 2019. The Part provided that ACPs of greater than 30% PE core by mass were not permitted to be used on any building in any external cladding, external insulation or façade.

On 18 October 2019, the Queensland government further introduced Pt 4A of the Building Regulations 2006 (Qld). That Part required building owners of all buildings of Type A or Type B construction for which building development approval was given after 1 January 1994 but prior to 1 October 2018, to register their buildings, complete a “combustible cladding checklist”, and obtain a statement from a building industry professional as to whether their building may be “an affected private building” (ie, has combustible cladding). If the building was suspected to have combustible cladding, then the building owners were required to engage a fire engineer to complete a fire safety assessment |
| Western Australia | In June 2018, the Western Australian government issued Guideline “ GL-17: External Walls and Cladding ”. The guideline sets out the expectations of the Department of Fire and Emergency Services for any fire engineering brief or fire engineering report when addressing the performance requirements of the BCA.

Those expectations included that any use of potentially combustible wall systems be supported by large-scale façade test data. The guideline further provided that ACPs with a combustible core did not meet the DtS Provisions of the BCA for external walls of Type A and Type B construction and that a CodeMark “Certificate of Conformity” could only be relied upon if a fire engineer demonstrated its applicability to the subject building’s design.

On 5 October 2018, the Western Australian government inserted reg 31HA into the Building Regulations 2012 (WA), which required any Performance Solution in respect of external walls to be non-combustible by the BCA definition to be verified in accordance with C1V3 (unless used for exempt remedial work). C1V3, as defined in reg 3 of the Building Regulations (WA), means the Building Code Volume One Part C1 verification method. |
| South Australia | On 12 March 2018, amendments to the Development Regulations 2008 (SA) came into operation which created new requirements for “designated building products” used on “designated buildings”.

Around the same time, the Minister gazetted any metal plate or lining formed with aluminium, or similar metal sheet material, irrespective of core material, as a “designated building product” when used on a “designated building”. As a result, the builder/designer was required to provide further details of the proposed product and complete any Performance Solution in the gazetted template. A statement of compliance was also required before any certificate of occupancy could be issued. |
| Tasmania | On 27 December 2017, the Director of Building Control issued a determination under ss 18 and 20(1)(d) of the Building Act 2016 (Tas). The determination, relevantly, provided that ACPs containing a PE core used as external building cladding were classified as “high risk building products” if they were used on (i) a class 2, 3 or 9 building of 2 or more storeys; or (ii) a class 5, 6, 7 or 8 building of 3 or more storeys.

This means that those products could not be used in Tasmanian buildings unless approved under the determination. Approval could only be obtained where there was evidence that the product was fit for the purpose for which it was intended, including, among other things, appraisable reports from suitably qualified persons and test reports being provided. |
2.3 Manufacture and supply of Alucobond

43 3A is a composites manufacturing company incorporated under the laws of Germany, and is responsible for the invention of the original ACP. 3A has been a manufacturer of ACPs since 1968.

44 Dr Joachim Werner, the Managing Director of 3A, gave evidence that 3A and its related entities maintain offices and manufacturing operations in 27 countries across Europe, the Americas and Asia. However, Dr Werner stated that neither 3A nor its related entities had ever had an office in Australia.

45 The Alucobond products were, at all times during the relevant period, manufactured by 3A at its large-scale industrial manufacturing plant in Singen, Germany. Dr Werner deposed to the nature and scale of production of the Singen plant. He stated that during the relevant period it acquired approximately 30,000 tons of raw material per year, which were manufactured into, alongside other products, between two and three million square metres per year of the Alucobond products which were sold throughout the world.

46 Dr Werner deposed that different size specifications of Alucobond PE and Alucobond Plus were manufactured in continuous production runs of the same width, and that these production runs would usually produce around 12,000 m 2. For Alucobond Plus, the raw core materials would be transported through separate pipes to an automatic scale which weighed each of the components, with the small measured portions then being continuously fed into the production machine in relevant proportions. Each production run would be cut into sheets of the same colour and usually the same length.

47 Dr Werner deposed that the production process at the Singen plant was monitored to maintain consistent production. This included samples being regularly tested by 3A’s technicians in processes certified and controlled by German authorities. During a production run the scaling of the infeed of materials would continue to be measured, along with measuring the density and weight of the final product.

48 3A supplied HVG with the Alucobond products to be sold in Australia, pursuant to a series of distributor agreements between 3A and HVG. The distributor agreements were dated 1 July 2007, 1 September 2010, 1 September 2015 and 1 January 2018 (Distributor Agreements).

49 Under the Distributor Agreements, HVG was granted rights as the exclusive distributor of the Alucobond products in Australia throughout the relevant period. HVG would import the Alucobond products from 3A and sell them to customers in Australia. Under the terms of the Distributor Agreements, HVG was required to import the Alucobond products on its own account and purchase them exclusively from 3A. The specific terms of the Distributor Agreements, and the particular terms, which governed the supply of the Alucobond products to HVG are discussed in further detail when considering whether the TPA and ACL apply to 3A (issues 1–2).

50 In support of its business, HVG published and distributed various pieces of promotional material in the Australian market regarding the Alucobond products. While the nature of these promotional materials changed over time, they were distributed throughout the relevant period. The promotional material includes a series of marketing brochures which were the focus of much of the trial, particularly in relation to the Applicants’ misleading conduct claim.

51 These brochures generally contained the HVG logo but also utilised the ALUCOBOND® trademark which HVG was authorised to use under the Distributor Agreements. There are, however, a number of issues the Respondents raise in relation to the brochures, including whether each of the relevant publications was in fact authorised by 3A, and whether they were published during the publication periods alleged by the Applicants. These issues, alongside a closer review of the actual brochures, are dealt with in further detail later in these reasons.

2.4 Shore Building

2.4.1 Construction

52 The Shore Building is a four-storey residential apartment building consisting of 17 residential units and a basement car parking level.

53 The building was designed by architects V ictor R obert Bryce Lake & Associates Pty Ltd for the developers of the land, Ronnstar Pty Ltd and Lawtow Pty Ltd (the Shore Developers) and built by Prestige Apartments.

54 On 27 June 2011, Mr Tony Hatziandreou (being a representative of the Shore Developers and Prestige Apartments) sent a copy of the completed architectural drawings to Mr Ben Di Giorgi who was the “Sales & Technical Manager – NSW” of HVG. In the email, Mr Hatziandreou specified that “[e]verything referred to as prefinished metal cladding” was to be Alpolic (a different brand of ACP) or Alucobond.

55 On 21 July 2011, Mr Di Giorgi met with Mr Hatziandreou on site at the Shore Building to discuss the cladding. After the meeting, HVG provided Mr Hatziandreou with a list of recommended installers, including Modernise Installations, alongside various documents and marketing material. This material included a technical data sheet; a product information sheet regarding the fixed cassette fixation system; a marketing brochure depicting the use of Alucobond in long vertical runs up the entire length of what appears to be a commercial building, referred to in the material as Sydney Water HQ; a two-page AS 1530.3 test report; and a European Commission safety data sheet for Alucobond PE issued in March 2004.

56 Between 27 September 2011 and 25 May 2012, HVG supplied 130 sheets of Alucobond PE panels to Modernise Installations. Modernise Installations affixed the cladding to the Shore Building using the “cassette method”.

57 The “cassette method”, also referred to as the “tray method”, refers to ACP cladding panels being routed and folded to create shallow box shapes that can then (typically) be hung from cladding rails on the outside of a building.

58 The following photographs highlight (in red) where Alucobond PE was affixed to the Shore Building:

Southern elevation (screen capture from Professor Luke Bisby Report dated 26 April 2022)

Northern elevation (screen capture from Professor Luke Bisby Report dated 26 April 2022)

West elevation (screen capture from Professor Luke Bisby Report dated 26 April 2022)

East elevation (screen capture from Professor Luke Bisby Report dated 26 April 2022)

59 On 25 July 2012, AR Building Certifiers conducted an inspection of the Shore Building, ahead of issuing an Occupation Certificate on 16 August 2012.

2.4.2 Discovery of Alucobond PE

60 Following the Grenfell Fire in June 2017, the possibility that the Shore Building’s cladding was potentially combustible was first raised at a strata meeting of the Shore OC on or around 4 September 2017.

61 On or about 16 October 2017, the Shore OC resolved to engage Core Project Consulting to provide a cladding identification report for the Shore Building. Core Project Consulting produced a report dated 19 January 2018, which identified tthe cladding applied to the building as most likely having a PE core (Core Shore Report). The report did not identify the exact type of cladding, or the percentage of PE in the core.

62 The Core Shore Report recommended that the Shore OC consult with the building’s insurer to determine if they had further compliance requirements in relation to the presence of the cladding. To the extent the cladding was considered unacceptable, the report noted that the Shore OC had the option of engaging a fire engineer or building certifier to determine if the fire protection systems of the building were adequate or if a fire Performance Solution could be achieved, or alternatively, removing the existing cladding and replacing it with a compliant material.

63 In August 2018, Mr Peter O’Reilly, who was the chairperson of the strata committee at the time, made enquiries with HVG as to the nature of the cladding installed on the Shore Building. On 27 August 2018, a representative of HVG emailed Mr O’Reilly confirming that the product installed on the Shore Building was Alucobond PE. The email confirmed that the panels contained a full PE core and also stated that the product was fully compliant with the BCA at the time of installation.

64 Having determined that the ACP on the Shore Building was Alucobond PE, on 10 September 2018, Ms Margaret Hall, another member of the strata committee, emailed Bayside Council to inform the council that the Shore Building contained Alucobond PE. In her email, Ms Hall referred to the product ban that was made on 10 August 2018, noting that the Shore Building may have been an “affected” building.

65 On 17 September 2018, two representatives of the Bayside Council conducted an inspection of the Shore Building. Having confirmed that Alucobond PE was used as cladding on the building, in an email to Ms Hall and Mr O’Reilly on 18 September 2018, the council stated that the cladding would need to be replaced with a non-combustible material.

66 On 11 October 2018, the Shore OC decided to engage fire safety engineers (FSE s), Defire (NSW) Pty Ltd, to provide a report on the compliance or otherwise of the cladding affixed on the Shore Building.

67 On 17 December 2018, the Shore OC received Defire’s final combustible cladding risk assessment report. The report assessed the different levels of risk involved with how Alucobond PE had been installed around the Shore Building. The risk assessment involved an evaluation of the risk of ignition against the potential consequences of ignition (which, in turn, involved an assessment of the potential fire spread, risk to evacuating occupants, and fire brigade intervention).

68 Defire reached the following conclusions regarding the risk of Alucobond PE on the Shore Building:

70 The report also noted that while the performance requirements of the BCA were considered to establish the risk context, the report could not be considered a Performance Solution designed to demonstrate compliance with the BCA.

2.4.3 Removal of cladding

71 On 7 March 2019, Bayside Council sent a proposed Fire Order & Building Product Rectification Order in relation to the Shore Building.

72 Following a request by the Shore OC to extend the relevant compliance date from 90 days to 120 days, the council issued a Fire Order & Building Product Rectification Order in relation to the Shore Building on 29 May 2019.

73 The Rectification Order required the Shore OC to replace the combustible cladding on the building with a product that was “non-combustible” under the BCA within 120 days. In its reasons for issuing the order, the council stated the following:

Reasons for the Order:

1. Bayside Council is in receipt of documentation which indicates that the Aluminium Composite Panelling (ACP) installed on the subject premises is a product that contains a core material that is greater than 30% Polyethylene (PE) and is therefore a Banned Product pursuant to the [Building Products (Safety) Act 2017 (NSW)].

2. Such products cause an unreasonable risk to the spread of fire around a building and therefore give rise to a risk of loss of life or damage to property from fire.

3. The subject building is an 'affected building' under the [Building Products (Safety) Act 2017 (NSW)] (a building is an 'affected building' if a building product the subject of a building product use ban has been used in the building for a use that is prohibited by the building product use ban.

4. Provisions for fire safety or fire safety awareness are not adequate to prevent the spread of fire or ensure or promote the safety of persons in the event of fire.

5. To improve the current level of fire safety at the premises.

74 The Shore OC subsequently obtained four quotes in relation to the replacement works. Ultimately, on 17 October 2019, the Shore OC resolved to engage Restorial Remedial Building Services. On 27 November 2019, the Shore OC and Restorial entered into a contract for the rectification works, involving the removal of the existing Alucobond PE cladding and replacing it with alternative cladding.

75 The Shore OC also separately resolved to raise a special levy to fund the rectification works.

76 Restorial ultimately completed the works around 29 May 2020, replacing the Alucobond PE cladding with non-combustible “Vitradual” cladding. On 2 June 2020, representatives of the Bayside Council inspected the Shore Building and confirmed on 5 June 2020 that the Rectification Order had been resolved.

2.4.4 Loss incurred by the Shore OC

77 In its claim, the Shore OC seeks recovery from the Respondents of the following costs incurred by the Shore OC in relation to the replacement of the Alucobond PE on the Shore Building:

| Work conducted | Supplier | Cost |
| Core cladding identification report | Core Project Consulting | $528.00 |
| Inspection of Shore Building and combustible cladding risk assessment | Defire | $8,800.00 |
| Removal of old cladding and installation of new cladding | Restorial | $451,979.00 |
| Total (incl GST) | | $461,307.00 |
78 The Shore OC also seeks recovery of its increased insurance premiums, which the Shore OC claims was incurred by reason of the presence of Alucobond PE on the building. In particular, it is claimed that the Shore OC paid higher premiums in respect of its residential strata insurance policy from the period of 31 August 2018 (following the identification of combustible cladding on the building) until 31 August 2020 (being after the rectification works were completed on around 29 May 2020).

2.5 Five Dock Building

79 The Five Dock Building is a five-storey residential apartment building with 22 apartments and a two-level basement carpark. The apartments on the ground floor have their own courtyards, while the apartments above the ground floor each have their own balconies. The balconies are located on both the western aspect of the building (being the main façade of the building) and the eastern aspect of the building.

80 There is cladding on the front and back of the building. On the eastern elevation of the building (being the back of the building), there is silver/white Alucobond Plus on the external wall which extends from the first storey to the roof. On the western elevation of the building (being the front of the building), there is a charcoal/dark Alucobond Plus affixed on the sides from the first storey to the roof.

81 The following photographs highlight (in red) where Alucobond Plus is affixed to the Five Dock Building:

Eastern elevation (ie, back of building)

Western elevation (ie, front of building)

2.5.1 Construction

82 Relative to the material provided in this proceeding in relation to the Shore Building, there is little material as to why and how Alucobond Plus came to be affixed to the Five Dock Building, including the process of affixation chosen.

83 The developer of the Five Dock Building was Mr Omar Abdul-Rahman. Mr Abdul-Rahman and the Shore Developers will be referred to collectively as the developers when referring to the developers of both the Shore Building and the Five Dock Building.

84 In November 2017, a representative of ACP Cladding Solutions Pty Ltd, an Alucobond installer, attended the Five Dock Building site to assess the possible use of Alucobond for the project and to provide a quote to the builder, Buildrite Australia Pty Ltd.

85 On 11 November 2017, ACP Solutions confirmed they could provide Alucobond for the project. ACP Solutions provided Buildrite with marketing materials concerning the fire properties of Alucobond Plus, including a list of the international fire classifications that the goods were said to have passed.

86 It appears that ACP Solutions issued an invoice for its work to Buildrite around January 2018. However, there appears to be little documentary evidence around when the work was specifically undertaken or when it was completed by ACP Solutions.

87 It is also relevant to note that Buildrite engaged FSEs, BCA Innovations Pty Ltd, in relation to the construction of the Five Dock Building. A statement was prepared by BCA Innovations on 27 August 2018 which confirmed that the building had been constructed in accordance with an earlier fire engineering report (FER) dated 29 November 2017 which BCA Innovations had prepared in relation to the property.

88 The statement prepared by BCA Innovations explicitly noted that it was limited to the items required to satisfy the earlier FER, and did not include a BCA compliance assessment of the building.

89 Most relevantly, the statement also explicitly excluded external cladding from the scope of the report. The report included the following:

Please note: External cladding is out of the scope of this Fire Engineering Report. External cladding had been identified onsite by our office, however after requests to the builder to provide information confirming compliance to the PCA [sic] for assessment, to our knowledge no such information has been provided. Neither myself or our office take any responsibility for the type of cladding used if it deemed [sic] to be not in accordance with the BCA as this is out of the scope of our engagement and was mentioned numerous times during the design and construction phases of the project.

90 In this context, it is worth noting that on 5 June 2018, ACP Solutions provided Buildrite with several pieces of marketing material regarding the fire properties of Alucobond Plus. This included a table listing the various international fire classifications of the Alucobond products, a one-page report of ISO 9705-1 testing from 2010, a two page AS 1530.3 report from 2009, and a CodeMark Certificate for Alucobond Plus issued on 12 July 2016. Mr Ahmed Zeitoun of Buildrite replied to the email from ACP Solutions with the following:

Hi mate,

This is non combustible right ?

Regards

91 On 8 June 2018, Mr Zeitoun forwarded the attachments to BCA Innovations stating: “Please see attached product used at Fivedock”.

92 Around 9 November 2018, an interim occupancy certificate was issued on the basis of a CodeMark Certificate, being the version of the certificate issued on 12 July 2016 (certificate number GM_CM 30070 Rev A). However, it is now common ground between the parties that the use of the Alucobond Plus on the Five Dock Building was non-compliant with the BCA.

2.5.2 Proposed removal works

93 On 20 August 2020, the Five Dock OC engaged Core Project Consulting to review the cladding on the building, including to determine whether there were ACPs on the building. Core Project Consulting took ACP samples from both the eastern and western elevations. Following tests conducted on the samples, Core Project Consulting produced a report dated 30 September 2020 in which they identified that both samples had a core containing 29% PE (Core Five Dock Report). The report noted that:

While the panels have been identified as having a composition of less than 29% PE, the materials used in the entire assembly are what will ultimately determine how well the facade will perform in the event of a fire…

Furthermore, it is recommended to engage a fire engineer and a building certifier to assess the entire wall assembly to ascertain any risks associated with the areas clad in ACP considering the fire protection systems at the property.

94 In or around mid-2021, the Five Dock OC made a decision to remove the Alucobond Plus cladding on the Five Dock Building. At a meeting with the lot owners in May 2021, the owners agreed that even though the Alucobond Plus present was not the subject of a product ban (unlike Alucobond PE), the fact that the cladding wrapped into windows and balconies, and was bunched together, presented a danger. The lot owners formed a view that no certifier would certify the building with the cladding affixed. As a result, it was determined that the Five Dock OC would obtain three quotes with a view to removing the cladding, given the danger presented, the impact on possible sales, and the impact on insurance.

95 As the Five Dock OC did not have sufficient funds to undertake the remediation works, from May 2021, Mr Bill Filippopoulos, the chairman of the Five Dock Building’s strata committee, began making efforts to try to obtain an interest-free loan from the NSW Government’s program “Project Remediate” to facilitate the removal of the cladding. Mr Filippopoulos also approached the builders, Buildrite, and the developer, Mr Abdul-Rahman, to determine if they would be willing to fund the cladding works. Mr Filippopoulos’ evidence is that both denied responsibility for replacing the cladding. The Five Dock OC was also unsuccessful in securing funding from Macquarie Bank due to the loan amount sought being less than $500,000, although in August 2021, the Five Dock OC obtained a proposal for a loan from Lannock Strata Finance at an interest rate of 7.65%.

96 On 11 March 2022, the City of Canada Bay issued a “Notice of intention to issue a Fire Safety Order Development Control Order” to the Five Dock OC. The notice stated the following:

Council has been made aware of the potential problems with the use of inappropriate and potentially dangerous cladding material to the façade of the buildings in our local area… [t]his review has identified the above-mentioned property as potentially containing the subject cladding.

97 The notice attached a draft order, under s 9.34 of the EPA Act. The order proposed to require the Five Dock OC to engage an FSE, at its own cost, to conduct an analysis of the external wall cladding, and in the case of non-compliance, to submit a report outlining appropriate forms of rectification as required.

98 On 11 April 2022, the Five Dock OC’s strata managing agent informed the council that the Five Dock OC wished to seek an extension of time to resolve the matters the subject of the notice on the basis that steps were already being undertaken to seek the removal of the cladding. The request noted the steps that had been undertaken by the Five Dock OC since August 2020.

99 On 12 May 2022, the council responded stating:

Your proactive approach and potential engagement with Project Remediate assures confidence for a compliant cladding replacement proposal.

Considering the above, council will hold off on the order, however in the interim please provide an update within 30 days.

100 On 19 October 2023, Mr Filippopoulos received an email from the contractors engaged as part of Project Remediate, which provided a link to three tenders from third party contractors for the removal and replacement of the Alucobond Plus on the Five Dock Building. The total project costs associated with the three tenders were as follows:

102 The Five Dock OC made further enquiries with private contractors regarding the replacement works, receiving the following quotations:

| Date | Contractor | Total Project Cost (incl. GST) |
| 15/12/2023 | Restorial | $476,622.30, offering an additional home owners warranty fee of $32,400.00. |
| 16/05/2024 | Everest Contracting Pty Ltd | $298,338.00 |
| 30/07/2024 | IClad Solutions Pty Ltd | $366,300.00 |
103 As at the time of trial, no cladding replacement work had been carried out at the Five Dock Building. The Five Dock OC’s intention remained to replace the cladding as soon as possible, which they intended to do by engaging the services of one of the above private contractors. At the time of the trial, the Five Dock OC did not have sufficient funds to replace the cladding without raising significant special levies or obtaining a loan.

104 Given no cladding replacement work has in fact been carried out at the Five Dock Building, the Five Dock OC’s claim is for the future cost to replace the cladding. Mr Stephen Abbott has provided expert evidence in relation to the Five Dock Building, and specifically, regarding what would be considered a reasonable cost for replacing the Alucobond Plus cladding on the building.

2.6 Fire science concepts

105 Fire science and fire safety engineering is a complex and technical area. It is not possible, or necessary, to explain in detail each relevant fire science concept or the relevant tests conducted on the Alucobond products. However, given the subject matter of this proceeding, being the fire risk posed by the use of the Alucobond products, it is necessary, to a degree, to provide a basic understanding of the technical language used in fire science to communicate, with a degree of precision, the properties of the Alucobond products. This section seeks to provide a basic explanation of common terms used to quantify the combustibility or flammability of the Alucobond products.

106 The flammability of a material is, in effect, the ease with which the material ignites and the manner in which it burns. A number of techniques have been developed to measure material flammability, the most common of which use a radiant heat source to heat the relevant material. The magnitude of the heating is defined in terms of the “heat flux”. Heat flux is a measure of thermal energy delivered per unit area and unit time. This is typically expressed in units of kilowatts per square metre (kW/m 2).

107 The physical properties of a material naturally govern its flammability. The process of thermal decomposition of a solid material is called “pyrolysis”. The pyrolysis process is what results in the production of flammable vapours which fuel the flaming combustion of a solid. The pyrolysis process is, naturally, temperature dependent. Materials with higher pyrolysis temperatures are more difficult to ignite.

108 Different materials also have different “thermal inertia”. Thermal inertia represents the ease with which the surface temperature of a material will change, where materials with high thermal inertia are slow to react to changes in temperature. The thermal inertia of a material is a product of its thermal conductivity (ie, the ability of the material to transfer thermal energy internally), the density of the material, and the material’s specific heat capacity (ie, the amount of energy required to increase the temperature of a unit mass of the material by one degree Celsius). Given that pyrolysis is temperature dependent, materials with a low thermal inertia will initially experience more rapid pyrolysis than materials with high thermal inertia.

109 Ignition refers specifically to the initiation of sustained flaming combustion of pyrolysis gases. Ignition only occurs after a period of heating of the solid material, such that the surface temperature of the material reaches pyrolysis temperature. The “time to ignition” refers generally to the time required to heat the relevant solid to pyrolysis temperature, where pyrolysis occurs at a rate sufficient to form a flammable mixture. A material’s time to ignition depends on the magnitude of applied energy (ie, the heat flux) and the material’s thermal inertia. Where the applied heat flux is increased, and/or a material has a lower thermal inertia, the time to ignition decreases.

110 The “critical heat flux for ignition” refers to the minimum heat flux at which a material will ignite when exposed to heating for a specified time period (generally, 15 minutes).

111 Once a material has ignited, a key variable is the rate at which energy is released.

112 The total amount of energy that is available to be released from a material is known as the “heat of combustion” (also referred to as a material’s “calorific value”). This is a measure of the maximum energy that a material can be expected to release via combustion, or in other words, the amount of “fuel” that a material may provide for a fire. Heat of combustion is reported in units of megajoules per kilogram (MJ/kg). The heat of combustion provides an upper limit on the amount of energy that can be released by burning a material but does not give any information regarding the rate at which energy is released.

113 A material’s “heat release rate” describes the rate of energy release, per unit of time, as a material burns. The heat release rate of a material is dictated by the pyrolysis mechanism of the material, the physical geometry of the sample, the boundary conditions of the materials, and the presence of an external heat source. Heat release rate is commonly expressed in terms of the area of burning, being the heat release rate per unit area. Heat release rate is important in evaluating fire hazards as it determines the energy released from a material that is available to be transferred back to the fuel, which may create a positive feedback loop resulting in fire growth.

114 Another variable is “flame spread”. Flame spread occurs when heat is transferred from a burning region to adjacent unburnt material. It can be thought of as a series of ignitions, where sufficient energy is applied to the fuel ahead of the flame such that pyrolysis can occur. As the rate of flame spread is governed by the rate at which the material ahead of the burning region can be heated to its pyrolysis temperature, the rate of flame spread is dependent on the heat transferred to the material and the material’s thermal inertia.

115 Flame spread is often distinguished between “concurrent flame spread” and “opposed-flow flame spread”. Concurrent flame spread occurs where the flame propagates in the same direction as the flow of hot combustion products. The most common case of concurrent flame spread is upwards flame spread. Opposed-flow flame spread occurs when the flame spread is in the opposite direction to the flow of hot gases. This is most commonly observed where a flame is spreading downwards or horizontally. Concurrent flame spread is generally faster than opposed-flow flame spread given that the hot combustion products rise due to buoyancy, resulting in higher rates of heat transfer to the surface of the material.

116 When considering the fire hazards of products such as Alucobond PE, it is also relevant to consider the risk of downwards vertical fire spread due to the melting and dripping of PE core material. This and other properties affect the “compartmentation” of the fire, which refers to confining a fire to the particular compartment where it breaks out in order to limit any potential fire spread and enable evacuation of the building. This is discussed further below in the context of Alucobond PE’s reaction-to-fire behaviour.

117 It is also relevant to note that much of the factors and variables noted above relate primarily to non-composite products. When considering composite products, such as the Alucobond products, which are made up of layers of multiple materials that have different flammability and fire spread behaviours, the thermal and physical interactions between the materials must be borne in mind. Flammability and fire spread are further influenced by a number of factors of the broader system in which a product is used.

3. OVERVIEW OF CLAIMS

118 As referred to earlier, the Applicants rely on two separate causes of action.

119 The first is a claim for compensation on the basis that the Alucobond products were not of merchantable or acceptable quality within the meaning of s 74D of the TPA, and s 54 of the ACL, respectively (ie, the consumer guarantee claim). This claim is progressed on a few separate bases:

(a) Firstly, the Applicants plead that when the Alucobond products were fitted as part of or as an attachment to the external wall or other building element, there was, and is, a material risk that the cladding will, in the event of a fire: cause or contribute to the spread and severity of the fire, cause or contribute to debris falling from the building, cause or contribute to fire and smoke overwhelming or compromising any fire safety measures in the building, and cause or contribute to the release of toxic products of combustion. As a result of all, any, or a combination of the above matters, the Applicants plead that the Alucobond products increase the risk of loss of life and damage to property, adversely impact the ability of occupants to evacuate, and/or adversely impact the ability of firefighting authorities to fight the fire. These are collectively referred to as the “Material Fire Risk Properties” of the Alucobond products. It is relevant to note that this part of the claim is pleaded in relation to all buildings (regardless of the class of building under the BCA).

(b) Secondly, the Applicants plead that the Alucobond products do not and did not comply with the BCA, or there was a material risk that they did not so comply. This is pleaded on the basis that the panels could not be used as part of a design that was compliant with the DtS Provisions of the BCA, and could not reasonably practicably form part of an alternative solution, other than where used in insubstantial quantities. These are referred to as the “BCA Non-compliance properties” and “BCA Non-compliance Risk Properties” of the Alucobond products. The Applicants stress that this aspect of their claim is separate and independent to the claim regarding the Material Fire Risk Properties.

(c) The third iteration of the consumer guarantee claim is effectively a consequence of the first two. The Applicants plead that by reason of the BCA Non-compliance Properties and/or the BCA Non-compliance Risk Properties of the panels, there was at all material times a risk that the Alucobond products could be the subject of a legally binding direction to be removed and/or replaced at the cost of the owner or leaseholder. These are referred to as the “Prohibition Risk Properties” and the “BCA-related Prohibition Risk Properties”.

120 Under the consumer guarantee claim, it is alleged that the Alucobond products are not as fit for all of the purposes for which ACPs were commonly supplied, and as safe, such as a reasonable consumer would regard as acceptable, as a result of the above risks/properties of the panels. It is alleged that the panels were therefore not of merchantable or acceptable quality under the TPA and ACL respectively.

121 The second cause of action is that the Respondents made a series of false and misleading representations about the standard, qualities, uses and benefits of the Alucobond products, and engaged in misleading conduct by making those representations without appropriate warnings. This is alleged to amount to misleading or deceptive conduct under ss 53 and 55 of the TPA, and ss 29 and 33 of the ACL.

122 The relevant representations are alleged to be found in a series of marketing brochures and websites that promoted the suitability, safety and compliance of the products, primarily through images of buildings clad with large quantities of Alucobond PE and Alucobond Plus. The Applicants also allege that representations made within the material regarding positive results of international fire tests were also false and misleading. The Applicants allege that the representations exaggerated the positive qualities of the products and obscured the material risks arising from their use as advertised, which led to the products being used in a manner now understood to be unsafe and non-compliant with the BCA.

123 There are a number of threshold issues in the Applicants’ case which require consideration. In particular, whether the TPA and ACL apply to 3A’s conduct, and in relation to the consumer guarantee claim, whether there was a relevant “supply” to a “consumer” for the consumer guarantee to apply.

124 Setting aside these threshold issues for the moment, the Respondents make a number of arguments as to why the underlying claims should fail.

125 In relation to the consumer guarantee claim, the key issue the Respondents raise is the fact that the supply of the Alucobond products occurred in the context of the BCA which placed obligations on Q ualified P rofessionals – being those professionals involved in the design, construction and approval of buildings, including architects, builders, surveyors, certifiers, developers, project managers, FSEs, as well as consent authorities, façade engineers, façade contractors and sub-contractors – to ensure that the requirements of the BCA, including as to fire safety, were satisfied. The Respondents argue that this obligation necessarily sat with the Qualified Professionals, given that whether the particular use of a product on a building complied with the relevant performance requirements of the BCA depended on a broad range of factors specific to each building, and which could only be assessed on a case-by-case basis by the relevant Qualified Professionals.

126 The Respondents claim that the Alucobond products were capable of being used in a manner that was compliant with the BCA. In this sense, the Respondents argue that the alleged risks that the Applicants rely on, to the extent they arise, are not risks which are inherent in the products, but depend on how the products were used by Qualified Professionals. The Respondents argue that a reasonable consumer would consider products, such as the Alucobond products, to be of merchantable or acceptable quality if they could be used in accordance with the relevant regulatory regime.

127 In relation to the misleading conduct claim, there are again a number of initial issues which require consideration, including determining the relevant periods over which particular material was distributed in the Australian market, and whether 3A can be said to have made any of the relevant representations relied on by the Applicants.

128 Again, setting these preliminary issues aside for the moment, the key argument the Respondents make in response to the misleading conduct claim is that the representations contained in the brochures and websites were directed not to ordinary lay people, but Qualified Professionals. The Respondents argue that the general statements and images that the Applicants point to would not be understood by a reasonable Qualified Professional as conveying the broad and unconditional representations which the Applicants allege.

129 There are a number of additional points that also require consideration in these reasons. This includes causation and loss which are issues specific to the Applicants’ claims only; that is, these are individual, non-common issues to be established by each group member. Additionally, the Respondents also raise a number of limitations defences.

130 It is convenient at this point to clarify a number of terms used in this judgment. This judgment refers to (a) Qualified Professionals, (b) Design Professionals, and (c) building professionals. ‘Qualified Professionals’ is defined in [125 ] above and refers to all professionals involved in the design, certification and construction of the relevant buildings. ‘Design Professionals’ is relevant to the misleading conduct claim and is discussed (and defined) later in these reasons. Broadly speaking, it refers to professionals involved in the selection of Alucobond products for use on the relevant buildings. ‘Building professionals’ is not a defined term within this judgment; rather, one of the expert conclaves (Expert Group 7) was referred to by the parties and during the trial as ‘architects and building professionals’.

131 The parties addressed their closing submissions on the basis that the pleadings gave rise to 20 discrete issues which would determine each of the matters in the pleadings, and provide an answer to each of the common questions.

132 The structure of these reasons for judgment is to identify the agreed 20 issues that require determination, and to make the relevant findings of fact on each issue and apply the relevant legal principles to the facts as found. These 20 issues are outlined in the table below:

| # | Issue |
| Part 1 – Whether the TPA and ACL apply to 3A’s conduct | |
| 1 | Whether 3A engaged in the impugned conduct in Australia. |
| 2 | If not, whether the TPA and ACL applied to conduct 3A engaged in outside Australia because it was carrying on business within Australia within the meaning of s 5(1) TPA and s 5(1)(g) of the CCA. |
| Part 2 – Consumer guarantee claims: threshold requirements | |
| 3 | Whether 3A supplied Alucobond PE or Alucobond Plus to HVG in “trade or commerce”: TPA, s 74D(1)(a) [TPA only ]. |
| 4 | Whether Alucobond PE or Alucobond Plus were “goods” for the purposes of s 74D, which turns on whether they were goods of a kind ordinarily acquired for personal, domestic or household use or consumption: TPA, s 74A(2)(a) [TPA only ]. |
| 5 | Whether a person “supplied” Alucobond PE or Alucobond Plus to a “consumer”: TPA, s 74D(1)(b); ACL, s 54(1)(a). |
| | 5(a) – Whether each Applicant was “supplied” and “acquired” Alucobond PE or Alucobond Plus (as the case may be) as a "consumer” upon creation under the NSW strata legislation. |
| | 5(a)(i) - Whether each Applicant was “supplied” and “acquired” Alucobond PE or Alucobond Plus upon creation under the NSW strata legislation. |
| | 5(a)(ii) - Whether each Applicant is taken to have done so as a “consumer”, which will only be so if, relevantly:

(A) the amount paid or payable by the Applicant for the Alucobond PE or Alucobond Plus did not exceed $40,000; or

(B) Alucobond PE or Alucobond Plus were goods of a kind ordinarily acquired for personal, domestic or household use or consumption: TPA, s 4B(1)(a)(i)-(ii); ACL, s 3(1)(a)-(b). |
| | 5(b) – Whether each developer of the Shore Building and Five Dock Building is taken to have been “supplied” and “acquired” Alucobond PE or Alucobond Plus as a “consumer”, which will only be so if, relevantly: |
| | 5(b)(i) – the amount paid or payable by the developer for the goods did not exceed $40,0000; or |
| | 5(b)(ii) – the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption; and |
| | 5(b)(iii) – the developer did not acquire or hold itself out as acquiring Alucobond PE or Alucobond Plus:

(A) for the purpose of re-supply in trade or commerce; or

(B) for the purpose of using it up or transforming it, in trade or commerce, in the course of a process or production or manufacture or in the course of repairing of treating other goods or fixtures on land: TPA, s 4 B(1); ACL, s 3(2). |
| 6 | If 5(a) is not established, but 5(b) is established, whether each Applicant is a person who derived title to Alucobond PE or Alucobond Plus through or under the relevant developer: TPA, s 74D(1); ACL, s 271(1)-(2). |
| 7 | Whether the relevant goods affixed to the Shore Building and Five Dock Building are Alucobond PE or Alucobond Plus, or have been so used up or transformed as to be different “Third Party Products” manufactured by the Qualified Professional(s) who produced their façade systems: TPA, s 74D(1); ACL, s 54(1). |
| Part 3 – Consumer guarantee claims: merchantable and acceptable quality | |
| 8 | Whether Alucobond PE or Alucobond Plus were not of merchantable or acceptable quality within the meaning of the relevant provisions: ACL, s 54(2)-(3); TPA, s 74D(2)-(3). |
| Part 4 – Consumer guarantee claims: defences | |
| 9 | Whether, if Alucobond PE or Alucobond Plus are not of merchantable or acceptable quality, that is only because of an act or default or omission of, or any representation made by, any person other than the manufacturer or an employee or agent of the manufacturer, occurring after the goods have left the control of the manufacturer: ACL, s 271(2)(a). |
| Part 5 – Misleading conduct claims | |
| 10 | [Positive misrepresentations ] Whether, by distributing and/or publishing and/or authorising or approving HVG to distribute or publish certain brochures in Australia, 3A made, in trade or commerce, in connection with the supply, possible supply or promotion of Alucobond PE or Alucobond Plus, each of the: Suitability Representation, Plus Composition Representation, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation, and/or Compliance Representation, which depends on: |
| | 10(a) – Whether 3A distributed and/or published the brochures in Australia; |
| | 10(b) – Whether 3A authorised or approved HVG distributing and/or publishing the brochures in Australia; |
| | 10(c) – Whether, if 10(b) is established, that is sufficient to establish that 3A ‘made’ any representations conveyed by the brochures; |
| | 10(d) – Whether the brochures conveyed the alleged representations. |
| 11 | Whether the alleged representations were misleading for the reasons alleged in SOC [77]-[80]. |
| 12 | [Warnings ] Whether 3A or HVG were obliged to, and did not, publicly disclose, adequately or at all, the Suitability Warning, Limitation of Use Warning, Fabrication and Affixation Warning, Fire Risk Warning, Plus Composition Warning, and Non-compliance, Non-compliance Limitation or Fire Advice Limitation Warnings. |
| Part 6 – Causation and loss (Consumer Guarantee claims) | |
| 13 | Whether each Applicant has suffered loss or damage because of Alucobond PE or Alucobond Plus not being of acceptable quality: ACL, s 272(1)(b). |
| 14 | Whether it was reasonably foreseeable that each Applicant would suffer such loss or damage as a result of the Alucobond PE or Alucobond Plus not being of acceptable quality: ACL, s 272(1)(b) |
| Part 7 – Causation and loss (Misleading Conduct claims) | |
| 15 | Whether 3A made each of the Representations to, or directed the Misleading Conduct to, (a) Qualified Professionals engaged with respect to the Shore Building and Five Dock Building and/or (b) the developers. |
| 16 | Whether, had 3A not made the Representations or engaged in the Misleading Conduct: (a) the Qualified Professionals engaged with respect to the Shore Building and Five Dock Building would not have designed, specified, certified or used Alucobond PE or Alucobond Plus on the Shore Building and Five Dock Building and/or (b) the developers and the Applicants would not have acquired Alucobond PE or Alucobond Plus. |
| 17 | Whether, by reason of issues 18-19, the Applicants have suffered loss or damage because of the conduct of 3A in contravention of ss 29 or 33 of the ACL: ACL, s 236. |
| Part 8 – Limitations defences | |
| 18 | Whether the amendments made in the SOC are deemed to have taken effect on 3 March 2020, being the date certain significant amendments were made to the Applicants’ claim, or on 14 February 2019, being the date on which the proceedings were commenced. |
| 19 | Whether 14 February 2019 or 3 March 2020 (whichever is applicable) is within 3 years after the day on which the Applicants first became aware, or ought reasonably to have become aware, that the acceptable quality guarantee had not been complied with: ACL, s 273. |
| 20 | Whether 14 February 2019 or 3 March 2020 (whichever is applicable) is within 6 years after the day on which Applicants’ causes of action under s 236(1) accrued: ACL, s 236(2). |
133 Due to the representative nature of this proceeding and the complexity, both factually and legally of the issues that arise for determination, I have decided to answer each of the 20 issues, notwithstanding that the conclusion which I reach in relation to some issues may mean that other issues are not necessary to decide, in case a Full Court should take a different view of the correct answer to any one or more of the 20 issues.

4. LAY EVIDENCE

134 Little lay evidence was filed in this proceeding, the majority of which was uncontroversial. Of the lay evidence that was filed, there was limited cross-examination of some of the witnesses, and generally such cross-examination was directed to discrete matters only. These matters are discussed briefly below.

4.1 Mr Michael Sheils (Shore Building)

135 Mr Michael Francis Sheils is a lot owner in the Shore Building and has been a member of the strata committee of the Shore OC since 1 October 2013. As a member of the strata committee, Mr Sheils gave evidence on behalf of the Shore OC.

136 A singular affidavit of Mr Sheils, sworn on 1 March 2022, was read into evidence. The affidavit dealt with matters which were largely uncontroversial, namely in relation to the process undertaken by the Shore OC in discovering the presence of Alucobond PE on the Shore Building, and its subsequent efforts to replace the cladding with non-combustible cladding. This evidence is largely dealt with in the background to the Shore Building in section 2.4 above, and is unnecessary to discuss in further detail here.

137 It is relevant to note briefly that Mr Sheils deposed to hearing about the Lacrosse Fire in 2014, however he did not recall the strata committee or the relevant lot owners in the Shore Building having any discussions regarding the fire around that time, or in the following years. Mr Sheils deposed that it was only following the Grenfell Fire in June 2017, that there were discussions regarding the potential fire risks of the cladding on the Shore Building.

138 As noted above, Mr Sheils was subject to limited cross-examination. The cross-examination which Mr Sheils was subject to focused primarily on two topics, being (i) whether the Shore OC could have become aware of the potential issues with the cladding on the Shore Building following the Lacrosse Fire, rather than the Grenfell Fire; and (ii) the increased insurance premiums paid by the Shore OC which were said to be due to the presence of Alucobond PE.

139 Mr Sheils was a careful and honest witness, whose evidence was not seriously challenged. Although some difficulties were identified in attributing all of the increased insurance premiums to the presence of Alucobond PE during cross-examination, it is convenient to discuss these matters when considering the loss suffered by the Shore OC (issues 13, 17).

4.2 Dr Joachim Werner (3A)

140 A singular affidavit affirmed by Dr Werner on 14 March 2023 was read into evidence.

141 Dr Werner is an engineer by profession, having completed a Masters and PhD in mechanical engineering from the University of Aachen. He has held the position of Managing Director of 3A since 2003, and as Managing Director, has had responsibility for the Singen plant that manufactured the Alucobond products including oversight of the production and operation of the plant.

142 In his affidavit, Dr Werner deposed to a number of general matters regarding 3A’s production and supply of Alucobond panels. This included the manner in which 3A manufactured the Alucobond panels, 3A’s distribution-based business model under which 3A sold the majority of its products around the world through distribution agreements (including relevantly the Distributor Agreements between the Respondents), the manner in which 3A’s products were tested, and the fact that despite 3A’s global operations, 3A and its related entities have never had an office in Australia. Much of this evidence is outlined above at section 2.3 in the context of the manufacture and supply of the Alucobond products, and is not contested.

143 Dr Werner gave specific evidence regarding the manufacturing process for Alucobond Plus, saying that a normal production run for Alucobond Plus would usually contain 8.6 tonnes of linear, low-density PE, 8.6 tonnes of EVA, and 40 tonnes of mineral ATH. 3A’s acceptable production tolerances were said to be +/- 0.5% variability by weight for each of the inputs.

144 Dr Werner was subject to cross-examination, which was primarily targeted at three issues, being:

(a) whether 3A’s production processes could appropriately ensure any particular Alucobond Plus panel had no more than 30% plastic binders. The Applicants contend that the acceptable tolerances within 3A’s production process means that the proportion of material fed into the machine at any given time could be above or below the relevant proportion required, and therefore, some batches or panels would have more than 30% plastic binders. Dr Werner’s evidence on this issue is dealt with in more detail in section 8.5.1 of these reasons;

(b) whether 3A engaged in impugned conduct in Australia or was otherwise carrying on business in Australia. Broadly speaking, this involved cross-examination regarding the nature of the Distributor Agreements between the Respondents, 3A’s provision of warranties to Australian clients, and Dr Werner’s visits to Australia. Additionally, Dr Werner was cross-examined about a senior sales manager from 3A in Germany, Susan Haas, who appears to have been largely responsible for the Australian market during the relevant period, and who also made numerous marketing trips to Australia. Again, Dr Werner’s evidence on this issue is dealt with in more detail in section 6 of these reasons, below; and

(c) the nature of the fire performance tests conducted by 3A in relation to the Alucobond products, and the representations made by 3A regarding the results of those tests.

145 Dr Werner presented as a careful and honest witness, whose credit as a witness was not seriously challenged. I accept his evidence.

4.3 Other lay evidence

146 A number of affidavits were read into evidence from other lay witnesses, who were not subject to cross-examination. It suffices to summarise the following.

4.3.1 Margaret Lynette Hall (Shore Building)

147 Like Mr Sheils, Ms Hall is a lot owner in the Shore Building and has been a member of the strata committee since 1 October 2023. A singular affidavit of Ms Hall, sworn on 16 March 2022, was tendered into evidence.

148 Ms Hall’s evidence was largely consistent with Mr Sheils’ evidence, deposing that the first time that the Shore OC discussed the potential fire risks of the building’s cladding was at a strata committee meeting following the Grenfell Fire. Ms Hall had no recollection of the issue having been raised before. Unlike Mr Sheils, Ms Hall did not recall reading about the Lacrosse Fire around the time it occurred.

149 Ms Hall’s evidence regarding the process by which the Shore OC discovered that the Shore Building was clad with Alucobond PE, and the Shore OC’s subsequent engagements with the council regarding the need to remove Alucobond PE, is consistent with Mr Sheils’ evidence.

150 Subject to minor objections to parts of the affidavit, Ms Hall’s evidence was not subject to challenge by the Respondents.

4.3.2 Mr Bill Filippopoulos (Five Dock Building)

151 Mr Filippopoulos is a lot owner in the Five Dock Building, having moved into the building around the first week of January 2019. Mr Filippopoulos subsequently joined the strata committee of the Five Dock OC on 25 May 2020 and was appointed chairperson of the committee on 30 March 2021.

152 Two affidavits of Mr Filippopoulos were tendered into evidence, sworn on 2 March 2022 and 30 July 2024. The evidence largely relates to the efforts undertaken to investigate the replacement of the Alucobond Plus cladding on the Five Dock Building. This evidence was largely uncontroversial, and is discussed in section 2.5 of these reasons above regarding the Five Dock Building.

153 Mr Filippopoulos also gave evidence regarding the increased premiums paid by the Five Dock OC in respect of residential strata insurance following the identification of combustible ACPs on the building. This evidence is more conveniently discussed in the context of the individual loss claimed by the Five Dock OC, in section 10.1.3.

154 Again, Mr Filippopoulos’ evidence was largely uncontroversial and was not subject to challenge by the Respondents.

5. EXPERT EVIDENCE

155 Extensive expert evidence was filed as part of the trial, with a total of 14 different experts across the parties, with most experts often filing multiple expert reports.

156 Most experts were grouped into different “Expert Groups” for the purposes of the trial and the issues before this Court. While there was overlap between the groups, with certain experts involved in a number of different groups, it is convenient to discuss each expert and their evidence in the context of each expert group.

157 The following table summarises the relevant expert evidence, and identifies the joint report prepared by each expert group. The table also identifies the experts who were not part of an expert group and gave their evidence individually.

Kirk Report 2 – 1 Dec 2023

Abbott Report 2 – 13 Apr 2022

Abbott Report 3 – 19 Jan 2024

Abbott Report 4 – 6 Aug 2024 |
| | | Mr David Youssef | Youssef Report – 25 Apr 2022 |
158 Despite the extensive expert evidence that was filed, as it turns out, there was actually limited disagreement between the experts.

5.1 Expert Group 1 – Chemists

159 The summary of Expert Group 1 is extracted below:

Kirk Report 2 – 1 Dec 2023

Carrascal Report 2 – 30 Aug 2024 |
| | | Associate Professor David Lange | Lange Report 2 – 23 Aug 2024 |
| | Joint report of Dr Kirk and Mr Carrascal dated 3 March 2024 (“Group 1 Joint Report”) | | |
160 Expert Group 1 consisted of Dr Caroline Kirk, Mr Jeronimo Carrascal, and Associate Professor David Lange. The experts provided their evidence jointly in an expert conclave.

161 Dr Kirk is a senior lecturer in Materials Chemistry in the School of Chemistry at the University of Edinburgh. Dr Kirk was promoted to this position in March 2020, previously having been a Lecturer in the University of Edinburgh’s School of Chemistry since 2017. Prior to her positions at the University of Edinburgh, Dr Kirk was employed as a lecturer in Inorganic Chemistry in the Department of Chemistry at Loughborough University from 2007. Dr Kirk has significant experience in the area of materials chemistry. There was no attack made on Dr Kirk’s relevant expertise by the Respondents.

162 At the time of preparing his reports, Mr Carrascal was a Laboratory Manager in the Fire Safety Laboratory (School of Civil Engineering) of the University of Queensland. Mr Carrascal had held that position since 2012, during which time he designed two fire laboratories at the university. Mr Carrascal has worked in fire science and fire safety engineering positions for over 15 years. As part of his role at the University of Queensland, Mr Carrascal was involved in various research projects relating to fire safety engineering, including the cladding library which is maintained by the University of Queensland. Prior to his position at the University of Queensland, Mr Carrascal worked as a bushfire consultant analyst for five years for a regional government in Spain, developing bushfire regulatory policies. Mr Carrascal is an engineer by trade, specialising in environmental science and forest resources. No attack was made on Mr Carrascal’s relevant expertise by the Applicants. By the time of the trial, Mr Carrascal was no longer employed by the University of Queensland, having moved to Germany.

163 Associate Professor Lange is an Associate Professor in Structural Engineering in the School of Civil Engineering at the University of Queensland. Associate Professor Lange was appointed to the University of Queensland in February 2018, and is the discipline lead of the Fire Safety Engineering Research Group in the School of Civil Engineering. Associate Professor Lange is also responsible for the Fire Safety Engineering Laboratory in the school. Prior to his role at the University of Queensland, Associate Professor Lange was a senior research scientist at the Research Institutes of Sweden in the fire research division from 2011 to 2018. Prior to that, he held various roles at the University of Edinburgh. Associate Professor Lange obtained his PhD from the University of Edinburgh in 2009, under the supervision of Professor Asif Usmani and Professor Jose L Torero. Professor Torero was also an expert called by 3A. Associate Professor Lange also knows Mr Carrascal through their time at the University of Queensland. Again, no attack was made on Associate Professor Lange’s relevant expertise by the Applicants.

164 The focus of Expert Group 1 was the composition of Alucobond Plus. As noted above, there was a dispute between the parties as to whether the core of the Alucobond Plus panels was in fact constituted by at least 70% mineral filler (ie, ATH), with no more than 30% of the core being combustible “plastic filler” (ie, EVA and/or PE).

165 In Dr Kirk’s first report dated 22 April 2022, Dr Kirk tested the core of two samples of Alucobond Plus which were sourced from the Five Dock Building. The samples from the Five Dock Building were manufactured in January and August of 2017, therefore representing panels from different production batches. Dr Kirk conducted various tests on the samples to identify the materials present in the core of the samples, and to determine the percentage (by weight) of each material as a proportion of the core. In answering which tests may be carried out to accurately identify materials present in the core of the samples, Dr Kirk observed that:

To identify the materials or substances… present in the core of the ACPs, different materials characterisation tests may be carried out on samples taken from the core of the ACPs… Combining results from a series of different tests provides more conclusive results, as, for instance, if different tests point towards the same result, there is more confidence in the finding.

166 Dr Kirk conducted the following tests in relation to the Alucobond Plus samples: (X R PD), Attenuated Total Reflectance Fourier Transform Infrared Spectroscopy (ATR-FTIR), Thermogravimetric Analysis (TGA), Scanning Electron Microscopy Energy Dispersive Spectroscopy (SEM-EDS), and Inductively Coupled Plasma Mass Spectroscopy (ICP-MS).

167 It is unnecessary to explain each of these methods in any particular detail. It is sufficient to note that XRPD is a method routinely used in the characterisation of solid compounds. Every crystalline compound has a unique X-ray powder diffraction pattern, such that the XRPD data results from a particular compound can be compared to a database housing over 200,000 datasets.

168 TGA is used to measure weight loss as a function of temperature, to monitor any decomposition/dehydration processes. This information, combined with information from XRPD and infrared, allows compositional information to be obtained. TGA is a highly reproducible technique when samples are studied using the same testing conditions (such as sample form, temperature range, heating rate, gas used, and the gas flow rate). Dr Kirk’s opinion, based on her experience using the technique, was that the error on the weight loss values using TGA for a single dataset was, at most, in the order of 0.5-1 weight %. For the purposes of the report, Dr Kirk carried out three repeat measurements and confirmed the estimated standard deviation for the Alucobond Plus samples to be +/- 0.2 weight %.

169 Dr Kirk’s analysis of both the XRPD and ATR-FTIR results confirmed that the Alucobond Plus samples contained aluminium hydroxide and EVA. SEM-EDS confirmed that the sample contained aluminium and carbon, with no evidence for the presence of any other major metallic element. ICP-MS data also confirmed that aluminium was present as the only major metallic element.

170 The TGA was conducted on a small amount of the powdered samples of Alucobond Plus. The powdered samples were prepared by filing down the core of the Alucobond Plus. As noted above, repeat measurements were conducted on the Alucobond Plus samples to test the reproducibility of the weight loss of the samples, and to calculate a standard deviation on the weight % of the aluminium hydroxide present in the cladding samples.

171 Dr Kirk identified that the weight loss for the Alucobond Plus samples were very similar. Having identified the residue as alumina (Al2O3) through XRPD and TGA data collected on the residue, Dr Kirk calculated the average weight % of aluminium hydroxide in the first sample of Alucobond Plus at 68.3%, and in the second sample of Alucobond Plus at 67.2%. Given it was known that the remaining component of both samples was due to the presence of EVA, Dr Kirk identified that the first sample contained 31.7 weight % EVA, while the second sample contained 32.8 weight % EVA.

172 In Mr Carrascal’s first report, dated 10 March 2023, he conducted various tests on the core of four samples of Alucobond Plus taken from the Five Dock Building. Mr Carrascal conducted an ATR-FTIR test on the samples and identified that each of the samples were composed of EVA and aluminium hydroxide.

173 More significantly, Mr Carrascal also conducted various tests to quantify the percentages by weight of EVA and aluminium hydroxide in the samples.

174 Mr Carrascal conducted a TGA on the Alucobond Plus samples. The nominal sample mass for the tests was 10.0 mg, with a maximum deviation of 2.5 mg. Two preparation techniques were implemented for each sample. Samples were firstly filed into fine particles, and secondly, chopped finely into small pieces.

175 Two tests were conducted for each sample prepared using the filing technique. The TGA measured an average inorganic content (ie, aluminium hydroxide) of 66.6%, with the highest standard deviation of results being 0.7%.

176 Three tests were conducted for each sample prepared using the chopping technique. The TGA measured an average inorganic content of 70.2%, with the highest standard deviation of results being 1.1%.

177 Mr Carrascal also conducted a dry ash analysis on the samples. A dry ash analysis involves pre-drying a sample and then placing the sample into a muffle furnace for a period of time, to ensure the ashing of the sample. The relative weight loss between the pre-dried sample and the ash is calculated to enable the quantification of the inorganic content of the samples.

178 Three dry ash tests were carried out per sample, with two grams being the nominal sample used per test. The dry ash test method measured an average inorganic content of 71.3%, with the highest standard deviation of results being 0.5%.

179 The following table summarises Mr Carrascal’s findings on inorganic content:

| Sample s | TGA (filing) | TGA (chopping) | Dry ash method |
| P1-B | 66.9% | 69.7% | 71.0% |
| P2-B | 66.7% | 70.7% | 70.9% |
| P3-B | 66.6% | 70.6% | 72.2% |
| P5-A | 66.2% | 69.8% | 71.1% |
| Overall a verage | 66.6% | 70.2% | 71.3% |
180 In Dr Kirk’s second report, dated 1 December 2023, she noted that the results she obtained through the TGA when filing the samples were in very close agreement with the results obtained by Mr Carrascal when also using the filing preparation method.

181 In Mr Carrascal’s first report, he stated that the chopping preparation method was used to ensure that the sample contained a fully representative cross section of the material. Mr Carrascal stated that this representation may be more challenging to enforce when samples are filed into powder. Mr Carrascal acknowledged that without further investigation, there could be other potential factors at play that could contribute to the discrepancy between the two preparation methods for the TGAs.

182 Dr Kirk, in her second report, was critical of Mr Carrascal’s statement that Dr Kirk’s filing preparation method may have resulted in the testing of an unrepresentative sample, where she challenged that critique on the basis that a large amount of the core sample had been filed through its entire thickness and homogenised. Nevertheless, Dr Kirk directed further TGAs be conducted on the two Alucobond Plus samples using the chopping sample preparation method. Three tests were conducted in relation to each sample.

183 The average weight % of the aluminium hydroxide in the samples, using the chopping method, was calculated as 67.7% for the first sample (P1-A) and 68.9% for the second sample (P3-A).

184 Dr Kirk also conducted a dry ash test to compare results against Mr Carrascal’s first report. Dr Kirk’s report noted that while she sought to follow the process outlined in Mr Carrascal’s report, insufficient information had been provided about how the tests were performed for them to be reproduced exactly.

185 Three dry ash tests for each of the two Alucobond Plus samples were conducted. The results produced an average weight % of aluminium hydroxide of 72.7% in the first Alucobond Plus sample and 74.7% in the second sample. Dr Kirk observed that she had been unable to replicate the results obtained by Mr Carrascal, having found a much higher weight % of the aluminium hydroxide present in the samples. Dr Kirk’s opinion was that the differences were due to different approaches to the experiment, as the method itself was subject to larger experimental errors. Dr Kirk’s report stated her view that the TGA was very accurate, including because it tested very small quantities of sample (10-20 mg) and had very little operator errors associated with the method, such that smaller experimental errors would be associated with the results. In contrast, the dry ash method analyses much larger quantities of sample (around two grams) where more operator errors can be associated with the method, such that there were larger experimental errors associated with it.

186 As noted above, Dr Kirk and Mr Carrascal ultimately prepared a joint expert report dated 3 March 2024. The Group 1 Joint Report included the following table summarising the results of the various testing methods used by the experts to determine the percentage weight of aluminium hydroxide in the Alucobond Plus samples.

| | TGA (filing) | TGA (chopping) | Dry ash method |
| University of Edinburgh | 68% | 68% | 74% |
| University of Queensland | 67% | 70% | 71% |
187 The only substantive point of discussion within the Group 1 Joint Report was in relation to which tests or results the experts would consider to be the most accurate and reliable. Both experts agreed that TGA was the preferred test method to precisely determine the percentage (by weight) of aluminium hydroxide and EVA in the Alucobond Plus samples, and that cryomilling was the ideal sample preparation method. This was on the assumption that the sample introduced into the crucibles represented the full sample of the ACP sheet. Cryomilling was considered to be the best and most efficient way of guaranteeing free-flowing powders from ACP samples, which were ideal for TGA experiments.

188 At the time of the joint report, neither expert was able to use cryomilling methods for sample preparation. Dr Kirk stated that she did not have this facility available to her in her lab and had made enquiries at several research laboratories in the UK. Mr Carrascal could not use the cryomill equipment at the University of Queensland Composites Group in the School of Mechanical & Mining Engineering as it was temporarily unavailable due to repair work.

189 The experts noted that the results obtained from their TGAs were in close agreement. They considered the variance between results to be within the errors associated with the technique, accounting for the analysis of a complex sample containing two different compounds, and tests performed across different laboratories. Both experts were encouraged that their results were close given the analyses were of 10 mg sub-samples from large sheets of cladding manufactured on an industrial scale typically in sizes of around 3 m 2.

190 The experts noted that while it could be argued the dry ashing method is more representative of the cladding sheet due to its larger sample size, the method was arguably less precise than TGA due to a larger number of potential errors in the method. The degree of experimental error, bias or deviation was not sought to be determined.

191 The experts agreed that the variation of aluminium hydroxide content in an ACP sheet after manufacturing likely lay within the range of 67-71 weight %, as determined by the various tests performed by the experts. The experts agreed that to determine the value with a low experimental error (from 1-2 weight %), the ACP sample would need to be cryomilled to produce a free-flowing powder before undergoing TGA. To ensure a representative part of the sample was being analysed, sub-samples of the cryomilled sample would then need to be analysed. For example, if 50 mg was cryomilled, five TGAs using 10 mg sub-samples would need to be carried out. In order to accurately determine the variability in aluminium hydroxide content within the Alucobond Plus product as a whole, a thorough survey involving many sub-samples of different panels manufactured in different runs would be necessary.

192 Following the Group 1 Joint Report, Dr Kirk prepared a third expert report dated 15 July 2024. In this report, Dr Kirk outlined the results of further TGAs performed on the two Alucobond Plus samples which were provided to her, which were cryomilled in the manner contemplated by the joint report.

193 Approximately 0.5 g each of two Alucobond Plus samples were cryomilled, from which five sub-samples were tested. The results were as follows:

(a) the average weight % of aluminium hydroxide was 68% for P1-A, and 68.6% for P2-A;

(b) the estimated standard deviation of each value was calculated as +/- 0.5 for P1-A, and +/- 1 for P2-A;

(c) the total average for sample P1-A across the test repeats was 68% of aluminium hydroxide, therefore reflecting an average 32 weight % of EVA, while the total average for sample P2-A was 68.6% of aluminium hydroxide and 31.4% of EVA.

194 Dr Kirk noted in her third report that there were very small differences between the TGA results for the three different sample preparation methods, and that her view remained that the weight % of aluminium hydroxide in the samples, rounded to whole numbers, was between 67-69%.

195 Ultimately, at the trial, Dr Kirk stated that due to servicing of certain testing equipment used in the preparation of her third report, the data was collected under nitrogen rather than air. As a result, Dr Kirk did not consider the results contained in her third report to be valid or reliable.

196 In response to Dr Kirk’s third report, Mr Carrascal prepared a short second report dated 30 August 2024. In the report, Mr Carrascal raised a number of issues which he argues constitute inconsistencies in the cryomill tests which call into question the reliability and accuracy of the results produced. Mr Carrascal also argued that a full representation of the ACP cross-section could not be guaranteed, since only around 10% of the 0.5 grams of cryomilled material was analysed.

197 Associate Professor Lange also prepared his second report, dated 23 August 2024, in response to Dr Kirk’s third report. Associate Professor Lange’s second report was supplemented by two letters dated 1 September 2024 and 4 September 2024 which identified and updated errors made in the second report. In his second report, Associate Professor Lange made a number of observations regarding the nature of Dr Kirk’s results which he opined were indicative of errors in the testing. Associate Professor Lange’s view was that the results contained in Dr Kirk’s third report were not of sufficient quality to draw conclusions, with any degree of confidence, as to the percentage of EVA in the core of the samples tested.

198 In his second report, Associate Professor Lange also conducted his own TGAs where the Alucobond Plus samples (previously provided to Mr Carrascal) were cryomilled. Associate Professor Lange conducted 20 tests. This was originally intended to reflect five tests of each of the four Alucobond Plus samples, however, it was clarified in Associate Professor Lange’s subsequent letter dated 1 September 2024 that there had been a mix-up in one of the test runs.

199 Following the corrections made to Associate Professor Lange’s second report, the ultimate result of his testing was that across the four Alucobond Plus samples tested, there was an average EVA weight % of 29.5%.

200 The following table summarises the average weight % of aluminium hydroxide in the Alucobond Plus samples calculated by the various tests conducted by the experts:

| | TGA (filing) | TGA (chopping) | Dry ash method | TGA (cryomill) |
| University of Edinburgh | 68% | 68% | 74% | 68% (invalid) |
| University of Queensland | 67% | 70% | 71% | 70.5% |
201 At the trial, Dr Kirk, Mr Carrascal, and Associate Professor Lange provided evidence concurrently as Expert Group 1. The following agenda was prepared by the parties which the experts discussed during the expert conclave:

1. What tests were conducted to determine the chemical compounds present in the core of the Alucobond Plus samples tested?

2. For the Alucobond Plus samples tested, what tests were conducted to determine the percentage (by weight) of:

(a) polyethylene vinyl acetate (EVA); and

(b) aluminium hydroxide (AI(OH)3),

and what were the results of those tests?

3. Which of the tests, or combination of tests, provide the most accurate and reliable result?

202 There was very little, if any, areas of disagreement between the experts during the expert conclave. The experts’ answers largely reflected the agreed position expressed in the Group 1 Joint Report, which has been discussed above. Each of the experts agreed that the test results of the proportion of EVA and aluminium hydroxide in the samples were in close agreement. The experts also agreed that a margin of error of +/- 2% would be reasonable given the analysis of the samples across different laboratories (albeit no detailed analysis as to the variability was conducted).

203 The experts also noted the difficulty with attributing the particular test results to a larger panel of Alucobond Plus, let alone an entire manufacturing run. In relation to the tests he conducted, Associate Professor Lange noted that the process involved cryomilling between one to two grams of each sample, of which 50 mg is then subject to TGA (through five separate test runs of 10 mg each). The intention through cryomilling is to homogenise, as far as is possible, the sample which has been cryomilled by creating a free-flowing powder.

204 Associate Professor Lange stated that while the test results are intended to be reflective of the one or two grams which have been cryomilled from a particular part of the panel, it is not necessarily reflective of a panel as a whole. Associate Professor Lange stated that in order to provide an answer as to the composition of a panel in its totality, additional testing would be required involving more locations on a particular panel in order to understand how the concentration of EVA varied across the panel.

205 Dr Kirk also agreed with Associate Professor Lange regarding the need to sub-sample different points across a large cladding piece in order to understand the homogeneity of an entire panel. Dr Kirk did not seek to assert that the results of the TGAs she conducted were representative of the panel as a whole; only that they were representative of the sub-sample of the panel analysed.

206 Dr Kirk agreed that this problem became more acute when considering the composition of Alucobond Plus over an entire manufacturing batch, which she agreed would require a survey over multiple panels over the entirety of the batch, and perhaps multiple places in those panels, to come up with enough information to form an opinion as to the average polymer content in the panels as a whole.

207 Dr Kirk and Mr Carrascal also agreed that when considering complex materials, such as the Alucobond Plus core, it is appropriate to use a combination of different techniques to analyse the materials.

5.2 Expert Group 2 – Fire behaviour experiments

208 The summary of Expert Group 2 is extracted below:

Bisby Report 2 – 1 Dec 2023 |
| | 3A | Mr Jeronimo Carrascal | Carrascal Report 1 – 10 Mar 2023 |
| | | Associate Professor David Lange | Lange Report 1 – 10 Mar 2023 |
| | Joint Report of Professor Bisby, Mr Carrascal and Associate Professor Lange dated 28 March 2024 (“Group 2 Joint Report”) | | |
209 There was a degree of cross-over between Expert Groups 2 and 3.

210 Mr Carrascal and Associate Professor Lange’s professional backgrounds have been discussed above under Expert Group 1.

211 Professor Bisby is a Professor of Fire and Structures and is Head of the Research Institute for Infrastructure and Environment at the School of Engineering at the University of Edinburgh. Professor Bisby has extensive experience in engineering research and consultancy, with his research to date focused primarily on the thermal and structural performance of materials and construction systems when exposed to high temperatures and fire. Professor Bisby has advised various industrial and government fire safety research organisations, and was instructed as an expert witness in the 2018 inquiry that followed the Grenfell Fire. His work in the Grenfell Fire inquiry has included detailed forensic study of the fire at Grenfell Tower, including a large programme of experimentation to identify and characterise the reaction-to-fire behaviours of various materials used in the overcladding system at Grenfell Tower, including PE-cored ACP rainscreen panels which were used in the tower’s refurbished overcladding system.

212 The focus of Expert Group 2 was the consideration of tests conducted by Mr Carrascal to determine the reaction-to-fire properties of Alucobond Plus. Mr Carrascal was not provided with any samples of Alucobond PE, and therefore, conducted tests exclusively on Alucobond Plus.

213 In order to determine the flammability of Alucobond Plus, Mr Carrascal determined the critical heat flux for ignition using a cone calorimeter. Mr Carrascal, using a F ire P ropagation A pparatus, also sought to determine the ignition temperature of Alucobond Plus and the apparent thermal inertia of the samples.

214 A cone calorimeter is a piece of specialist fire science equipment which is used to apply a controlled level of radiant heat to a test sample. An electrical spark is generally used to provide an ignition source immediately above the sample. A cone calorimeter enables the calculation of various factors which can be used to describe the flammability of a material, including the heat release rate, smoke production, and in this case, the critical heat flux for ignition.

215 The FPA consists of two main components, being the fire model and the gas analyser system. The fire model was only required to assess the ignition characteristics of the material. The fire model is fitted with a sample holder, infrared lamp heaters to irradiate heat above the sample, and a piloted flame that sits above the sample to induce ignition.

216 In the cone calorimeter and FPA tests, Mr Carrascal used Alucobond Plus samples of 100 x 100 mm. The exposed upwards faces of the samples did not have the aluminium cover sheets, and therefore, the radiant heat flux from the experiments was imposed on the exposed core of the samples. The test procedure between the cone calorimeter and FPA tests were therefore similar, except that, in the FPA tests, a premixed pilot flame was used to induce ignition and infrared lamps were used to irradiate the sample, rather than a spark system and a coil heating element, respectively.

217 Mr Carrascal conducted the tests on four samples. His results are summarised in the table below:

| | Critical heat flux for ignition | Ignition temperature | Apparent thermal inertia |
| Sample average | 17.5 kW/m 2 | ~397°C | 2.3±0.1 kW 2 m -4 K -2 s |
218 More significantly for the purposes of this proceeding, Mr Carrascal also studied the flame spread of the Alucobond Plus core through a Lateral Ignition and Flame spread Test (LIFT) in a vertical orientation.

219 The LIFT involved preparing samples that were nominally 600 mm long by 100 mm wide. As noted above, the samples were placed vertically in a sample holder. Mr Carrascal also removed the front aluminium cover sheet, exposing the sample’s core. During the expert conclave, Mr Carrascal stated that he exposed the core of the sample in order to capture the “worst-case scenario”. The samples were held in place using four binder clips. The samples were exposed to an external radiant heat flux at the leading edge of the sample. Each sample was marked with lines every 25 mm to track the pyrolysis front, allowing the flame spread to be measured.

220 At the start of the test the external radiant panel was turned on and allowed to preheat the sample, with an exposure of 17 kW/m 2 at the bottom of the sample, which was intended to allow the material to reach thermal equilibrium before inducing ignition. The preheating was sustained for five minutes which was the maximum time allowed by the sample before flowing downwards due to melting. After preheating, the sample holder was pushed forward. In that position, the heat flux reduces as a function of height over the sample, ranging from 40 kW/m 2 at the bottom to 8 kW/m 2 at the top.

221 The following image extracted from Mr Carrascal’s report shows a sample marked every 25 mm and a preheating test phase.

222 After the sample ignited, the location of the pyrolysis front as a function of time was tracked to determine the flame spread rate. A heat flux calibration curve was then used to obtain the value of the external radiant flux at the location of the pyrolysis front. This then enabled Mr Carrascal to correlate the location of the minimum heat flux required to sustain flame spread.

223 Mr Carrascal conducted two LIFTs for each of his four samples. The critical heat flux for flame spread was calculated using the average location of pyrolysis front 30 seconds prior to flame extinction, to determine the heat flux at that height based on the recorded decay of external heat flux over the height of the exposed sample.

224 Mr Carrascal determined that the average value of critical heat flux for flame spread across the samples tested was 10 kW/m 2. Mr Carrascal also calculated the average minimum flame spread velocity and the flame spread parameter of the samples tested.

225 Mr Carrascal noted in his report that adequate preheating was prevented by the material’s behaviour due to softening and detachment of the core from the aluminium skin, which hampered the tracking of the pyrolysis front. Indeed, screenshots of Mr Carrascal’s experiments immediately after the five-minute preheating period show that the core had mobilised to different degrees.

226 Nevertheless, Mr Carrascal concluded that the values suggest that the material may have a limited flame spread under exposure equivalent to the testing conditions.

227 Professor Bisby, in his second expert report dated 1 December 2023, reviewed the LIFT conducted by Mr Carrascal and made a number of criticisms. In particular, Professor Bisby noted that, during the tests, the samples of Alucobond Plus were held in place by inconsistently placed metal binder clips. Professor Bisby, reviewing the images of the LIFTs immediately after the five minutes preheating stage, noted that variable placement of the binder clips, as well as differing initial conditions in terms of mobilisation or initial detachment of the core, was evident.

228 More significantly, Professor Bisby also stated the fact that the core material melted and flowed downwards at the beginning of the test fundamentally undermined the data obtained from the tests. He stated that fire science parameters obtained via LIFTs rely on the material under consideration remaining substantively in place during testing, since once the material is removed from the sample, it is incapable of meaningfully participating in the test. Professor Bisby criticised the removal of the aluminium cover sheet of the samples stating that it was unrepresentative of any credible end-use application of Alucobond Plus as cladding, and that it allowed the majority of the core material to fall away from the sample during testing. Professor Bisby opines that, in reality, when applied as cladding on a building, the core may, under some circumstances, remain largely in situ and thereby continue to contribute to the heat flux above the fire.

229 Professor Bisby extracted the following image from one of Mr Carrascal’s LIFTs, arguing that the image shows the removal of the majority of the core from the lower section of the sample, where the imposed heat flux is the highest, commencing effectively immediately from the beginning of the test.

230 Professor Bisby concluded that the fact a considerable proportion of the core fell away from the samples during Mr Carrascal’s LIFT testing fundamentally compromises the applicability of the data generated by the tests, and greatly diminishes their usefulness in assessing the fire hazards associated with the use of Alucobond Plus in real cladding applications on buildings. Professor Bisby also noted that Mr Carrascal had explicitly highlighted that his results are strictly only applicable to situations where the core material is free to easily fall away.

231 The criticisms raised by Professor Bisby in relation to Mr Carrascal’s experiments were discussed in the Group 2 Joint Report.

232 In response to the question of whether the tests carried out by Mr Carrascal were carried out “properly”, the experts all agreed that, in the current context, what mattered was not whether a test is “proper” or “improper”, but rather how the outcomes of any test are interpreted, presented, and used by manufacturers, designers, specifiers, and approvers.

233 In relation to the specific criticisms raised by Professor Bisby, the experts agreed that the criticism concerning the method of affixing the Alucobond Plus samples to the sample holder for the LIFTs were likely to be of minimal (albeit unquantified) significance to the results from Mr Carrascal’s testing.

234 In relation to the criticism regarding portions of the core detaching early on during certain LIFTs, Professor Bisby inquired about the absence of a mesh or alternative mechanism to secure the core material upright and prevent some detachment rather than (or in addition to) using the bulldog clips. Mr Carrascal’s view was that introducing any object onto the core surface would disrupt the vertical flame spread mechanisms, potentially distorting the results further. While Professor Bisby acknowledged that there would be distortion of the results through detachment of the core material, he disagreed that avoiding further distortion provided a valid justification for not preventing detachment of the core material during the testing. Professor Bisby noted that detachment of the burning material prior to cessation of flame spread was observed in five of Mr Carrascal’s eight LIFTs.

235 During the expert conclave, the experts dealt with a single agenda item, being “What tests were carried out by Mr Carrascal to determine the flammability and flame spread properties of Alucobond Plus and what, if any, are the limitations of those tests?”

236 Associate Professor Lange, during the expert conclave, expanded on the agreement of the experts that, ultimately, the more important question was how the outcomes of Mr Carrascal’s tests were interpreted. Associate Professor Lange stated:

There are, essentially, two types of tests in fire safety engineering. There are those tests which are developed and which are carried out in order to, essentially, assign some kind of a category or declare a pass/fail outcome of that test for a building product… The other types of testing that we might do in fire safety engineering are tests to the performance of building products or building materials. The reasons why we do those is to gather data that would be used to inform a fire safety engineering solution…

An important point to note with these two different types of test methods is that they’re not intended to reproduce reality… They are designed in such a way… to gather data… as is relevant. They do not always represent reality because of that. If they were to represent reality, they would either be constrained to a very, very narrow band of application or they would be far too complex…

I consider the values which Mr Carrascal has determined and the observations that can be made on the basis of his testing, to be relevant as input to the fire engineering design process. I agree with Professor Bisby that the critical heat flux for ignition and for flame spread of the core of the material, the ignition temperate of the core and its burning behaviour cannot be characterised as reaction to fire properties of the composite product, as Professor Bisby has said. However, given the nature of the composite product… the response of the core, in my opinion, is a meaningful bound for the worse case of the product in terms of the relevant properties which have been discussed…

[Mr Carrascal’s] test, as I mentioned before, is designed to deliver information which could be used by a fire safety engineer to inform the use of the fire safety engineering model or analysis to support the fire safety strategy or the design of a fire safety strategy of a building. The test that Mr Carrascal has done is not intended to represent reality.

237 Professor Bisby noted his disagreement, stating that while he did not consider that the test data was of no value to a competent FSE, he did not agree that the test results supported any definitive statement as to the core material being incapable of propagating fire away from a large external heat source. He considered that any such statement would need to be heavily caveated by reference to the particular testing conditions used by Mr Carrascal. Professor Bisby also noted that the imposed heat flux at the bottom of the LIFT samples was comparatively mild for a cladding fire scenario, noting that changes in the heating of a material under a more severe heat flux can change the manner in which the material burns. Professor Bisby further noted his belief that the manner in which the LIFTs were conducted may have actually been unconservative as opposed to conservative.

238 Mr Carrascal, in response to a number of the criticisms, stated that the key value the LIFTs sought to determine was the critical heat flux for flame spread. He stated that the pyrolysis rate of the samples was driven primarily by the heat flux imposed by the radiant panels at the bottom of the sample. In his view, as long as there was ignition at the bottom of the sample, it would not be particularly relevant if sections of the burning core fell away during the test. Mr Carrascal also argued that while the heat exposure of a cladding fire would be much more severe than the 40 kW/m 2 imposed as part of the LIFTs, that was also somewhat irrelevant to determining the critical heat flux for flame spread, since there would be flame propagation until heat exposure reduced down to around 10 kW/m 2 (again, noting the assumption of the LIFT that flame spread was driven primarily by the heat flux provided by the radiant panels at the bottom of the samples). Mr Carrascal also noted that while the cover sheet being in place would influence the reaction-to-fire behaviour of the core, in his view, retaining the aluminium cover sheet would not allow for the flame spread characteristics to be studied.

239 Ultimately, it is clear that there is a degree of disagreement among Expert Group 2 regarding the degree to which Mr Carrascal’s experiments may be said to support the view that the Alucobond Plus core does not sustain flame spread. To a certain degree, the distinction may be more academic than of practical relevance to these proceedings.

240 As the experts agreed, the more pertinent question is how the results of Mr Carrascal’s tests are interpreted and used by manufacturers, designers, specifiers and approvers. In this context, it is relevant to note the views expressed as part of Expert Group 3 (discussed below) regarding the risks presented by the use of Alucobond PE, where it was noted that while Alucobond Plus may perform, in some ways, better than Alucobond PE, the material is more complicated to analyse. Therefore, while some advantage can be taken in the design process of its better reaction-to-fire characteristics, a conservative approach should be exercised in presuming the benefit of any such advantage.

241 As Associate Professor Lange stated during the course of the expert conclave, Mr Carrascal’s experiment is not intended to represent reality.

242 While the information can be used to inform the design of a fire safety analysis of a building, ultimately the degree to which the results could be relied on would need to be carefully and cautiously approached by a competent FSE.

243 Mr Carrascal’s tests were the subject of further consideration, alongside the targeted radiating heating experiments conducted by Professor Bisby, in Expert Group 3. This is discussed in further detail below under the seventh topic of Expert Group 3.

5.3 Expert Group 3 – Fire engineers (academics)

244 The summary of Expert Group 3 is extracted below:

Bisby Report 2 – 1 Dec 2023 |
| | 3A | Professor Jose Torero | Torero Report – 10 Mar 2023 |
| | | Associate Professor David Lange | Lange Report 1 – 10 Mar 2023 |
| | Joint Report of Professor Bisby, Professor Torero and Associate Professor Lange dated 3 April 2024 (“Group 3 Joint Report”) | | |
245 Expert Group 3 was constituted by Professor Bisby, Associate Professor Lange, and Professor Torero.

246 Professor Torero is a Professor of Civil Engineering and the Head of the Department of Civil, Environmental and Geomatic Engineering at University College London. He was previously a Professor of Civil Engineering and the Head of the School of Civil Engineering at the University of Queensland. Professor Torero’s field of expertise is fire safety – having worked in the field for more than 25 years and having held a number of significant positions in the area. This includes being the Editor-in-Chief of the Fire Safety Journal, the most respected scientific publication in the field, between 2010 and 2016. Professor Torero has written extensively in the field of fire safety and been involved in the training of fire engineers for more than 20 years. Professor Torero is also the director of the fire engineering consultancy, Torero, Abecassis Empis and Cowlard. Professor Torero gave expert evidence to the inquiry into the Grenfell Fire in 2018.

247 In the context of the topics discussed by Expert Group 3, it is relevant to note that Professor Bisby accepted that he has no personal knowledge of fire engineering practice in Australia, or of practice in the Australian building and construction industry more broadly. Professor Bisby also accepted that he does not have relevant expertise in Australian building requirements, including the BCA or the NCC. To the extent Professor Bisby sought to make comments regarding the involvement of FSEs in Australia during the relevant period, or of the relative competency of such engineers, Professor Bisby did so largely by reference to his understanding of the discussions in the expert conclaves he participated in, and by reference to the opinions of other experts.

248 The focus of Expert Group 3 was on the reaction-to-fire properties of the Alucobond products and how such properties might create risks to life and/or property. The experts also considered how the particular use of the Alucobond products on the Shore Building and the Five Dock Building impacted the risk to life and/or property in the event of a fire.

249 The agreed agenda between the experts was relatively lengthy, constituting 11 separate questions. These are extracted below:

1. What are the fundamental principles of a fire safe design?

Alucobond PE

2. What are the reaction-to-fire properties of Alucobond PE and do the aluminium coversheets of Alucobond PE protect the core?

3. What conclusions, if any, can be drawn from the fire performance tests conducted by Professor Bisby?

4. What, if any, are the risks to life and/or property presented by the use of Alucobond PE as part of or as an attachment to an external wall or building element?

5. To what extent can any risks to life and/or property identified in response to question (4) be mitigated by the design of the building as a whole?

Alucobond Plus

6. What are the reaction-to-fire properties of Alucobond Plus and to what extent do the aluminium coversheets protect the core of Alucobond Plus?

7. What conclusions, if any, can be drawn from the fire performance tests conducted by Professor Bisby and Mr Carrascal?

8. What conclusions, if any, can be drawn about the risks to life and/or property presented by the use of Alucobond Plus as part of or as an attachment to an external wall or building element?

9. To what extent can any risks to life and/or property identified in response to question 8 be mitigated by the design of the building as a whole?

Shore and Five Dock Buildings

10. Did the use of Alucobond PE on the Shore Building as part of or as an attachment to an external wall or building element materially increase the risks to life and/or property in the event of a fire? If the answer is “yes”, could Alucobond PE have been used in a way that did not present such risks and, if so, how?

11. Did the use of Alucobond Plus on the Five Dock Building as part of or as an attachment to an external wall or building element materially increase the risks to life and/or property in the event of a fire? If the answer is “yes”, could Alucobond Plus have been used in a way that did not present such risks and, if so, how?

250 The experts collectively prepared a joint report dated 3 April 2024 which largely addresses each of the questions raised in the agenda.

5.3.1 Principles of a fire - safe design

251 As the experts have noted in the Group 3 Joint Report, the purpose of a fire-safe design is to mitigate the risk of fire in a manner that delivers a building that adequately protects the occupants. For the purpose of a fire-safe design, it is assumed that a fire will occur.

252 As Associate Professor Lange stated during the expert conclave, fire-safe design achieves this purpose through the articulation and implementation of a “fire safety strategy”. While all buildings have a degree of fire risk associated with them, it is the specification of the fire safety strategy of a building that reduces the residual risk to a level which is accepted. A fire safety strategy can have multiple objectives, but its primary objectives are to protect the life of the occupants and enable a safe and effective response by the fire service.

253 The fire safety strategy of a building refers to the ensemble of elements that ensure the satisfactory performance of the building in a fire, including fire prevention measures, detection, alarm, evacuation, active suppression, hazard protection, smoke control, material performance, and the structure itself. This fire safety strategy design must take into account all relevant features of a building, including its use and occupancy. Mitigation strategies that may be included in a fire safety strategy include appropriate placement of products, management of quantities of products, active protection measures like sprinklers, and passive protection strategies such as fire-resistant glazing. The fire safety strategy is, in effect, the means by which an FSE demonstrates that the functional objectives are being met. A fire safety strategy is articulated through the F ire E ngineering B rief and an FER, which is discussed further below.

254 A particularly important part of a building’s fire safety strategy, in the context of the Alucobond products, is compartmentation.

255 Professor Torero acknowledged during the expert conclave that the capacity of the Alucobond products to facilitate vertical flame spread, which thereby may undermine the building’s compartmentation of fire, was a particular risk that needed to be considered in assessing a building’s fire safety strategy. Professor Bisby also accepted during the expert conclave that, generally, compartmentation does not need to be absolute and permanent. Rather, it is sufficient if a fire is prevented from progressing beyond the floor of origin for a period consistent with the egress strategy of the building.

256 Developing a sufficient understanding of the potential fire spread in a building, including in or on a façade system, and the interactions with the overall fire safety strategy of a building requires detailed elucidation of a design fire scenario, which is a narrative structure of a fire event that accounts explicitly for the features of a particular building and the reaction-to-fire behaviours of its various components. A design fire scenario can be used subsequently as the basis for the development of models of fire scenarios for the performance assessment of the building.

257 “Factors of safety” are also incorporated in a design fire scenario to cover any uncertainties in the design. Simpler solutions, based on less complete knowledge or with greater inherent variability, will usually carry larger factors (ie, more variability) of safety, while more knowledge-based and/or less variable design solutions, which typically require more complex tools and analyses, can be more safely optimised.

258 The experts noted in the Group 3 Joint Report that, in fire safety engineering, designers are expected to evaluate the response of their proposed solution(s) against pre-determined performance criteria using models which are neither predictive nor complete in their formulation, and which are rarely if ever entirely accurate. Regardless of the approach adopted, any fire safety engineering design ought to be supported by a body of evidence intended to support a position that the design proposed achieves its objectives. To the extent there is insufficient evidence or knowledge to support the use of a particular material or system in the context of a specific building and its fire safety strategy, obviously the relevant material or system should be excluded.

259 A DtS Solution implicitly meets the performance requirements under the BCA in relation to fire safety. On the other hand, a Performance Solution must be explicitly shown to meet the performance requirements of the BCA. As Professor Torero noted in his expert report, allowing for functional requirements allows relevant Qualified Professionals to assess the appropriate use of products. This demands a need for higher competency among all such professionals. The development of a Performance Solution is dependent upon the judgment and competency of the relevant professionals involved. Any Performance Solution designed for a particular building must be supported by a body of evidence which demonstrates that the overall fire safety strategy for a building satisfies the performance requirements of the BCA.

260 It is important to note, as Professor Torero stated during the expert conclave, that compliance is assessed for each building as a whole. It is the building itself that is considered compliant when the overall fire safety strategy of the building enables it to perform in accordance with the outcomes desired. In this sense, as Associate Professor Lange also stated, it is important to consider the fire safety strategy of a building holistically. For example, the design for egress from the building is intrinsically linked with the smoke management and compartmentation strategies of the building.

261 As the focus of fire safety compliance is on the building holistically, not its individual components, this allows for certain components to be appropriate for certain types of designs but inappropriate for others, depending on the fire safety strategy of each building. Professor Torero stated in his expert report that in this context, it is not the materials or products which are themselves inadequate; rather, they only become inadequate when improperly used. Therefore, the use of any particular material, component or system in construction must be assessed in the context of the fire safety strategy of the particular building. This assessment is unique for each building. Professor Bisby also accepted, during the expert conclave, that the acceptability of certain material qualities, such as heat of combustion or ignitions characteristics, is ultimately a function of the specific building and its particular fire safety strategy.

262 Within the context of fire-safe design, evidence was also given which went to whether appropriate fire safety strategies would practically have been designed during the relevant period.

263 It was noted by the experts in the Group 3 Joint Report that in a performance-based design regime, designers have a responsibility to carefully use all necessary information in a competent manner to demonstrate that the formulated solution meets the requirements of the building regulations. What would constitute the “necessary information” would depend on the complexity of the formulated solution, the uncertainties associated with the design inputs, models and outcomes, and the care and competency of the designer.

264 Broadly speaking, three issues were raised: (i) whether an FSE would be engaged during the relevant period, (ii) whether FSEs in Australia during the relevant period had the relevant competency to properly assess the fire safety risks of using the Alucobond products, and (iii) appropriate disclosure of information and access to quality data regarding the fire performance of products, specifically testing conditions used in any compliance testing.

265 The evidence regarding whether an FSE was commonly engaged during the relevant period is most appropriately discussed in the context of the evidence given by Expert Group 4-5.

266 In relation to the competency of FSEs, the experts noted in the Group 3 Joint Report that, if appointed in the design process of any building in Australia during the relevant period, an FSE may have used “design fires” as inputs into computational models, and the outputs might have been used to assess the performance of fire protection systems and to assess safe egress capabilities. The output of the fire models may have also been used in conjunction with complex finite element models for the purposes of establishing heat transfer from the fire to the structure and structural performance. To establish the “design fire”, the FSE (if appointed) may utilise knowledge of the properties of combustible materials which may enable them to establish how the fire might initiate, grow, and spread. The experts noted that the combustible properties of many common construction materials, including PE, have been known since the 1960s.

267 While Professor Bisby was unable to attest to matters of engineering practices in Australia during the relevant period, Professor Torero asserted in the Group 3 Joint Report that the use of PE and aluminium, and fire safety engineering design tools and methods, had been allowed by the BCA since the 1990s. Professor Torero asserted that this had been standard practice by most individuals acting as FSEs in Australia during the relevant period.

268 The experts also noted in their joint expert report that an assessment of the hazards imposed by the Alucobond products could have been developed during the relevant period using the known properties of the materials, and using relatively simple methods of analysis, such as the form of analysis utilised in Professor Torero’s assessment of the Shore Building (which is discussed below). The experts noted that none of the data or information used in Professor Torero’s analysis was unavailable to manufacturers, suppliers, specifiers, approvers, or careful and competent FSEs in Australia during the relevant period.

269 However, the experts also acknowledged that ACPs and the external wall systems in which they are commonly used are very complex systems, and the properties of the products’ component materials can lead to significant fire hazards. Professor Torero and Associate Professor Lange stated that a detailed hazard analysis can, therefore, be extremely complex and may not have been accessible to a typical FSE in Australia during the relevant period.

270 Professor Torero, speaking to the ability of FSEs during the relevant period to assess the use of the Alucobond products, stated:

[T]he process of development of cladding systems evolved at a certain speed that was much more significant than the speed at which competency was developed within the field creating a gap that resulted in many of these buildings being designed in a manner that… was not ideal.

…

[W]e have enabled systems to become too complex and the moment that they became too complex they became almost impossible to assess, rendering the professionals incompetent. Now, whether we can design simpler systems that we actually can assess, if we take back the control of the design process, is a completely different story. But in essence, what we have created is a system, which brought us to 2021, that had enabled the existence of a number of different buildings that had become too complex for the professionals to be able to assess.

271 Nevertheless, the experts noted in the Group 3 Joint Report that simpler solutions carrying larger factors of safety – utilising tools and methods that may have been in common use by FSEs in Australia during the relevant period, which restrict the manner and extent of ACPs used on a building – could, in principle, have been demonstrated to result in adequate fire safety. That said, Professor Bisby noted his view that it was unlikely that such an analysis would support the substantial use of Alucobond PE or Alucobond Plus on most tall buildings.

272 Further, Professor Torero and Associate Professor Lange have both, in their individual expert reports, written about the national inconsistencies and lack of controls over fire safety engineering practice during the relevant period. They noted only NSW, Queensland, Victoria and Tasmania have any form of legislative or regulatory controls in place, which vary significantly from state to state. Additionally, only Queensland and Tasmania had significant restrictions and requirements for registration of FSEs.

273 The experts noted that due to the inconsistencies in barriers to practice, it is not possible to make broad sweeping statements about the overall diligence and competence of FSEs in Australia over the relevant period. While there would have been individuals who had high levels of competence and professionalism, Professor Torero and Associate Professor Lange agreed that there were also individuals who had very low levels of competence and professionalism who were practising as FSEs during the relevant period.

274 Professor Torero, in his expert report, referred to reports of the Warren Centre regarding the lack of appropriate regulation over the competency of FSEs in Australia. In particular, the Warren Centre noted that due to the lack of control of the practice of FSEs, there was a lack of audit and enforcement of FSEs and their performance, and therefore, no requirements or standards against which to judge performance and competency. Professor Torero ultimately summarised in his expert report that the manner by which fire safety engineering was practiced in Australia during the relevant period could not be considered as reflecting the quality and consistency of practice expected by the NCC, noting the significant evidence of poor and inconsistent practices. Professor Torero noted in his expert report that, in accordance with proper professional practice, it was a professional engineer’s responsibility to recognise when the task of designing a building’s façade fell outside of their scope of qualifications, or where the necessary knowledge was not available, and it was their duty to inform their employers or clients that they could not deliver the task to an acceptable standard.

275 Associate Professor Lange also acknowledged during the expert conclave that given the complexity of the fire risks associated with combustible cladding, there was a risk that an FSE who was appointed to a project may not have the competency to deal with the challenges of that project. However, Associate Professor Lange reiterated that it was not possible to say with any degree of certainty what the level of competency of FSEs was over the relevant period.

276 Professor Torero further acknowledged during the expert conclave that the main reason he developed two continuing professional development (CPD) courses in fire safety engineering in 2021 was to correct what he saw as a lack of competency among different FSEs, particularly due to poor knowledge within the fire safety engineering industry as to the fire behaviour of complex flammable façade systems.

277 Regarding FSEs having access to the necessary information to inform their design solutions, the experts noted in the Group 3 Joint Report the expectations placed on manufacturers and competent professionals, stating:

Material and product manufacturers and suppliers have a responsibility to deliver accurate, relevant, credible, transparent, easily accessible, complete, unambiguous, and verifiable information on their products, to be used by competent professionals (i.e. specifiers, designers, approvers). This information has to be – and has to be presented in a form that is – consistent with careful and competent professional practise. If that information is not available to the satisfaction of the careful and competent professional, then it is incumbent on them to obtain it if possible, and therefore also incumbent on material and product manufacturers and suppliers to provide any and all information that is available to them.

278 During the expert conclave, the Applicants referred to the Cladding Materials Library developed and operated by the University of Queensland. The library comprises of an extensive database of the composition and flammability of different cladding materials, which is designed to provide a source of information for engineers to assess external wall systems. Professor Torero acknowledged that the library was developed in response to an impression that there was a need to compile information required for FSEs and other professionals in Australia. Professor Torero sought to qualify his statement noting that “many times a perceived lack of information is simply not being able to have that information at the tip of your fingers”.

5.3.2 Alucobond PE

5.3.2.1 What are the reaction-to-fire properties of Alucobond PE and do the aluminium cover sheets of Alucobond PE protect the core?

279 The reaction-to-fire properties of Alucobond PE are not substantially in dispute between the experts and were outlined in the Group 3 Joint Report. The extent of the disagreement between the experts appears, in substance, to be about how likely it would have been for the reaction-to-fire properties of Alucobond PE to have been practically sufficiently managed in reality.

280 In particular, Professor Bisby sought to characterise the reaction-to-fire behaviour of Alucobond PE as “problematic” in general, whereas Associate Professor Lange stated that such a characterisation, without reference to a specific application, is incorrect. While Professor Bisby accepted, in principle, Professor Torero’s statement that the complexities associated with the safe use of Alucobond PE could be addressed using simple tools when considering specific applications, Professor Bisby’s view was that, in actual practice, it was unlikely that such a simple analysis would support the substantial use of either Alucobond PE or Alucobond Plus on the outside of most tall buildings.

281 The evidence of Expert Group 3 considered the individual and composite elements of Alucobond PE as follows. PE has a heat of combustion of about 46 MJ/kg. This is similar to many derivatives of petrol. PE melts, drips and flows at comparatively low temperatures, possibly whilst also flaming. It steadily loses mechanical stiffness as its temperature increases from 20°C to 100°C. Its melting temperature is in the range of 130–135°C, above which it is likely to drip and flow as a viscous liquid. It has a critical heat flux for ignition of about 15 kW/m 2, and a surface temperature at ignition of about 377°C.

282 In relation to the aluminium cover sheets, most aluminium alloys used in construction melt at a temperature between 580–660°C, which is a considerably lower melting temperature than most other metals used in building construction and lower than the temperatures that are likely to be experienced in a typical building fire scenario. Aluminium conducts heat relatively rapidly. Aluminium also has a comparatively high coefficient of thermal expansion such that under heating, aluminium can be expected to warp and deform.

283 Considering the composite product, Expert Group 3’s evidence was that PE from the core of Alucobond PE may not burn entirely in situ, given that PE will melt before it reaches its pyrolysis temperature. When Alucobond PE panels are mounted and fixed, if heated for more than a few minutes by an external fire burning within or adjacent to a building, the PE core will melt and flow and will ignite. Once mobilised, the melted PE may collect on horizontal surfaces, pooling and possibly burning in situ, or it may burn as droplets.

284 Under other conditions, the PE may also burn partly in situ, with the surface of the PE melting and burning but with semi-solid PE partly retained between the aluminium cover sheets, or with burning over exposed PE surfaces after separation of the aluminium cover sheets.

285 The thicker an Alucobond PE panel is, the greater the proportion and total amount of PE core material that is available as fuel, and the more potential energy that is available to contribute to a growing and spreading fire.

286 In a cladding fire, the additional heat released from burning PE core material has the potential to further compromise the encapsulation of additional PE core material due to the mechanical separation of the aluminium cover sheets from warping or melting, which may thereby expose further PE core material. This may continue as a positive feedback loop, possibly resulting in an escalation of burning. However, for this to result in vertical flame spread, some of the burning material must remain in situ.

287 The experts have collectively outlined in the Group 3 Joint Report that, in the event of a significant fire developing within or adjacent to a building which is substantially clad with Alucobond PE (as part of or as an attachment to an external wall), where Alucobond PE is directly exposed to heating from this fire for any appreciable period of time, the product is likely to exhibit some or all of the following behaviours:

(a) the PE core may melt and ignite. In cases where some of the PE material remains in situ, areas of the panel remote from the area of direct influence of the pre-existing fire may be heated to a greater extent than would be the case had non-combustible cladding been used, thus potentially promoting upward external fire spread;

(b) the PE core material may flow out from the Alucobond PE panels and/or form burning droplets of molten PE, which would then mobilise in a downward direction due to gravity, likely whilst burning. This would increase the overall heat release rate of the fire and could promote external fire spread;

(d) the aluminium cover sheets may separate, particularly where mechanical fixings are not in place to explicitly prevent this; this would expose larger surface areas of PE within the cladding system, with consequent increases in the burning area and hence the fire size. This would promote upward, downward, and horizontal fire spread;

(e) mechanical deformation of the Alucobond PE panels – induced by differential thermal expansion alongside loss of mechanical properties of the PE core material, the polymer adhesive films bonding the PE core to the aluminium cover sheets, and the aluminium cover sheets themselves – may compromise the geometry of the cladding system, potentially opening up gaps and voids not intentionally designed into the Alucobond PE panels or the overall cladding system. This may also compromise the functionality of any fire cavity barriers or fire separation materials or products installed within the cladding system (intended to slow or prevent storey-to-storey vertical fire spread and/or fire spread horizontally around a building);

(f) mobilised, burning PE may flow or drip downward, over the surfaces of materials and products within the cladding system, thus increasing the surface area of burning PE and increasing the overall heat release rate, whilst also potentially igniting other combustible materials present within or adjacent to the cladding system, and potentially increasing the fire size and promoting further fire spread; and

(g) ongoing separation or burn-through of the aluminium cover sheets may further increase additional mobilisation of PE, with consequent further increases in heat release rate and fire spread; this may also lead to separation of cladding panels or components thereof (e.g. aluminium cover sheets) from the building, which could generate falling (potentially burning) debris hazards to bystanders, evacuating building occupants, emergency services personnel, and adjacent building properties.

288 The experts noted that the reaction-to-fire behaviours will be influenced, for better or for worse, by the methods used for forming, fixing, and mounting the Alucobond PE panels. This includes the manner of cutting, routing, folding and forming Alucobond PE into cladding panels, as well as the mounting and affixation methods used to fix the panels to the outside of a building.

289 The experts noted that the reaction-to-fire behaviours will also be influenced by the configuration, materiality, and geometry of the broader cladding system in which Alucobond PE panels are used. The effects of internal cavities, thermal feedback, and interactions with other materials forming part of the cladding system would all need to be considered by designers and approvers.

290 The experts noted that, in the absence of specific design measures to prevent re-entry of a growing and spreading external fire, Alucobond PE’s reaction-to-fire behaviour is likely to result in re-entry of the fire into building compartments above, below and possibly adjacent to the building compartment of the fire’s origin. Such re-entry would likely result in the generation of additional internal fires within the building, involving internal building contents, and the generation of additional compartment fire plumes which would then both increase the overall heat release rate of the fire and promote additional external fire growth and spread. The experts stated that this could result in widespread loss of fire compartmentation within a building, which could compromise fire suppression, smoke control, or phased evacuation systems incorporated within the building design – with consequent risks to both life and property.

291 The experts noted in their joint report that, ultimately, the extent to which all of the above reaction-to-fire behaviours will occur, the consequences of their occurrence, and the need for specific design measures to prevent or mitigate the behaviours, would all depend on the particular building under consideration and the particular fire safety strategy of that building. The experts, therefore, agree that it is necessary for a suitably qualified and competent engineering professional to assess the use of Alucobond PE in an external wall system. Additionally, the experts also agreed that manufacturers of ACPs, therefore, need to behave with competency and integrity in the use of test methods and in the reporting of data to ensure data is relevant, credible, transparent, easily accessible and complete.

292 In relation to the protection afforded by the aluminium cover sheets, a number of marketing brochures during the relevant period stated that Alucobond PE’s non-combustible aluminium cover sheets protected the plastic core.

293 The experts agreed that while the aluminium cover sheets provide some protection, they do not provide absolute protection. This has been explained above in the context of Alucobond PE’s reaction-to-fire properties. The experts agreed that whether the protection provided by the aluminium cover sheets will be “sufficient” in any application of the panels will depend on a range of factors specific to each application. However, the experts agreed that the statements made in the marketing materials are not qualified in terms of the particular circumstances in which the “protection” can be relied upon, and that multiple fires have demonstrated the fact that any protection provided by the cover sheets, at least in those cases, was insufficient and did not prevent the rapid and extensive external fire spread.

294 Professor Bisby shared a more conclusive view in relation to any case involving substantial use of Alucobond PE on the outside of a building, in the event of a significant fire developing within or adjacent to the building clad with Alucobond PE. In such cases, his opinion is that where Alucobond PE is directly exposed to heating from the fire for any appreciable period of time, the level of protection afforded by the aluminium cover sheets is unlikely to be sufficient or adequate to prevent the involvement of the PE core in the fire, which is likely to then contribute to external fire spread described above. The rationale for Professor Bisby’s opinion is that when Alucobond PE panels are installed in the manner recommended in the marketing material, the panels will always have exposed PE such as along cut edges and routing and folding lines. Additionally, there may be exposed PE where penetrations exist within cladding systems. Moreover, this is before any thermal or mechanical damage to the panels is initiated in the event of a fire.

295 Professor Bisby stated further that even where PE is initially protected beneath aluminium cover sheets, the cover sheets are likely to provide minimal protection to the core if the Alucobond PE panel is exposed to heat fluxes typical of cladding fire over a significant area since the PE core may melt and flow out from between the cover sheets (even before the cover sheets have been physically compromised), the panel may deform, or the cover sheet may dis-bond or melt.

296 Professor Torero did not disagree with the features of Alucobond PE described by Professor Bisby which would have the potential to affect the degree of protection afforded by the aluminium cover sheets. However, Professor Torero, rather than seeking to make broad statements about the particular degree to which the aluminium cover sheets provided protection, sought to focus attention to particular applications of Alucobond PE. Indeed, this emerged as an ongoing tension between Professor Bisby and Professor Torero’s evidence.

297 Professor Torero stated, in relation to Professor Bisby’s opinion, that terminology such as “significant”, “appreciable”, “unlikely”, “sufficient” and “adequate” could be quantified for a specific project by a competent FSE, and that the quantification of those subjective terms is the necessary engineering design process that must be undertaken to demonstrate the safe use of a product within a building, when using performance-based design provisions. For example, this may involve the quantification of the impact that exposures in cuts, edges and penetrations in affixed panels may have on the overall performance of the system. Professor Torero stated that an FSE could take a conservative stand, by fully ignoring any protection afforded by the cover sheets, and still demonstrate that a building offered a level of safety consistent with the requirements of the NCC.

298 Associate Professor Lange also sought to focus attention to how any particular application of Alucobond PE would fit within the fire safety strategy of a building, stating that whether the cover sheets provided “sufficient” protection was separate to whether the cover sheets prevented the involvement of the Alucobond PE core at all. Associate Professor Lange stated that the prevention of the involvement of the core of an ACP product in a fire was more onerous an expectation than other measures of what may be “sufficient”; delaying the significant involvement of the core material could be “sufficient” to ensure adequate fire safety if compatible with the rest of the building’s fire strategy. Associate Professor Lange noted that prevention as a measure of what was “sufficient” was not always what would be required of the aluminium cover sheets. Associate Professor Lange stated that while the actual protection afforded by the cover sheets would be difficult to determine in practice, acknowledging that they provide some protection but ignoring the protection when determining flammability properties for design purposes may represent a conservative input to design.

299 Associate Professor Lange stated in the Group 3 Joint Report that while there were clearly a number of instances where the fire safety strategy of a building was disabled by the presence of combustible cladding, there are other instances where fires have occurred in buildings with combustible cladding where the fire safety strategy was not disabled. Associate Professor Lange stated the following:

The question to be asked when considering these [fires occurring in buildings with combustible cladding] in the context of these proceedings is not whether the performance of the external cladding on those buildings is adequate; but whether the performance of the external cladding is adequate having due consideration for, e.g., the function or use of the building, the fire load, the fire intensity, the evacuation time, etc.

(Original emphasis.)

300 The experts agreed that, in any case, the adequacy of any protection afforded by the cover sheets needs to be carefully and competently considered, and that, in order for this to occur, suitably careful and competent persons would need to be involved and have some doubt or concern as to the adequacy of the protection provided. Only practitioners sufficiently informed of the degree to which the protection can be relied upon, and who are qualified with the relevant expertise, would recognise that there was a concern and be able to engage with the relevant considerations. Additionally, competent professionals have a responsibility to obtain all necessary data to support their design, and it is conversely the responsibility of the manufacturer to behave with competency and integrity in the use of test methods including by providing relevant, credible, transparent, accessible and complete test data.

301 Professor Bisby agreed that there were methods that would enable a competent engineer to conduct a relevant assessment of the use of Alucobond PE (and the degree of protection provided by the cover sheets). However, Professor Bisby was of the view that such an analysis by a careful and competent professional would, in the vast majority of practical cases, result in a decision not to use Alucobond PE (or Alucobond Plus) in substantial quantities on a tall building, in the manner which was contained in the advertising material.

302 Professor Bisby also stated that, from a practical perspective, he understood (from his involvement in Expert Group 4-5, discussed below) that during the relevant period, it was not common practice for an FSE to be engaged to assess the proposed use of combustible ACPs. Additionally, Professor Bisby also stated that employing a competent FSE to develop a performance-based fire safety engineering solution would incur additional time and cost compared to a DtS Solution. Professor Bisby further stated that performance-based engineering solutions may generate approval risks, such that the use of Alucobond PE (or Alucobond Plus) may be viewed as undesirable by building developers. Professor Bisby, therefore, considered that both during the relevant period and presently, there was and is a vanishingly small likelihood that a careful and competent assessment of a cladding system involving the substantial use of Alucobond PE on a tall building would result in a positive decision to use Alucobond PE.

303 While Professor Torero agreed that the issues Professor Bisby flagged were relevant to design practice, Professor Torero noted that the employment of a competent FSE should not be dismissed purely because of costs or the increased approval risk. Professor Torero stated that doing so would be equivalent to saying that simplistic lower quality solutions should always be used because they are cheaper and easily understood. Professor Torero noted that during the relevant period, performance-based design solutions were allowed, and therefore, a cost-benefit analysis of a particular approach to a design (which could include the involvement of the Alucobond products) was a necessary process in the development of any project.

304 Associate Professor Lange stated that a large proportion of buildings in Australia have one or more Performance Solutions, and therefore, did not agree with Professor Bisby’s suggestion generally that a performance-based engineering solution may lead to an approvals risk which would deter the adoption of a Performance Solution. Associate Professor Lange also disagreed with Professor Bisby’s general statement that the substantial use of Alucobond PE on a tall building would be unlikely to result in a decision to use the product, given the number of other possible motivations someone may have for using the product which may influence a positive decision to use the products and to develop a Performance Solution to address fire safety.

5.3.2.2 What conclusions, if any, can be drawn from the fire performance tests conducted by Professor Bisby?

305 Professor Bisby, in his first expert report, conducted a number of fire performance tests of samples of Alucobond PE which were taken from the Shore Building. The results from the experiments are largely consistent with the reaction-to-fire behaviour of Alucobond PE discussed above.

306 The tests Professor Bisby conducted included bomb calorimetry of the PE core in order to determine its heat of combustion. The test determined that the PE core had a heat of combustion of approximately 46 MJ/kg. The experts accepted that Alucobond PE could never credibly be considered a non-combustible product, by any manufacturer or supplier.

307 Professor Bisby also conducted a program of targeted radiant heating exposure experiments seeking to demonstrate and understand the reaction-to-fire performance of the Alucobond PE samples. In conducting the experiments, Professor Bisby cut 100 x 100 mm samples of Alucobond PE. The samples were fixed in place on a specimen holder which was held above a tray used to catch falling debris.

308 The samples were affixed to the specimen holder using three different techniques. Firstly, spot welded to the rear of the sample; secondly, spot welded to the front of the sample; and thirdly, through full penetration holes drilled through the samples from back to front. While the fixing configurations were not intended to precisely simulate particular cladding system configurations, they were designed to provide a means to understand how the reaction-to-fire behaviour could change as a result.

309 The first configuration (rear fixing) was intended to be broadly representative of where the heated face of the panel was held in place only by its adhesion to its core material, such as might happen when using a two-sided adhesive tape called the “flat stick” method. The second configuration (front fixing) was intended to be broadly representative of where only the front face is held in place through mechanical fixings. This was intended to be representative of situations that would occur with the use of ACP cassettes or tray panels. The third configuration (through fixing) was intended to be broadly representative of a screwed or riveted installation where both front and rear aluminium cover sheets are mechanically fixed in place.

310 A radiant heat panel was used to investigate the burning behaviour of the samples at heat flux values of 25, 50 and 75 kW/m 2. Professor Bisby conducted the following tests, noting that he conducted fewer experiments in relation to Alucobond PE as it behaved similarly to other PE core ACPs that he has significant history testing:

| Number | Fixing condition | Heat flux (kW/m 2) |
| PE01 | Rear fixing | 25 |
| PE02 | | 50 |
| PE03 | | 75 |
| PE04 | Front fixing | 50 |
| PE05 | Through fixing | 50 |
311 Professor Bisby noted some visual observations from PE02 in his report. He stated that around 1:03 minutes into the experiment, the coating on the front of the sample ignited. Shortly after this, around 1:06 minutes, the front aluminium face began to move downwards and detached entirely around 1:08. Flaming on the front aluminium cover sheet continued in the debris tray. Flames were also well-established over the front surface of the exposed PE core, with burning droplets of PE beginning to fall into the debris tray at around 1:17 minutes. A near continuous stream of burning PE flowed from the sample from 1:35–1:49 minutes. At around 1:54 minutes, flaming on the sample ceased. However, it was not until 5:38 minutes that the flames from the PE core burning in the debris tray were extinguished.

312 Professor Bisby noted in his first report that the effect of increasing the incident heat flux was to reduce the time to ignition of the PE core, although even at the lowest heat flux of 25 kW/m 2, the ignition of the PE core occurred in under six minutes. Increasing the incident heat flux also increased the peak heat release rate.

313 In the Group 3 Joint Report, the experts agreed that the PE core of Alucobond PE panels will, regardless of the mounting and fixing methods, melt, ignite and continue to burn while dripping or flowing from the product when it is exposed to incident heat fluxes greater than 25 kW/m 2. While Professor Bisby did not experiment with heat fluxes below 25 kW/m 2, the Group 3 Joint Report noted that ignition and continued burning of PE can occur for incident heat fluxes as low as about 15 kW/m 2.

314 The Group 3 Joint Report noted that increasing the incident heat flux to the sample from 25 kW/m 2 to 75 kW/m 2 reduces the time to separation of the front aluminium cover sheet (in all cases where no mechanical fixing to the cover sheet was provided), and the time to ignition of the PE core. However, even the lowest heat flux of 25 kW/m 2 resulted in ignition of the PE core in less than six minutes.

315 The experts noted that the data collected by Professor Bisby is specific to the tests conducted and relevant to situations of significant thermal exposure of an entire panel. Notwithstanding, Professor Bisby’s opinion is that the data shows that, in cases involving substantial use of such products on the outside of buildings, in the event of a significant fire developing within or adjacent to the building, and where Alucobond PE is directly exposed to heating from this fire for any appreciable period of time, ignition and continued burning of the PE core is virtually assured.

316 The joint report noted that increasing the incident heat flux from 25 kW/m 2 to 75 kW/m 2 will increase the peak heat release rate, increasing the chances that an external fire will spread up, down, across, or within a cladding system incorporating Alucobond PE.

317 The experts also noted that in post-flashover building fires, venting from windows can be expected to generate, in the areas adjacent to the upper part of the window, external heat fluxes in excess of 75 kW/m 2 (being the maximum heat flux tested by Professor Bisby) even when non-combustible cladding materials and products are used.

318 The experts also noted in the joint report that mechanical separation of the front aluminium face of the samples occurred in all of Professor Bisby’s experiments, regardless of the mounting and fixing methods used. This demonstrates that, under the specific conditions of the experiments, the cover sheets could not be relied upon to protect the PE core absolutely.

319 The effect of changing the fixation configuration modified the manner of mechanical separation of the front aluminium face of the Alucobond PE sample, thereby modifying the manner by which, and the time at which, significant direct thermal exposure to the PE core material occurred. This also then impacted the extent and manner of burning and downward mobility of the PE core once it ignited.

320 The experts noted that the extent to which Professor Bisby’s different mounting and fixing methods were representative of cladding applications on real buildings would depend on the particular cladding system, noting that the scale and size of the samples relative to their full-scale application means that the behaviours observed in practice may not exactly conform with those observed in the experiments.

321 The joint report also noted that the experiments show that dripping or flowing burning PE core material that mobilises downward collects and pools on horizontal surfaces, where it may continue to burn as a pool fire.

322 Again, while Professor Bisby asserted in the joint report that his experiments illustrated many of the potential reaction-to-fire hazards associated with the substantial use of products such as Alucobond PE, which Professor Torero and Associate Professor Lange did not disagree with, Professor Torero and Associate Professor Lange again focused their analysis on specific applications of Alucobond PE. They asserted that the reaction-to-fire hazards of Alucobond PE ultimately need to be considered in the specification, design and approval of a building, such that they are not necessarily unacceptably problematic in all potential applications, nor related to the quantity of Alucobond products used in design.

5.3.2.3 What, if any, are the risks to life and/or property presented by the use of Alucobond PE as part of or as an attachment to an external wall or building element?

323 The risks to life and/or property are largely reflected in the evidence given by the experts as to the reaction-to-fire behaviour of Alucobond PE, outlined above in section 5.3.2.1. In addition to what is summarised there, the Group 3 Joint Report also outlined risks involving deformation of the Alucobond PE panels. The evidence was that ACPs are typically used in combination with an additional insulation material (e.g. polymer foam insulations or a mineral wool product) on the opposite side of a cavity from the ACP. In the event of fire exposure within the cavity, there is a potential hazard in the form of flames entering the cavity, igniting the insulation material if this is combustible, as well as involving the ACP through either dis-bonding of the aluminium in the region of the opening, melting of the core of the ACP, or one of the other mechanisms described above. Thus, insulation will also retain thermal energy within the cavity, increasing heating of the ACP and the likelihood that greater areas of PE core material may become involved in a fire.

324 The experts noted in the Group 3 Joint Report that understanding the risk to life and/or property presented by the use of Alucobond PE as part of or as an attachment to an external wall or building element, requires consideration of the potential external fire spread mechanisms via the building’s façade system and the impacts upon the overall fire safety strategy of the relevant building.

325 Developing such an understanding requires detailed elucidation of a design fire scenario, taking into consideration the features of the particular building, the reaction-to-fire behaviour of Alucobond PE and the level of protection provided by the cover sheets. Where such an understanding does not exist or cannot be developed, the experts agreed that the product should not be used.

326 It is relevant to note that the experts flagged within the joint report that while the behaviours and properties of Alucobond PE were summarised in the report, the experts had not developed a design fire scenario for any particular building. Therefore, the experts had not meaningfully quantified the specific risks associated with the use of Alucobond PE for any given building.

327 It is important, in my view, to emphasise this matter. While the matters disclosed in the joint report explain how the use of Alucobond PE may present a risk to life and/or property, it does not seek to quantify any such risk. As Associate Professor Lange stated in the joint report, each building has a different degree of inherent and residual fire risk, and it is the specification of the fire safety strategy of a building which reduces the residual risk within a specific building to a level which is generally acceptable or tolerable.

328 The experts noted in the Group 3 Joint Report that any cladding element installed on a building will present certain hazards which need to be managed through the fire safety strategy of that building to such an extent that the residual risk is at a level that is satisfactory for all stakeholders. As was noted above in relation to the reaction-to-fire behaviours of Alucobond PE, the extent to which the use of Alucobond PE will present a risk to life and/or property will depend on the particular building under consideration, the particular use of the Alucobond PE, and the overall fire safety strategy of the building including any features or countermeasures designed to address the reaction-to-fire behaviour of Alucobond PE.

329 During the expert conclave, Professor Bisby accepted that, ultimately, the potential reaction-to-fire behaviour of Alucobond PE and the consequences of that behaviour depended on a wide range of factors. These included, without seeking to be exhaustive, the size, shape, and use of the particular building; the details of the particular cladding system; the size of the particular panels; the continuity of the panels and their proximity to other combustible material; the presence of fire alarms and smoke detectors; the building’s egress strategy; the ease of access for fire services; and other features of a building’s overall fire safety strategy.

330 Professor Bisby, having accepted the reaction-to-fire behaviour of Alucobond PE, and the consequences of that behaviour, is a function of such a range of matters, also accepted that he could not state that all uses of Alucobond PE on all buildings are always unacceptable. Professor Bisby accepted that, in principle, it would be possible for Alucobond PE to be used appropriately on a building with an appropriate fire safety strategy in place.

331 Professor Torero gave similar evidence in the expert conclave stating:

[W]hether one uses one material or another that is simply one component that needs to be analysed. But it is impossible to generalise back and say, “If you use this material with this particular type of reaction to fire, then you will get this outcome”, because the outcome is not the product of the material. It is the product of the ensemble of the fire safety strategy.

5.3.2.4 To what extent can any risks to life and/or property identified in response to question (4) be mitigated by the design of the building as a whole?

332 The experts reiterated in the Group 3 Joint Report that the overall performance of a building in the event of a fire is defined by the many variables involved in the design. Each hazard can be mitigated with appropriate design decisions, including appropriate placement of products, management of quantities of products, introduction of active protection measures like sprinklers, use of passive protection strategies like fire resistant glazing, etc. If a hazard cannot be appropriately mitigated by means of the design process, it is the responsibility of the competent professional to inform their client, assuming that a suitably careful and competent professional is appointed to the design team.

333 DtS Solutions for fire safety rely on an assumption that either external fire spread must not occur, or that it is adequately controlled, such as through the use of a classified external wall system. On the other hand, a Performance Solution does not rely on an assumption that external fire spread does not occur, such that there is no stringent requirement imposed to prevent this. Instead, the designer is required to demonstrate explicitly that external fire spread is adequately controlled. This requires an engineering analysis showing that any spread of fire is not inappropriate considering the function and use of the building, and does not negatively impact on egress. In other words, that the consequences of external fire spread are accounted for and adequately managed by the overall fire safety strategy.

334 The experts noted in their joint report that most fire safety strategies of tall buildings rely on a combination of elements, including: detection, alarm, egress strategy, automatic suppression systems, smoke management, compartmentation (both horizontal and vertical), firefighting provisions, and structural stability. In many instances, the specification of these systems (such as detection, alarm, and automatic sprinklers) will rely on prescriptive codes and standards which respond to building classifications. In other instances (such as smoke management, egress, compartmentation, and structural stability) the FSE can use simple or complex models to analyse a building’s response.

335 The experts stated that the consequences of Alucobond PE’s reaction-to-fire behaviour is principally related to a loss of vertical compartmentation in the building, which can have impacts on the egress strategy through, for example, the need for more than one floor to evacuate at once leading to overpopulation of the staircase(s), contraflows with fire and rescue services, and an inadequate smoke management strategy (eg, stair pressurisation).

336 The experts stated that a competent FSE will be capable of designing an appropriate evacuation strategy and of defining the stair dimensions to allow more than one floor to evacuate, which could guarantee a fast enough evacuation so that contraflows with fire and rescue services are properly managed and smoke is prevented from entering the evacuation stairs.

337 The experts also noted that the tools required to address such issues were very common in the practice of fire safety engineering over the relevant period. The loss of vertical compartmentation thus does not imply that any of these problems cannot be resolved. This is consistent with Professor Bisby’s acceptance during the expert conclave that, generally, compartmentation does not need to be absolute and permanent. Rather, elements of a building relevant to compartmentation (including the façade of a building) will be considered to perform adequately if they prevent the fire from progressing beyond the floor of origin for a period consistent with the egress strategy of a building.

338 The experts concluded in their joint report that the use of Alucobond PE, therefore, will result in the need for a performance-based design conducted by a competent FSE to mitigate the specific hazards introduced by the use of the product. The specific measures undertaken would need to consider the potential loss of vertical compartmentation, the heat released by the burning PE core, the potential for molten and burning PE to flow downwards, and the potential for burning debris. The experts also acknowledged that it was not common practice during the relevant period for such specific measures to be undertaken and considered as part of the design process.

339 During the expert conclave, Professor Bisby sought to qualify the principled view expressed in the Group 3 Joint Report – that risks to life and/or property could potentially be mitigated with appropriate design decisions – by what he considered would occur in practice. Professor Bisby stated that, based on his participation in Expert Group 4-5, he understood that it was not common practice to engage an FSE during the relevant period, and therefore, any risks to life and/or property could not be mitigated through the design process where no suitably qualified and competent professional was appointed. Additionally, Professor Bisby also stated that given “considerations of commerce and time”, it was difficult to see how the risks would be mitigated effectively in support of a positive decision to use Alucobond PE.

340 Professor Bisby accepted that his comments did not mean that Alucobond PE could not be used safely, only that, it would have been unlikely to have been so used in practice, given that doing so would have been associated with additional time and money. Additionally, Professor Bisby also accepted that matters such as the cost of any mitigation measures required for the use of a particular material on a building would have to be assessed on a case-by-case basis.

341 Professor Bisby also accepted that to the extent that he had referred to photos in Alucobond product marketing brochures where Alucobond PE or Alucobond Plus had been used, he was not in a position to assess or consider the overall fire safety strategies of those buildings from the photos. Professor Bisby also did not inspect any such buildings, and accepted that he could not definitively say whether the use of the Alucobond products on any particular building gave rise to risks to life and/or property that had not been adequately mitigated.

5.3.3 Alucobond Plus

5.3.3.1 What are the reaction-to-fire properties of Alucobond Plus and to what extent do the aluminium cover sheets protect the core of Alucobond Plus?

342 The reaction-to-fire properties of Alucobond Plus were described by the experts as largely similar to the reaction-to-fire properties of Alucobond PE, subject to the magnitude of those properties being diminished.

343 Again, the reaction-to-fire properties of Alucobond Plus were not in substantive dispute between the experts. The fundamental disagreement between the experts, as disclosed in the Group 3 Joint Report, was largely the same as that discussed in relation to Alucobond PE. In particular, whilst Professor Bisby sought to characterise Alucobond Plus’ reaction-to-fire behaviour as problematic generally, Associate Professor Lange’s view was that such a characterisation without reference to a specific application was incorrect.

344 The experts noted in their joint report that due to the difference in core material between the Alucobond products, the following differences manifest in the reaction-to-fire behaviours of Alucobond PE and Alucobond Plus:

(a) the mineral-filled EVA core material used in Alucobond Plus has less energy to release during a fire than Alucobond PE. Alucobond Plus had a heat of combustion of 13 MJ/kg compared to Alucobond PE’s heat of combustion of 46 MJ/kg;

(b) on the basis of the experiments performed by Professor Bisby and Mr Carrascal, the mineral-filled EVA core material used in Alucobond Plus mobilises less readily upon heating compared to the PE core material used in Alucobond PE; and

(c) in the case of Alucobond Plus, the core material does not drip or flow like PE, but rather swells, softens, oozes and sloughs off.

345 The experts noted in the joint report that information about Alucobond Plus’ heat of combustion did not appear to have been generally available to specifiers, designers or approvers during the relevant period. However, Professor Torero also noted that provided the mass fraction of mineral filler within the core was known, and provided that it was also known which polymer was used in the core, an approximate heat of combustion could be conservatively calculated.

346 The experts noted that on the basis of Alucobond Plus’ heat of combustion, it is reasonable to expect that its core material would fail any of the widely used tests for non-combustibility.

347 Professor Bisby opined in the joint report that meaningfully quantifying the reaction-to-fire behaviour of Alucobond Plus when substantially used as part of a cladding system was not straightforward in general terms, based on the test data available during the relevant period. In Professor Torero’s view, the absence of precise data cannot be confused with the impossibility of conducting an adequate design. Professor Torero stated that it is the prerogative of the designer to design on the basis of limited data, and that in the absence of a comprehensive set of data, a responsible designer was required to use conservative values and approaches. The designer could have opted to use the properties of pure PE for their analysis, without considering any advantage of the mineral filler. Again, Professor Bisby sought to create a distinction between demonstrating that a design incorporating the Alucobond products could provide adequate safety with the likelihood that a positive decision to use the products might end up being taken in practice.

348 As with Alucobond PE, the experts have collectively outlined in their joint report the reaction-to-fire properties of Alucobond Plus, considering the potential mechanisms of fire spread that substantial use of Alucobond Plus may actuate. The experts stated that, in the event of a significant fire developing within or adjacent to a building which is clad with Alucobond Plus, as part of or as an attachment to an external wall, and where the Alucobond Plus is directly exposed to heating from this fire for any appreciable period of time, the reaction-to-fire properties of Alucobond Plus would be as follows:

(a) the mineral-filled EVA core will swell and is likely to ooze out from the edges of the Alucobond Plus. This may result in burning debris mobilising in a downward direction, possibly whilst flaming, and could result in downward external fire spread under certain conditions. However, given the relatively short-lived flaming observed for the Alucobond Plus core after it has fallen, these conditions may not occur in all cases;

(b) any exposed mineral-filled EVA core may ignite. In cases where some of the Alucobond Plus core material remains in situ, areas of Alucobond Plus remote from the area of direct influence of the pre-existing fire will be heated to a greater extent than would be the case had non-combustible cladding been used, thus making upward fire spread more likely;

(c) the aluminium cover sheets may separate locally where heated, particularly where mechanical fixings are not in place to explicitly prevent this. This will expose larger surface areas of mineral-filled EVA core material within the cladding system, with consequent increases in the burning area and hence the fire size. This could enable external vertical fire spread;

(d) mechanical deformation of the Alucobond Plus panels – induced by differential thermal expansion alongside loss of mechanical properties of the core material, the polymer adhesive films bonding the core material to the aluminium cover sheets, and the aluminium cover sheets themselves – may compromise the geometry of the cladding system. This may potentially open up gaps and voids not intentionally designed into the Alucobond Plus panels or the overall cladding system. This may also compromise the functionality of any fire cavity barriers or fire separation materials or products installed within the cladding system;

(e) mobilised and potentially burning mineral-filled EVA core material may ooze, dis-bond, or slough downward, with consequent increases in the overall heat release rate, whilst also potentially igniting other combustible materials present within or adjacent to the cladding system. It is important to note that the likelihood and potential impact of mobilised, potentially burning mineral-filled EVA on downward ignition and increased heat release rate will be less than is the case for the PE core used in Alucobond PE panels; and

(f) ongoing separation or burn-through of the aluminium cover sheets may increase mobilisation of core material, with consequent increases in heat release rate and thus fire spread. This may also lead to separation of cladding panels or components thereof (eg, aluminium cover sheets) from the building, generating falling (potentially burning) debris hazards to bystanders, evacuating building occupants, emergency services personnel, and adjacent properties.

349 Again, the experts noted that the reaction-to-fire behaviours will be influenced, for better or for worse, by the methods of forming, fixing, and mounting the Alucobond Plus panels, including the manner in which the panels are cut, routed, folded, and formed into cladding panels. The behaviour will also be influenced by the configuration, materiality, and geometry of the broader cladding system in which Alucobond Plus panels are used.

350 Ultimately, as was the case with Alucobond PE, the experts noted that the extent to which all of the reaction-to-fire behaviours will occur in any given situation, their consequences, and the need for design measures to prevent or mitigate those behaviours, will depend on the particular building under consideration and how the consequences of those reaction-to-fire behaviours are addressed by the specific fire safety strategy of that building.

351 Again, in relation to the protection afforded by the aluminium cover sheets, the experts noted that the cover sheets will provide some protection – but will not provide absolute protection.

352 As with Alucobond PE, Professor Bisby gave a more conclusory view about cases involving substantial use of Alucobond Plus on the outside of buildings, when used in the manner recommended by the relevant marketing material, in the event of a significant fire developing within or adjacent to a building which is clad with Alucobond Plus. His view is that in such cases, where the panels are directly exposed to heating from the fire for any appreciable period of time, the level of protection afforded is unlikely to be sufficient or adequate to prevent the involvement of the core materials in a fire. Professor Torero and Associate Professor Lange’s view, in relation to Alucobond Plus, was the same as expressed above in relation to Alucobond PE. That is, in effect, that what is considered “sufficient” protection is not the same as prevention, and must be considered by a qualified and competent FSE considering the particular application of the Alucobond Plus to a particular building.

353 Professor Torero also noted the following in terms of comparing Alucobond Plus’ reaction-to-fire behaviour to that of Alucobond PE:

I think, in general, what is being described is a material that burns or a product that burns with fairly similar characteristics controlled by, fundamentally, the same parameters, same reaction to fire parameters as Alucobond PE will be controlled. I think there is – in some ways, I think the only difference is that there is some sense of better behaviour. You are diluting the combustible material by using an inert filler and you are adding some chemical products that reduce the flammability of the material. Nevertheless, the form of behaviour becomes quite complex. Significantly more complex than what you see with the PE, which, I think, from an engineering perspective, my only differentiation would be that, when treating the gain that the Alucobond Plus brings in terms of mobility, I would exercise quite a bit of caution and probably try to cover those uncertainties by accepting a very small fraction of that gain.

So I can accept, for example, the fact that, if I’m diluting the core with inert, I can reduce the heat of combustion by an equal proportion but, for example, I will not consider the gain of the chemical product because I think that creates a series of behaviours that probably compound it, doesn’t make me gain that much. So, as a means of addressing this conservatively I will probably be very, very conservative in my judgment of what aspect of the gain I would take. But otherwise I think the mechanisms are the same.

5.3.3.2 What conclusions, if any, can be drawn from the fire performance tests conducted by Professor Bisby and Mr Carrascal?

354 The fire performance tests conducted by Mr Carrascal on Alucobond Plus have been discussed with respect to the evidence of Expert Group 2 in section 5.2.

355 Professor Bisby, alongside the fire performance tests conducted on samples of Alucobond PE in his first report, also conducted a variety of targeted radiant heating experiments on Alucobond Plus samples. The experiments were conducted in the same manner as described above in relation to Alucobond PE but were more numerous.

356 As with Alucobond PE, Professor Bisby conducted the experiments on 100 x 100 mm samples of Alucobond Plus and fixed the specimens in place using three different affixation techniques, being rear fixing, front fixing, and through fixing.

357 Professor Bisby conducted a total of nine targeted radiant heating experiments, with each of the three fixing conditions being subjected to heat fluxes of 25, 50, and 75 kW/m 2. In conducting the experiments, heat release rates, mass losses from the samples, mass gains to the debris tray, and temperatures of the front aluminium plates were recorded during all experiments.

| Sample number | Fixing condition | Heat flux (kW/m 2) |
| Plus01 | Rear fixing | 25 |
| Plus02 | | 50 |
| Plus03 | | 75 |
| Plus04 | Front fixing | 25 |
| Plus05 | | 50 |
| Plus06 | | 75 |
| Plus07 | Through fixing | 25 |
| Plus08 | | 50 |
| Plus_09 | | 75 |
358 Again, in his first report, Professor Bisby noted his visual observations of the rear fixing radiant heating experiment at 50 kW/m 2 (Plus-02). He noted that around 1:01 minutes into the experiment, mild expansion and bubbling of the core was evident along the top and sides of the sample. Around 1:17 minutes, the front aluminium face began to move down rapidly and separate almost immediately. At 1:22 minutes, ignition of the surface of the core occurred, and until 1:48 minutes, the intensity of the flaming was relatively low. There was an increase in the intensity of the flame between 1:48 minutes and about 2:33 minutes, as the core material swelled, oozed, and charred. Around 2:37 minutes, the front surface of the core detached and fell away into the debris tray, and continued to burn in the debris tray for about four seconds. The intensity of the burning increased again at 2:50 minutes until the remainder of the core detached at around 3:01 minutes. At 3:12 minutes, the flaming on the specimen ceased.

359 Professor Bisby noted that the peak heat release rates from the experiments on Alucobond Plus were, in general, considerably less than the experiments on Alucobond PE, due to the presence of the inorganic filler. Nevertheless, Professor Bisby opined that each of the samples displayed heat release rates that were “very significant” as regards external fire spread.

360 Professor Bisby noted that increasing the incident heat flux of the experiments generally reduced the time to ignition of the Alucobond Plus core, modified the extent to which the aluminium cover sheets were compromised, and modified the physical response of the core. Professor Bisby noted that samples Plus04 (front-fixed) and Plus07 (through-fixed) did not result in any ignition when exposed to the lowest heat flux condition of 25 kW/m 2.

361 Professor Bisby also noted his observation that the heat release rate responses for samples with different fixing conditions appeared to be strongly influenced by the fixing methods used. He stated that both rear-fixed and through-fixed samples displayed considerable burning of the core material in situ, and that under the highest heat flux of 75 kW/m 2, the prevention of downward mobilisation of the core for the through-fixed sample led to higher heat release than would otherwise have been observed. Professor Bisby also observed that samples that were front-fixed displayed minor heat releases in all cases due to the fact that the vast majority of the core fell into the debris tray relatively early on in the experiments (due to the separation of the front aluminium face), before significant flaming could occur.

362 The fire performance tests conducted by Professor Bisby and Mr Carrascal were also the subject of detailed discussion within the Group 3 Joint Report.

363 The experts agreed that Alucobond Plus could never credibly be considered a non-combustible product by any manufacturer or supplier, or by any competent FSE.

364 The experts also agreed that the core of Alucobond Plus will, regardless of the mounting and fixing methods used, soften, ignite and continue to burn when it is exposed to incident heat fluxes greater than 50 kW/m 2, while ignition will also occur within a matter of minutes at heat fluxes of 25 kW/m 2 in cases where the cover sheets become compromised and the core is directly exposed to heating.

365 Professor Bisby, noting the observations made during his experiments when increasing the incident heat flux from 25 kW/m 2 to 75 kW/m 2, expressed the same opinion as that made in relation to Alucobond PE. Namely, that in cases involving the substantial use of Alucobond Plus on the outside of buildings, in the manner recommended in the marketing material of the Alucobond products, in the event of a significant fire developing within or adjacent to a building which is clad with Alucobond Plus, where Alucobond Plus is directly exposed to heating from the fire for any appreciable and continuing period of time, ignition and burning of the core was likely. However, the experts jointly noted that, as with Professor Bisby’s experiments with Alucobond PE, the experiments only directly showed the reaction-to-fire hazards of Alucobond Plus consistent with the dimension and nature of the experiments.

366 The experts also agreed that while the aluminium cover sheets provided some protection, in practice, the cover sheets could not be relied upon to protect the Alucobond Plus core absolutely. The experts noted that mechanical separation of the front aluminium face occurred in each of the experiments where the samples were not through-fixed.

367 The experts noted that the effect of changing the fixing conditions impacted the manner of mechanical separation of the front aluminium cover sheet, modifying the manner and time at which significant direct thermal exposure to the core occurred, thereby impacting the extent and manner of burning and downward mobility of the core. The experts noted that the extent to which the various fixing methods were representative of the application of Alucobond Plus in actual cladding applications would depend on the particular cladding systems under consideration.

368 The experts particularly noted that in the case of panels larger than those tested by Professor Bisby, the cover sheets were likely to delay heating and oozing of the core material, thereby delaying exposure of the core to oxygen – reducing the heat flux conducted through the core material. The experts noted that this could reduce the likelihood of flame spread to below that of the core material by itself, and therefore, the protection provided could be significant away from areas of severe heat flux exposure.

369 The experts also agreed that Mr Carrascal’s experiments showed that the core of Alucobond Plus melts, swells and begins to mobilise downwards in less than five minutes at a heat flux of only 17 kW/m 2. Additionally, Professor Bisby’s experiments show burning core that mobilises downwards may collect on horizontal surfaces, where it may continue to burn, albeit for a relatively short duration in the absence of an external heat flux. The extent to which ongoing burning may occur in a real cladding fire event, or would be sufficient to ignite other combustible material, would depend on the system configuration and other materials present, thereby requiring case-by-case consideration.

370 The key discussion between the experts, which continued the discussion from Expert Group 2, was the extent to which Alucobond Plus could be said to sustain external flame spread. This was, in substance, one of the only areas of substantive disagreement between the experts.

371 Professor Bisby noted the same disagreement raised in Expert Group 2 with respect to Mr Carrascal’s LIFT experiments, and Mr Carrascal’s opinion that those experiments suggested a critical heat flux for upward vertical flame spread of 10 kW/m 2. Professor Bisby’s view was that Mr Carrascal’s results were only strictly applicable to the particular test conditions used, and tests where the majority of the core material was permitted to fall away before it could become involved in burning. Professor Bisby’s view was that the result may be unconservative compared to potential real cladding fire scenarios where the core material may be less likely to fall away so readily.

372 In the Group 3 Joint Report, Associate Professor Lange responded to Professor Bisby’s criticisms stating that where upwards flame spread is self-sustaining, it is inherently acceleratory due to the feedback between the flame and the surface of the material in advance of the pyrolysis front, meaning that if any quantity of a material is burning then flame spread will occur. Associate Professor Lange stated that in Mr Carrascal’s experiments of Alucobond Plus, there is too little energy input to the system from either the flames from the material burning, or the external source, such that there is a critical heat flux for flame spread.

373 Associate Professor Lange further stated that where the Alucobond Plus core is unexposed, then it may remain in situ. However, there is limited oxygen present to participate in a combustion reaction, making flame spread and burning generally difficult. On the other hand, where the cover sheet is not present (due to detachment or oxidation), the core material is unlikely to remain in situ as a result of its mechanical behaviour when heated, which means that vertical flame spread cannot occur. Associate Professor Lange noted that detachment of the burning material was observed in five of the eight tests prior to self-extinguishment and cessation of flame spread. However, in the other three tests, self-extinguishment was observed prior to detachment of the last of the burning material. Associate Professor Lange stated that in all instances, the flame spread velocity prior to detachment of the final burning material was very low and tending to zero. Associate Professor Lange affirmed his position that Mr Carrascal’s experiments indicate that that there is likely to be very limited flame spread via the core of the material, in the absence of a significant external heat flux.

374 Professor Bisby repeated his view that the assertions could not be generalised to the use of Alucobond Plus within cladding systems. Professor Torero also noted that while Mr Carrascal’s observations for the experiments were valid for the tests he conducted, whether they could be generalised or extrapolated to a specific building application was a matter for a competent professional to decide.

375 The experts agreed that the conditions of Mr Carrascal’s testing are not representative of those typically expected in a cladding fire scenario in terms of the severity of heating imposed. Professor Bisby also sought to extend this observation to the physical responses of the samples (namely, in relation to the core being allowed to fall away from the sample), stating that the outcomes of Mr Carrascal’s tests could not be easily generalised to other sizes, geometries, cladding system configurations, heat fluxes, or heat flux decay conditions.

376 The experts also noted that when products are exposed to heat, they experience different behaviours as a function of the heat flux applied. Professor Bisby argued that building fires venting from windows can be expected to generate external heat fluxes to Alucobond Plus well in excess of 75 kW/m 2, and well beyond the 40 kW/m 2 used in Mr Carrascal’s experiments.

377 While Professor Torero and Associate Professor Lange both accepted this to be the case, they noted that it was not necessary to conduct tests at these heat fluxes if the behaviours of interest had been identified to occur at a heat flux threshold below that value. It was appropriate, to determine the critical heat flux for flame spread, for Mr Carrascal to conduct the test at 40 kW/m 2, as that enabled the experiment to observe the cessation of flame spread, being the relevant behaviour of interest.

378 In relation to the differing views on the ability of Alucobond Plus to support flame spread, Professor Torero stated, what is, in my view, the key takeaway. Namely, Professor Torero noted that while the threshold value (critical heat flux for flame spread of 10 kW/m 2) was conceptually correct, the figure could only be extrapolated with great caution given that it stemmed from a series of experiments conducted for a specific purpose. Professor Bisby noted his agreement with Professor Torero. While Associate Professor Lange also agreed that the figure should be treated with caution, he added that for the purposes of the discussion, the demonstration that there was such a threshold value is what was most relevant.

379 Professor Torero expanded on this over the course of the expert conclave, making the following statements:

[T]here is the debate of whether [the flame] will stop spreading. So Mr Carrascal mentions that there is a critical heat flux at which it will not continue to spread and Professor Bisby indicates that he is not comfortable with the universality of that statement – and because it depends on the conditions and the characteristics and so forth. The reality is they are both right…

[U]nder certain conditions the flame will become shorter than the area that is burning and then it cannot spread. Now, those conditions are complicated to calculate. But this is an advantage that we could envision the Alucobond Plus will potentially have, that it can lead to conditions, under certain conditions of design, where effectively we can say that it will not spread. Are those conditions going to be universal? No. Are those conditions going to be difficult to calculate and interpret? Yes… But are we capable of approximating those conditions in a conservative way? Yes. And we will actually take results, like the tests of Mr Carrascal, and try to see to what extent those can be extrapolated appropriately because the fact that we can condition the possibility of it not spreading is a great advantage.

380 Ultimately, as was discussed in relation to the evidence of Expert Group 2, what the critical heat flux for flame spread of Alucobond Plus’ core is, in isolation, is of more academic than practical relevance to these proceedings. As was noted by Associate Professor Lange during the Expert Group 2 conclave, not all experiments are designed to be a reflection of reality. As Professor Torero noted, experiments such as Mr Carrascal’s contribute to the data and knowledge that competent FSEs can use to develop an appropriate fire engineering design. The risk that Alucobond Plus may propagate flame spread away from an external source is relevant to how its use impacts risks to life and/or property. However, in any case, this is ultimately a function of a number of variables that must be considered on a case-by-case basis by a competent FSE. As the experts concluded in relation to Expert Group 2, the more pertinent question is how the results of the tests are interpreted and used. The specific critical heat flux for flame spread, as calculated by Mr Carrascal pursuant to his experiments, is of little relevance to these proceedings outside of this broader context.

381 In the Group 3 Joint Report, the experts agreed that their response regarding the risks to life and/or property presented by the use of Alucobond Plus was largely the same as the response given in relation to Alucobond PE. This was not substantively explored in any further detail during the trial.

5.3.3.3 To what extent can any risks to life and/or property identified in respons e to question 8 be mitigated by the design of the building as a whole?

382 Again, in the Group 3 Joint Report, the experts noted that their response regarding the extent to which any risks to life and/or property could be mitigated by the design of the building as a whole was largely the same as their response in relation to Alucobond PE. The experts noted in light of the slightly different reaction-to-fire behaviours of the core materials, where Alucobond PE required specific measures considering the potential for molten and burning polymer flowing downwards, in the context of Alucobond Plus, the relevant consideration would be burning polymer falling downwards.

383 Professor Torero stated the following during the expert conclave, with which Professor Bisby agreed:

[W]e are dealing with a material that has, in many ways, a better performance but in [some] ways is slightly more complicated to analyse. So while we can take some advantage in the design process of this better reaction-to-fire characteristics we have to exercise potentially a lot more caution in the way in which we take advantage of this and be quite conservative in our approach.

5.3.4 Shore Building and Five Dock Building

5.3.4.1 Did the use of Alucobond PE on the Shore Building as part of or as an attachment to an external wall or building element materially increase the risks to life and/or property in the event of a fire? If the answer is “yes”, could Alucobond PE have been used in a way that did not present such risks and, if so, how?

384 Neither Professor Bisby nor Associate Professor Lange undertook a detailed assessment of the Shore Building or reviewed any fire safety strategy of the building. As such, neither of them were able to provide specific commentary on the issue beyond the general hazards associated with the reaction-to-fire properties of Alucobond PE. The experts noted generally in the Group 3 Joint Report that the hazards associated with the reaction-to-fire behaviours of Alucobond PE, which have been outlined above, were relevant to the use of Alucobond PE on the Shore Building. The experts again noted that quantifying or assessing the risks to life and/or property arising from the use of Alucobond PE on the Shore Building required consideration of the potential external fire spread mechanisms via the building’s façade and the interactions with, and impacts upon, the overall fire safety strategy of the building.

385 During the expert conclave, the highest Professor Bisby appeared to be able to put the position was that all of the hazards relevant to the use of Alucobond PE on the Shore Building, unless mitigated in design, would “almost certainly increase the risks to life and property in the event of a fire as compared with a non-combustible but otherwise equivalent product, all other factors about the building being equal”.

386 Professor Bisby again sought to create a distinction between what he considered theoretically possible, and practice in reality. Professor Bisby stated:

Of course, in principle, Alucobond PE could have been used in a way that… minimises or makes acceptable such risks [to life and property]… In practice, justifying any substantial use would require employing, again, notably, with some cost in both time and money presumably, a careful and competent fire engineering designer to develop a suitably quantified and technically evidenced performance solution accounting for all of the relevant features in the building. Whether this is realistic within the Australian design context has already been discussed at some length.

387 Professor Torero was the only expert who had conducted a review of the use of Alucobond PE on the Shore Building. The analysis conducted by Professor Torero was intentionally simple, considering only the quantity and location of Alucobond PE on the building prior to its removal, which can be seen in the images at [58 ] above.

388 In his expert report, Professor Torero noted that all of the Alucobond PE panels on the Shore Building were located on levels three and four (being the upper two floors of the building), and therefore, the two key scenarios for consideration would be a fire on the third floor and a fire on the fourth floor.

389 Professor Torero noted that, for the third floor, the fire would have to be an internal fire that would activate fire alarms and start the onset of evacuation. A fire on the fourth floor, on the other hand, could occur internally representing a scenario similar to the one on the third floor, or externally, if a fire was to be started in the terraces. In the case of an external fire on the fourth floor, smoke detection would not activate until the fire penetrated into any of the units, meaning that egress from the building could have been delayed.

390 It is helpful to extract Professor Torero’s analysis on the Shore Building in some detail:

Given the presence of the terraces, a fire starting on the third floor cannot progress vertically, thus fire spread will be limited by lateral fire spread over the ACP. A fire on the fourth floor cannot progress vertically, but the molten polyethylene will pool underneath the ACP intensifying the fire and potentially supporting lateral fire spread. This was a key mechanism of fire spread in the Grenfell Tower fire, nevertheless, lateral progression of the fire was very slow (several hours). The hazard condition for occupants will be the re-entry of the fire. If this was to occur, fire alarms will be activated and occupants will evacuate in approximately 2-3 minutes, if standard pre-movement and egress times are used.

In all of these scenarios, the fire cannot progress vertically, so the risk is clearly one of lateral fire spread… Using the fastest lateral fire spread rates from the Grenfell Tower fire it can be estimated that in 3 minutes a fire cannot spread laterally beyond a metre… Thus, the maximum possible fire dimensions will be one metre of panel. A fire of this size will be unlikely to ignite a fire on the fourth floor, if it was to start in the third floor. Therefore, the one-floor-fire scenario will not be compromised by the ACP and adjacent buildings will not be affected.

It is clear that for both scenarios, it is possible for polyethylene to drop and ignite combustible materials below the area of the fire. This will be of greater concern for a fire on the third floor. Nevertheless, there are no combustible materials present in significant quantities below the ACPs, therefore any fire event below will be very small and short lived. In a similar manner, the main risk of a fire fuelled by molten polyethylene on the fourth floor will be the ACPs themselves. The quantity of polyethylene is small therefore the pool created by the molten polyethylene will also be of a very small radius.

The potential contribution of the ACPs to the intensity and duration of internal fires will represent no challenge to the fire resistance of all the internal partitions, thus the protection of the internal means of egress will remained [sic] unchanged by the ACPs. The egress strategy will therefore be unaffected.

As the panels burn, they will deform and most likely fall off. This will only be a relevant issue if the fire starts on the third floor. In this case, the ignition of the panel would have been due to an internal event that would have had to attain very severe conditions before breaking out and igniting the panel. Typically, the characteristic time for an internal fire to attain those conditions would be of the order of 5 minutes. Fire alarms would have been activated and the fire authorities would have been informed.

(References omitted.)

391 Professor Torero’s analysis was intentionally simple, noting that a more detailed analysis should be done if ACPs were to be retained for the Shore Building. The analysis was not intended to provide a complete justification that supported the ideal use of ACPs on the Shore Building.

392 However, the analysis was undertaken to demonstrate that an adequate analysis could enable materials and products such as Alucobond PE to be used correctly and with adequate safety. The analysis, despite its simplicity, shows that the use of ACPs on the Shore Building did not add significant additional risk to occupants and firefighters, and that the potential for increased damage was limited by the absence of vertical fire spread.

393 Professor Torero also noted that the analysis on the Shore Building provides a clear example of why an explicit assessment of performance is required to establish the risks introduced by ACPs and why general statements of performance cannot be made.

5.3.4.2 Did the use of Alucobond Plus on the Five Dock Building as part of or as an attachment to an external wall or building element materially increase the risks to life and/or property in the event of a fire? If the answer is “yes”, could Alucobond Plus have been used in a way that did not present such risks and, if so, how?

394 The experts again agreed that the reaction-to-fire behaviours of Alucobond Plus, as discussed above, are relevant to the use of the product on the Five Dock Building. The experts agreed that in order to assess the risks to life and/or property arising from the use of the product again requires consideration of the potential external fire spread mechanisms, and the interactions with and impact upon the overall fire safety strategy of the building.

395 Again, neither Professor Bisby nor Associate Professor Lange had undertaken a detailed assessment of the fire safety strategy of the Five Dock Building and were, therefore, unable to specifically respond to the issue. Professor Bisby stated, during the expert conclave, that his comments on the use of Alucobond Plus on the Five Dock Building were the same as the comments made regarding the use of Alucobond PE on the Shore Building.

396 Professor Torero, again, conducted a relatively simple analysis of the amount and location of Alucobond Plus on the Five Dock Building (although, unlike the Shore Building, Professor Torero was unable to visit the Five Dock Building in person and was unable to assess the building in detail). Professor Torero also reviewed the FER prepared by BCA Innovations in relation to the Five Dock Building dated 29 November 2017.

397 Professor Torero noted in his expert report that BCA Innovations’ report, while identifying that a Performance Solution for the building was required, failed to conduct a comprehensive analysis of the impact that each Performance Solution had on the overall performance of the building. Professor Torero also noted that the entire DtS Solution was predicated on the assumption that the fire would be contained within the unit of origin, and that the definition of design fires in the report did not consider a multiple-storey fire. Professor Torero noted that in the absence of a demonstration that the underlying assumptions implied in the accepted design fires are met, particularly considering the possibility that the building’s façade could affect the spread of a fire beyond the unit of origin, the performance assessment conducted by BCA Innovations was inappropriate.

398 Again, it is helpful to extract Professor Torero’s analysis of the Five Dock Building in his expert report in some detail:

The fire engineering report establishes that the Five Dock Building is designed to allow for full evacuation of all occupants, including occupants with disabilities. The expected number of occupants is small (total of 157 occupants). The building utilises multiple levels of compartmentation protecting means of egress with a high level of redundancy. The approach towards detection and alarm is designed to deliver an optimized egress process. Thus, occupants will be expected to evacuate and the detection and compartmentation provisions are expected to enable evacuation to proceed safely. The Fire Engineering report does not provide any quantification. Therefore, it is not possible to establish the exact margin of safety, nevertheless, a simple analysis using commonly accepted approaches will show that the approach provides ample margin of safety, redundancy and robustness for the egress process.

The Five Dock Building provides a different type of example because it illustrates a scenario where the poor design and use of a product can introduce risks that cannot be mitigated even by the use of a product with the fire performance characteristics exhibited by Alucobond Plus. In this case, significant alterations to the fire safety strategy and building design are necessary to deliver a building that complies with the level of risk acceptable to the BCA.

The chosen fire safety strategy relies on containing the fire within one floor but nevertheless does not provide any assessment by which the design of the façade will support this to be the case…

Further, BCA Innovations could instead also have relied on the existing CodeMark for Alucobond Plus and have used the requirements for a façade as stated therein. Had Alucobond Plus been used in the façade of the Five Dock Building, in accordance with the requirements of the CodeMark certificate, then a Deemed-to-Satisfy solution may have been proposed for the Five Dock Building. This is provided a valid CodeMark certificate had been issued and the requirements on the CodeMark certificate had been adhered to. While, a BCA Professional would be entitled to rely on clause A2.2 of the BCA as evidence that the certified product could be used in compliance with the BCA, due diligence would have still been required. Due diligence is necessary to establish that all assumptions embedded in the Deemed-to-Satisfy solution would have still been met. This analysis would have demonstrated that a fire would have inevitably extended beyond the floor of origin. This would have then required a Performance Solution…

The detailed analysis of the Five Dock Building required to prepare a performance solution for the Building, would have to have regard to the presence and configuration of the Alucobond Plus, in the context of the overall fire performance of the building. As I have explained previously in this report, any analysis of the fire performance of a product, and the building as a whole, is complex and requires the consideration number of interrelated factors. In the context of the Five Dock Building, these considerations may include:

a) the fire safety strategy;

b) the properties and relative fire performance of Alucobond Plus (when compared to Alucobond PE);

c) the inclusion of any other fire safety features of the building;

d) the proximity of the Five Dock Building to other buildings;

e) the fire brigade response times and response protocols;

f) the nature of the occupants and egress patterns;

g) the overall fire safety system (eg. shelter in place, staggered evacuation, full evacuation); and

h) the design and construction of the façade system and the proposed method of installation.

This list is non-exhaustive, and it is not possible to provide an exhaustive list of factors which will be considered. However, it is important to note there are a number of factors unrelated to the façade, or the products used in the façade system, which will influence the fire performance of the building, and in turn, the ability of the building to comply with the BCA.

(References omitted.)

399 Professor Torero concluded that a detailed analysis of the Five Dock Building would most likely result in the redesign of the fire safety provisions as well as a significant redesign of the building façade. Professor Torero also agreed with Professor Bisby’s conclusion that:

[I]n the case of the Five Dock Building, the use of Alucobond Plus across five floors on the Eastern elevation of the building, including around balconies and impinging into windows, would increase the risk of vertical and horizontal fire spread across floors, and a re-entry of the fire (through the balconies and windows) into further components.

5.3.4.3 Conclusions on the evidence of Expert Group 3

400 A particular takeaway of the Expert Group 3 conclave was that Alucobond PE and Alucobond Plus can each be used on a building in a manner that is generally safe and compliant. At a theoretical level, this was at least common ground between the experts. However, as each of the experts clearly agreed, the use of any particular product within a building must be considered within the context of the overall fire safety strategy of the building. In the context of Alucobond PE and Alucobond Plus, given their reaction-to-fire properties, while it was possible for the product to be used in a safe (and BCA compliant) manner, a competent FSE would need to undertake a careful assessment of the overall fire safety strategy. This would include, for example, which product is being used, where it is being used, how much is being used, how it is being affixed, what other products make up the overall façade system, the nature of the building (eg, height, use, number of occupants, etc), fire mitigation strategies, egress times, location of exits, etc. Given that each of these are relevant factors that go towards determining whether a particular building is overall compliant, or otherwise has a tolerable level of fire risk, use of Alucobond PE and Alucobond Plus can be theoretically used in a manner that is safe and compliant, if properly assessed and used by competent FSEs.

401 As Professor Torero explained during his evidence, the overall fire safety strategy is the dominant factor in determining what risks to life and property are presented by the use of Alucobond PE or Alucobond Plus. Therefore, I find that it is possible for the Alucobond products to be used in a manner which is safe and compliant depending on their use in a particular building.

402 However, in terms of ensuring safe and compliant use, there were a number of relevant issues discussed, which are as follows:

(a) evidence was given regarding the different levels of competency during the relevant period. In particular, Professor Torero and Associate Professor Lange spoke about how prior to the Grenfell Fire, there generally appeared to be a significant gap in the profession’s ability to properly assess the fire risk posed by the more sophisticated façade systems;

(b) Professor Torero also spoke partly to the lack of available knowledge or understanding which led to the creation of the cladding library at the University of Queensland, and the development of CPD programs to assist skill development in the area;

(c) Professor Bisby, a number of times, referred to his understanding from Expert Group 4-5 that at the relevant time in Australia, FSEs appeared to be rarely engaged in such projects, based on the industry’s understanding that the panels were DtS compliant, such that no one would have had the sufficient competency to assess the fire risk at the time. Even if engaged, as noted above, Associate Professor Lange and Professor Torero noted the very wide degrees of variation in competency in the area; and

(d) Professor Torero noted his expectation that manufacturers and suppliers needed to ensure they were disclosing clear, accurate, and reliable information regarding the fire performance of their products. Professor Torero noted that this information was required for FSEs to be able to do their jobs properly. Professor Torero noted that a competent FSE would be expected to understand the limitations of any particular classification, and seek further information from manufacturers or suppliers and that classification and test data would need to be carefully reviewed to reasonably extrapolate to any real-life application since, in reality, reaction-to-fire behaviour would depend on so many different factors. An FSE would not expect to rely purely on information disclosed in a brochure since it would not be sufficient to properly consider the reaction-to-fire properties.

5.4 Expert Group 4-5 – Fire engineers (practising professionals)

403 Due to the close nature of the matters raised in Expert Group 4 and 5, they were combined. The summary of Expert Group 4-5 is extracted below:

Davis Report 2 – 22 Sep 2023 |
| | | Professor Jose Torero | Torero Report – 10 Mar 2023 |
| | HVG | Mr Ian Moore | Moore Report – 5 Dec 2022 |
| | Joint Report of Mr Kip, Mr Davis, Mr Moore, Professor Bisby and Professor Torero dated 3 April 2024 (“Group 4-5 Joint Report’) | | |
404 The combined Expert Group 4-5 consisted of practising FSEs, with the focus of the group generally directed at the practice of FSEs in Australia during the relevant period, as it applied to ACPs. This included consideration of how the BCA applied to ACPs, how and/or when FSEs were engaged in projects using ACPs during the relevant period, and how the use of ACPs were assessed by FSEs.

405 In addition to Professor Bisby and Professor Torero, Expert Group 4-5 consisted of the following:

(a) Mr Stephen Kip: Mr Kip is the director of SKIP Consulting Pty Ltd, a fire safety engineering and building regulatory consultancy. Mr Kip was previously a building surveyor, and from 2000, was registered as an FSE in Victoria. Mr Kip has taught building regulations, building codes, and fire safety engineering at several TAFE colleges and universities since 1987. He is an adjunct Associate Professor at Victoria University, an honorary Fellow at the University of Melbourne School of Architecture, Building & Planning and one of the independently appointed building industry representatives on the ABCB. Mr Kip has been a member of the ABCB since 2015, and in that role, has been involved in reviewing and approving draft amendments to the BCC and NCC;

(b) Mr Rob Davis: Mr Davis was originally a part-time firefighter from 1979 until 1983. He completed his engineering qualifications in civil and structural engineering at the University of Witwatersrand in South Africa and was employed as a civil engineer in South Africa and Swaziland. In 2000, Mr Davis was registered as a Chartered Engineer through the Institution of Fire Engineers with the Engineering Council UK. Mr Davis migrated to Australia in 2003 and has provided fire safety engineering consultancy services on projects in Australia since then. Mr Davis is registered as a Fire, Civil, Structural and Building Services Engineer on the National Engineering Register, and has a Fire Safety Engineering registration in Queensland, NSW and Victoria. Since 2020, Mr Davis has held the position of Associate Director, Fire Engineering APAC at Total Essential Services Group; and

(c) Mr Ian Moore: Mr Moore is HVG’s only witness. Mr Moore is a materials scientist by first degree, having qualified in 1985 and worked as a research metallurgist, senior materials engineer and forensic material scientist. Mr Moore became an FSE in 1995 and has over 30 years of fire safety and fire investigation experience. Mr Moore was part of the Fire Code Reform Centre research team that developed the first edition of the Centre’s Fire Engineering Guidelines, for use in Australia. Mr Moore is a registered FSE in Victoria, and has held various fire safety engineering consultancy positions, including most recently from February 2021, Associate Fire Safety Team Leader at NJMdesign.

406 A single joint expert report was prepared by Expert Group 4-5, and the experts provided evidence together in a joint expert conclave. The Group 4-5 Joint Report noted that Professor Bisby has no experience of fire safety engineering practice in Australia. Due to this, Professor Bisby’s input on a number of the topics canvassed during the expert conclave was limited.

407 The report also noted that Professor Torero worked in Australia at the University of Queensland. The responses to the questions raised in the joint report in relation to group 4 were noted as primarily being the answers of Messrs Kip, Davis and Moore, taking into account the views of Professors Bisby and Torero.

408 During the trial, the following agenda was prepared for the expert conclave:

1. What “Performance Requirements” were applicable to the use of combustible ACPs as part of or as an attachment to an external wall or building element on Class 2 to 9 Buildings?

2. What was the role and involvement of fire safety engineers in designing, constructing and certifying buildings in respect of combustible ACPs in Australia during the relevant period?

3. How did fire safety engineers assess the proposed use of combustible ACPs as part of or as an attachment to an external wall or building element (and did this change during the relevant period)?

4. What information did fire safety engineers rely upon and/or could they properly rely upon when assessing the suitability or compliance of ACPs for use on a building, including product information provided by manufacturers and/or suppliers of ACPs?

5. Did the local and international fire tests used in the marketing material support the use of Alucobond PE or Alucobond Plus as part of a Performance Solution?

6. How (if at all) could Alucobond PE have been used on the Shore Building as part of a Performance Solution such that the building complied with the BCA? In answering this question, please address Mr Davis’ proposed Performance Solution.

7. How (if at all) could Alucobond Plus have been used on the Five Dock Building as part of a Performance Solution such that the building complied with the BCA? In answering this question, please address Mr Davis’ proposed Performance Solution.

5.4.1 What “Performance Requirements” were applicable to the use of combustible ACPs as part of or as an attachment to an external wall or building element on Class 2 to 9 Buildings?

409 The BCA identifies a number of performance requirements (from CP1 to CP9). Without seeking to extract the performance requirements in full, they broadly deal with the following:

(1) CP1 deals with structural elements, and requires the elements of a building to, to the degree necessary, maintain structural stability during a fire appropriate to the building (including considerations such as the function and use of the building, the fire load and potential fire intensity, the height of the building, evacuation time, etc);

(2) CP2 deals with building elements which will, to the degree necessary, avoid the spread of fire to exits, to sole-occupancy units and public corridors, between buildings, and within a building. The avoidance of the spread of fire must be appropriate to the nature of the building, function or use of the building, the fire load, the potential fire intensity, the fire hazard, the number of storeys in the building, its proximity to other property, any active fire safety systems installed in the building, the size of any fire compartment, fire brigade intervention and other elements they support, and the evacuation time;

(3) CP3 requires a building to be protected from the spread of fire and smoke to allow sufficient time for the orderly evacuation of the building in an emergency;

(4) CP4 requires that linings, materials and assemblies in a Class 2 to 9 building, in order to maintain tenable conditions during evacuation, must, to the degree necessary, resist the spread of fire and limit the generation of smoke, heat, and any toxic gases likely to be produced. They must do so appropriate to the evacuation time, the number, mobility and other characteristics of occupants, the function or use of the building, and any active fire safety systems installed in the building;

(5) CP5 requires concrete external walls that could collapse as a complete panel to be designed so that in the event of fire within the building, the likelihood of outward collapse is avoided;

(6) CP6 requires a building to have elements which will, to the degree necessary, avoid the spread of fire from service equipment having a high fire hazard or potential for explosion;

(7) CP7 requires a building to have elements which will, to the degree necessary, avoid the spread of fire so that emergency equipment provided in a building will continue to operate for a period of time necessary to ensure the intended function of the equipment is maintained during a fire;

(8) CP8 requires that a building element provided to resist the spread of fire must be protected to the degree necessary so that an adequate level of performance is maintained where openings, constructions joints and the like occur, and where penetrations occur for building services; and

(9) CP9 requires access to be provided to and around a building to the degree necessary for fire brigade vehicles and personnel to facilitate intervention appropriate to the function or use of the building, the fire load, the potential fire intensity, the fire hazard, any active fire safety systems installed in the building, and the size of any fire compartment.

410 The experts provided a succinct answer to this issue in the Group 4-5 Joint Report. They noted that the primary performance requirement for the use of a combustible ACP on a Class 2-9 building is CP2, which has within it all the primary aspects (heads of consideration) an FSE needs to look at. CP2 is extracted in full below:

CP2

(a) A building must have elements which will, to the degree necessary, avoid the spread of fire–

(i) to exits; and

(ii) to sole-occupancy units and public corridors; and

(iii) between buildings; and

(iv) in a building.

(b) Avoidance of the spread of fire referred to in (a) must be appropriate to–

(i) the function or use of the building; and

(ii) the fire load; and

(iii) the potential fire intensity; and

(iv) the fire hazard; and

(v) the number of storeys in the building; and

(vi) its proximity to other property; and

(vii) any active fire safety systems installed in the building; and

(viii) the size of any fire compartment; and

(ix) fire brigade intervention; and

(x) other elements they support; and

(xi) the evacuation time.

411 The experts also noted that other performance requirements were secondary in that they dealt with related or secondary aspects, which could be relevant depending upon the specifics of the construction proposed or site of the building. The experts explained in further detail that:

(a) as CP1 deals with structural elements (and ACPs are usually not structural elements), CP1 can apply where ACPs are part of or attached to a structural element;

(b) where an ACP’s location and/or method of construction enabled it to be ignited so that smoke or fire could spread into a building, or near evacuation routes, CP4 could also apply;

(d) CP9 would apply to a building that included ACP cladding if the ACP impacted exit locations, fire services locations, and fire brigade vehicular access.

412 There was a minor disagreement between the experts to the applicability of CP1 to ACPs. In particular, Mr Davis disagreed with the view that CP1 could apply. Mr Davis’ view was that CP1 dealt with structural stability during a fire and that, given that the ACP was an attachment to the structure rather than being structural itself, CP1 would not apply. Mr Davis did not concede this position on cross-examination, but rather maintained his position that CP1 does not apply to ACPs, including where the ACP may be said to form part of an external wall, because ACPs do not affect a building’s structural stability.

413 On my interpretation of the performance requirements, I prefer the joint views of Mr Kip and Mr Moore as expressed in the expert conclave and joint report, namely that CP1 is relevant to the use of ACPs when ACPs are part of or attached to a structural element. The performance requirement requires consideration to be given to maintaining the structural stability of the building, which may become relevant depending on how ACPs are used on the particular building.

414 I also accept the following position outlined by Mr Moore during the expert conclave that CP1 would not be directed to ACPs, by themselves:

[T]he stability of the actual panel itself is not what CP1 would be about. I would look at it more as the panels or the attachments are not to affect the structural stability of the wall, assuming it’s a fire-rated wall, in terms of insulation load bearing capacity and integrity. So the method of fixing screws or whatever cannot affect the wall’s performance, not the actual attachment element itself.

5.4.2 What was the role and involvement of FSE s in designing, constructing and certifying buildings in respect of combustible ACPs in Australia during the relevant period?

415 The experts agreed that it was not common practice for FSEs to assess the proposed use of ACPs as part of or as an attachment to an external wall or building element in Australia during the relevant period.

416 The experts noted that the primary design responsibility, including product selection, was usually that of the architect or a builder. Separately, the role of identifying deviations from the DtS Provisions of the BCA was the role of the building certifier. The experts agreed that during the relevant period, the use of ACPs as part of or as an attachment to an external wall or building element was considered by certifiers to be compliant with the BCA DtS Provisions. This matter is the subject of further discussion in the context of Expert Group 6.

417 The experts agreed that it was generally only where deviations from the DtS Provisions of the BCA were identified by a building certifier that FSEs were engaged to assess the use of ACPs. In that context, the role of FSEs was generally limited to the preparation of a performance or alternative solution, where deviations from the BCA DtS Provisions were identified. In that role, the involvement of the FSE could arise in respect of questions of design, during construction, or at the point of certification.

418 While, in Mr Davis’ and Mr Moore’s experience, it was not unknown for an FSE to become involved in the assessment of a Performance Solution, the experts agreed that this was not common practice during the relevant period.

419 The experts also noted that, from August 2018, the product ban under s 9(1) of the BPS Act effectively negated any reason for an FSE, or any other person, to assess the proposed use of combustible ACPs, other than for a Performance Solution for an ACP with a core of no more than 30% PE.

5.4.3 How did FSE s assess the proposed use of combustible ACPs as part of or as an attachment to an external wall or building element (and did this change during the relevant period)?

420 The experts agreed that combustible ACPs are and were not in the relevant period properly capable of DtS compliance under the BCA and could only have been used pursuant to a proper Performance Solution or alternative solution. The experts agreed that, during the relevant period, FSEs should always have been requested to prepare a fire safety Performance Solution for the use of combustible ACPs on an external wall of a Class 2-9 building. The only exception noted by the experts in their joint report was if there was a valid CodeMark Certificate of Conformity for fire safety that applied to every possible use, location and installation on the building, and where there were no other fire safety Performance Solutions proposed.

421 The experts also outlined, in practice, what the process for considering, analysing, and preparing a Performance Solution would look like.

422 Mr Kip outlined, during the course of the expert conclave, that the preparation of a Performance Solution involved a two-step process. Firstly, an FSE must prepare an FEB. In the FEB, an FSE is required to review, assess and satisfy the relevant heads of consideration in the performance requirements. Given the qualitative nature of the performance requirements, the FEB is expected to adequately deal with the interests of all relevant stakeholders. This would include, for example, the relevant client or owner, architect, certifier, fire brigade, and occupiers.

423 The FSE would then engage with relevant stakeholders in relation to the FEB, for their review and agreement. This process of engagement is designed to allow all relevant stakeholders to have their needs addressed in the proposed Performance Solution.

424 If all stakeholders agree, the FSE prepares an FER, which, in effect, forms the relevant Performance Solution.

425 Mr Kip explained the process in his oral evidence as follows (with which Mr Davis and Mr Moore agreed):

[The] process is set out in the International Fire Engineering Guidelines. It requires the fire safety engineer to [prepare] a FEB, as I described in the last question, and then provide that document to all relevant stakeholders for their review and agreement.

In my view, this step is the most important step for a fire safety engineer. The Building Code of Australia is performance based, it may or may not have been discussed yet, your Honour, so that means there are non-measurable qualitative requirements set out by government that describe what a building code needs to achieve with a set of incomplete deemed-to-satisfy provisions. So an owner or a builder can choose to follow the prescriptive deemed-to-satisfy provisions or use appropriately qualified consultants to design the building to those performance requirements.

There are often examples of fire safety matters that are either inappropriate or can be better served by different solutions. So, as I say, that step is really critical. So the fire safety engineer prepares a brief, which says, “This is what I intend to vary from the deemed-to-satisfy provisions and how I intend to satisfy the performance requirements”, then the fire safety engineer has to find out who the relevant stakeholders are, and again, that could be people such as the owner, the architect, the insurer, particularly the fire brigade on fire safety matters, the builder, sometimes tenants in unusual circumstances, and their role is to make sure that what the fire safety engineer is proposing to do, frankly, passes a commonsense test for some of those practitioners but, for the fire brigade, doesn’t adversely affect their firefighting operations. So the fire brigade are, again, perhaps the most relevant to the discussions we are having today.

Again, if any stakeholder does not agree to the proposed FEB then that disagreement has to be resolved before proceeding to the fire engineering report and, again, the legislation is, I would argue, necessarily complex but perhaps you might have a different view, your Honour. So the fire engineering report becomes the performance solution. They are the same thing if the process is followed correctly. But if the process isn’t followed correctly, it doesn’t exist. It’s not a concluded performance solution, it’s just a proposal.

So that fire engineering brief process of bringing the stakeholders into the discussion is really critical to make sure that public safety levels are maintained when we have a qualitative performance based code. Hopefully that makes some commonsense as well. From August 2018, the product ban, under section 91 of the Building Product Safety Act, effectively negated any reason for a fire safety engineer to be involved in those pr[o]scribed combustible ACPs that were banned. So that’s fairly obvious that you wouldn’t need to be involved in.

426 The experts noted that the process by which an FSE assesses a Performance Solution has not changed since the commencement of the relevant period, albeit that since the product ban, there has been no consideration of Performance Solutions for ACPs that have a core of more than 30% PE.

427 Mr Moore provided further detail around how FSEs assessed the particular use of combustible ACPs, stating the following:

I agree with comments by Mr Kip in that that sets out the process of how the reports and the consultation stakeholders are involved. In terms of how you would go about the actual assessment, obviously, you would – I would start looking at where the panels are, the exposure of how those panels can become involved, such as barbecues, if they are on a balcony, car fires, bin fires, if they are down in ground level openings in the walls, such as windows or vent openings, and then look at – from that exposure, look at the conditions the panels would be exposed in terms of temperature and incident radiation, etcetera, and then go to the fire tests, both Australian and international, look at the results those panels got for those tests, look at what those tests exposed those panels to.

So, for example, a test exposed panel to 100 kilowatts per metre squared exposure and the actual building scenarios that you develop was only down at 50, you can have confidence that the panels would behave in a similar or better way than the test. If it’s less, then the test becomes less reliant, or you can put less reliance on the test. So you go through that process and then you also look at risks in terms of other systems within the building, the evacuation routes, are there multiple routes, such as in a shopping centre, so if the fire is on one side, people evacuate to the other side. All of those aspects would still come into it, but the process, as Mr Kip explained, would be the same in terms of stakeholder review, brief, etcetera, etcetera.

428 In his first expert report, Mr Kip considered the fire hazards posed by the use of Alucobond PE and Alucobond Plus, and the use of the products as part of a Performance Solution. Without reference to any particular building or application of Alucobond PE or Alucobond Plus, Mr Kip concluded in his report that it would be difficult and unlikely that a Performance Solution, for Type A or Type B construction, would be possible based on sound engineering principles and stakeholder inputs and requirements. Mr Kip stated that a competent FSE would be likely to refuse to accept the use of Alucobond PE in any circumstances and would be likely to refuse to accept the use of Alucobond Plus, unless significant mitigation measures were introduced.

429 Mr Kip also concluded, in relation to Type C construction, that a detailed engineering analysis would be required to consider the risk of fire spread, and that a competent FSE would still be likely to refuse to accept the use of Alucobond PE on external walls, and would be likely to refuse to accept the use of Alucobond Plus in most circumstances unless significant mitigation measures were introduced.

430 Mr Kip’s position was the subject of significant challenge over the course of the expert conclave. In particular, Mr Kip was taken to a number of previous reports in which he was involved which 3A suggested showed that combustible ACPs could be used appropriately on external walls of Class 2 to 9 buildings.

431 Mr Kip was first referred to an FER prepared in relation to a secondary school building at 135 Aphrasia Street, Newtown, Victoria 3220 on 1 December 2014. Mr Kip stated in his first expert report that this was the only time he had been engaged to consider a Performance Solution for the use of an ACP.

432 The building at 135 Aphrasia Street consisted of a three-storey Class 9b building of Type A construction. The building did not have sprinklers. Mr Kip was requested to demonstrate that the proposed building, which included a proposal to use Alucobond Plus, satisfied the requirements of the BCA as an alternative solution.

433 Mr Kip stated in his first report that the building was of low-rise, the amount and location of ACP was limited, the building was a private secondary school (ie, a managed non-residential use with supervisory staff) and the relevant fire brigade agreed that the above factors and their operational response to the site was sufficient to allow the installation of the panels.

434 The report outlined Mr Kip’s analysis of the proposed use in further detail:

The product has been tested to [Australian Standard] 1530.3-1999 and achieve [sic] an ignitability test, spread of flame index and heat evolved index of 0 (range of 0-20), and a smoked [sic] developed index of 1 (range of 1-10).

Despite these excellent test results the product does not meet the strict test requirements for non-combustibility and because of this the product was submitted to the Australian Building Codes Board Codemark TM scheme for issue of a certificate of conformity. That certificate confirms the product meets performance requirements CP1 & CP2 of the BCA subject to;

…

• Buildings of Type A Construction are required to be protected throughout with a sprinkler system complying with Specification E1.5 of the BCA.

As this is a Type A building and is not sprinkler protected, the installation requires assessment as a BCA alternative Solution. …

For tall buildings this is especially important as fire spread vertically is well known and understood and a flashover fire in a storey can explosively exit the space and spread up the façade. For relatively large predominantly low-rise buildings this is less well understood and height ceases to be accurate limiter (or indicator) of fire spread. For example a large fire within the proposed new area is at least 6m from the existing parts of the building and therefore is highly unlikely to rapidly spread to this part via the external building façade.

Additionally, the roof will often fail due to its lightweight construction… and vent the products of the fire through the roof. Whilst these fires can be very severe and provide fire-fighting challenges, they are not by themselves significantly worse than a fire in a BCA DtS compliant building of Type C construction, which in that case would allow external walls to be non-combustible, as those walls are > 18m from allotment boundaries. All of these matters have no substantial impact on life safety as building evacuation will have occurred before flashover due to alert, upright occupants and efficient egress out of the building.

The requirement for external walls to be non-combustible in this case is therefore unduly onerous in this circumstance, particularly given the proposed product, and does not significantly improve fire-resistance for the following reasons:

• The new external walls are predominantly two storey and have no combustible single storey and > 18m from the existing two storey part.

• The use of non-combustible external walls will not significantly improve life safety.

• The large amount of external glazing will dominate the fire growth and subsequent fire-fighting operations and these are not controlled by the BCA.

• The roof and supporting structure are not required to be fire-resisting in this case, and the roof covering will be non-combustible.

• The remaining external linings will all be non-combustible, with only the internal structural timber framing, and the areas of Alucobond cladding described in Appendix C being combustible.

Conclusion

Based on the analysis, the BCA provisions for non-combustible external walls are considered not appropriate in the circumstance.

(References omitted.)

435 Mr Kip also signed a report by SKIP Consulting dated 25 May 2017 comprising a peer review of a draft FER on the use of combustible external cladding on 1-25 Harbour Street, Darling Harbour, Sydney. Mr Kip noted that although he was a signatory, the work itself was conducted by his cosignatory, Dr Ian Bennetts. However, Mr Kip also accepted that he had reviewed the letter and agreed with the views of Dr Bennetts.

436 That project consisted of two buildings with 10-storeys, which are connected at ground level, and at the basement levels. Three types of combustible ACPs were used in the project, being Alucobond PE, Alucobest FR (which contained around 55% non-combustible filler), and Alpolic/fr (which contained around 80% non-combustible filler). The SKIP Consulting report noted that the use of Alucobond PE was very limited, being restricted to awnings over ground floor shop fronts.

437 The report noted that the acceptance criteria for the assessment were qualitative, being that the use of non-compliant combustible materials not result in an undue risk of fire spread, and that the use of such materials not compromise the safety of occupants seeking to evacuate or of attending fire brigade personnel.

438 The report assessed the risk from the use of Alucobond PE as follows:

This is used at [sic] part of the awning structure at ground level and is potentially exposed to heating via a flashover/flaming fire within the adjacent space in the building or a local fire initiated directly below the awning. It is noted that the space below the awning is sprinkler protected via heads within the underside of the awning. In the unlikely event of sprinkler failure, this ACP could be ignited by such a fire. Since the awning is a horizontal structure, the effect of a fire below the awning will be to (a) melt the aluminium and (b) the [sic] cause the polyethylene to drip downward and potentially burn off any horizontal surface.

Flaming from [sic] directly from the ACP structure will be limited compared with if the structure was orientated vertically and while the awning structure remains in place, will provide shielding to the level above the canopy. In any case, the burning below the canopy as a result of the melting of the core is unlikely to result in spread between levels compared with the effect of a flashover fire in the adjacent ground level space if there was no awning. Furthermore, combustible cladding is not used for the exterior façade of the building above the awning level.

It is therefore considered that the use of ALUCOBOND®PE awnings as described in the [fire safety engineering report], does not present an undue risk with respect to fire spread. It is also considered that this construction will not present a risk with respect to egress from the adjacent parts of the building.

…

Subject to the description of materials and their usage and installation being as described in the [fire safety engineering report], we consider that the use of these materials will achieve compliance with BCA performance requirements CP2 and CP4.

439 It is also relevant to note the observations made in the report regarding the use of Alucobest FR. The report noted that while similar test evidence as was available in respect of Alpolic/fr, it was not available for Alucobest FR, “given that its core is constructed of at least 55% non-combustible material, it is expected that it will behave significantly better than if the core was constructed only from polyethylene”.

440 The report assessed the risk from the use of Alucobest FR as follows:

This material is used for the roofs above level 6 but… is located above a 1mm thick layer of GALVABOND® steel sheeting and separated from the steel sheeting by 100mm of stone wool… This means that if heated continuously at 350°C, it will maintain its structure and thermal properties. The material is non-combustible but will tend to ‘compress’ when it reaches a higher temperature.

Combustibles within the kitchen/barbecue area on level 6 are the kitchen benches and combustible timber ceiling… This area is sprinkler protected so it can be reasonably assumed that a fire will be dealt with by the sprinklers or by extinguishers if the area is occupied at the time of the fire…

The other potentially significant fire scenario is a flaming/flashover fire in a space below the roof should the sprinklers fail to operate. The presence of the steel sheeting and stone wool will delay heating of the ACP. However, should it be ignited after a period of time, then flame spread will be on the outside of the roof with little contribution to the internal fire and will not spread the fire to other parts of the building. The risks associated with this scenario, in our assessment, are mostly associated with the effects of the unsprinklered internal flaming fire (for which the ACP is not responsible) and therefore it is considered that the presence of ALUCOBEST FR does not pose a significant risk to the building occupants

(Emphasis in original.)

441 Over the course of the cross-examination, Mr Kip sought to create a distinction around how the reports should be interpreted, stating that reports such as the one conducted in relation to 1-25 Harbour Street were dealing with existing buildings, and that the reports were conducted in the context of a post-construction risk assessment of the buildings. Mr Kip’s suggestion was effectively that different standards or considerations would apply at the design stage than would apply in a post-construction environment, however, Mr Kip also accepted that the performance requirements were no different to a building being designed, or a building post-construction.

442 The Respondents argue that the exchanges with Mr Kip reflected poorly on the reliability of his evidence. This is a matter that I have addressed later in these reasons. For the reasons I have outlined there, I am not satisfied that it is appropriate to approach Mr Kip’s evidence with such a degree of caution.

443 Mr Kip was also taken to another report by SKIP Consulting dated 25 May 2017, signed by Mr Kip and Dr Bennetts, comprising a peer review of a draft FER on the use of combustible external cladding on 1151 Creek Road, Carindale, Queensland (Carindale Shopping Centre). Mr Kip stated that the peer review of the draft report regarding the Carindale Shopping Centre was part of the same process undertaken in relation to 1-25 Harbour Street, for the same client.

444 The building has a rise in storeys of four, and is primarily a Class 6 building, with Class 7a (carparks), Class 9b (cinema and library) and Class 5 (offices) structures in some parts of the centre. The building is sprinkler protected. The ACPs used on the building were Alucobond Plus and Alpolic/fr. The report noted that the use of the ACPs were primarily decorative, except with respect to a certain application which may have had a weatherproofing or insulating function.

445 The report noted that the scope of the draft FER was essentially to determine whether the use of the ACPs could be considered to meet the performance requirements of the BCA and whether its use invalidates any of the previous Performance Solutions.

446 The report assessed the risk associated with the use of the ACPs on the building as follows:

The evidence summarised in Section 5 above [regarding various fire tests conducted on Alpolic/fr and Alucobond Plus] and in the [fire safety engineering report] is considered sufficient to demonstrate that the presence of ALUCOBOND® PLUS and ALPOLIC®/fr will have little effect on vertical fire spread and will be resistant to potential internal and external fire exposures. Notwithstanding the ability of ALUCOBOND® PLUS and ALPOLIC®/fr to limit fire spread as stated above, the risk assessment presented in the [fire safety engineering report] recognises other risk control measures including the presence of a sprinkler system. Other aspects that would further mitigate potential fire spread are now considered…:

(a) the ACP is generally limited to “strips” as opposed to large areas,

(b) the larger wall area shown in Figure 5.8 is at the top of the building and fire spread, should it occur, would have much less effect than if the area was at the bottom,

(c) the orientation of much of the ACP… is horizontal and discontinuous and this will greatly limit the burning rate and the likelihood of vertical spread. Horizontal spread would be very limited,

(d) the ACP materials are not readily accessible to the public and therefore are unlikely to be subjected to deliberate external fires, and

(e) for the 3 lowest levels, the ACP is attached to the outside of “balconies” which will reduce the impact on the ACP of a fire from the interior of the building in the event of sprinkler failure.

…

Subject to the description of materials and their usage and installation being as described in the [fire safety engineering report], we consider that the use of the materials will achieve compliance with the relevant BCA performance requirements.

447 Mr Kip clarified, in reviewing the comments made in the report, that his position was not that the Alucobond products could never be used. Rather, Mr Kip accepted that each building required its own assessment of fire risk, given the complex and multi-faceted nature of fire safety assessments.

448 3A referred to a further report prepared by SKIP Consulting, dated 29 September 2023, in relation to 544-550 High Street, Northcote, Victoria 3070. The report constitutes an Audit and Risk Assessment Report dated 29 September 2023.

449 The relevant building contains seven storeys, with five rising above ground level. It is of mixed use (Class 2, 5, 6, 7a), containing 27 apartments and three retail tenancies of Type A construction. Alucobond Plus was fitted to the building in vertical and horizontal continuous lines, as can be seen in the below extract from SKIP Consulting’s report. The Alucobond Plus can be seen as the brown cladding attached around the corner of the building.

450 The report was prepared in the context of an appeal by the owners corporation of the building to the B uilding A ppeals B oard.

451 In July 2017, shortly after the Grenfell Fire, the Victorian Government established the V ictorian C ladding T askforce to investigate the extent of non-compliant external wall cladding used on buildings in Victoria. The VCT developed a risk-assessment tool (RAT) for the audits of buildings state-wide, in order to assess the actual risk of a building with combustible cladding against a number of factors. For buildings with non-compliant combustible cladding, the outcomes were low, moderate, high, or extreme.

452 A preliminary RAT analysis was conducted of the 544-550 High Street building by the V ictorian B uilding A uthority which classified the building as extreme risk.

453 A building notice was issued by the Municipal Building Surveyor of the City of Darebin on 16 December 2022 in respect of the ACP, as well as expanded polystyrene and expanded polystyrene (conpolcrete), identified by Mr Kip respectively as Alucobond Plus, Expanded polystyrene architectural feature strips and QT Eco-series conpolcrete. The building notice noted that the ACPs used on the building were not non-combustible, as required for Type A construction. The notice also stated that the building was a danger to the life, safety, or health of any persons using the building, and required the owners corporation to show cause as to why they should not be required to replace the ACPs from the building with non-combustible cladding.

454 The owners corporation appealed to the BAB in respect of the Surveyor’s failure to cancel the building notice on their request. Mr Kip was engaged by the owners corporation to assess the risk posed by the use of the ACPs on the building, as part of the appeal.

455 Mr Kip conducted his own review of the building and concluded that he disagreed with the preliminary RAT analysis and the views of the VBA, and that, on his analysis, the building was low-risk when the RAT was applied. In making this determination, Mr Kip referred to a number of considerations, including that:

(a) the extent of combustible cladding is less than 50% if the entire façade is included (whereas in the preliminary RAT assessment, the extent of the combustible cladding was determined as between 51-100% of the façade);

(b) the majority of the structure behind the cladding materials was fire-resisting or non-combustible;

(c) the building has sprinklers throughout, reinforced concrete stairways, no combustible cladding near the exits and short exit travel distances;

(d) the building has sprinklers, smoke alarms, and a direct fire brigade connection. Mr Kip determined that the speed of evacuation would be as quick as possible for an apartment building, as a building-wide alarm would be activated once a sprinkler head operated; and

(e) the site, being on the corner of two major roads, whilst creating the potential for traffic management challenges, provided for excellent firefighter set-up and application. The other two boundaries were also set-back or fire resisting.

456 The report noted that while the use of the combustible cladding was not strictly compliant with the BCA (since it did not comply with the DtS Provisions, and no alternative solution was provided to Mr Kip), in Mr Kip’s view, subject to the preparation of a relevant Performance Solution for the cladding that is independently peer reviewed and agreed by the relevant fire brigade, no cladding needed to be removed.

457 Mr Kip noted, particularly in relation to the report on 544-550 High Street, that the RAT assessment was conducted as a triaging tool as an interim measure, and did not constitute an actual fire safety Performance Solution. Again, Mr Kip sought to clarify the distinction which he argued ought to be made when considering the performance requirements in relation to an existing building, as opposed to a building still in the design phase, arguing that the acceptance criteria for such buildings was different. However, Mr Kip accepted that while acceptance criteria may vary, and that he may not have chosen to design the buildings in such a manner, the reports illustrated that combustible ACPs could be used in a manner that complied with the performance requirements of the BCA.

458 When it was specifically put to Mr Kip that his statement in his first expert report – that it was highly unlikely that a 100% PE cored ACP would be approved for use on any building as part of a Performance Solution – was overstated, Mr Kip again sought to distinguish between the reports which were prepared retrospectively in a post-rectification context, compared to the design context in which his comments were made. Mr Kip also clarified that his view was not that it was impossible to use such a product.

459 Professor Torero stated the following in response to Mr Kip’s statement:

I think that would have to be caveated with, “it depends”. You can put the appropriate provisions. Now, there are certain things that you will have to consider like the fire exposure from rubbish bins and, if I’m going to put a combustible material to the ground, I will probably include the potential for arson and there will be a number of different things and it is very unlikely that I will end up with 100 percent PE in the building. But, in essence, as a blank statement, I think it doesn’t include all the necessary caveats that you should put in there that are part of the design process.

5.4.4 What information did FSE s rely upon and/or could they properly rely upon when assessing the suitability or compliance of ACPs for use on a building, including product information provided by manufacturers and/or suppliers of ACPs?

460 The experts outlined the following agreed position in respect of the agenda topic in the Group 4-5 Joint Report:

The information relied upon by FSEs when assessing the suitability or compliance of combustible ACPs for use on a building were in the relevant period and are now the results of fire tests carried out by NATA accredited bodies, or if such fire tests were not available, the results of overseas tests properly understood and contextualised, as well as any available and relevant scientific papers and fire engineering principles generally. The key relevant fire tests in the BCA Volume One were;

a) an Australian Standard (‘ AS ’) 1530.1-1994: Combustibility test for materials (AS 1530.1) test report for the determination of non-combustibility, to then assess compliance with BCA DtS clauses 3.1(b) and 4.1(b) of Specification C1.1 for external walls to be non-combustible,

b) an AS/NZS 1530.3 -1999: Simultaneous determination of ignitability, flame propagation, heat release and smoke release (AS1530.3) test report for the determination of the spread of flame index and smoke developed index of the test sample for assessment of attachments to a part of an external wall required to achieve a F ire R esistance L evel,

c) an AS 1530.4-2005 (or 2014): Fire-resistance tests on elements of construction (AS 1530.4) for the determination of the ability of an attachment to a part of an external wall required to achieve a FRL to prevent ignition and to screen its core material from air for at least 10-minutes (BCA DtS clause 2.4 of Specification C1.1), and/or

d) an AS 5113-2016: Classification of external walls of buildings based on reaction-to-fire performance fire test report to assess one of the criteria to satisfy BCA verification method CV4 (for BCA 2016 Amendment no. 1, from March 2018 onwards).

Relevant international tests included NFPA 285, BS 8414, FM tests and smaller scale tests from the EU, UK and USA.

461 It is helpful at this stage to provide some additional context to how the various Australian tests referred to by the experts in their response relate back to the provisions of the BCA. Of course, the Australian tests are also supplemented by a number of international fire tests.

462 AS 1530 is an Australian Standard relating to the fire testing of building materials, components and structures. The standard is comprised of four parts, but most relevant to these proceedings are parts one, three, and four.

463 Part one, AS 1530.1-1994, is a simple, small-scale test to determine whether a material is considered non-combustible for the purposes of the BCA. The test involves a small-scale cylindrical sample of the material being lowered into a small furnace held at a constant temperature of 750°C, with a pilot flame located above the furnace. The test measures whether the relevant product burns under such circumstances. Where a material is not deemed combustible as determined by AS 1530.1, it is classified as non-combustible for the purposes of the BCA. This is particularly relevant in these proceedings when considering the DtS fire resistance provisions in relation to Type A and Type B construction which require external walls to be non-combustible. As has been noted above, it is not in dispute that the Alucobond products are combustible for the purposes of the BCA.

464 For materials that are determined to be combustible, part three of the standard, AS 1530.3-1999, is a test designed to assess the fire hazard properties of materials, namely: ignitability, flame propagation, heat release, and smoke release. The test involves a 600 x 450 mm sample which is held onto a supporting frame in a vertical orientation and exposed to heating from a radiant panel source. The sample is progressively moved closer to the radiant heater over a period of 20 minutes or until ignition occurs. A pilot flame is maintained above the sample. The response of the sample is then measured with the results reported as indices for time to ignition, intensity of radiation, spread of flame, and smoke detection. Unlike part one of the standard, where the product is either combustible or not, AS 1530.3 allows a cascading level of fire safety for materials which are combustible.

465 The relevance of AS 1530.3 to the proceeding is more limited than AS 1530.1, and in the context of the Alucobond products, relates primarily to the “attachment exception” in cl 2.4 of Specification C1.1 of the BCA.

466 Part four of the standard, AS 1530.4-2005, relates specifically to the fire resistance level of a material, whether or not it is combustible. Again, in the context of ACPs, the fire resistance level of a material is relevant in the context of the attachment exception in cl 2.4 of Specification C1.1 of the BCA.

467 AS 5113 was published in 2016, and was the first Australian Standard testing method specifically for the external fire performance of cladding systems. In contrast to the other tests discussed above, AS 5113 is a large-scale test.

468 AS 5113 itself is based on the earlier UK test BS 8414. The principle of the BS 8414 test was to simulate a fully developed fire in a room abutting the face of a building and venting through an aperture. In the test, the product is applied over the front face of a testing rig which is around eight to nine metres high. The testing rig also includes a “wing wall” at right angles to the main face. A combustion chamber sits at the bottom of the testing rig, into which a wooden crib is placed and ignited, developing into a severe fire source which vents from the combustion chamber and impinges on the cladding above the opening.

469 Part of the case the Applicants sought to raise was that the marketing material for the Alucobond products represented that the products had passed a series of local and international fire tests, where such representations were said to be incorrect and fundamentally misleading. The Applicants argued that the tests were performed in a manner that was limited to the particular testing set up, and in most cases, had little correlation with the manner in which the products were promoted for use in Australia.

470 However, in relation to the representations made in the marketing material regarding the results of various fire tests, a separate issue also arose being the extent to which FSEs would place reliance on such results. The experts noted their agreement in the Group 4-5 Joint Report that “[a] reasonable and competent FSE would not rely upon any test results stated in the marketing material but should ask to be provided with the relevant test reports and results, including certificates”.

471 The Respondents’ experts expanded on this during the expert conclave, following Professor Bisby identifying what he considered to be misleading statements in a marketing brochure regarding the fire behaviour of Alucobond Plus. Mr Davis stated:

I consider this to be marketing fluff, not technical data. I agree with what Professor Bisby says, that it should be accurate, but I would not rely on it in that case. I agree that a product that’s class B s 1 rated [when tested according to EN 13501-1] is inconsistent with "generates no harmful gases in case of fire”. But, as I have said already, I would not be relying on this. I would be asking for test reports, test data… whether that is intended to be misleading or whether it is… marketing people who put this literature together without understanding the technical details, I don’t know. But, as a result, I am very cynical of marketing products like this.

472 Professor Torero and Mr Moore agreed with Mr Davis indicating that they would not rely on such statements in marketing material and would, instead, seek further information such as the relevant test results.

473 Given the nature of the case the Applicants sought to put forward, during the expert conclave counsel for the Applicants spent a fair period of time cross-examining the Respondents’ experts in relation to the results reported for various local and international fire tests in marketing material.

5.4.4.1 AS 1530

474 The experts accepted during the expert conclave that small-scale tests such as AS 1530.1 and AS 1530.3 were not representative of the types of circumstances that would be expected in a façade fire, and were therefore of limited, if any, utility. Counsel for the Applicants referred particularly to the Metropolitan Fire Brigade’s Post Incident Analysis Report on the Lacrosse Fire dated 25 November 2014, in which the Metropolitan Fire Brigade noted their agreement with the conclusions made in The Fire Protection Research Foundation’s June 2014 report “Fire Hazards of Exterior Wall Assemblies Containing Combustible Components”. The report concluded that:

Small scale tests can provide misleading results for materials which are complex composites or assemblies. This is particularly the case where a combustible core material may be covered by a non-combustible or low-combustible material…

Full-scale façade tests are currently the only method available for absolutely determining the fire performance of complete assemblies which can be influenced by factors which may not be adequately tested in small scale tests.

475 Indeed, in his expert report, Mr Moore noted his understanding that many building surveyors incorrectly interpreted the attachment exception under Specification C1.1 cl 2.4, in that they considered that a material that passed AS 1530.3 with a Spread-of-Flame Index of 0 could incorrectly be assessed as meaning that the product would not cause undue fire spread. Mr Moore noted that given the limitations in the testing, the tests did not demonstrate that the panels would not cause undue risk of fire spread, and that most surveyors did not have the required training to interpret such test results.

476 Mr Davis and Mr Moore also noted that the test certificate of Alucobond PE’s AS 1530.3 results explicitly noted the following:

These results only apply to the specimen mounted, as described in this report.

The results of this fire test may be used to directly assess fire hazard, but it should be recognized that a single test method will not provide a full assessment of fire hazard under all fire conditions.

Mr Moore noted that the comments were required to be included as part of the standard.

477 The certificate noted that the Alucobond PE sample had been fixed in place by being clamped in four places. Mr Moore and Mr Davis both accepted that this did not reflect how an Alucobond PE panel would be used on a façade, although Mr Moore noted that AS 1530.3 outlined how the relevant material needs to be fixed. They also accepted that the test results were not consistent with the requirements of Specification A2.4 of the BCA which sets out the procedures for determining the fire hazard properties of assemblies tested to AS 1530.3. In particular, cl 2.3 of Specification A2.4 requires test specimens to incorporate all types of joints, and all types of perforations, recesses or the like, which are proposed to be used for the member or assembly of members in the building.

478 Mr Moore and Mr Davis accepted that the results from the AS 1530.3 test would not provide sufficient information to approve the use of Alucobond PE or Alucobond Plus, unless it was used in a limited area, and to a limited extent.

479 Mr Moore noted his agreement with the limitations identified around how the results from the AS 1530.3 tests could be interpreted and practically used, indicating that that is where fire engineering would come into play to determine how the data obtained from the tests could be used to meet a performance requirement. He noted that AS 1530.3 was not intended to be a precise duplicate of real-world conditions which, therefore, required interpretation of those results. However, in the expert conclave, Mr Moore also did not disagree with Mr Kip’s comment that it was not common practice during the relevant period for FSEs to be engaged, which relates to Mr Moore’s concern that in the absence of FSEs, surveyors during the relevant period would misinterpret the relationship between the DtS requirements of not constituting undue risk of fire spread, and the Spread-of-Flame Index applying AS 1530.3.

5.4.4.2 AS 5113

480 Alucobond PE was never tested under AS 5113.

481 Alucobond Plus, of 4 mm thickness, was tested in November 2016 in accordance with the requirements of BS 8414.2-2015. The panels were installed onto a steel substructure that was 9.3 m high.

482 The report outlined a number of observations made over the course of the 60-minute test and also attached images of the test at various points in time. Images of the test are extracted below which show the cladding system prior to testing, and during the testing (specifically, 18:48 minutes into the test).

483 The report identified the results from the test, in relation to a number of classification criteria in AS 5113, as follows:

484 The NFPA 285 is one of the most widely used large-scale cladding fire tests and was developed in the United States of America. It was developed through modifications to the pre-existing ASTM E108 test, “Standard Methods of Fire Tests of Roof Coverings”.

485 A “modified” ASTM E108 test was carried out in relation to Alucobond PE in 1982. The experts were unable to confirm the particular nature of the modification to the testing protocol, however, it appears that the relevant “modification” may have been a reference to modifications which were made in order to evaluate a vertical external wall, rather than roof coverings. In any case, the particular nature of the modification is not germane to this proceeding.

486 A record of the test conducted noted that “[t]he results presented in [the] report apply only to the material tested, in the manner tested, and not to any identical or similar material”. During the expert conclave, counsel for the Applicants directed particular attention to the manner in which the panels were affixed. The test involved a large wall of Alucobond PE panels which was composed of two vertical sections. The individual panels were routed, folded, and then bolted to an aluminium T-section. This resulted in a vertical seam which ran up the wall, which was covered with silicon. An illustration of this configuration is extracted below:

487 During the expert conclave, Mr Davis and Mr Moore accepted that, absent the aluminium melting, the above system and configuration of the panels would protect any exposed core from direct heat. The experts also accepted that the configuration was not akin to any of the standard fixing methods contained in the marketing material for the Alucobond products. Again, Mr Moore emphasised his view that ultimately, an FSE would be expected to identify the limitations of a test, such as how the material was fixed in the test, to understand the extent to which it would be applicable.

488 Alucobond Plus was first tested under NFPA 285 in 1999. NFPA 285 involves a testing rig that is 7.32 m high. The candidate cladding is installed over the exterior wall of the testing rig and a combustion chamber is placed near the base of the wall, with the fire allowed to vent to the exterior wall, resulting in direct impingement of a fire plume on the exterior cladding system being assessed.

489 The report from the 1999 NFPA 285 test noted that, for the test, there was a continuous perimeter dry gasket extrusion system which formed a frame around each individual panel. The dry gasket extrusion system was held in place on the panel with a structural silicone adhesive. This formed a water/air infiltration barrier when installed. The report contained an illustration of a “typical vertical joint” of the test panel, which was coloured by counsel for the Applicants to help illustrate the different sections of the panel involved. This image is extracted below.

490 Mr Davis and Mr Moore again accepted that the manner in which the panels were affixed for the purposes of the test fully enclosed the core of the material. They also accepted that the manner in which the panels were affixed did not represent any of the standard fixing methods promoted in the marketing material for the Alucobond products.

5.4.4.4 ISO 9705

491 In his second report, Mr Davis prepared a number of proposed Performance Solutions in relation to the Shore Building and Five Dock Building. This is discussed in further detail in the context of topic six below. However, in the reports prepared by Mr Davis, he referred to tests conducted under ISO 9705 in understanding the reaction-to-fire behaviour of the Alucobond products.

492 ISO 9705 is a test used to determine materials to be used in internal applications such as floor materials, floor coverings, and wall and ceiling lining materials. The test determines a “group number” for materials.

493 The test involved a set up that replicates the corner of a room with a gas burner situated on the floor in the corner. The gas burner is ignited, and the growth rate of the fire resulting from involvement of the lining products, as well as the total heat released and amount of smoke generated, is measured. For the first 10 minutes, the heat output of the burner is set to 100 kW, after which the heat output of the burner is increased to 300 kW for another 10 minutes.

494 Two reports, dated 30 November 2010, recorded Alucobond PE and Alucobond Plus as passing the ISO 9705 test. Each of the panels affixed for the purposes of the test appear to have been riveted along each edge, as can be seen in the below photo extracted from the Alucobond PE test.

495 The report for Alucobond PE noted that due to the expected flashover situation, and for safety purposes, photographs of the test were not taken. However, it noted that a video recording was made available.

496 The ISO 9705 test for Alucobond PE reached flashover in just under nine minutes. Alucobond Plus on the other hand did not reach flashover over the course of the 20-minute test. However, the panels appeared to experience significant delamination and burning, as can be seen from the following images extracted from the Alucobond Plus test report.

497 In the context of the proposed Performance Solutions prepared by Mr Davis, he accepted that the reaction-to-fire behaviour of panels fixed to the Shore Building and Five Dock Building could be different to that seen in the tests, given the different manner in which the panels were affixed.

498 Counsel for the Applicants directed the experts’ attention to an email chain between Mr Bill Kerr of HVG and Mr Frank Ritter of 3A in relation to the ISO 9705 testing of Alucobond PE. An email from Mr Kerr on 14 July 2010 reads as follows:

With regards to testing PE, I don’t care how the ceiling panels are installed, the main thing is that they and the wall panel are installed in a manner that that [sic] will prolong the period prior to flashover for as long as possible.

I need to achieve group 3 rating, that is, flashover occurs between 120 – 600 seconds @ 100kw, not before.

…

Whatever protection you can provide to the ceiling panels to prolong the non flashover period, will be appreciated.

With regards to the wall panels, we are using cassettes with sealed panels joints. I am not sure if flat panels with exposed joints will assist in achieving the desired result.

As previously mentioned, anything that can be done to achieve a minimum of 120 seconds to flashover should be considered.

499 In a subsequent email to Mr Kerr on 15 July 2010, Mr Ritter stated:

we passed the 120 sec.

as open joint system with a maximum of joints à 550mm (‘worst case’).

We build the ceiling like a submarine: rivets à 130 mm.

The flash over (=inferno) was at 9:07 minutes. They need more than the double time to extinguish the fire and will need more than 9 hours to clean up the test room.

500 Mr Ritter replied to Mr Kerr’s email on 15 July 2010 in relation to the ISO 9705 test conducted in relation to Alucobond Plus. The email stated the following:

Plus was tested on Tuesday: no flash-over within 20 min, as I told before.

PE had the flash-over after 120sec., i. e. group 3 rating as required.

Both tests were done as open joint/edge system with riveted fixing. The grid was about 550…600mm.

The only difference was the number of rivets in the ceiling. We put the double amount of rivets into the PE panels. We will see whether this will be mentioned in the report.

Probably we were lucky, that due to the first test the roof of the test room had a crack where a lot of smoke (and heat) escaped.

501 Ms Haas of 3A was copied into the email chain between Mr Kerr and Mr Ritter. Ms Haas replied to Mr Ritter stating (translated from German), “That looks good! Super”. Mr Ritter responded back to Ms Haas stating (translated from German):

We have the classification.

When you have seen the fire in the 9 th Minute, however, you think about what you are selling…

502 When Mr Davis was questioned whether the emails he was taken to casted doubt on his reliance on the ISO 9705 report, Mr Davis accepted that the language would be the cause of some concern.

503 Professor Torero appeared less troubled by the language contained in the emails, providing the following response to the question:

I would have already expected that performance… [W]hen you look at the way in which these materials burn, you know, like many other materials that we use in construction, the fire is a very, very significant fire… I mean, if you are asking me the question whether I expect these materials to produce a little fire that doesn’t do anything, that’s completely incorrect. What I’m expecting in a room of that nature, that is ISO test, I would expect flashover in two to three minutes… So, to be honest, the results I’m not surprised at all. I mean, the language is appalling but…

504 When asked to consider whether the test was honest and transparent, as Professor Torero noted in the Group 3 Joint Report about the expectation around how manufacturers would operate, Professor Torero noted the following:

I mean, you know, clearly, the language is not the language that I would agree with, but whether this is honest and transparent, I mean, we require that to be the case and we want that to be the case but I believe that’s to the judge to decide, not me…

I mean, the reality is that I would not request the internal communications. I would go straight to the data… When I look at the data I can figure out what the configuration was: a system that is riveted is a system that performs in a certain way, a system that is not riveted performs in a different way. I look at the heat release rate curve and I know exactly if it’s riveted or not.

505 During the Expert Group 4-5 conclave, all the experts (excepting Professor Bisby, who was not questioned on this topic) agreed that in addition to fire tests, FSEs could rely on a number of sources of information in designing Performance Solutions, including: scientific papers, reports into cladding fires, the Society of Fire Protection Engineers Handbook of Fire Protection Engineering, and the International Fire Engineering Guidelines.

506 The experts also agreed that, theoretically at least, FSEs could design a Performance Solution using ACPs without having large-scale fire test results. Mr Kip, while accepting this theoretical possibility, sought to create a distinction between what might be theoretically possible, and what would be practical reality. Mr Kip stated:

[I]f I can explain the process as it would happen in my period of practice, so if you came to me and said, “I want to put aluminium composite panels on my building”, I wouldn’t design it. I would say, “well, what are the products that we have got to choose here and what is the cost per square metre and what will the cost penalty be for the cheaper products?” And that analysis, which is not really engineering, it’s just accounting, would be probably that would knock PE out on almost every project and I would argue actually every project because an engineer’s responsibility is to make sure their clients have an economical building. That’s a ten[et] of the code of ethics for engineers. It’s not enough to say, “I can build you the most expensive building ever using the worst products as long as it’s shiny”. That’s not what engineering is.

…

I’m making a point about practical engineering. It’s an ethical obligation to make sure we don’t waste a client’s money, and this theoretical design you are proposing to me seems, without any analysis, a waste of money. Now, I don’t disagree with, conceptually, that you can theoretically design anything.

507 Mr Kip accepted that while theoretically it could be done, for reasons of costs, he stated that it would not be done. The other experts accepted that cost would be a factor for consideration but noted that this did not detract from an FSE’s ability to design a Performance Solution without having access to large-scale fire test results. Professor Torero stated:

I think that one of the things that we cannot confuse is that we have a functional requirement system and that functional requirement system enables the competent professional to be able to design things with the tools that are available.

…

You could actually even assume that the entire polyethylene was going to burn, you know, and you make that assumption and that is very restrictive, which basically means you are going to use it in very, very specific conditions that might be significant[ly] restricted. I think what we – if I may take Mr Kip’s words and try to explain the reason for the confusion, is that, in reality, that didn’t work, because not all the parties had the same level of competency… I think a reality of this problem of the approvals process cannot be confused with the possibility of getting things approved correctly.

…

You say if there was [sic] 100 storeys, and I would say that then we will decide, for example, that the restriction is that it will only be used in the top floor.

508 In response to Professor Torero’s comments, counsel for the Applicants directed the Professor’s attention to the following image of Distillery Hill in Pyrmont, NSW. The building is shown clad in Alucobond PE, in a marketing brochure for Alucobond PE. Counsel for the Applicants noted that the building contained many elements that Professor Torero agreed would generally want to be avoided, including vertical runs of Alucobond PE panels up the building, and returns around windows.

509 When suggested that the building would not be safe or compliant, Professor Torero provided the following response:

[A]s a professional fire engineer, you are asking me to make an assessment on a building that I don’t know with all the provisions that it has that I’m not aware of and the reality is I cannot do that. I mean, you can argue that many of the features that are visible there are features that will create concern for me, that I will carefully analyse to make sure that they don’t create a problem and, if they do, I would recommend not to do it. But the reality is that what you are asking me is just simply an impossibility.

5.4.5 Did the local and international fire tests used in the marketing material support the use of Alucobond PE or Alucobond Plus as part of a Performance Solution?

510 While this topic was broadly covered while discussing the fourth topic above, the experts provided the following response in the Group 4-5 Joint Report:

The tests listed in the material and the results there identified would not support the use of Alucobond PE or Alucobond Plus for DtS compliance as part of, or as an attachment to, an external wall or building element. Some of the tests could support the use of a performance-based solution depending upon the circumstances. A reasonable and competent FSE would not rely upon any test results stated in the marketing material but should ask to be provided with the relevant test report and results, including certificates.

511 As this topic was largely addressed by the experts in their discussions regarding topic four, it was not substantively explored in further detail during the expert conclave. Mr Moore only conceded that the test reports would necessarily support or not support the use of a Performance Solution.

512 The experts agreed that the test reports could support the use of Alucobond PE or Alucobond Plus as part of a Performance Solution, noting that any Performance Solution would require a consideration of the particular nature and features of the building, and how the Alucobond products would be used.

5.4.6 How (if at all) could Alucobond PE have been used on the Shore Building, and how (if at all) could Alucobond Plus have been used on the Five Dock Building, as part of a Performance Solution such that the buildings complied with the BCA? In answering this question, please address Mr Davis’ proposed Performance Solution s

513 In his second report, Mr Davis was requested to prepare Performance Solutions in relation to both the Shore Building and the Five Dock Building.

514 In relation to the Shore Building, Mr Davis prepared an “example” FER to offer a Performance Solution demonstrating that the Shore Building would meet the relevant performance requirements in the BCA as at the time the relevant development consents for the Shore Building were issued. Mr Davis assessed the building against the BCA 2009 edition. The joint report noted that it should have been by reference to the BCA 2010 edition, but the experts agreed that this was a trivial matter, given the editions were unchanged in respect of the relevant issues.

515 Without seeking to reiterate each detail contained in the FER, Mr Davis assessed the relevant performance requirements applicable, identified the fire properties of Alucobond PE, identified potential ignition sources, considered the characteristics of the building’s occupants, considered the ability for fire brigade intervention, and then assessed the risks posed by the particular use of Alucobond PE on the Shore Building.

516 Ultimately, the Performance Solution proposed by Mr Davis was for:

(a) A combustible ACP to not be installed between windows three and four and windows nine and 10 on level two of the building’s eastern elevation (being one of the sides of the building). Mr Davis identified that Alucobond PE was installed between windows of apartments such that the Alucobond PE could readily be involved in a fire. Mr Davis identified that this was a potential source of fire spread between apartments, although he noted that the consequences of a fire involving the ACPs are no greater than an equivalent building that complies with the DtS Provision; and

(b) The roof eaves to the apartments on level three of the building to not have continuous combustible ACPs between adjacent apartments. Mr Davis identified that a fire on level three could spread to the roof eaves and involve the Alucobond PE installed there. However, Mr Davis noted the roof is part of the apartment below and so, this does not represent an increased risk of fire spread between apartments. Mr Davis noted that the Alucobond PE was installed continuously between the apartments on level three and, therefore, required the ACPs to be fire separated to address the potential for lateral fire spread between apartments.

517 Mr Davis otherwise noted within the report that the Alucobond PE located on level two would not lead to vertical fire spread between apartments due to the balcony on level three which would have a significant retardant effect on the spread of flame from the balustrade to the apartment. Mr Davis also noted that while there was the potential for some debris to fall to ground level, the potential was not anticipated to be any greater than a fire without ACPs present. Mr Davis noted further that the location of the Alucobond PE was unlikely to have any effect on occupant evacuation and that standard fire brigade intervention could be expected.

518 The report also noted the following:

A building with ACPs may not be unsafe, and the risks may be considered acceptable, however risk perception is subjective, and often varies according to the experience and biases of interested parties. The only way to completely remove risk associated with ACPs is to replace them with a non-combustible alternative.

…

A Fire Engineering Brief (FEB) was not prepared as input to this example Fire Engineering Report (FER) as this FER is provided only for the purposes of advice in the Federal Court of Australia proceeding NSD215/2019.

519 Mr Davis also prepared an “example” FER in relation to the Five Dock Building. The report was prepared to offer a Performance Solution for the Five Dock Building that would meet the relevant performance requirements in the BCA as at the time the relevant development consents for the building were issued (by reference to the BCA 2016 edition).

520 It is important to note that this analysis considered the Five Dock Building as designed in the relevant construction certificates, given the purpose of the analysis was to consider a Performance Solution based on the proposed design of the building. However, it was noted that Mr Davis’ site inspection showed that the Alucobond Plus had not actually been installed in accordance with the approved construction drawings. Mr Davis conducted a further analysis reviewing the actual Five Dock Building to offer a Performance Solution demonstrating the building’s compliance with the performance requirements of the BCA 2019 Amendment 1 (Volume 1). This further analysis is discussed in the context of Mr Abbott’s evidence below.

521 In relation to the western elevation of the Five Dock Building (being the front of the building), Mr Davis identified in the report that the Alucobond Plus affixed to the front of the building comprised:

(1) lining to external walls on levels three and four of the building;

(2) lining to the external side of the ground floor privacy fence and garden walls, offset from external walls;

(3) lining to an external wall at ground level around the fire exit door;

(4) lining to columns extending from the ground floor and then connected to Alucobond Plus on upper levels; and

(5) lining to external walls at the rear of balconies on levels one and two.

522 The location of the relevant Alucobond Plus panels is illustrated in the following image extracted from Mr Davis’ report:

523 Mr Davis identified, in relation to the lining to external walls on levels three and four (area (1)), that burnings droplets or debris on level four would be expected to be confined to the balcony of origin as it was set back from level three. Mr Davis also identified in relation to area (2) that the building element was not part of the external wall of the building and comprised Alucobond Plus to the external side of the ground floor privacy fences only. In relation to area (5), Mr Davis identified that a fire involving the Alucobond Plus panels would be limited to the balcony due to the overhang of the concrete slab above each balcony.

524 Mr Davis did, however, identify changes required in relation to areas (3) and (4). In relation to the Alucobond Plus located at ground level around the fire exit door (area (3)), Mr Davis noted that a fire involving the panels might prevent occupant egress through the fire exit. In relation to the Alucobond Plus on columns extending from ground floor and connecting to the Alucobond Plus on the upper levels of the building, Mr Davis noted that there was no significant ignition source located near the ACPs, and therefore, the probability of ignition was low. It was also noted that the panels were not located near any openings to the building and, therefore, a fire involving the panels was not expected to enter the building. However, it was also noted that in the very unlikely event that the panels were involved in a fire, there was the potential for debris to fall near to the fire exit.

525 Due to the analysis above, Mr Davis recommended that the Alucobond Plus located in areas (3) and (4) be replaced with a non-combustible alternative.

526 In relation to the eastern elevation of the building (ie, the back of the building), Mr Davis identified that Alucobond Plus panels were located on the ground floor only, and on levels 3 and 4 of the building. In relation to the Alucobond Plus located on the ground floor, Mr Davis identified that while the panels could be ignited, fire spread would be limited to the ground floor due to the spandrel separation between the windows on the ground floor and level one.

527 However, Mr Davis considered that the Alucobond Plus on the spandrels above the windows on level three should be substituted with a non-combustible alternative in order to limit potential fire spread.

528 Again, Mr Davis’ report noted that an FEB had not been prepared as input into the FER, as the FER had only been provided for the purposes of advice in relation to this proceeding.

529 In the Group 4-5 Joint Report, Mr Kip outlined a number of issues he took with Mr Davis’ approach. Mr Kip’s relatively lengthy criticisms are extracted below:

• No Fire Engineering Brief was prepared, or agreement from stakeholders sought/reached to proceed to the FER preparation stage.

• No input was provided from the relevant fire brigade on a critical firefighting issue for them (a combustible façade) and analysis of their needs beyond the expertise of a fire safety engineer.

• No holistic analysis of the overall building, including consideration of the previous alterative [sic] solutions that were required for the building.

• Dominant occupant characteristics and parameters for design occupant groups were not indicated (including no consideration of disabled egress).

• Hazards and preventative and protective measures were not described.

• Acceptance criteria and factors of safety for the analysis were not included.

• The engineering judgement that is applied is not justified.

• Fire scenarios and parameters for design fires are not included.

• Standards of construction, commissioning, management, use and maintenance are not specified.

• Sensitivity, redundancy and uncertainty studies are not included.

• The construction requirements that are needed to ensure that the fire safety system is properly realised are not discussed.

• There are no commissioning requirements discussed or specified.

• Procedures or processes that should be adhered to during management and use of the building (including façade alterations work) are not included.

• No maintenance requirements are specified, especially where ‘nonstandard’ components (those not fully complying with the prescriptive or deemed-to-satisfy requirements) are used in the fire safety system.

• The references to the BCA term “to the degree necessary” are misused. (performance requirements of the BCA must be satisfied entirely, but some ‘heads of consideration’ might not be relevant).

• A full (holistic) hazards analysis was not undertaken.

• The analysis does not consider other external ignition sources, including lightning strike, gas or other fuelled cooking devices (BBQ’s) or hot-work on the building.

• The summary of findings in Section 1.2 confuses ‘low-risk’ with compliance with the BCA. Low-risk applies to a risk assessment process outcome, but compliance is satisfaction of the relevant performance requirements. ‘Risk’ is not a criteria or requirement in the BCA fire performance requirements.

• The summary of findings in Section 1.2 states; “The fire safety risk related to ACPs on a façade is primarily a life safety issue” but ignores the property protection requirements of the BCA for boundary separation of the façade.

• Incorrect application of the fire test reports for AS 1530.3 by not testing the ACP with the edges exposed for joints, perforations, recesses or the like for pipes, light switches or other fittings, which are proposed to be used as installed on the building.

530 Mr Kip also noted that agreement on the applicable performance requirements is a critical part of the FEB process under the International Fire Engineering Guidelines and that the FSE cannot confirm the relevant performance requirements and proceed to an FER without that stakeholder agreement.

531 Mr Davis noted his response in the joint expert report that he did not generally disagree with Mr Kip’s comments on the process used to develop the FERs. However, Mr Davis stated that the reports needed to be considered in the context of why they were provided, and the inherent limitations of preparing an FER without the full input that would normally be required as part of a complete building approval process. The Group 4-5 Joint Report included the following comments from Mr Davis:

[Mr Davis] does not generally disagree with [Mr Kip]’s comments on the Performance Solution process to develop the FE reports, however the submitted reports need to be considered in the context of why they were provided and the inherent limitations of preparing a FER report without the full input that the approval process would normally require as part of a complete building approval process.

A performance solution is developed using a stakeholder process as described in the International Fire Engineering Guidelines. The process includes a Fire Engineering Brief (called a Performance Based Design Brief since BCA 2019). The brief is prepared and developed in consultation with the relevant stakeholders, and includes the scope of the report, particularly the matters to be addressed through performance solutions, the relevant stakeholders, the principle [sic] building and occupant characteristics, fire hazards, the proposed assessment methodologies and the acceptance criteria to be applied for approval by stakeholders.

The Fire Engineering Reports were prepared in response to the questions from KWM, and as described in the letters of appointment to Mr Davis, which related to the potential to allow the use of Alucobond PE and Plus through a performance solution, and to prepare an example of Fire Engineering Reports for the performance solutions.

The Davis Fire Engineering Reports were not prepared to seek building approval, as this is not possible retrospectively, but were intended to demonstrate that a Performance Solution could demonstrate that a combustible ACP attached to an external wall could comply with the Performance Requirements. These reports are pro-forma examples of the type of fire engineering report that might have been developed through the approval process.

532 Mr Kip, rightly, noted that the “example” FERs prepared by Mr Davis could not be treated as an actual “Performance Solution” having not been through the approval process as outlined in the joint report. This is not a point of dispute, and the reports are therefore limited to some degree, as Mr Davis accepted. Mr Davis’ position was that this is inherently the case given the nature of the hypothetical exercise which was undertaken. In particular, the reports were prepared retrospectively after the building had been constructed and approved, and Mr Davis did not have an opportunity to consult with relevant stakeholders, such as the fire brigade.

533 In relation to the more specific criticisms made regarding Mr Davis’ report, Mr Davis also noted his view that he had undertaken a holistic analysis of the building and that he had assessed occupant characteristics, hazards, preventative measures, and external ignition sources appropriately.

534 The comments made by each of Mr Kip and Mr Davis during the course of the expert conclave were largely consistent with the comments contained within the joint report. It is not necessary to labour this in further detail. Mr Davis accepted, in cross-examination, that the process of preparing a Performance Solution requiring an FSE to analyse the particular use of a product on a building, and to engage with stakeholders to ultimately prepare a solution, involved considerable additional time and cost in comparison to DtS compliance. Mr Davis also accepted that the process was also uncertain in that an FSE could not guarantee the approval of a proposed Performance Solution.

535 As has been noted above, Mr Davis also accepted that the manner in which the panels were fixed to the building and how they might react to a fire could differ from that seen in the relevant fire tests he referred to, due to the different manner in which the panels were affixed. However, Mr Davis noted that he had taken conservative approaches in each case, assuming that once ignited, a fire would progress across the extent of the Alucobond panels, and particularly in the case of Alucobond PE, that the fire would progress rapidly.

5.5 Expert Group 6 – BCA compliance experts

536 The summary of Expert Group 6 is extracted below:

Kip Report 2 – 1 Dec 2023 |
| | 3A | Mr Nathan Halstead | Halstead Report – 10 Mar 2023 |
| | Joint Report of Mr Kip and Mr Halstead dated 13 Mar 2024 (“Group 6 Joint Report”) | | |
537 Expert Group 6, referred to as the “BCA compliance experts”, was constituted by Mr Kip and Mr Nathan Halstead. As suggested by the name, the focus of the expert group was how Alucobond PE and Alucobond Plus could be used in a BCA compliant manner during the relevant period.

538 Mr Halstead was engaged by 3A and prepared a single expert report dated 9 March 2023. Mr Halstead has over 27 years’ experience in the building and construction industry and is currently the Foundation Managing Director of the building consulting and engineering firm AED Pty Ltd. Mr Halstead is a practising building surveyor and is also registered as a professional engineer in fire safety in NSW, Queensland, and Victoria.

539 As with the other expert groups, Mr Kip and Mr Halstead prepared a joint expert report addressing how the Alucobond products could be used in a BCA compliant manner. The following agenda was prepared to guide the expert conclave:

1. Could Alucobond PE or Alucobond Plus have been used on a Class 2 to 9 Building during the relevant period:

(a) as a “bonded laminate” pursuant to C1.12(f) (or, from 1 March 2018, C1.9(e)(vi)); or

(b) as an “attachment” pursuant to clause 2.4 of Specification C1.1?

2. Could Alucobond PE or Alucobond Plus have been used in conformance with a CodeMark Certificate of Conformity during the relevant period (and if so, in what circumstances)?

3. Could Alucobond PE or Alucobond Plus have been used on a low-rise building of type C construction during the relevant period?

540 There was limited disagreement between the experts in relation to each of the agenda items. Again, it is easiest to address the evidence provided by each expert in turn in relation to each agenda item.

5.5.1 Could Alucobond PE or Alucobond Plus have been used on a Class 2 to 9 Building during the relevant period as a “bonded laminate” pursuant to C1.12(f) (or, from 1 March 2018, C1.9(e)(vi)); or as an “attachment” pursuant to cl 2.4 of Specification C1.1?

541 Under the DtS Provisions of the BCA, the external walls of Type A and Type B construction must be non-combustible. It is not in dispute that, for the purposes of the BCA, Alucobond PE and Alucobond Plus are combustible (ie, they fail the AS 1530.1 test). There are two potential exceptions which are relevant to consider in the context of ACPs, being the bonded laminate exception under C1.12(f) of the BCA, and the “attachment” exception under Specification C1.1, cl 2.4.

5.5.1.1 Bonded laminate exception

542 C1.12(f) of the BCA 2016, containing the bonded laminate exception, provided the following:

C1.12 Non-combustible materials

The following materials, though combustible or containing combustible fibres, may be used wherever a non-combustible material is required:

…

(f) Bonded laminated materials where–

(i) each laminate is non-combustible; and

(ii) each adhesive layer does not exceed 1 mm in thickness; and

(iii) the total thickness of the adhesive layers does not exceed 2 mm; and

(iv) the Spread-of-Flame Index and the Smoke-Developed Index of the laminated material as a whole does not exceed 0 and 3 respectively.

543 In the Group 6 Joint Report, the experts agreed that the exception could not be applied to the Alucobond products, on the basis that the bonded laminate exception requires each individual laminate to be non-combustible. As the combustible core of the products was also considered a “laminate” for the purposes of the provision, the exception could not apply to the Alucobond products.

544 It is relevant to note that the Applicants submit that it was a widely held belief within the industry generally that the bonded laminate exception could apply to products such as Alucobond PE and Alucobond Plus, as the combustible core was not considered a “laminate”. This interpretation of the BCA was rejected by the Victorian Court of Appeal in Tanah Merah at [224]-[231]. This decision concerned the design and construction of the Lacrosse Tower.

545 It is also relevant to note that the BCA was amended in March 2018 to clarify that buildings of Type A and Type B construction required external walls, including all components incorporated in them including the façade covering, to be non-combustible. The bonded laminate exception was also amended to clarify that, in the case of a bonded laminate material, each lamina, including any core, needed to be non-combustible.

546 While Mr Halstead accepted in the joint report that the bonded laminate exception could not apply to the Alucobond products, this was not the position originally adopted in his expert report dated 9 March 2023. In particular, Mr Halstead’s report stated the following:

In cases where external walls were constructed wholly or in part from combustible ACPs, then this was permitted in some circumstances during some of the Relevant Period despite the prohibition… by clause C1.12 of BCA 2016 (prior to the introduction of amendment 1 in March 2018).

…

In my opinion, an ACP comprising two aluminium “laminates” glued to the core could fall within the exception in C1.12(f) if it met the requirements of that clause. Given the terms of C1.12(f), the question of what is a “laminate” would be one of interpretation.

547 Mr Halstead stated during the expert conclave that following his first report, he had conducted further research into the issue and understood that the exception required each laminate material, including the core, to be non-combustible.

548 The Applicants also note that the application of the exception was put in issue in both the Respondents’ defences.

5.5.1.2 Attachment exception

549 There was disagreement between the experts regarding the extent to which the attachment exception could apply to the Alucobond products, which was outlined in the Group 6 Joint Report. Given this disagreement, it is helpful to step out, in some detail, the requirements of the attachment exception in the BCA. The attachment exception is contained in cl 2.4 of Specification C1.1. It is outlined as follows:

2.4 Attachments not to impair fire-resistance

(a) A combustible material may be used as a finish or lining to a wall or roof, or in a sign, sunscreen or blind, awning, or other attachment to a building element which has the required FRL if–

(i) the material is exempted under C1.10 or complies with the fire hazard properties prescribed in Specification C1.10; and

(ii) it is not located near or directly above a required exit so as to make the exit unusable in a fire; and

(iii) it does not otherwise constitute an undue risk of fire spread via the façade of the building.

(b) The attachment of a facing or finish, or the installation of ducting or any other service, to a part of a building required to have an FRL must not impair the required FRL of that part.

550 In particular, the issues centred around cl 2.4(a)(i) (whether the Alucobond products were exempted under C1.10 or complied with the fire hazard properties prescribed in Specification C1.10), and cl 2.4(a)(iii) (whether the use of Alucobond products constituted an undue risk of fire spread).

551 Therefore, the first question is whether the material is exempted under C1.10. C1.10(a) lists (i) to (xv) of “linings, materials and assemblies in a Class 2 to 9 building” which “must comply with Specification C1.10”. This includes “[a]ttachments to floors, ceilings, internal walls and the internal linings of external walls” (see item (viii)) and “[o]ther materials including insulation materials other than sarking-type materials” (see item (ix)). C1.10(c) has the following chapeau: “[t]he requirements of (a) do not apply to a material or assembly if it is –…”. C1.10(c)(i)-(xv) then lists specific materials and/or assemblies, including “any other material that does not significantly increase the hazards of fire” (see item (xv)).

552 Specification C1.10(2) sets out, in tabular form, the applicable clause for each type of lining, material or assembly. Both “[a]ttachments to internal floors, walls and ceilings” and “[o]ther materials including insulation” must comply with cl 7. Clause 7 sets out, in tabular form, the “Flammability”, “Spread-of-Flame”, and “Smoke-Developed” indices which each listed material cannot exceed. There is no separate line item for attachments, only the line item “[o]ther materials or locations and insulation materials other than sarking-type materials ” (emphasis in original).

553 In the Group 6 Joint Report, Mr Kip expressed his view that the Alucobond products would fail the criteria under cl 2.4(a)(i). That is, that the Alucobond products do not meet the requirements of Specification C1.10, and are not exempt under C1.10.

554 Conversely, 3A submits that, on its proper construction, C1.10 does not apply to attachments to external walls, given that the language under C1.10(a)(viii) refers explicitly only to “internal linings” of external walls. 3A submits that if the intention of the clause was to apply to attachments to external walls generally, the words “internal linings” would be entirely otiose. On this basis, 3A submits that it should be concluded that the Alucobond products are exempted from C1.10 for the purposes of the first limb of the attachment exception.

555 While 3A’s submission in relation to the interpretation of C1.10(a)(viii) may be correct, it is not of assistance in interpreting the attachment exception. 3A’s submission fails to grasp that the material in question must be exempt under C1.10. As stated above, C1.10(c) lists the materials which are exempt from complying with C1.10(a). 3A did not submit that the Alucobond products fell within C1.10(c)(xv), being “any other material that does not significantly increase the hazards of fire.” Pursuant to cl 2.4(a)(i) in Specification C1.1, if the material is not exempted under C1.10, it must comply with the fire hazard properties prescribed by Specification C1.10.

556 Therefore, the Alucobond products are not exempted under C1.10. The Alucobond products must comply with the fire hazard properties prescribed in Specification C1.10.

557 This interpretation of the attachment exception is supported by the BCA Guide which noted the first limb can be satisfied if the material “is one of the exemptions from fire hazard properties listed in C1.10(c)”. Further, the BCA Guide also stated that the intent of cl 2.4 is to “minimise the risk that the method of attaching or installing a finish, lining, ancillary element or service installation will compromise the fire-resistance of a building element.” In my view, to hold that an attachment to an external wall need not comply with Specification C1.10 would be inconsistent with the purpose of cl 2.4 of Specification C1.1.

558 On the basis that the Alucobond products would fall under “other materials” under Specification C1.10, the fire hazard properties they are required to meet are: a Spread-of-Flame Index that does not exceed 9, and, if the Spread-of-Flame Spread Index is more than 5, a Smoke-Developed Index that does not exceed 8.

559 Under Specification A2.4, the BCA requires the fire hazard properties of materials to be determined in accordance with AS 1530.3 (in relation to the Spread-of-Flame Index and the Smoke-Developed Index) and AS 1530.4 (to determine the ability to prevent ignition and screen its core material from free air). The AS 1530.3 test results for both Alucobond PE and Alucobond Plus resulted in a Spread-of-Flame Index of 0 and a Smoke-Developed Index of 0-1.

560 It is also worth considering that note 3 in relation to “other materials” in Specification C1.10 states the following:

3. In the case of a composite member or assembly, the member or assembly must be constructed so that when assembled as proposed in a building–

(a) any material which does not comply with this Table is protected on all sides and edges from exposure to the air; and

(b) the member or assembly, when tested in accordance with Specification A2.4, has a Spread-of-Flame Index and a Smoke-Developed Index not exceeding those prescribed in this Table; and

(c) the member or assembly retains the protection in position so that it prevents ignition of the material and continues to screen it from access to free air for a period of not less than 10 minutes.

561 As was noted in the context of the evidence of Expert Group 3, Mr Kip’s view was that the AS 1530.3 test results provided in relation to Alucobond PE and Alucobond Plus did not satisfy the requirements of the BCA. In particular, Specification A2.4, cl 2.3 requires that the test specimen used in the tests must incorporate all types of joints, and all types of perforations, recesses or the like for pipes, light switches or other fittings, which are proposed to be used for the member or assembly of members in the building.

562 Mr Kip noted the following in the joint report:

The BCA requires this of an AS 1530.3 fire test so that certain materials are tested in a way that exposes any combustible parts of that material or assembly, and the fire test report provided does not satisfy the requirements set out in the BCA Clause A2.4.

This is why the two fire test reports for Alucobond PE and Alucobond Plus both show the same results regardless of the combustibility of the cores. The aluminium face sheet of an ACP completely protects the combustible core from the radiant heat source in the fire test.

It is impossible to install Alucobond PE or Alucobond Plus on a building as a single sheet without joins.

563 Mr Kip noted in his expert report that the AS 1530.3 tests did not satisfy the BCA as “evidence of suitability” because the criteria under Specification A2.4 were not met and the tests were not consistent with the note to Specification C1.10 extracted above.

564 In the joint report, Mr Halstead noted his view that the relevant note to Specification C1.10 only applied to tests for internal linings and not for materials that were to be installed on the outside of buildings. Mr Halstead referred particularly to the fact that the note refers to a member or assembly in a building. Additionally, Mr Halstead also noted various CodeMark Certificates for Alucobond PE and Alucobond Plus which relied on and accepted the fire hazard property certificates issued in relation to the Alucobond products under AS 1530.3.

565 During the expert conclave however, Mr Halstead noted that he was relying on the results of the AS 1530.3 tests but had not particularly considered how the test of the Alucobond products had been conducted.

566 Mr Kip stated in the joint report that the Alucobond products would need to be individually assessed for compliance with the criteria in cl 2.4(a)(ii), (iii) and (b) of Specification C1.1 when used as an attachment to an otherwise fully BCA compliant external wall which is required to achieve a F ire- R esistance L evel. He stated further that:

In my opinion the criteria for undue risk of fire spread could not be satisfied for Alucobond PE in any circumstances, and would be extremely difficult or expensive to satisfy for Alucobond Plus, as shown in the subsequent CodeMark Certificate of Conformity issued on 6 July 2023 that now requires (amongst other matters and further fire testing); enhanced fire sprinklers throughout the building, cavity barriers at each floor level, non-combustible insulation throughout and treatment of all penetrations.

567 Mr Kip also stated the following in his first expert report:

In my view… the use of Alucobond PE or Alucobond Plus will constitute an undue risk of fire spread via the façade of the building if used in anything other than insubstantial quantities and the concession in Clause 2.4(a)(iii) therefore cannot apply.

568 On the other hand, Mr Halstead noted in his expert report the following:

“Undue risk of fire spread” is not a concept that has a specific definition in the BCA. In my opinion, the use of the word “undue” indicates that the requirement is not directed towards preventing any and all risk of fire spread. Rather, the risk of fire spread is to be balanced against other factors, including for example: other fire safety systems incorporated into the building, the function and use of the building and the nature and mobility of its occupants, and the needs of the fire brigade in accessing the building;

569 Mr Kip’s position in relation to the attachment exception was subject to strenuous challenge over the course of the expert conclave. In particular, Mr Kip was again taken to a number of previous SKIP Consulting reports in which the firm had reviewed the use of Alucobond products.

570 The SKIP Consulting report on 1-25 Harbour Street, discussed above in section 5.4.3 of these reasons, noted the following in relation to the attachment exception:

It is agreed that the ground level awnings incorporating ALUCOBOND®PE and decorative timber laminates and timber battens can be considered as attachments in terms of clause 2.4(a) of Specification C1.1 of the Building Code of Australia (BCA)…

Section 6.1 [of the draft fire safety engineering report] correctly identifies the relevant conditions (i.e. (i) - (iii)) of clause 2.4(a) of Specification C1.1 of Volume 1 of BCA 2009) that must be met by a combustible attachment to meet the BCA requirements. The key issues with respect to the attachments (i.e. the awnings) is the potential effect on persons evacuating the building and whether the attachments will significantly increase the risk to occupants due to increased (or undue) fire spread compared with a building where the attachments are non-combustible.

571 Upon counsel for 3A suggesting that the report implied that Alucobond PE did, in fact, satisfy the requirement under cl 2.4(a)(i), Mr Kip stated that it was a mistake, stating the following during the conclave:

Look, upon reflection, I think that’s actually not an accurate statement. Again, I expressed yesterday that I was a co-author of this document, and I probably should have picked that up. It wasn’t a critical part of the risk assessment and peer review process.

572 Mr Kip accepted that the letter expressed a view as to the compliance of Alucobond PE with Specification C1.1, cl 2.4 that was contrary to the evidence he was giving in this proceeding.

573 As has already been outlined above in relation to the Expert Group 4-5 conclave, the report goes on further to consider the use of Alucobond PE on the building, stating the following:

It is noted that the space below the awning is sprinkler protected via heads within the underside of the awning. In the unlikely event of sprinkler failure, this ACP could be ignited by such a fire. Since the awning is a horizontal structure, the effect of a fire below the awning will be to (a) melt the aluminium and (b) the [sic] cause the polyethylene to drip downward and potentially burn off any horizontal surface.

Flaming from directly from the ACP structure will be limited compared with if the structure was orientated vertically and while the awning structure remains in place, will provide shielding to the level above the canopy. In any case, the burning below the canopy as a result of the melting of the core is unlikely to result in spread between levels compared with the effect of a flashover fire in the adjacent ground level space if there was no awning. Furthermore, combustible cladding is not used for the exterior façade of the building above the awning level.

It is therefore considered that the use of ALUCOBOND®PE awnings as described in the [draft fire safety engineering report], does not present an undue risk with respect to fire spread. It is also considered that this construction will not present a risk with respect to egress from the adjacent parts of the building.

574 When the apparent inconsistency between the SKIP Consulting report and Mr Kip’s position in the Group 6 Joint Report was put to him, Mr Kip again sought to create a distinction between a pre-construction review, and what he referred to as a “post-construction risk assessment methodology”.

575 Mr Kip was again taken to SKIP Consulting’s peer review of the draft FER on the Carindale Shopping Centre dated 25 May 2017, which considered the use of Alucobond Plus and Alpolic FR and stated:

Sections 5.2 and 6.2 of the [draft fire safety engineering report] correctly identifies the relevant conditions (i.e. (i) - (iii)) of clause 2.4(a) of Specification C1.1 of Volume 1 of BCA 2006) that must be met by a combustible attachment to meet the BCA requirements. The key issues with respect to such attachments are the potential effect on persons evacuating the building and whether the attachments will significantly increase the risk to occupants during evacuation or due to increased (or undue) fire spread compared with a building where the attachments are non-combustible.

576 Again, the report made no particular reference to the requirement under cl 2.4(a)(i) of Specification C1.1. Mr Kip’s evidence was that this was, in effect, the same mistake as contained in the peer review regarding the 1-25 Harbour Street building. Mr Kip stated that both of the peer reviews were conducted as part of a larger batch of reviews which were conducted at the same time.

577 The Carindale Shopping Centre peer review report went on further to state:

The evidence summarised in Section 5 [regarding the results of various fire tests] above and in the [draft fire safety engineering report] is considered sufficient to demonstrate that the presence of ALUCOBOND®PLUS and ALPOLIC®/fr will have little effect on vertical fire spread and will be resistant to potential internal and external fire exposures.

Notwithstanding the ability of ALUCOBOND®PLUS and ALPOLIC®/fr to limit fire spread as stated above, the risk assessment presented in the [fire safety engineering report] recognises other risk control measures including the presence of a sprinkler system. Other aspects that would further mitigate potential fire spread are now considered…:

(a) the ACP is generally limited to “strips” as opposed to large areas,

(b) the larger wall area shown in Figure 5.8 is at the top of the building and fire spread, should it occur, would have much less effect than if the area was at the bottom,

(c) the orientation of much of the ACP (Figure 5.7) is horizontal and discontinuous and this will greatly limit the burning rate and the likelihood of vertical spread. Horizontal spread would be very limited,

(d) the ACP materials are not readily accessible to the public and therefore are unlikely to be subjected to deliberate external fires, and

578 Mr Kip accepted that the view expressed in the first paragraph of the above extract, regarding the use of Alucobond Plus having little effect on vertical fire spread, was independent to the number of fire spread mitigation measures that were then identified in the report. When the potential inconsistency between the views Mr Kip expressed in the Group 6 Joint Report and the views contained in the report he co-authored on the Carindale Shopping Centre were put to Mr Kip, Mr Kip again sought to explain the latter on the basis that it was considering a “post-construction remediation issue” rather than a “design issue” which is what his comments in the joint report were directed towards.

579 Senior counsel for 3A also referred to SKIP Consulting’s report on 544-550 High Street, Northcote, also discussed above in section 5.4.3 of these reasons.

580 In that report, as mentioned, Mr Kip conducted his own analysis of the building and assessed the building to be “low-risk” using the VCT’s RAT, compared to the “extreme” risk assessed by the VBA. While Mr Kip noted that a low-risk assessment using the RAT was not equivalent to a particular use of an ACP not constituting an undue fire risk (and indeed, Mr Kip’s RAT assessment reflected the same value for a number of assessment criteria in the RAT, including the configuration of the combustible cladding, and the proximity of combustible cladding to potential ignition sources), Mr Kip accepted that, in his view, the particular use of Alucobond Plus in that building did not give rise to an undue risk of fire spread.

581 While Mr Kip also stated that his analysis was conducted in the context of a post-construction risk assessment, and that he had advised the owners corporation that, in the long term, they would need to reclad the building, he accepted that this was for other reasons such as insurance. Mr Kip also noted in the report that, in his view, subject to the preparation of a relevant Performance Solution that was independently peer-reviewed and agreed by the relevant fire brigade, he did not believe that any cladding needed to be removed.

582 In summary, Mr Kip’s opinion was that the Alucobond products could not be used as an attachment, pursuant to cl 2.4 of Specification C1.1 because the products must comply with the requirements in Specification C1.10, and the AS 1530.3 test results provided in relation to Alucobond PE and Alucobond Plus did not satisfy the requirements of the BCA. Therefore, the Alucobond products do not meet the requirement in cl 2.4(a)(i) of Specification C1.1. Mr Kip also opined that the requirement in cl 2.4(a)(iii) (that the products not constitute an undue risk of fire spread via the façade of the building) could not be satisfied for Alucobond PE in any circumstances, and would be extremely difficult or expensive to satisfy for Alucobond Plus. Mr Halstead’s opinion was that the Alucobond products, when used as an attachment to an external wall were exempt from the requirements in Specification C1.10, making the AS 1530.3 test results irrelevant. In relation to the requirement in cl 2.4(a)(iii), Mr Halstead’s opinion was that ‘undue’ indicates the risk of fire spread is to be balanced against other factors, rather than preventing any and all risk of fire spread.

5.5.2 Could Alucobond PE or Alucobond Plus have been used in conformance with a CodeMark Certificate of Conformity during the relevant period (and if so, in what circumstances)?

583 Before outlining the relevant evidence of the experts, it is helpful to explain what the CodeMark regime is and how it fits into the BCA.

584 The CodeMark Certification Scheme is a voluntary third party building product certification scheme, administered by the ABCB. The scheme was first developed in 2009.

585 The scheme sets a nationally accepted process to demonstrate compliance with the BCA.

586 The scheme involves the accreditation of CodeMark Certification Bodies. Applications are then made to the Certification Bodies for certification of particular products in Australia against particular requirements of the BCA. Certification Bodies assess the application of the product, and where such applications are approved, the Certification Body may issue a Certificate of Conformity. A Certificate of Conformity may be suspended or withdrawn by the Certification Body. Certificates of Conformity are generally valid for three years and describe, amongst other matters, the relevant BCA provisions in respect of which the certificate is issued and any conditions or limitations which must be satisfied in order to rely on the certificate.

587 Under the BCA, a Certificate of Conformity can be used as evidence that the use of a material meets particular performance requirements or DtS Provisions. Clause A2.2 specifically provides:

A2.2 Evidence of suitability

(a) Subject to A2.3 and A2.4, evidence to support that the use of a material, form of construction or design meets a Performance Requirement or a Deemed-to-Satisfy Provision may be in the form of one or a combination of the following:

(i) A report issued by a Registered Testing Authority, showing that the material or form of construction has been submitted to the tests listed in the report, and setting out the results of those tests and any other relevant information that demonstrates its suitability for use in the building.

(ii) A current Certificate of Conformity or a current Certificate of Accreditation.

(iii) A certificate from a professional engineer or other appropriately qualified person which–

(A) certifies that a material, design, or form of construction complies with the requirements of the BCA; and

(B) sets out the basis on which it is given and the extent to which relevant specifications, rules, codes of practice or other publications have been relied upon.

(iv) A current certificate issued by a product certification body that has been accredited by the Joint Accreditation System of Australia and New Zealand (JAS-ANZ).

…

(vi) Any other form of documentary evidence that correctly describes the properties and performance of the material or form of construction and adequately demonstrates its suitability for use in the building.

588 In effect, a CodeMark Certificate of Conformity can be relied upon by a builder or building certifier as evidence that a particular product or system, when used in accordance with the certificate, meets a particular performance requirement or complies with a DtS Provision.

589 Three CodeMark Certificates were issued for Alucobond PE, covering consecutive periods from July 2013 to July 2016. The certificates certified that Alucobond PE complied with performance requirements CP2 and CP4. However, the certificates had always been limited to Type C construction and were subject to increasing limitations over the period during which they were issued.

590 In relation to Alucobond Plus, six CodeMark Certificates were issued covering consecutive periods from 12 July 2013 to 12 July 2019. Again, the certificates certified that Alucobond Plus complied with performance requirements CP2 and CP4, however, they contained a number of limitations which continued to grow over the relevant period. The first CodeMark Certificates for Alucobond Plus were issued by CertMark, however, from 12 July 2016 onwards, the CodeMark Certificates were issued by Global-Mark.

591 Both Mr Kip and Mr Halstead agreed that Alucobond PE and Alucobond Plus could be used in conformance with a CodeMark Certificate of Conformity during the relevant period, if the relevant conditions and limitations on the certificates were satisfied. Mr Kip noted in the Group 6 Joint Report that on his review of the relevant certificates, the allowed use of Alucobond PE pursuant to the certificates was very limited and the use of Alucobond Plus was also subject to limitations.

592 The Applicants make submissions that, to the extent the CodeMark certificates support a finding that the Alucobond products could be used in a manner compliant with the BCA, such a finding should not be made on the basis that the certificates should never have been issued in the first place, as the Certification Bodies did not have sufficient information to reach the conclusions they did. This is discussed in further detail later in these reasons.

593 It is, however, relevant to note a number of key points in relation to the expert evidence on this issue. Mr Kip, in his first expert report, noted his view that the original applications for CodeMark Certificates for both Alucobond PE and Alucobond Plus did not provide a sufficient basis or sufficient test reports and analysis for the issue of the CodeMark Certificates.

594 In particular, Mr Kip’s view was that the applications:

(a) did not adequately address the performance requirements of the BCA in the application form;

(b) did not provide AS 1530.1 or AS 1530.4 test results;

(d) relied on a number of international tests of doubtful relevance, which were performed in ways that did not reflect the proposed installation of the product in the Australian market;

(e) did not involve large-scale testing; and

(f) did not analyse or consider the degree of concealment of the combustible core.

595 Particularly in relation to Alucobond Plus, Mr Kip noted his view that the materials provided in support of the applications for the CodeMark Certificates did not provide a sufficient basis for the issuing of the certificates. He noted that, over time, each certificate progressively increased the number of conditions and limitations – which he said supported his view that the materials provided did not provide a sufficient basis for the issue of any CodeMark Certificates.

596 In relation to Mr Kip’s criticisms of the applications for CodeMark Certificates, Mr Halstead made the following comment in his expert report:

I take these statements to be criticisms of the Certifying Body for having issued the Alucobond PE and Alucobond Plus CodeMark Certificates. I do not understand the relevance of those criticisms. It is up to the Certifying Body to determine whether the information provided by the applicant is a sufficient basis to issue the certificate. What is important is that the CodeMark Certificates were in fact issued. This means that unless they were suspended or withdrawn, they constituted one form of evidence under clause A2.2 of the BCA that Alucobond PE and Alucobond Plus could be used conformably with the BCA, as long as the user was mindful of the limitations set out in the particular certificate.

597 Mr Kip on the other hand, in his second expert report, stated that Mr Halstead’s comments ignored the obligation of an applicant who applies for a Certificate of Conformity to provide accurate, complete, and comprehensive details of their product’s properties and characteristics to the Certification Body for consideration.

598 Although Professor Torero did not participate in Expert Group 6, the following comments made in his expert report are also relevant:

I will fully concur with Mr. Kip’s statement:

“I also note below that many of the fire tests included with the material provided were performed on samples that do not reflect the use of the product as set out in the applicant’s Australian installation manuals, and therefore do not support the proposed use. In my view, the certificates should never have been issued based on the material provided.”

The issuing of these certificates promotes the incorrect use of these products under Deemed-to-Satisfy provisions, which is inappropriate.

(Citations omitted.)

599 It is also relevant to note that, in NSW, up until March 2018, a certifier was not entitled to refuse to issue a construction certificate if a Certificate of Conformity had been issued in accordance with the CodeMark scheme. In particular, s 109F(2) of the EPA Act, as it then applied, relevantly provided:

109F Restriction on issue of construction certificates

...

(2) A certifying authority must not refuse to issue a construction certificate on the ground that any building product or system relating to the development does not comply with a requirement of the Building Code of Australia if the building product or system is accredited in respect of that requirement in accordance with the regulations made for the purposes of Part 4.

600 Clause 224 of the Environmental Planning and Assessment Regulation 2000 (NSW) was a regulation made for the purposes of ss 4.15(4), 4.28(4) and 6.8(1)(a) of the EPA Act. Clause 224 provided that a building product or system was “accredited if…a certificate of conformity issued in accordance with the CodeMark scheme is in force in respect of the building product or system”.

601 Consistent with the legislative provisions, during the expert conclave Mr Halstead stated that to the extent that the use of a material was supported by a CodeMark Certificate, he would not, as a building certifier, need to go further in order to approve the use of the product.

602 This was illustrated by reference to an AED Group report dated 18 May 2018 which comprised of a façade compliance assessment of a multi-storey apartment building at 41-45 Belmore Street, Ryde. The report was reviewed and approved by Mr Halstead.

603 The purpose of the report was to identify if there was non-compliance with BCA C1.9 and C1.14, specifically in relation to the non-combustibility of external walls and ancillary elements, due to the presence of Alucobond Plus. The building was of Type A construction, having a rise in storeys of 13.

604 The following images extracted from the report provide an indication as to the extent to which Alucobond Plus was used on the building.

605 The report contains little, if any, analysis of the location of Alucobond Plus, or whether it is used as an attachment to or is part of the external wall (although the report does contain some discussion regarding this relevant distinction). The report, after identifying the location of the Alucobond Plus on the building, appears to simply have concluded that:

AED has been provided with a Codemark Certificate for the Alucobond Plus ACP’s [sic], installed to the building.

The Alucobond Plus product is certified under a Codemark Certificate of Conformity (see attachment A) which is considered suitable to comply with Clause A2.2(a)(i) of the BCA.

Accordingly, based on the information provided that the installed product is “Alucobond Plus” and supported by a Codemark Certificate of conformity, no further works are considered necessary.

606 The CodeMark Certificate referred to in the report is certificate number CMA-CM40032 (Rev 3), revised in August 2015. As a separate point, it appears unclear on the face of the report how it was determined that the actual use of Alucobond Plus on the building was consistent with the number of limitations contained in the CodeMark Certificate.

5.5.3 Could Alucobond PE or Alucobond Plus have been used on a low-rise building of Type C construction during the relevant period?

607 There was disagreement between the experts on this issue, with the nature of the disagreement effectively being a question as to the proper interpretation of the BCA.

608 Mr Kip’s view was that while Type C construction was not subject to the higher standards that applied to Type A and B construction, which required external walls to be non-combustible, the BCA still prescribed minimum fire hazard property requirements that needed to be satisfied under C1.10 as it applied to specific building elements, including wall linings. Again, Mr Kip’s evidence was that he had never seen fire test reports for Alucobond PE or Alucobond Plus that satisfied the minimum fire hazard property requirements and which were tested in the manner required under the BCA.

609 In Mr Kip’s view, where the BCA did not contain a specific DtS Provision in relation to a building element or product, the performance requirements still needed to otherwise be satisfied. Mr Kip explained his position as follows during the expert conclave:

The building code deemed-to-satisfy provisions are not a complete set of requirements, and if you don’t have a provision that you have to satisfy, it doesn’t allow you to do anything you want. So you can’t – you can’t use the most combustible material you can imagine because the building code tells you it doesn’t have to be non-combustible.

610 In Mr Halstead’s view, C1.10 does not apply to external elements, and therefore, where the Alucobond products are used as, for example, an external lining to an external wall, they are not required to comply with the fire hazard properties of Specification C1.10. In particular, Mr Halstead noted that C1.10 refers to linings, materials and assemblies in a Class 2 to 9 building. Mr Halstead also noted that the performance requirement CP4 refers to the maintenance of tenable conditions during occupant evacuation, and noted that CP4 applies to linings, materials and assemblies in Class 2 to 9 buildings.

611 Mr Halstead’s view was that the Alucobond products could be used on Type C construction without a Performance Solution where the installation complied with a CodeMark Certificate. He said they could also be used where it was in conformance with the attachment exception under cl A2.4 of Specification C1.1, or where the wall on which it was located was not required to be fire-rated (in which case the attachment exception need not apply) and was not relying on the cladding to form the weatherproofing for the wall.

612 As I have already discussed, particularly in [506 ]-[507 ], Mr Kip accepted that the Alucobond products could, theoretically be used in compliance with the BCA through a Performance Solution. Mr Halstead’s view, as expressed in his report, was that a Performance Solution could be developed, with the assistance of an appropriately qualified FSE to determine whether the particular building element design satisfied the relevant Performance Requirements.

613 My findings as to whether the Alucobond products were able to used in a BCA compliant manner are discussed in section 8 of these reasons.

5.6 Expert Group 7 – Architects and building professionals

614 The summary of Expert Group 7 is extracted below:

Smithson Report 2 – 22 Sep 2023 |
| | Joint Report of Mr Quigley, Mr Incoll, and Mr Smithson dated 26 February 2024 (Group 7 Joint Report) | | |
615 Expert Group 7, referred to as the “Architects and building professionals”, was constituted by Mr Peter Quigley, Mr Greg Incoll and Mr Peter Smithson.

616 Mr Quigley is a qualified and registered architect. From 1975 to 2003, Mr Quigley worked for major architectural firms in Melbourne and Sydney, including from 1993 to 2003 as a director of Daryl Jackson Architects. In 2003, Mr Quigley relocated to Allans Flat and has worked in private practice since then as a freelance architect. Mr Quigley has also lectured in professional practice at RMIT and the University of Sydney. Mr Quigley also provided expert evidence in litigation related to the Lacrosse Fire in the Victorian Civil and Administrative Tribunal.

617 Mr Incoll is a project and development manager with 40 years of experience in major property development and construction projects, providing consulting, governance, and advisory services. Since 2013, Mr Incoll has been the Managing Director of Sagent, a management consulting company. Prior to this role, Mr Incoll has held various positions in project management and delivery.

618 Mr Smithson, 3A’s expert, has been a registered architect in Victoria for more than 35 years. Mr Smithson has had particular experience in façade issues, having established Peter Smithson & Associates, a façade consulting business in 1998 which was subsequently purchased by Arup Façade Consultants in 2001. In 2007, Mr Smithson established BG&E Facades Pty Ltd, a consulting practice linked to the multi-disciplinary engineering consultancy BG&E, through which Mr Smithson was involved in a range of major façade projects. Mr Smithson continues to be engaged by BG&E as a consultant.

619 Each expert in Expert Group 7 prepared two of their own reports in these proceedings. The experts also prepared a joint report dated 26 February 2024.

5.6.1 Objections to evidence given by Mr Quigley and Mr Incoll

620 3A made objections to various parts of the expert reports prepared by Mr Quigley and Mr Incoll. The objections were raised primarily regarding aspects of their reports where Mr Quigley and Mr Incoll sought to give evidence regarding the state of knowledge of the broader industry.

621 Mr Quigley, at various parts of his first report, sought to give evidence as to the “general understanding” of architects in Australia regarding ACPs during the relevant period, including where this understanding stemmed from. Mr Quigley’s statements were to the effect that there was a general understanding in the profession that ACPs were relevantly non-combustible products, as the aluminium skins protected the core from ignition, and that such an understanding was derived from the advertising of the products by the suppliers, including in literature provided to architects.

622 3A objected to this evidence on the basis that Mr Quigley was not qualified to give the evidence. In particular, 3A highlighted that during the relevant period, Mr Quigley had been based in regional Victoria and had worked in private practice as a freelance architect, collaborating with a local firm of architects, and architects in Sydney and Melbourne. While I do not doubt Mr Quigley’s professional experience and skills as an architect, I accepted 3A’s submission that Mr Quigley could not speak to the state of mind of architects generally in Australia during the relevant period.

623 While Mr Quigley referred to having held positions in various professional bodies and having given lectures in professional practice, it is not clear when this occurred, and if it occurred during the relevant period. Additionally, it is unclear to what extent Mr Quigley’s opinions are informed by discussions with other architects; his first report does not identify how the issue was discussed with other architects, when such discussions arose, or who such discussions may have been held with. Accordingly, several swathes of Mr Quigley’s first report were ruled inadmissible. I do note, as a point of distinction, that I do not consider this to undermine Mr Quigley’s ability to give evidence as to how a prudent and qualified architect would have acted, or what they would have expected, during the relevant period. But such evidence does not go to the state of mind of architects generally in the industry. This distinction was less evident in some circumstances than in others.

624 Similar objections were raised in relation to Mr Incoll’s evidence. In various parts of his reports, Mr Incoll sought to give evidence regarding the “commonly held understanding” regarding ACPs among developers, builders (and developers’ or builders’ trade contractors or subcontractors), and superintendents in Australia (which Mr Incoll defined as the “Relevant Personnel”) during the relevant period, including his evidence about what that understanding was based on. Mr Incoll’s evidence was largely to the same effect as that of Mr Quigley; namely, that the Relevant Personnel specifying ACPs commonly understood that they would comply with the BCA, and that they would generally be non-combustible. Again, the basis of this understanding was said to be the information made available by manufacturers and suppliers of ACPs.

625 Mr Incoll has owned and operated project management consulting businesses in Australia for over 30 years and has significant experience in providing development and project advice. Mr Incoll’s experience includes acting on numerous medium and high-rise buildings that have been specified and clad with ACPs. Again, I do not doubt Mr Incoll’s considerable experience in his profession.

626 However, where Mr Incoll’s evidence was said to be based upon, for example, his interactions with his network in the building industry, I accepted 3A’s submission that his evidence is not sufficiently based upon his specialised knowledge, and the underlying facts and assumptions on which it is based are not sufficiently disclosed.

627 Considering the breadth of evidence sought to be given by Mr Incoll, including the particularly broad definition of Relevant Personnel, I was not satisfied that Mr Incoll could appropriately speak to the “general understanding” of such persons within Australia during the relevant period. Accordingly, a number of sections of Mr Incoll’s first and second report were ruled inadmissible.

628 The evidence rulings discussed above posed a difficulty in respect of the Group 7 Joint Report, as aspects of it went to the same topics ruled inadmissible in the individual reports of Mr Quigley and Mr Incoll, namely the general understanding of architects and building professionals regarding ACPs during the relevant period.

629 Prior to the Expert Group 7 conclave commencing, I was informed that the parties had reached a compromise whereby rather than striking out sections of the joint report, where the report referred to the generalised knowledge of industry participants, the report should be read as referring to the personal knowledge of the experts during the relevant period. I agreed that this was an appropriate manner of proceeding and have read the Group 7 Joint Report accordingly.

630 The following agenda was prepared in relation to the Expert Group 7 conclave:

1. What advantages are offered by the use of ACPs?

2. What uses of ACPs did you observe during the relevant period?

3. During the relevant period, what role would a reasonably prudent architect, developer, builder or contractor, or superintendent, (together, Building Professionals) have played in the selection of materials (including ACPs) for use on the façade of a building?

4. In performing that role, would a reasonably prudent Building Professional have had regard to marketing material provided by manufacturers and/or suppliers of ACPs? If so, in what way(s)?

5. During the relevant period, would a reasonably prudent Building Professional have considered Alucobond PE or Alucobond Plus safe and fit for purpose if it is assumed for the purposes of the question that both products:

a. were combustible;

b. were not capable of being used in a manner that met the deemed-to-satisfy provisions of the BCA; and

c. had the fire-risk properties identified in paragraph 14 of the Second Further Amended Statement of Claim?

6. Could a reasonably prudent Building Professional have adopted or approved the performance solutions proposed by Mr Davis for the Shore Building and the Five Dock Building?

5.6.2 What advantages are offered by the use of ACPs?

631 There was little disagreement between Expert Group 7 that ACPs provided a range of advantages. These advantages included the fact that ACPs:

(a) provided a high-quality finish to the exposed external aluminium surface;

(b) involved less expensive material supply and fabrication costs when compared with the alternative post-finished solid aluminium sheet-based façade systems;

(c) provided the opportunity to achieve an in-place, flatter façade system less likely to exhibit out-of-plane distortion caused by thermal movement due to considerations of the product’s response to changes in temperature and detailed design facilitating the accommodation of such movement;

(d) were relatively lightweight compared with the alternative post-finished solid aluminium sheet-based façade systems, allowing less robust (and sometimes less complex) fabrication of individual cladding components and face support structures;

(e) could be easily formed to create unique façades either in the factory or on-site, and where the current and folding required to achieve the required shapes was to be undertaken on site, the panels could be transported flat, reducing transportation costs; and

(f) were more thermally efficient than aluminium or steel panels.

5.6.3 What uses of ACPs did you observe during the relevant period

632 Again, there was little disagreement between the experts. The experts agreed that ACPs were mainly used for external cladding on buildings. The buildings that ACPs were used on varied widely from medium or high-rise residential or commercial buildings, institutional buildings such as hospitals or universities, or low-rise retail and residential buildings.

633 The Group 7 Joint Report noted that ACPs were used generally as the envelopes of buildings for weatherproofing, either as a sealed system which provided the primary waterproofing or as part of a rainscreen system where a weatherproof wall sat behind the rainscreen. ACPs were also used as an attachment not serving the function of a rainscreen such as a perforated sunscreen, soffit linings, internal wall cladding, rooftop features, and signage.

5.6.4 During the relevant period, what role would a reasonably prudent architect, developer, builder/contractor, or superintendent (together, the “Building Professionals”) have played in the selection of materials (including ACPs) for use on the façade of a building?

634 In the Group 7 Joint Report, the experts agreed that the architect was the leading professional in the design team who had primary responsibility for the selection of materials for use on the façade of a building, taking account of the views of or instructions from the developer and any advice from relevant specialist consultants.

635 It was noted in the joint report that there was a degree of disagreement between Mr Smithson on the one hand, and Mr Quigley and Mr Incoll on the other. In particular, Mr Smithson’s view was that Mr Quigley and Mr Incoll both over-emphasised the role of the architect.

636 The extent of this disagreement was explained in more detail in Mr Smithson’s first report. Mr Smithson noted his view that the architect on a project is responsible for assisting the relevant project manager in eliciting advice from various consultants, including specialists such as façade consultants, fire engineers, or surveyors, and then implementing such advice. Mr Smithson’s view is that where an architect is involved in a decision that goes beyond the scope of their expertise, the architect would raise the issue with the project manager and request for specialist input to be obtained. In doing so, Mr Smithson noted that an architect does not work in isolation, and therefore, that the ultimate selection of materials is the result of an iterative process, involving input from other professionals.

637 Mr Quigley accepted that in particular projects, the architect may be instructed to use a particular material by a client. While Mr Quigley also noted that input may be provided by specialist consultants such as those identified by Mr Smithson on the suitability of materials, in his view, the engagement of such specialist consultants did not minimise the role of the architect, who he said holds ultimate responsibility for the selection of materials. To the extent a builder or another consultant proposed a substitute material, Mr Quigley noted that the architect would evaluate the proposal to determine if the substitute satisfied the relevant design intent.

638 Mr Quigley also noted that the engagement of such specialist consultants would depend on particular projects. Clients would consider their approach to risk management and their confidence in the ability of the architect. Mr Quigley’s experience was that separate project managers or façade consultants had only been engaged in more recent years, and mainly for large projects.

639 I accept, as outlined in the Group 7 Joint Report, that the difference of opinion expressed by Mr Smithson is likely a result of Mr Quigley and Mr Incoll’s view regarding where the ultimate responsibility sits. I do not take Mr Quigley and Mr Incoll to be saying that the architect is solely responsible for the selection of materials to be used on a façade – rather that, as expressed in the joint report, architects have primary responsibility for the selection of materials, which would be exercised taking into consideration any advice from relevant specialist consultants in particular projects. Naturally, the specific scope and how such selection was exercised by an architect would depend on the particulars of the relevant project. In this sense, I do not consider the experts to be in any substantive disagreement.

640 It is also relevant to note, as identified in the joint report, the degree of disagreement may also be the result of the different professional experience of the experts. Where Mr Quigley has worked as a project architect responsible for projects as a whole, Mr Smithson has worked more specifically as a façade consultant during the relevant period.

641 The experts also noted that, generally, developers had limited input in relation to material selection, and where a preference for a particular façade system was indicated, it would generally be motivated by the impact to the feasibility of the project. The experts also noted that builders also have a more limited role in material selection, particularly where they did not carry a design responsibility. Builders may propose an alternative to what may be specified in a design if they considered it had a cost or time advantage, which would then be subject to evaluation. The role of superintendents on the other hand was largely limited to administering the relevant building contract between the developer and builder, and they would not ordinarily be involved in the selection of materials.

5.6.5 In performing that role, would a reasonably prudent Building Professional have had regard to marketing material provided by manufacturers and/or suppliers of ACPs? If so, in what way(s)?

642 In response to a substantively similar question, the experts provided the following response in the Group 7 Joint Report:

What was the extent to which architects and building professionals relied upon material provided by suppliers and/or manufacturers of ACPs?

Where the material was in common usage or where it had been previously used successfully on a project in which one of us was involved, architects and building professionals would rely upon supplier/manufacturer information, unless qualified or contradicted by any building specialist such as a building certifier, surveyor or fire engineer (the latter if engaged).

In addition to the above answer, we would say the following:

In practice, in the period up to 2017/2018 architects (and building specialists such as building surveyors, certifiers and fire engineers) used ACPs on the basis that they were appropriate and promoted as being appropriate by manufacturers and suppliers, there being a view held by some building professionals that the Lacrosse fire may well have been caused by substitution of an inferior product. The issue of combustibility did not arise with Alucobond products whether with architects, building surveyors, certifiers or fire engineers.

After the Grenfell fire, the Victorian Cladding Taskforce report and the 2018 NSW Fair Trading regulation banning the use of ACPs with a core of more than 30% polyethylene, opinion began to change amongst all building professionals. But architects (and other building professionals) continued to use Alucobond Plus on the basis that it complied with the exemption listed in the NSW Commissioner for Fair Trading ban.

643 The comments made in the joint report are to be interpreted subject to the limitation discussed above regarding evidence of generalised knowledge of industry participants, to be read as referring to the personal knowledge of the experts during the relevant period.

644 In Mr Quigley’s first report, he noted that architects ordinarily rely on information provided by the supplier and/or manufacturer of the ACP when deciding to specify or recommend an ACP for use on a building, including information in respect of matters such as aesthetics, cost, durability, performance, and compliance with Australian Standards. Mr Quigley stated that architects would initially consult the trade literature material held in their office such as promotional brochures which would include technical data such as thermal performance, structural behaviour, fire behaviour, and sizes and colours, among other details. He noted that this literature became available online with the development of the internet.

645 Mr Quigley explained that where the product information provided the technical detail required, an architect could rely on that information in making a final decision. However, to the extent it was determined that additional information was required on a particular aspect of the product, such information would be sought from the supplier directly. During the expert conclave, Mr Quigley noted that this often related to particular fixing methods.

646 Mr Quigley also stated in his first report that architects would generally take compliance as a given if marketing materials contained numerous examples of the use of the material on finished buildings, which would include compliance in terms of fire hazard. Mr Quigley further noted that while the information provided by suppliers or manufacturers could include the results of fire tests, as architects were not trained in or familiar with the interpretation of fire test results they were not in a position to interpret the results of those tests. Mr Quigley stated that to the extent that marketing material showed that there was no difference in the AS 1530.3 test results for Alucobond PE, Alucobond Plus, and Alucobond A2, to an architect, the fire properties of the three, for BCA compliance purposes, were identical.

647 However, during the expert conclave, Mr Quigley was also taken to other aspects of the Alucobond marketing material which contained a table containing the international fire classifications for Alucobond PE, Alucobond Plus, and Alucobond A2. The table outlined the different classifications each product had under various international fire standards. The table is extracted below:

648 Additionally, Mr Quigley was also taken to a section of the marketing material (a brochure by Alucobond Architectural titled "Alucobond Vision Materialized" dated 2010) which outlined the various features of the relevant Alucobond range, and described the core of Alucobond PE as “Virgin PE” core, the core of Alucobond Plus as “mineral filled core (hardly inflammable according to EN1350-1)”, and the core of Alucobond A2 as “mineral core (non-combustible according to EN13501-1)”.

649 Mr Quigley accepted that this would indicate to a reasonably prudent and qualified architect that the cores of the product had different degrees of fire resistance. However, Mr Quigley also noted that the same marketing material also made reference to the non-combustible aluminium cover sheets protecting the core, such that the reaction-to-fire properties of the core were less relevant. In this context, Mr Quigley also noted that he was not familiar with the international fire standards, and in selecting a product he relied on the expertise of the relevant certifier to determine whether or not a product was non-combustible, and therefore, whether a product satisfied the DtS Provisions of the BCA.

650 Mr Smithson, in his first report, suggested that an architect would be unlikely to pay attention to the technical information provided in such product information, given that architects were generally more interested in the appearance of the products and the capacity to transform the products into a façade. Mr Smithson stated that architects would have regard to their knowledge of the BCA, and the overall feasibility of the project, when developing a new design, and will consider the range of products and materials they are familiar with to help formulate the design. To the extent an architect was considering a new product, a competent architect would undertake further investigation into the technical aspects of the product and its suitability to be used on a façade. In any event, an architect would expect the technical details to be examined closely during the iterative design process and would seek and rely on the advice of relevant specialists as to the suitability of specific products.

651 During the expert conclave, Mr Smithson referred specifically to paragraph 90 of his first report which stated:

[W]here an Architect is involved in a decision that goes beyond the scope of their expertise, in my experience, the Architect would raise this with the Project Manager (or the client where relevant) and request to retain an appropriate specialist (eg. a fire engineer). In my experience, an Architect would not (and should not, having regard to their relevant professional obligations set out above) make that decision without the advice of a specialist consultant.

652 Mr Smithson reiterated this position during the expert conclave. While Mr Smithson accepted that the product information provided by a supplier or manufacturer would be the first resource an architect would refer to, he reiterated his view that an architect would need to seek specialist advice when dealing with areas that did not fall within their field of expertise.

653 While Mr Smithson’s observation can be accepted in principle, it is relevant to note that the Group 7 Joint Report explicitly considered whether it was common to engage an FSE during the relevant period, and in what circumstances FSEs were engaged. The responses provided in the joint report are extracted below, although it is noted that they were not the subject of discussion over the course of the expert conclave:

Whether it was common to engage a fire safety engineer to assess the fire risks associated with the use of ACPs during the relevant period? Whether it was common to engage a fire safety engineer to assess the fire risks associated with the use of ACPs during the relevant period?

In the experience of [Mr Incoll] and [Mr Quigley] it was not common during the relevant period to engage a fire engineer for this purpose, though [Mr Quigley] knew of it having been done on one project in Albury around 2014. [Mr Smithson]’s experience was that it was common to engage a fire engineer covering every relevant aspect of a job, but he cannot say and cannot recall that they gave any specific advice on the use of ACPs and on any attendant fire risks associated with them.

What were the circumstances in which a fire safety engineer would be engaged to assess the fire risks associated with the use of ACPs during the relevant period?

In the experience of [Mr Incoll] and [Mr Quigley] a fire engineer was only engaged where a builder certifier had indicated a possible non-compliance and the building certifier considered that the development of a performance solution could justify certification. [Mr Quigley] does not recall ever engaging a fire engineer himself. [Mr Incoll] recalls in 2016 a developer engaged a fire engineer who formulated a performance solution which, when relevant work for it was done, led to certification.

In [Mr Smithson]’s experience the fire engineer was involved in the iterative process of building design in all aspects, but he cannot say and cannot recall that they gave specific advice on the use of ACPs, and any attendant fire risks associated with them.

654 In this respect, the evidence of Mr Incoll and Mr Quigley is to be preferred. Indeed, this is consistent with the evidence given by the FSEs in Expert Group 4-5 themselves. As identified above, Mr Smithson has worked more recently as a façade consultant, which I accept is more likely to be involved in larger projects where more specialist advice may be sought. It is difficult to understand Mr Smithson’s view that it was common to engage an FSE covering every relevant aspect of a job as being reflective of general practice in the industry during the relevant period, given the conflicting evidence given by the other experts, including the FSEs themselves.

5.6.6 During the relevant period, would a reasonably prudent Building Professional have considered Alucobond PE or Alucobond Plus safe and fit for purpose if it is assumed for the purposes of the question that both products: (a) were combustible; (b) were not capable of being used in a manner that met the deemed-to-satisfy provisions of the BCA; and (c) had the fire-risk properties identified in paragraph 14 of the Second Further Amended Statement of Claim?

655 In response to a substantively similar question, the experts provided the following responses in the Group 7 Joint Report, in respect of both Alucobond PE and Alucobond Plus:

[Mr Quigley and Mr Smithson]: If a fire engineer provided a performance solution for Alucobond [PE or Plus] the architect could consider its use if they considered that the fire engineer’s recommended performance solution as to how to mitigate the risk, was satisfactory at least from a design perspective.

[Mr Incoll]: [F]rom a project manager’s perspective, the project manager would require that the architect, in addition to any performance solution for Alucobond [PE or Plus], also proposed alternative non-Alucobond [PE or Plus] or equivalent solutions for consideration by the project team because of the implications of use of combustible products. These other alternatives together with the performance solution for Alucobond [PE or Plus] would be put before the client.

656 Mr Quigley noted during the course of the expert conclave that had he known that the Alucobond products were combustible and were not capable of being used in a manner that met the DtS Provisions of the BCA, he would have avoided their use.

657 The observations noted by Mr Quigley and Mr Smithson acknowledge, as they must, that Alucobond PE and Alucobond Plus could be used in a manner that was compliant with the BCA. In this sense, to the extent that an FSE provided a Performance Solution in respect of the fire resistance requirements of the BCA, it would be open to an architect to incorporate that Performance Solution subject to any other consideration the architect considered relevant.

658 It should be noted that there is a fair distinction to be drawn between an architect accepting an alternative Performance Solution proposed by an FSE on the one hand, and, on the other hand, whether a relevant Qualified Professional would ordinarily pursue a Performance Solution. This was the subject of discussion in the subsequent topic below. Of course, this distinction only arises if the relevant non-compliance was identified in the first place, such that it was understood that a Performance Solution would need to be adopted.

5.6.7 Could a reasonably prudent Building Professional have adopted or approved the Performance Solution s proposed by Mr Davis for the Shore Building and Five Dock Building?

659 In response to a substantively similar question, the experts provided the following response in the Group 7 Joint Report (but which included the wording “in preference to using a non-combustible cladding product at the relevant time”), in relation to the Shore Building:

Assuming the fire engineering suitability and satisfaction of building requirements of the performance solutions, the performance solutions of Davis could be adopted by an architect or other building professional on the basis of a series of related issues being satisfactorily addressed as are outlined in the report of Mr Quigley in reply at paragraph [62] to [69].

Also, in [the experts’] experience it was often the case that even a mere suggestion of the need for an alternative solution (or performance solution) would prompt a developer or designer to select an alternative cladding product that does not require such a performance solution so as to avoid time, cost and risk impacts…

660 The experts provided the same answer in respect of the Performance Solutions designed by Mr Davis for the Five Dock Building.

661 Paragraphs 61 to 73 of Mr Quigley’s second report separately identified how an architect would consider the Performance Solutions proposed by Mr Davis in his various alternative proposed Performance Solutions, some of which were proposed assuming the solution took place for a new build prior to the building being erected, and some of which were proposed as remediation measures taking effect upon existing buildings. Mr Quigley’s view is that while an architect would accept an FSE’s proposal to remove, or from the beginning not use, combustible ACPs from the perspective of compliance with the performance requirements of the BCA, an architect would also consider: the impact on the aesthetics of the building, the ease of panel fixing, the impact of the proposed change on the architectural vision for the design of the building, the non-combustibility of the material to be substituted, the impact of the additional work on the occupants of the building, and the costs associated with the proposed change.

662 Mr Quigley also noted particularly in relation to Mr Davis’ Performance Solution for the Five Dock Building (which is discussed in detail below in the context of the evidence given by Mr Abbott who undertook a cost assessment of the proposed work) that unlike some of the other Performance Solutions proposed which involved the removal of ACPs, Mr Davis also proposed that a Performance Solution could be achieved through the provision of sprinklers throughout the entirety of the building. Mr Quigley noted that such a proposal, in the context of an existing building, would be a costly exercise. To the extent the sprinklers and pipework were mounted externally to finished ceilings and walls, this would be visually intrusive, and would involve some impact to occupants who would need to vacate their apartments while the works were undertaken. Alternatively, where the pipework was to be installed within the existing walls and ceilings, while this would be less visually intrusive, it would involve substantially more work and more impact to occupants.

663 During the expert conclave, Mr Quigley and Mr Incoll reiterated their position that if faced with the option of developing a Performance Solution, or alternatively, being able to select a DtS pathway, there would be a strong preference to pursue the DtS pathway given the increased cost and risk that was associated with a Performance Solution. Mr Incoll referred to the following comments made in his second expert report:

My comment as a development management professional is that, during a project, it would take extra cost, time, and inconvenience to prepare a brief, tender services and engage a separate fire engineering professional to prepare an alternative solution (or performance solution) for a building… The process would generally involve… drafting a brief, identifying possible tenderers from a network of contacts, responding to queries from tenderers, assessing responses and engaging the preferred party. There is of course no guarantee that the fire engineering professional ultimately engaged will be able to successfully design an alternative solution that is approved. It is often the case that it would take several attempts by the fire engineering professional to design a proper alternative solution, if at all. Any alternative solution would need to accord with the Architect's design intent and vision for the building, and it would likely be necessary for further discussions to be had between the various stakeholders (including between the Architect, the Developer and the fire engineer who drafted the alternative solution) following the initial drafting of the alternative solution. In my capacity as a project manager on a few projects I have witnessed the outcome of the tender processes described above. The tender process alone can generally take up to two to three weeks to finalise, (with more time that will need to be allowed for, after the finalisation of the tender process, for the alternative solution to be designed and approved) which may result in a delay to the project.

5.7 Mr Stephen Abbott

664 Mr Abbott is the Managing Director of SJA, a firm providing advisory and delivery services to the construction industry. Mr Abbott has held this position since 1999 when he founded the firm.

665 Prior to his current role, Mr Abbott has held various operational and managerial positions in the construction industry. Mr Abbott has more than 42 years of experience in the building, construction, and engineering industry.

666 Mr Abbott is a certified project manager, and in his role at SJA, has provided project advisory, general construction advice, and project management services in relation to major construction projects. Mr Abbott has also been involved in the provision of expert evidence in various matters dealing with issues such as the assessments of construction costs, assessments of construction delays and disruptions, quality of product and rectification costs, and project delivery issues.

667 As identified in the expert evidence summary table above, Mr Abbott has prepared four reports in this proceeding. They are as follows:

(a) Abbott Report 1 – 8 Apr 2022;

(b) Abbott Report 2 – 13 Apr 2022;

(d) Abbott Report 4 – 6 Aug 2024.

668 Mr Abbott’s reports related primarily to the quantification of loss or damage sought by each of the Applicants. Naturally, these are matters that are specific to the individual cases of the Applicants.

669 Mr Abbott presented as an honest and forthright witness, who made appropriate concessions when required. Mr Abbott provided appropriate detail and justification for the opinions and workings contained within his reports, each of which (subject to the issues regarding his third report which are identified below) I consider to have been prepared methodically and with appropriate care. I accept Mr Abbott’s evidence as such.

670 Mr Abbott was subject to confined cross-examination, which focused primarily as to the opinions expressed in his third report. Again, this is discussed in further detail below. There was no substantive challenge raised in respect of his other reports.

5.7.1 Were the rectification costs regarding the Shore Building reasonable?

671 In his first report, dated 8 April 2022, Mr Abbott considered a single question:

Were the costs incurred by the [Shore OC] in replacing the cladding products on the Shore Building as at 14 February 2019, pursuant to the agreement between the [Shore OC] and Restorial Pty Ltd dated 27 November 2019, reasonable and appropriate having regard to the scope of work under the Contract…

672 Mr Abbott identified in his methodology for the report that his assessment of the reasonableness and appropriateness of the costs is by reference to the date when the cladding replacement works were carried out, being between the period of January and May 2020.

673 Mr Abbott identified that he considered a reasonable and appropriate estimate for the work undertaken to be $419,929.10 (excl GST). This assessment followed a detailed assessment of the area of cladding to be removed and installed, labour requirements and relevant rates, supply costs, and other cost inputs.

674 Excluding the costs of performing a painting and cleaning variation (which Mr Abbott stated he had no knowledge of), the Shore OC had incurred a cost of $398,000 (excl GST) for the removal and replacement of the Alucobond PE cladding. Given his estimate for the works was $21,929.10 greater than the cost actually incurred by the Shore OC, Mr Abbott considered that the costs incurred by the Shore OC were reasonable and appropriate.

675 There was no challenge made to the substance of Mr Abbott’s first report, or any evidence filed by the Respondents in response to Mr Abbott’s first report. I accept Mr Abbott’s evidence that the costs incurred by the Shore OC for the works conducted were reasonable.

5.7.2 How much would the complete Alucobond Plus cladding removal work at the Five Dock Building cost?

676 Mr Abbott’s second report, dated 13 April 2022, contained his assessment of the costs that could be incurred by the Five Dock OC if it were to entirely replace the Alucobond Plus cladding at the Five Dock Building with a non-combustible cladding product. Mr Abbott’s fourth report, dated 6 August 2024, then provided an update of the costs that would be incurred in 2024.

677 Following a similarly methodical approach as undertaken in his first report, in his second report, Mr Abbott identified that his independent assessment of the costs that would be incurred to replace the Alucobond Plus cladding at the Five Dock Building with a non-combustible cladding would be $234,649.99 (excl GST) ($258,114.98 incl GST).

678 In his fourth report, this amount was increased to $308,823.36 (excl GST) to reflect 2024 prices ($339,705.70 incl GST).

679 Mr Abbott compared his assessment against the three private contractor quotes the Five Dock OC received in relation to the work over the course of December 2023 to July 2024. As outlined above, at the time of the hearing, the Five Dock OC was still in the process of considering the quotes. The quotes are re-extracted below for ease of reference:

681 In relation to the quotes from Everest Contracting and IClad (when limited to the same scope as his assessment), Mr Abbott noted that the prices quoted were consistent with his own assessment of the expected costs. Mr Abbott also noted that while the quotes received were lower than Mr Abbott’s estimation, each of the quotes had not accounted for certain items which Mr Abbott had accounted for, and which Mr Abbott expected would likely result in a price very close to his own assessment.

682 Again, there was no substantive challenge made to the conclusions reached in Mr Abbott’s second and fourth report, nor any evidence filed by the Respondents in response to them.

5.7.3 Cost a ssessment of Mr Davis ’ remedial P erformance S olution s

683 As noted above, Mr Davis, in his second report dated 22 September 2023, prepared two proposals for Performance Solutions in respect of the Five Dock Building. The first proposal was prepared from the perspective of it being a new build, as characterised by Mr Quigley, where Mr Davis offered a Performance Solution that was intended to meet the relevant performance requirements of the BCA, as at the time the relevant development consents for the building were issued (by reference to the BCA 2016). This Performance Solution was prepared by reference to the relevant construction certificates. However, Mr Davis also prepared a second Performance Solution to demonstrate the building’s compliance with the performance requirements under BCA 2019 Amendment 1, prepared from the perspective of offering remediation measures.

684 In the second proposed Performance Solutions, Mr Davis proposed the following remedial measures:

(a) removal of Alucobond Plus panels that connect vertically between apartment windows on the building’s eastern elevation (ie, the back of the building), replacing them with a non-combustible cladding option if necessary. Additionally, mineral wool batting with a minimum density of 60 kg/m 3 to be installed behind panels around all windows on the eastern elevation; or

(b) provide sprinklers to the entire building internally, including balconies, in accordance with AS 2118.1-2017.

685 Mr Davis did not specify any remediation measures in relation to the west elevation of the building (ie, the front of the building).

686 Mr Davis noted the following in relation to the Performance Solutions:

A building with ACPs may not be unsafe, and the risks may be considered acceptable, however risk perception is subjective and often varies according to the experience and biases of interested parties. The only way to completely remove risk associated with ACPs is to replace them with a non-combustible alternative.

Fire safety risk related to ACPs on a façade is primarily a life safety issue, but could also affect the insurability of the property, and may influence tenant desirability, or the ability to lease, even if a building is compliant with the BCA 2019’s Performance Requirements including one that complies with the DtS provisions or has been determined to be low risk.

687 Mr Abbott’s third report contained his independent assessment of the costs that would be incurred in implementing the remedial measures set out by Mr Davis in the second proposed Performance Solution regarding the Five Dock Building.

688 In relation to the remedial option of installing sprinklers in the building, Mr Abbott stated:

[I]n my experience the retrofitting of a sprinkler system is a very complex process involving many parties and stakeholders and would require a significant amount of survey and investigation (possibly intrusive), before a design could even be commenced. Without a design solution and detailed scope of works I am unable to provide a costing for this option. Such a design solution is not in the Second Davis Report.

689 Mr Abbott therefore focused on the first remedial measure Mr Davis proposed in the second proposed Performance Solution, being the removal of specific ACPs. Mr Abbott prepared the following image to illustrate the scope of work that Mr Davis proposed. The yellow highlighting indicates the Alucobond Plus panels to be replaced with non-combustible cladding, while the green highlighting indicates the Alucobond Plus panels that are to be removed and refixed with mineral wool batting behind them.

Illustration of Mr Davis’ remedial Performance Solution regarding the Five Dock Building

690 In his report, Mr Abbott estimated that this remedial work proposed by Mr Davis would cost $245,588.83 (incl. GST).

691 In reaching the above figure, Mr Abbott calculated that 46 m 2 of Alucobond Plus panels would need to be removed and replaced with solid aluminium, and that 111 m 2 of Alucobond Plus panels would need to be removed and refixed with mineral wool batting inserted behind them (157 m 2 in total).

692 Mr Abbott’s cross-examination was largely confined to the above calculation.

693 In Mr Abbott’s second and fourth report, when calculating the cost of replacing the entirety of the Alucobond Plus panels on the Five Dock Building with a non-combustible alternative, Mr Abbott had measured there being 130 m 2 of Alucobond Plus affixed to the eastern elevation of the building. This is clearly lower than the 157 m 2 of Alucobond Plus that Mr Abbott referred to in calculating the cost of the remedial Performance Solution.

694 Mr Abbott correctly conceded that he had likely made an error in his calculations. During cross-examination, Mr Abbott said, as a guess, the total consequence of the error would be “kind of, maybe 10,000” difference to the total amount. The Applicants have not provided a revised estimate in light of the error identified.

695 3A suggests that Mr Abbott incorrectly included 24 panels that did not require removal under Mr Davis’ Performance Solution, representing 46.08 m 2. 3A suggests that based on Mr Abbott’s calculations, this would reduce the estimated cost of the cladding work by $34,846.54 (from $245,588.83 to $210,742.29, incl. GST).

696 I find that the better view is that the consequence of Mr Abbott’s mathematical error is $35,000. My reason for so finding is that Mr Abbott’s suggestion of $10,000 was a guesstimate given during cross-examination. In contrast, 3A’s figure has been arrived at through a review and consideration of the relevant material.

697 Mr Abbott also suggested that if Mr Davis’ Performance Solution was to be adopted, $36,520 (incl GST) would be required for “project management of fire engineering activities”. This was said to capture the process of procuring an FSE to perform the work required to design and implement a Performance Solution. Mr Abbott suggested that the actual costs of the FSE in performing the work would be an additional cost in the range of $10,000 for final inspection and report, to $100,000 for a full-time service and reporting during the works. Mr Abbott noted that without being provided with a scope of work that would be performed by an FSE, which generally depended on the requirements of certain parties involved, he was unable to estimate a precise cost.

5.8 Mr David Youssef

698 Mr Youssef has over 30 years of operational experience as a firefighter, with the majority of this experience being with the Metropolitan Fire Brigade in Melbourne. Mr Youssef has experience attending thousands of fires and incidents over his career, and since 2010, routinely performed the role of Metropolitan Fire Brigade Senior Duty Officer, being the most senior fire officer on call in Melbourne.

699 Mr Youssef, as a member of the A ustralasian F ire and Emergency Service A uthorities C ouncil, Urban Operations Group, was directly involved in determining operational firefighting (including high-rise) doctrine and training at the national level.

700 On 25 November 2014, as the most senior fire officer on duty in Melbourne, Mr Youssef responded to the Lacrosse Fire. Following the event, Mr Youssef took a lead role in drafting safety-related communication to firefighters regarding the fire spread risk of ACPs. This role extended to contributing to the review and update of fire service doctrine and training. Due to Mr Youssef’s involvement in the Lacrosse Fire and post-event mitigation, Mr Youssef was requested by AFAC to present to Australian and New Zealand Fire Service senior officers on the operational challenges and learnings associated with the Lacrosse Fire.

701 Mr Youssef prepared a single expert report dated 25 April 2022 regarding the approaches adopted by Australian firefighting and rescue authorities during the relevant period to respond to and fight fires involving multi-storey buildings, and whether ACPs fitted to the external walls of such buildings create challenges for firefighting.

702 For the purposes of the report, Mr Youssef assumed that ACPs referred to ACPs consisting of a core entirely made out of PE.

703 Mr Youssef noted in his report that Australian firefighting doctrine and training is mainly predicated on knowledge and experience gained concerning the way that fire spreads in and on multi-storey buildings, and that this includes knowledge of the construction of buildings and the assumption that buildings are generally constructed in accordance with the NCC. Understanding the likely fire spread characteristics in turn informs the actions firefighters need to take to maintain their own safety and the safety of building occupants, and to control building fires.

704 Mr Youssef stated that prior to the Lacrosse Fire, and the subsequent learnings concerning fire spread risk associated with combustible cladding via the façade of buildings, it was generally understood by Australian Fire Services that the vast majority of medium-rise and all high-rise buildings were constructed in a way so as to promote compartmentation of fire. Accordingly, it was understood that major structural elements and materials used on building façades, such as cladding, would be non-combustible. Containing fires within the compartment of origin, or at least to the initial floor of the fire, is a fundamental aim of firefighting operations.

705 It was, therefore, understood that fires would not normally spread beyond the floor of origin, particularly via the façade. Although firefighters understood that, in some circumstances, fire could spread beyond the floor of origin, this usually was expected to occur as a result of combustible material present on balconies or fires spread via windows. Fire spread in this manner would not be expected to readily occur at a rapid pace, and fire spread beyond two floors from the fire floor was, in Mr Youssef’s experience, extremely rare.

706 For these reasons, Mr Youssef stated that prior to the Lacrosse Fire, firefighting doctrine and training, and firefighting practices, did not normally contemplate dealing with fires spreading to many or all floors on tall multi-storey buildings, particularly in the rapid fashion that Mr Youssef observed at the Lacrosse Fire.

707 Mr Youssef stated that knowledge in Australia concerning the use of combustible products, such as combustible cladding, on façades of multi-storey buildings evolved, particularly following the Lacrosse Fire and subsequently the Grenfell Fire. Firefighting authorities adjusted firefighting doctrine and practices to recognise the need to manage fires in areas previously not considered to be at risk of fire, and control fires that can readily undermine compartmentation.

708 Mr Youssef noted that the fire spread and fire load characteristics of combustible cladding can have significant and challenging implications on firefighting operations on multi-storey buildings that would otherwise not exist. In particular, Mr Youssef referred to the presence of combustible cladding providing an external bridge between compartments for a fire to spread, potentially between all floors of the building at a rapid rate, and laterally across floors of a multi-storey building. This creates the risk of what Mr Youssef referred to as a totally uncontrolled external (and potentially internal) fire, spreading to all floors of a high-rise building, with subsequent risks to the lives of firefighters and occupants and to the building structure. Mr Youssef noted that the fire behaviour of such combustible cladding can create an almost insurmountable challenge for firefighters to achieve the aim of containing fires within the compartment of origin.

709 Mr Youssef noted that the presence of combustible cladding on the façade of multi-storey buildings can cause significant challenges for Australian firefighting authorities, creating unacceptable risks to occupants, emergency service personnel, and the building and property within it. In particular, Mr Youssef discussed:

(a) the potential for rapid fire spread making it difficult to locate the floor of origin of the fire, and the building areas at greatest risk;

(b) the significant additional resources that may be required including the use of specialist fire appliances, which may not always be available, where a fire cannot be readily contained and fire spread is likely to continue;

(c) the difficulties with access to fight fires across multiple floors, and the limitations of fire protection systems and water supply. This includes that:

(i) there are limited options for firefighters to access the floor of fire origin, to the extent it can be identified;

(ii) external attack via hose lines from street level is limited to the first five floors;

(iii) placing firefighters above a fire floor is extremely dangerous;

(iv) where firefighting requires fire-isolated doors to be left open on multiple floors, this can impact on the effectiveness of stair pressurisation systems and allow smoke to enter the stairs, creating hazards for evacuating occupants;

(v) sprinklers and in-building hydrants may require boosting with water from street level, and even so, may not achieve adequate water flow to meet the needs of all sprinklers in the building; and

(vi) there is a significant challenge in providing sufficient water from fire appliances to multiple floors of a building at once, due to the number of hose lines and amount of water required.

(d) the difficulties associated with rescue and evacuation operations, where fire has spread across multiple floors; and

(e) the risk of descending fire spread and falling debris which may impact the entry of firefighters to the building and the egress of evacuees.

710 Mr Youssef was not subject to cross-examination by the Respondents. I accept that Mr Youssef is an expert in his field and capable of speaking to the issues raised in his expert report, particularly the challenges that firefighting authorities may face, and the danger to occupants and property, as a result of the presence of combustible ACP cladding.

711 However, Mr Youssef’s evidence must be understood within the context of the other expert evidence before me. In particular, the evidence of Expert Group 3 relating to the degree of risk of fire spread resulting from ACPs.

712 There is no doubt that the use of combustible ACPs like the Alucobond products can contribute to fire spread, which for the reasons Mr Youssef has identified, could materially impact the ability of firefighting authorities to effectively combat the fire, and create danger to occupants and property. However, the extent of any such risk will, necessarily, depend on how the Alucobond products are used.

713 As discussed in relation to the evidence of Expert Groups 4-5, 6 and 7, the experts accepted that, at least at a theoretical level, the Alucobond products can be used in a manner that is BCA compliant, in particular, through the use of a Performance Solution. Naturally, the extent to which the risks Mr Youssef rightly directed attention to might arise will depend on several factors which are building specific – in particular, consideration will need to be given to issues such as the nature of the building (construction type, height, etc), the use of the building, how much of and where on the building the Alucobond products are used, how the relevant use of the Alucobond products may involve potential external fire spread mechanisms, and how each of these factors impact the fire safety strategy of the building, such as the fire mitigation features of the building, egress avenues, and other matters.

714 Again, while Mr Youssef rightly pointed to the important risks which can be posed by the use of ACPs, I do not accept Mr Youssef’s conclusion at [170] of his report, that the use of combustible cladding products is unjustifiable and unacceptable, as a blanket statement. There is no doubt that particular ways the products have on occasion been used can be said to be unjustifiable and unacceptable, in that they have created a real and unacceptable risk to the health and safety of individuals within the buildings and that of emergency authorities. This has clearly been illustrated by the tragedies in which ACPs have been involved. However, I do not accept that it can be said, as a blanket statement, that the use of ACPs in general is unjustifiable and unacceptable, without considering the nature of the relevant construction in which they are used and the manner of that use.

6. WHETHER THE TPA AND ACL APPLY TO 3A’S CONDUCT

715 As noted above, the parties addressed their closing submissions on the basis that the pleadings gave rise to 20 discrete issues which, when determined, would resolve all the matters on the pleadings, and provide an answer to each of the common questions. These 20 issues are outlined in section 3, at paragraph [132 ] of these reasons above. The remainder of these reasons are structured to consider and determine each of these 20 discrete issues in turn.

716 The first two issues concern the application of the TPA and ACL to 3A. The Applicants submit, in effect, that there are two alternative ways that each statutory regime can apply to 3A as a foreign company: first, on the basis that 3A manufactured the Alucobond products that were supplied in Australia in trade or commerce, such that its conduct occurred in Australia and falls within the ordinary application of the TPA and ACL; second, on the alternative basis that 3A carried on business within Australia, bringing its conduct otherwise occurring outside Australia within the remit of the TPA and the CCA pursuant to s 5(1) of each Act. 3A claims that the TPA and the ACL have no application to it because it did not engage in conduct within Australia nor carry on business in Australia.

717 It is also appropriate at this stage to explain why the Applicants’ consumer guarantee claim and misleading or deceptive conduct claim were framed by reference to both the TPA and the ACL. Whilst each of the claims of the Shore OC and Five Dock OC are made under the ACL, the relevant period begins before the date on which the ACL came into force, being 1 January 2011 (in its original form as inserted into the TPA, and now its current form as Sch 2 to the CCA). Pursuant to the transitional provisions, the TPA continues to apply to acts and omissions by the Respondents prior to 1 January 2011. The ACL applies to all acts and omissions on and from that date. Accordingly, since some group members on whose behalf the Applicants bring this proceeding might only have recourse to the TPA under the earlier part of the relevant period, the Applicants have sought to establish the consumer guarantee claim and misleading conduct claim under the provisions of both the former TPA, and the ACL.

6.1 Issue 1 – Did 3A engage in the impugned conduct in Australia?

6.1.1 Consumer guarantee claim

6.1.1.1 The relevant conduct

718 The Applicants submit that for the purposes of the consumer guarantee provisions, it is not appropriate to ask whether 3A engaged in “impugned conduct”. The Applicants submit that the proper starting point is to consider the application of the substantive provisions of the TPA and the ACL. The Applicants submit that the Shore OC, Five Dock OC and each group member, as affected persons, have a right to recover damages from the manufacturer of the goods (being the Alucobond products) under s 271(1) of the ACL because the guarantee under s 54 applied to a supply of those goods and the guarantee was not complied with.

719 The relevant provisions provide as follows:

54 Guarantee as to acceptable quality

(1) If:

(a) a person supplies, in trade or commerce, goods to a consumer; and

(b) the supply does not occur by way of sale by auction;

there is a guarantee that the goods are of acceptable quality.

…

271 Action for damages against manufacturers of goods

(1) If:

(a) the guarantee under section 54 applies to a supply of goods to a consumer; and

(b) the guarantee is not complied with;

an affected person in relation to the goods may, by action against the manufacturer of the goods, recover damages from the manufacturer.

…

720 The Applicants contend that this does not involve “impugning” the conduct of the manufacturer, wherever that may have occurred. The Applicants submit that the circumstance of being a manufacturer makes a person liable pursuant to the cause of action under s 271, but the conduct that enlivens the cause of action is the supply of goods in circumstances where the guarantee under s 54 applies but is not complied with. This, the Applicants submit, is conduct which occurred in Australia. Further, given the various ways in which a person may be deemed to be a manufacturer, it may be of no significance where the conduct of manufacture occurred.

721 The Applicants argue that the guarantee that the goods be of acceptable quality in s 54 of the ACL attaches to the supply of goods to a consumer. If the supply of goods to a consumer occurred in Australia, then the statutory cause of action under s 271 of the ACL is engaged, with statutory consequences for any person who fits the definition of a “manufacturer” of the goods in question. The Applicants submit that no part of the application of the ACL turns on the location of the manufacturer of the relevant goods, whether at the time of manufacture or otherwise. The Applicants submit that, on this approach, it is a mistake to speak of the statute being given an extra-territorial effect. The Applicants submit that the correctness of this approach is reinforced by the various ways in which a person can be deemed to be a manufacturer under the ACL.

722 The Applicants refer primarily to two authorities which they say recognise the correctness of their approach. In Gill v Ethicon Sàrl (No 5) [2019] FCA 1905, Katzmann J said the following:

[3124] The respondents submitted that, as the two Ethicon respondents are incorporated overseas and neither has a place of business in Australia, the statutory causes of action do not apply to them.

[3125] I reject the submission.

[3126] There is a general presumption that the TPA applies to “conduct within Australia or of Australian nationals”. Section 5(1) extends the territorial operation but only to a limited extent: Bright v Femcare Ltd [2000] FCA 742; (2000) 175 ALR 50 (Lehane J) at [77]–[78]. Similarly, in Bray v F Hoffman-La Roche Ltd (2002) 118 FCR 1 at [50]–[51] Merkel J said that:

[Section] 5 of the TPA is to be accounted for only on the basis that the Act as a whole, including s 5 itself, has been framed on the assumption that when conduct is made a contravention of the Act it is only conduct in Australia that is meant unless the conditions set out in s 5 apply.

…

[U]nless expressly provided otherwise, the legislature intended that the Act is only to apply to extra-territorial conduct in the circumstances and subject to the conditions laid down in s 5.

(Emphasis added.)

[3127] In other words, “the conduct prescribed by Pt V of the TPA will be taken to be conduct within Australia unless s 5(1) applies”: Worldplay Services Pty Ltd v Australian Competition and Consumer Commission (2005) 143 FCR 345 at [18] per Ryan and Kiefel JJ, Tamberlin J agreeing at [28]–[43]. In Bright at [78] Lehane J observed:

Conduct, then, gives rise to a liability under, for example, s 52, if two conditions are met: first, it is engaged in within Australia (by a corporation) or outside Australia (by a body referred to in s 5(1)); secondly, it is conduct in trade or commerce ([which includes] trade or commerce between Australia and a place outside Australia).

[3128] The same is true of all the relevant provisions of the TPA and the ACL.

[3129] In the present case each of those conditions was met. This case is not concerned with the extra-territorial operation of the Act. The statutory claims are concerned with conduct relating to the supply of goods. As to misleading or deceptive conduct, see Australian Competition and Consumer Commission v Valve Corporation (No 3) [2016] FCA 196; (2016) 337 ALR 647 (Edelman J) (ACCC v Valve Corporation (No 3)) at [177]. Supply of the Ethicon devices took place in Australia because the devices were received in Australia by JJM, an Australian company, delivered to Australian hospitals and doctors, and implanted in women in Australia. The allegedly misleading conduct occurred in Australia because it is based on the information provided to, and received by, Australian consumers in Australia: see Valve Corporation v Australian Competition and Consumer Commission (2017) 258 FCR 190 at [104]–[105], [116], [134]. Where the relevant conduct occurs in Australia, in Trade Practices Commission v Australia Meat Holdings Pty Ltd [1988] FCA 338; (1998) 83 ALR 299 at 356 Wilcox J described it as “a misuse of language” to speak of the statute being given an extra-territorial effect.

723 The Applicants also refer to the New Zealand Court of Appeal decision in Body Corporate N umber DPS 91535 v 3A Composites GmbH (2023) 16 TCLR 719; [2023] NZCA 647 (Body Corporate No DPS 91535 (Appeal)). The decision related to an appeal against a New Zealand High Court decision considering proceedings brought against 3A and other respondents in New Zealand in relation to Alucobond PE. 3A filed a protest to the jurisdiction of the New Zealand courts. While the High Court set aside the protest to jurisdiction in relation to three tort causes of action, the protest to jurisdiction was upheld in relation to three other causes of action, being one brought under the C onsumer G uarantees A ct 1993 (NZ) and two brought under the Fair Trading Act 1986 (NZ). The High Court’s decision to uphold the protest to jurisdiction was appealed to the Court of Appeal.

724 The New Zealand Court of Appeal, in rejecting an argument similar to that raised by 3A in this proceeding, stated the following:

[64] Reading the Act as a whole, the relevant territorial connecting factor is in our view the supply of goods in New Zealand. Where goods have been supplied in New Zealand, the Act attaches certain consequences to that supply, both for the immediate supplier and for certain other businesses. It is not accurate to describe the availability of relief in respect of a supply of goods to a consumer in New Zealand against a person outside New Zealand as an “extraterritorial” application of the Act. Rather, the application of the Act turns on a relevant supply taking place in New Zealand.

[65] Put another way, supply to a consumer in New Zealand is the central focus or “hinge” of the Act, which provides the necessary territorial connection with New Zealand.

…

[70] The concept of extraterritoriality, as that term was used by the Supreme Court in Poynter, is not relevant in the present case. As already explained above, the supply of goods to a consumer in New Zealand provides the necessary link to this jurisdiction. The relevant conduct — the supply of goods to a consumer in New Zealand — takes place in New Zealand; the Act then prescribes the consequences of those goods being defective or unsafe.

725 The Applicants, therefore, submit that it is a mistake to focus on, as 3A suggests, the relevant supply between the Respondents. From a policy perspective, the Applicants submit that it is not absurd for the legislature to visit legal consequences upon the actual manufacturer of goods where those goods are supplied within Australia in trade or commerce, recognising that a manufacturer is best placed to control the quality of their products.

726 3A, in contrast to the approach contended for by the Applicants, contends that the TPA and ACL have no application to it as it did not engage in conduct within Australia.

727 3A refers to the decision of Derrington J in Vautin v BY Winddown, Inc. (formerly Bertram Yachts) (No 4) (2018) 362 ALR 702; [2018] FCA 426. In that case, Bertram, a boat manufacturer in Florida in the United States of America had sold a vessel to Eagle Yachts from its premises in Florida, and Eagle Yachts imported the vessel into Australia and supplied the vessel to a consumer, Mr Vautin. A claim was made by the consumer, Mr Vautin, against Eagle Yachts, as well as against the foreign manufacturer Bertram. The claim against Bertram was made under s 271(1) and (5) of the ACL in respect of failure to meet the guarantees in ss 54 and 59 of the ACL (guarantee as to acceptable quality and guarantee as to express warranties). In that case, Mr Vautin’s primary submission was that all that was required for Bertram to be subject to the operation of the ACL was that there had been a relevant supply of goods to a consumer in Australia. This is, in effect, the construction put forward by the Applicants in the present case, albeit in relation only to ss 54(1) and 271(1) of the ACL.

728 When considering the claim under s 59, his Honour rejected Mr Vautin’s submission, observing the following:

[199] However, for Bertram to be liable under s 59, it is necessary that it is within the definition of “manufacturer” in s 7 of the ACL which provides:

7 Meaning of manufacturer

(1) A manufacturer includes the following:

(a) a person who grows, extracts, produces, processes or assembles goods;

(b) a person who holds himself or herself out to the public as the manufacturer of goods;

(c) a person who causes or permits the name of the person, a name by which the person carries on business or a brand or mark of the person to be applied to goods supplied by the person;

(d) a person (the first person) who causes or permits another person, in connection with:

(i) the supply or possible supply of goods by that other person; or

(ii) the promotion by that other person by any means of the supply or use of goods;

to hold out the first person to the public as the manufacturer of the goods;

(e) a person who imports goods into Australia if:

(i) the person is not the manufacturer of the goods; and

(ii) at the time of the importation, the manufacturer of the goods does not have a place of business in Australia.

[200] It does not appear to be in doubt that, prima facie, Bertram would fall within each of subparas (a)-(d) of subs (1). It produced and assembled the vessel and held itself out as manufacturing it. Its branding is upon the vessel and, through the dealership agreement, it caused Eagle Yachts to hold it out as the manufacturer of the vessel.

[201] However, here, the vessel was manufactured in the United States and sold there to Eagle Yachts. It was the latter which imported it to Australia. So the question which arises is whether Bertram is subject to the operation of the ACL and, in particular, the obligations imposed by s 59?

…

[205] Although there is nothing in s 131 or in s 59 (or in the definition of “manufacturer” in s 7) to suggest that the operation of the Act is confined to persons or corporations within Australia, or who have some connection with Australia, as a matter of statutory construction, it is generally accepted that an enactment will be presumed to apply only to the territory or nationals over which the Australian Government has jurisdiction. In Meyer Heine Pty Ltd v China Navigation Co Ltd (1966) 115 CLR 10 at 23; [1966] ALR 791 (Meyer Heine), Kitto J cited the relevant principle from the speech of Lord Russell of Killowen in Reg v Jameson [1896] 2 QB 425 at 430 as being:

if any construction otherwise be possible, an Act will not be construed as applying to foreigners in respect to acts done by them outside the dominions of the sovereign power enacting

[206] In Bray v F Hoffman-La Roche Ltd (2002) 118 FCR 1; 190 ALR 1; [2002] FCA 243 (Bray) at [47] Merkel J phrased that principle as, “a general canon of construction that an enactment will not be construed as applying to foreigners in respect of acts done by them outside the dominions of the sovereign power enacting” and identified it as being based on international comity whereby sovereign powers are bound to respect the subjects and the rights of all other sovereign powers outside its own territory. In both Bray and Meyer Heine it was recognised that the existence of a statutory provision extending the territorial operation of an enactment can usually only be accounted for on the basis that the Act, as a whole, has been framed upon the assumption that when conduct is made a contravention of the Act, such conduct is limited to that which occurs in Australia or to conduct to which the extraterritorial provisions apply.

[207] In respect of the ACL, s 5 of the CCA identifies the extent of its extraterritorial operation such that, for conduct outside of Australia to contravene any of its provisions, that conduct must be within the scope of that section. That section indicates that, generally, the provisions of the legislation apply only to conduct in Australia or to conduct outside of Australia where there is a sufficient nexus between the relevant actor and Australia. It provides:

5 Extended application of this Act to conduct outside Australia

(1) Each of the following provisions:

(a) Part IV;

(b) Part XI;

…

(f) the remaining provisions of this Act (to the extent to which they relate to any of the provisions covered by paragraph (a), (b) or (c));

extends to the engaging in conduct outside Australia by:

(g) bodies corporate incorporated or carrying on business within Australia; or

(h) Australian citizens; or

(i) persons ordinarily resident within Australia.

[208] The necessary implication of s 5 is that the Act, as a whole, applies to conduct in Australia by, inter alia, the entities mentioned in subparas (g) to (i). If the Act expressly extends its scope to the conduct of those entities engaged in beyond Australian territorial limits, it is axiomatic that their conduct within Australia is also within the Act’s operational scope. It follows that if an entity is carrying on business within Australia its conduct, either within or outside of Australia, is subject to the liabilities imposed by the Act.

[209] For the purposes of this matter the issue resolves to one of the application of the ACL to the conduct of Bertram in the manufacture of the vessel in the United States and as well as, or in the alternative, its provision of a warranty to Mr Vautin in respect of Revive. Bertram will be subject to the operation of the ACL if relevant conduct occurred in Australia or if, at the relevant time, it carried on business in Australia. Here Mr Vautin contends that both connections existed in 2011 and 2012 when the vessel was supplied to Mr Vautin.

Conduct in Australia

[210] With respect to the submission that Bertram engaged in relevant “conduct” in Australia, Mr Vautin relies upon the terms of ss 59 and 271(5), the latter of which gives an affected person a cause of action where a guarantee is not complied with…

[211] Mr Vautin’s first submission is that all that is required for Bertram to be subject to the operation of the ACL is that there has been a supply of goods to the consumer and that such a supply does not need to be a supply directly by the manufacturer… He submits that, here, that requirement has been satisfied by the supply of the vessel by Eagle Yachts to Mr Vautin.

[212] That submission should not be accepted. The question is one of the liability of an overseas manufacturer who has sold goods in the USA to Eagle Yachts and the latter has imported them to Australia and supplied them to Mr Vautin. On a proper construction of the ACL the liability imposed on the manufacturer under s 271(5) does not arise merely by reason of the supply of the goods to a consumer by some third party (such as a retailer). That alone is insufficient and, as was identified in Bray, the nexus with Australia must be, at least, conduct by the manufacturer. Moreover, that relevant conduct must be conduct in relation to the relevant contravention and, indeed, it is probably necessary that it relate to the gravamen of the statutory cause of action being pursued ...

…

[214] Under s 271(5) the liability of a manufacturer of goods arises where the guarantee imposed by s 59 is not complied with. It might be said, however, that a necessary precondition to that is that the express guarantee had been given by the manufacturer to the consumer as so to enliven the operation of s 59.

729 Ultimately, Derrington J determined that the warranty itself was given to Mr Vautin in Australia, which then attracted the operation of the ACL (at [223]). Derrington J also found (at [224]) that it was the non-compliance with the statutory guarantee that gave rise to liability under s 271(5). The manufacturer’s obligation under the express warranty was to repair the goods in Australia and so its non-compliance with the statutory guarantee also occurred in Australia: Vautin at [225]. His Honour found that the non-compliance with the statutory guarantee occurring in Australia provided a “surer foundation” for the attraction of liability under the ACL, being conduct central to the violation of the statutory norms, but held that it did not follow that the “giving” of the warranty by the manufacturer was not also conduct which attracted the operation of the ACL: Vautin at [225]. Derrington J’s analysis was tied to his Honour’s consideration of the s 59 express warranty guarantee claim, and it is not clear the extent to which that analysis might have applied to the claim under s 54 brought by Mr Vautin, when viewed in isolation.

730 3A submits that, in the present case, the relevant “impugned” conduct giving rise to liability under s 271(1) of the ACL is the failure to comply with the statutory guarantee that goods will be of acceptable quality, and, at least insofar as that section concerns the liability of an entity in 3A’s position, the conduct proscribed could only be the manufacturing of the goods such that they are not of acceptable quality. 3A submits that both the manufacture of the Alucobond products and their supply by 3A to HVG occurred exclusively in Germany.

731 3A also seeks to distinguish the present case from both authorities the Applicants rely on.

732 In respect of the Applicants’ reliance on Katzmann J’s decision in Ethicon at [3129], 3A submits that the case records that the foreign manufacturers who manufactured the relevant goods supplied the goods to the Australian distributor (JJM) in Australia. 3A submits that this is a matter of distinction in the present case where 3A contends that they supplied the Alucobond products to HVG in Germany, which then imported the panels into Australia. 3A submits that the factual position in the present case reflects that of Bertram in Vautin, where the manufacture and supply of the product occurred outside Australia.

733 In respect of the Applicants’ reliance on Body Corporate No DPS 91535 (Appeal), 3A submits that the decision can be distinguished on the basis that the CGA (NZ) does not include the equivalent of s 5(1) of the TPA and the CCA. 3A also submits that to the extent the decision is not distinguishable, the decision would conflict with Vautin, and that Vautin, being an authority of this Court, must prevail.

734 3A further submits that the interpretation of the consumer guarantee provisions proposed by the Applicants would lead to “extreme results” where any manufacturer in the world could be exposed to liability under s 271 where their products were sold in Australia, even where the manufacturer had no knowledge or intention of the products being sold in Australia. This is, plainly, not the circumstance of the present case. However, I accept 3A’s submission that this would, in practice, be the direct consequence of the construction the Applicants contend for. It is worth noting at this stage that this was also put to the New Zealand Court of Appeal which noted the following in Body Corporate No DPS 91535 (Appeal) at [80]:

We are conscious that on this reading of the Consumer Guarantees Act, an overseas manufacturer might be exposed to liability even if it did not know its products were being sold in this country, for example because a distributor in another country was on-selling some of the product it had purchased into New Zealand. Indeed a manufacturer might find itself liable to a New Zealand consumer under the Act even if it had consciously chosen not to sell its product in this country, but the product found its way here indirectly. However it was not suggested to us that these concerns arise in the present case. We therefore need not consider whether such a result would go beyond the purpose of the Act, or whether private international law principles provide a solution to any apparent injustice in such a case.

735 As in Body Corporate No DPS 91535 (Appeal), this issue does not arise in the present case. Nonetheless, as it was raised by 3A as a compelling reason to reject the Applicant’s contended interpretation of s 271(1), the following must be considered.

736 First, in interpreting the TPA and the ACL, it is important to bear in mind that these statutes are “beneficial consumer protection legislation”: Karpik v Carnival plc (2023) 280 CLR 640; [2023] HCA 39 at 41. The express object of each statute is to enhance the welfare of Australians through the promotion of competition and fair trading and provision for consumer protection: TPA, s 2; CCA, s 2.

737 In the context of the consumer guarantee claim threshold requirements (considered below), the Applicants submit that the Court must prefer an interpretation that promotes this object and construe each of the TPA and the ACL in a way that “give[s] the fullest relief which the fair meaning of its language will allow”: Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470 at 503 (Lockhart and Gummow JJ); see also Webb Distributors (Aust) Pty Ltd v Victoria (1993) 179 CLR 15 at 41 (McHugh J); Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53; [2003] HCA 75 at 100. In my view, this submission applies equally to considering the scope of the ACL’s application in the present circumstances – that is, where 3A manufactures ACPs and supplies them to HVG in Germany, who then supplies the ACPs to a consumer in Australia, but the manufacturer supplied the products to an intermediary in a third country.

738 Second, it may be that there are other avenues by which a manufacturer can seek to limit the import or potential import of its products into Australia – for example, through contractual mechanisms. I was not addressed on this matter, and raise it simply to emphasise the point, as the New Zealand Court of Appeal did in Body Corporate No DPS 91535 (Appeal), that given this proceeding is not concerned with the application or potential application of the ACL to the hypothetical circumstances raised by 3A, it is unnecessary to consider this point further.

739 In relation to Vautin, the Applicants do not contend that Derrington J was wrong in his Honour’s approach, and the Applicants did not identify any direct contrary Australian authority. Instead, the Applicants contend that, rather than being inconsistent with their approach, Vautin supports their position. The Applicants submit that, in Vautin, Derrington J correctly focused on conduct which was central to the violation of the relevant statutory norm which would attract the operation of the ACL. The Applicants submit that, in Vautin, the relevant violation of the statutory norm in s 59 was non-compliance with an express warranty, such that focus was correctly directed to the location at which the express warranty was supplied or where the express warranty was not complied with. The Applicants submit that the conduct that enlivens the cause of action under s 54 is the supply of goods in circumstances where the guarantee under s 54 applies but was not complied with. The Applicants submit that the location of that conduct occurred in Australia. Vautin does not suggest any different principle.

740 Whether liability can be imposed on a foreign entity under the consumer guarantee provisions may naturally depend on (a) the particular provisions of the ACL which the cause of action arises under, and (b), as Derrington J identified in Vautin, whether the conduct of the manufacturer that has a nexus with Australia relates to the relevant contravention. Clearly, the liability which is imposed on a manufacturer under ss 59 and 271(5) of the ACL is distinct from the liability which arises under ss 54 and 271(1).

741 As the Applicants have identified, the conduct to which ss 54 and 271(1) apply is the supply of a good that is not of acceptable quality. Where there is a supply of goods that are not of acceptable quality, the manufacturer of those goods is subject to liability under s 271(1). This is distinct from the position under ss 59 and 271(5), where s 59 requires the giving or making of an express warranty by the manufacturer. However, Derrington J’s reasons in Vautin may properly be understood as stating that in the context of liability to be imposed on a manufacturer under s 271(5), in respect of non-compliance with s 59, it would be insufficient for there simply to be a supply of goods to a consumer in Australia, since the relevant conduct of the manufacturer which relates to the contravention is the non-compliance with the guarantee in s 59: that is, the giving of the express warranty must have occurred in Australia.

742 Having noted this, it is next necessary to understand how liability is imposed on a manufacturer under s 271(1). Where there is a relevant supply of goods to a consumer, in circumstances where the guarantee of acceptable quality in s 54 is not complied with, an affected person may, by action against the manufacturer of the goods, recover damages from the manufacturer. It is only by reason of the relevant entity being the “manufacturer” of goods which are not of acceptable quality that liability is imposed under s 271(1).

743 It is not in dispute that 3A manufactured the Alucobond products, within the meaning of s 7(1)(a) in Germany. But a question remains whether there must be a nexus between the conduct of a manufacturer and Australia for the purposes of an action brought under s 271(1). To the extent such a nexus is required to be established, the only conduct of the manufacturer that could be relevant to the determination is the conduct by which the entity is considered a manufacturer of the goods for the purposes of the legislation.

744 Section 7(1) of the ACL provides the following:

7 Meaning of manufacturer

(1) A manufacturer includes the following:

(a) a person who grows, extracts, produces, processes or assembles goods;

(b) a person who holds himself or herself out to the public as the manufacturer of goods;

(c) a person who causes or permits the name of the person, a name by which the person carries on business or a brand or mark of the person to be applied to goods supplied by the person;

(d) a person (the first person) who causes or permits another person, in connection with:

(i) the supply or possible supply of goods by that other person; or

(ii) the promotion by that other person by any means of the supply or use of goods;

to hold out the first person to the public as the manufacturer of the goods;

(e) a person who imports goods into Australia if:

(i) the person is not the manufacturer of the goods; and

(ii) at the time of the importation, the manufacturer of the goods does not have a place of business in Australia.

745 Considering the definition of “manufacturer”, and assuming the nexus discussed above is required, I reject 3A’s submission that the relevant impugned conduct giving rise to liability under s 271(1), insofar as it concerns an entity in 3A’s position, could only be the manufacturing of goods such that they are not of acceptable quality. Such an approach would be plainly inconsistent with the number of ways in which an entity may be considered a “manufacturer” for the purposes of the legislation and may thereby be liable for an action for damages under s 271 as a manufacturer.

746 Indeed, in the Second Further Amended Statement of Claim (2FASOC) at [4(d)], 3A is alleged to be a manufacturer for the purposes of the legislation not simply because it produced or processed the Alucobond products, but also because it:

(1) held itself out to the public as the manufacturer of the products;

(2) caused or permitted its brand or mark (being its “Alucobond” trademarks) to be applied to the products; and

(3) caused or permitted HVG to hold it out to the public as the manufacturer of the Alucobond products in connection with the supply or possible supply of the products, or the promotion by HVG of the supply or use of the products.

747 The difficulty with 3A’s submission is that it arbitrarily focuses on one variant of the definition of manufacturer under the legislation. Noting the various ways in which an entity may be a manufacturer under the legislation, such an approach appears to be inconsistent with the legislative purpose of the provision and arbitrarily gives primacy to one limb by which an entity may be a manufacturer of goods.

748 In the present case, for example, it may be said that Ms Haas travelled to Australia as a representative of 3A and represented 3A as the manufacturer of the Alucobond products to the public, including through her attendance at trade shows and at meetings with architects and cladding fabricators. This is discussed in further detail under issue 2. Alternatively, it may also be said that 3A, through its Distributor Agreements with HVG (also discussed in further detail below), caused or permitted HVG to hold out 3A as the manufacturer of the Alucobond products to the public in Australia, in connection with HVG’s supply of the panels or its promotion of the supply or use of the panels. This is all relevantly conduct occurring in Australia by which 3A could be a manufacturer of the Alucobond products under s 7(1) of the ACL.

749 This approach is also consistent with Katzmann J’s observations in Ethicon at [3129]. It is incorrect to submit, as 3A seeks to do, that Ethicon can be distinguished from the present case simply on the basis that Ethicon involved a supply of the relevant Ethicon devices to the Australian distributor in Australia. Her Honour’s comments “that the case was not concerned with the extra-territorial operation of the [TPA]”, was plainly informed by conduct beyond the Ethicon devices being received in Australia by an Australian company. Her Honour noted that the Ethicon devices had been “delivered to Australian hospitals and doctors, and implanted in women in Australia”. Her Honour indicated that the approach was the same in respect of the ACL.

750 I accept the Applicants’ submissions that the circumstance of being a manufacturer makes a person liable pursuant to the cause of action under s 271, but the conduct that enlivens the cause of action is the supply of goods in circumstances where the guarantee under s 54 applies but is not complied with. I find that in the circumstances of this case, that conduct occurred in Australia. This finding is not inconsistent with the principle and analysis of Derrington J in Vautin where his Honour correctly focused on the conduct which was central to the violation of the relevant statutory norm which would attract the operation of the ACL. Here, I have found that the relevant conduct that enlivens the cause of action under s 54 is the supply of goods in circumstances where the guarantee under s 54 applies but was not complied with. That, as I have said, occurred in Australia.

751 In addition, I am satisfied that to the extent a nexus is required to be established between the conduct of a manufacturer and Australia for the purposes of an action brought under s 271(1), the conduct of Ms Haas travelling to Australia as a representative of 3A and promoting the qualities of Alucobond products to the Australian market, as discussed in further detail below in issue 2, provides a relevant nexus between the conduct of 3A as manufacturer and Australia. Furthermore, 3A through its Distributor Agreements with HVG caused or permitted HVG to hold out 3A as the manufacturer of Alucobond products to the public in Australia, in connection with HVG’s supply of the panels, or its promotion of the supply and use of the panels in Australia.

752 For the reasons given above, I find that 3A engaged in conduct as a manufacturer in Australia and is subject to the operation of the ACL or the TPA for the purposes of the consumer guarantee claim.

6.1.1.2 Did 3A supply the Alucobond products to HVG in Australia?

753 3A contends that if the correct question for the Court to consider in relation to issue 1 was whether 3A engaged in the impugned conduct in Australia, then the impugned conduct is the manufacturing of the Alucobond products, and the supply of the products to HVG. For the reasons outlined above, I do not consider it appropriate to approach the question of whether liability can extend to 3A under ss 54 and 271(1) of the ACL by reference solely to where the Alucobond products were manufactured (in the ordinary sense), and where they were supplied to HVG.

754 The Alucobond products were plainly manufactured (in the ordinary sense of the word) by 3A in Germany. The Applicants do not contend otherwise. However, the question of where 3A supplied the Alucobond products remains relevant to the question of whether 3A was carrying on business in Australia (issue 2). It is, therefore, convenient to address this question here.

755 3A’s delivery of the Alucobond products was governed by 3A’s General Terms of Delivery and Payment, one version of which was dated 22 January 2003, with a subsequent version dated 25 July 2011.

756 Clause 4.1 of those General Terms provided:

Unless another form of shipment has been agreed, 3A Composites supplies “ex works” (INCOTERMS 2011). The time that the goods are ready for shipment in the supplying works shall prevail for observance of the agreed delivery periods and dates. Unless otherwise agreed in writing, the risk shall pass to the customer upon dispatch “ex works”.

757 “Ex works” is a term that reflects the seller’s minimum obligation to make the goods available at a specified place, usually the seller’s premises. Once the goods are delivered to the agreed point, the buyer bears all costs and risks involved in taking the goods. The transfer of title of the Alucobond products from 3A to HVG occurred in Germany, and therefore, 3A’s supply of the products to HVG occurred in Germany.

758 At least some of 3A’s supplies to HVG were shipped on a “ C arriage and I nsurance P aid To” basis. This required 3A to deliver the goods to the first carrier, at which point the risk transferred to HVG. In either case, 3A’s supply to HVG, in the sense of where title transferred, occurred in Germany. There has been no suggestion by the Applicants, or submissions made, that some other shipping terms applied.

759 The Applicants raised a number of arguments as to why 3A’s conduct, in supplying the Alucobond products to HVG, should be properly understood as conduct occurring in Australia.

760 Firstly, the Applicants submit that 3A dispatched goods to its exclusive distributor, HVG, for the explicit purpose of those goods being sold to Australian consumers for use on buildings in Australia. While it is clear 3A sold the Alucobond products to HVG with such an intention, 3A’s intention does not speak to where the relevant supply actually occurred.

761 Secondly, the Applicants submit that the focus on the terms of its supply contracts with HVG is misplaced as the statutory question is not answered solely by reference to contractual terms. In support of this submission, the Applicants argue that in Valve Corporation v Australian Competition and Consumer Commission (2017) 258 FCR 190; [2017] FCAFC 224 (Dowsett, McKerracher and Moshinsky JJ) (Valve FCAFC), the Full Court of this Court held that computer software downloaded in Australia involved a supply in Australia even if the agreement to supply was governed by a foreign law (at [116]). The Applicants also refer to Facebook Inc v Australian Information Commissioner (2022) 289 FCR 217; [2022] FCAFC 9 (Allsop CJ, Perram and Yates JJ), where the Full Court held that the provision of digital cookies to Australian iPhone users occurred in Australia, in circumstances where the physical devices were located in Australia, and the cookies were installed to those devices, even though the conduct by Facebook which brought about the installation of the cookies occurred overseas (Perram J at [37], [43] and [47], Allsop CJ and Yates J agreeing).

762 The Applicants’ submission in respect of Valve FCAFC appears to mischaracterise the Full Court’s reasons at [116] to a degree. The Full Court there rejected a submission that it was the location where the agreement to supply the goods in question was made which necessarily determined where the supply occurred; the Court was not considering any submission about the location of supply being determined by whether the agreement to supply goods was governed by a foreign law. Dowsett, McKerracher and Moshinsky JJ stated at [116]:

Valve submits that: its supply of computer software subscriptions, including games, to consumers was made in accordance with the [Steam Subscriber Agreement]; this supply was effected in Washington State, on the basis that a reference to the “supply” of goods includes a reference to agreeing to supply goods (see s 11(b) of the Australian Consumer Law); and, applying this, Valve’s supply of goods took place where Valve agreed to supply consumers with computer software, including games (namely, in Washington State). In our view, this submission should be rejected. Although the definition of supply includes an agreement to supply, it does not follow that the supply in this case is to be located where the agreement was made. In the present case, the supply of computer games by Valve to customers in Australia took place where the customer downloaded the computer game on his or her computer. …

763 In the present case, on the express terms of the General Terms of Delivery and Payment, the relevant supply took place in Germany as that is where title of the physical ACPs passed from 3A to HVG. That is quite distinct from the position of consumers in Australia who download computer games to their computers in Australia.

764 The same difficulty arises in relation to the Applicants’ reliance on Facebook. In that case, the relevant conduct involved installing cookies on “terminal equipment”, where the terminal equipment was located in Australia.

765 Lastly, the Applicants also submit that, to the extent the contractual terms are relevant, they do not establish that 3A ceased to have any interest in the goods once they left the Singen plant in Germany. In particular, the Applicants submit that while the goods were supplied “ex works”, this was always subject to an extensive retention of title under the General Terms of Delivery and Payment. The relevant clause included the following provisions, amongst others:

Reservation of Title

6.1 3A Composites reserves title to the goods delivered by 3A Composites as security for all claims accruing to 3A Composites against the customer from this and future business relations.

6.2 The title of 3A Composites shall extend to the new products created by the processing of the reserved goods. In the event of processing, union or mixing with items not belonging to 3A Composites, 3A Composites shall acquire joint title in the proportion of the invoice value of our reserved goods to that of the other materials.

766 I accept 3A’s submission that the fact that the goods were supplied on terms that included such a retention of title clause does not alter the position: the relevant supply still occurred in Germany. There is no evidence that the clause actually took effect to delay the transfer of title to HVG until after the goods arrived in Australia, and no evidence that such a claim between the Respondents existed so as to enliven the reservation of title clause.

767 The Applicants further submit that certain deliveries of Alucobond products by 3A were delivered CIP. It is unclear to what extent the Alucobond products were supplied on an ex works basis relative to on a CIP basis, however 3A accept that there were at least some supplies to HVG shipped CIP.

768 Under CIP, a seller delivers goods to a carrier, and it is the seller that must contract for and pay the costs of carriage necessary to bring the goods to the agreed destination. The seller is also responsible for contracting insurance cover against the buyer’s risk of loss or damage during the carriage.

769 However, when CIP is used, the seller fulfils its obligation to deliver when it hands the goods over to the relevant carrier and not when the goods reach the place of destination. Therefore, under CIP, risk passes and costs are transferred at different places. While 3A would be responsible for covering the cost of transport and insurance to Australia, risk and title would still pass to HVG in Germany.

770 For the reasons outlined above, the supply of the Alucobond products from 3A to HVG during the relevant period occurred in Germany. I will consider the significance of this in relation to whether 3A was carrying on business within Australia later in these reasons.

6.1.2 Misleading c onduct c laim

771 In respect of the misleading conduct claim, there was no dispute between the parties as to the relevant legal principles. The relevant inquiry is whether 3A made the alleged representations or failed to give the pleaded warnings in Australia.

772 The authorities establish that the location where misleading or deceptive conduct occurs is the place where the representations are received. As extracted above, in Ethicon, Katzmann J at [3129] said the following about the location of the misleading or deceptive conduct:

As to misleading or deceptive conduct, see Australian Competition and Consumer Commission v Valve Corporation (No 3) [2016] FCA 196; (2016) 337 ALR 647 (Edelman J) … at [177] … The allegedly misleading conduct occurred in Australia because it is based on the information provided to, and received by, Australian consumers in Australia: see Valve Corporation v Australian Competition and Consumer Commission (2017) 258 FCR 190 at [104]–[105], [116], [134]. Where the relevant conduct occurs in Australia, in Trade Practices Commission v Australia Meat Holdings Pty Ltd [1988] FCA 338; (1998) 83 ALR 299 at 356 Wilcox J described it as “a misuse of language” to speak of the statute being given an extra-territorial effect.

773 As the Full Court explained in Valve FCAFC at [134]:

[W]here it is alleged that a respondent has, by making representations on the internet, engaged in conduct that is misleading or deceptive… and an issue arises as to the place of the representations, it is necessary to ask where in substance the representations were made. If the respondent is based overseas and has a relationship with customers in Australia, it is likely that representations addressed to those customers will be taken to have been made in Australia, being the place where the customer accesses and reads the representations on his or her computer. This is likely to be the case even if the representations are available to be accessed by consumers in other countries around the world…

774 The Applicants submit that although the Full Court’s observations in Valve FCAFC were made in respect of representations made via websites, the Full Court’s reasoning applies equally to information in brochures that are distributed in Australia, and prepared and approved for the specific purpose of such distribution in Australia. Where such brochures are then distributed, accessed, and read in Australia, then the relevant conduct occurs in this jurisdiction.

775 The Applicants submit that the relevant misleading conduct by 3A includes statements on websites accessible from Australia, statements in brochures based on information provided by 3A and which 3A approved before distribution in Australia, and a failure to ensure appropriate warnings were given to Australian consumers. The Applicants submit that this is all conduct in Australia for the purposes of the relevant statutes.

776 3A submits that throughout the relevant period, it sold the majority of its products around the world through distribution agreements, which in the case of HVG was through the four Distributor Agreements.

777 The Distributor Agreements included the following terms:

(a) cl 1: 3A granted HVG the exclusive right to sell and use Alucobond within Australia, and to use 3A’s Alucobond trademark “in connection with the sale” of the Alucobond products. HVG was to import the products “on [its] own account” and purchase the products exclusively from 3A. Under cl 17 (or 16, depending on the particular Distributor Agreement), HVG was not to purchase or sell any products competing with Alucobond.

(b) cl 3: 3A was to sell and deliver to HVG such quantities of the Alucobond products as may be ordered by HVG, with all contracts for the sale to be based on the General Terms of Delivery and Payment;

(c) cl 4: HVG was required to buy and import from 3A minimum quantities of Alucobond which were described in schedules to the Distributor Agreements as HVG’s sales target. For the purposes of illustration, the 2015 Distributor Agreement noted sales targets for Alucobond of 460.000 m 2 for 2015, and 475.000 m 2 for 2016. The 2018 Distributor Agreement noted that sales targets for each year would be defined mutually by 30 September of the preceding year, however required under cl 4 that in the case of underperformance below 90%, for HVG to submit a detailed business and market report.

(d) cll 5-6: up to 1 January 2018, HVG was permitted to use 3A’s Alucobond trademark for the purposes of the Distributor Agreement. However, where HVG used the trademark, it was required to indicate 3A’s interest in it by displaying 3A’s logo and the address of 3A’s head office. Under cl 6 (again, up to 1 January 2018), HVG was required to secure 3A’s approval of any publication or other material prepared by HVG in connection with the sale of Alucobond prior to its use. HVG was restrained from doing anything which would impair the trademark.

(e) cll 7-8 (cll 6-7 for the 2018 agreement): HVG was required to maintain a place of business in Australia with adequate facilities, staff, and quantities of Alucobond to properly service the needs of customers in Australia, and to meet certain standards of operation and services. This included an obligation on HVG to generally carry on its business so as to maximise the Alucobond trademark, and to encourage the sale of Alucobond products. The Distributor Agreements also restrained HVG from giving any warranty or representation on behalf of 3A.

(f) cl 12 (cl 11 for the 2018 agreement): HVG was to present 3A with a marketing plan each year, which was to be approved by 3A prior to its implementation. This was to include activities such as advertisements, participation in exhibitions, product seminars, and other promotional activities. 3A would determine on a case-by-case basis a cost contribution to the expenditure for such marketing and promotional activities by HVG. Additionally, 3A was to provide HVG with such quantities of promotional material and literature about the Alucobond products published from time to time by 3A as was necessary for the purposes of the Distributor Agreements. 3A was also to give to HVG technical details and assistance as may be required from time-to-time. Such promotional material and literature and technical details were to be provided free of charge by 3A.

(g) cl 15 (cl 14 for the 2018 agreement): “[HVG], being an independent contractor engaged in its own and entirely separate business, shall in no way be construed to constitute itself an agent or employee of [3A] for any purpose whatsoever… Nothing in this agreement constitutes a partnership between the parties”.

(h) cl 16 (cl 15 for the 2018 agreement): As part of the termination rights of each party, if HVG failed to reach a minimum of 75% of its sales target, 3A had the option to terminate the agreement at the end of the relevant calendar year in which HVG failed to meet its commitment. Additionally, in the event of termination, 3A was not liable to repurchase any of the Alucobond products from HVG, and HVG would not be entitled to any compensation from 3A for a loss of customers resulting from the termination of the agreement; and

(i) cl 23 (cl 22 for the 2007 and 2018 agreements): the applicable law of the Distributor Agreements was the law of Germany.

778 3A submits that the Distributor Agreements between the Respondents mean that HVG promoted and sold the Alucobond products in Australia as an independent contractor engaged in its own entirely separate business. 3A submits that it did not, in any relevant sense, “cause” HVG to engage in those activities, and that although 3A had rights not to approve HVG’s promotional material or marketing plan, failing to withhold such approval did not entail positively causing the distribution of promotional material in Australia. In any event, 3A submits that approval by 3A of HVG’s promotional material or marketing plans occurred in Germany and was not conduct that occurred in Australia.

779 In the context of the misleading conduct claim, a key factual question which is addressed later in these reasons, is whether the representations contained in HVG’s brochures can be properly said to have been made by 3A in the context of their commercial dealings. For the reasons outlined below, I have answered this question affirmatively.

780 In this context, the following may be said regarding the location where 3A made the relevant representations. I do not accept 3A’s general submissions that HVG promoted the Alucobond products entirely separately as an independent contractor, such that 3A did not cause HVG to engage in those activities.

781 Rather, the terms of the Distributor Agreements establish the opposite. 3A required HVG to prepare a marketing plan in respect of its promotion of the Alucobond products which was subject to 3A’s approval. 3A would also consider directly contributing to the expenditure for such marketing and promotional activities by HVG. 3A was also required to provide HVG with sufficient quantities of promotional material necessary for the purposes of the Distributor Agreements, and to provide any technical details or assistance as required. This promotional material and literature was to be provided by 3A free of charge.

782 Additionally, under the terms of the Distributor Agreements (until 1 January 2018), 3A granted HVG the right to use its Alucobond trademark in advertising material, and specifically obligated HVG to indicate 3A’s interest in the trademark by including on the material its logo and the address of its head office in Germany. HVG was also required to obtain 3A’s approval of any publication or other material prepared by it in connection with the sale of the Alucobond products prior to the products’ use. HVG was also contractually required to carry on its business in a manner which sought to maximise the Alucobond trademark.

783 In the context of the above and the settled legal principles, I accept the Applicants’ submissions that where 3A engaged in conduct in preparing and approving the information contained in Alucobond marketing brochures that were distributed and read in Australia (particularly where they were prepared and approved for that particular purpose), such conduct is to be understood as conduct undertaken in Australia for the purposes of the TPA and ACL. The representations that 3A is alleged to have made were made in Australia when the marketing material was distributed to potential customers in Australia. For the same reason, I reject 3A’s submission that its approval of any promotional material or marketing plans occurred in Germany and, therefore, should not be understood as conduct that occurred in Australia.

784 Similarly, to the extent that it is alleged that there was a failure to provide warnings in the brochures, that failure only occurred in Australia when the brochures were read by Australian consumers.

785 In the present case, the relevant misleading conduct alleged by the Applicants includes statements on HVG’s website that were accessible from Australia (3A’s liability in respect of this conduct is dealt with separately), statements in 3A’s brochures and statements in HVG’s brochures which were distributed in Australia and were based on information provided by 3A and which 3A approved before distribution, and the alleged failure to ensure appropriate warnings were given to Australian customers. For the reasons I have just given, all this conduct took place in Australia.

786 However, the alleged misleading conduct also includes statements on 3A’s website, and it is more contentious whether such representations can be considered as having been made in Australia. There was no evidence led by the Applicants that these statements/webpages were actually accessed in Australia. Whilst there is evidence that customer enquiries were sent from Australian (prospective) customers to 3A via its website – which clearly demonstrates the website could be and was accessed in Australia – it is not evidence that those persons actually viewed any of the specific webpages which contained the representations which the Applicants rely on.

787 3A submits that the alleged representations were general and made to the world at large, rather than to any Australian customer in particular, and that “[u]ntil the representations were accessed, the representations were meaningless and could not be the subject of any alleged contravening conduct”: citing A ustralian C o mpetition and C o nsumer Commission v Valve Corporation (No 3) (2016) 337 ALR 647; [2016] FCA 196 at 181; Valve FCAFC at [127]-[134], [139]; Ward Group Pty Ltd v Brodie & Stone Plc (2005) 143 FCR 479; [2005] FCA 471 at [40]; Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 568 (Mason CJ, Deane, Dawson and Gaudron JJ).

788 The Full Court said in Valve FCAFC at [134]:

[W]here it is alleged that a respondent has, by making representations on the internet, engaged in conduct that is misleading or deceptive or likely to mislead or deceive in contravention of s 18 of the Australian Consumer Law, or made false or misleading representations in contravention of s 29 of the Australian Consumer Law, and an issue arises as to the place of the representations, it is necessary to ask where in substance the representations were made. If the respondent is based overseas and has a relationship with customers in Australia, it is likely that representations addressed to those customers will be taken to have been made in Australia, being the place where the customer accesses and reads the representations on his or her computer. This is likely to be the case even if the representations are available to be accessed by consumers in other countries around the world. A distinction is to be drawn between the conduct proscribed by ss 18 and 29 and the causation of loss or damage. It is not necessary, for the purposes of these provisions, to establish loss or damage. It follows that, for the purposes of determining the place where the representations were made, it is not necessary to determine whether any loss or damage was suffered and, if so, the place of that loss or damage.

789 It is helpful to explain the circumstances in Valve FCAFC that led the Full Court to determine that the representations in that case were made in Australia. The case concerned representations made by Valve, a company based in the State of Washington, in the United States of America which operated an online game distribution network, Steam. Some of the representations considered were contained in a subscriber agreement (referred to as the SSA). It was not in dispute that Steam had more than two million Australian subscribers. The SSA was uploaded in Washington State and could be accessed and read by people anywhere in the world. But consumers had to establish an account with Steam before they could purchase a game, and, as part of the process of establishing an account and purchasing a game, the consumer had to agree to the SSA.

790 Thus, despite the website being a “foreign website” not specifically directed to Australians, the Full Court found (at [135]):

In circumstances where Valve had a direct relationship with a large number of Australian consumers, and Valve required consumers to agree to the SSA before they could open an account and purchase a game, the… representations were made in Australia when consumers in Australia accessed and read the SSA on their computers. This is where, in substance, for the purposes of ss 18 and 29(1)(m) [of the ACL], the representations were made.

791 The circumstances relating to the representations on 3A’s website are vastly different. There is evidence of some customer enquiries from Australia, but not such that it can be said there was a “direct relationship with a large number of Australian consumers”. There was no analogous requirement for customers to view or agree with a document containing the representations on the 3A website. Rather, I am being asked to infer from the existence of Australian consumers, evidenced through the customer enquiries, that consumers in Australia will have received the representations. I will not make that inference. In any case, given my findings below as to 3A carrying on a business in Australia, it is ultimately not necessary for me to come to a concluded view on this matter.

6.2 Issue 2 – Was 3A carrying on business within Australia?

792 Irrespective of the outcome under issue 1, to the extent that 3A was carrying on business in Australia, its conduct, including conduct outside Australia, will be subject to the TPA and ACL under the extra-territorial provisions of the relevant statutes.

793 Section 5(1) of the CCA relevantly provides:

5 Extended application of this Act to conduct outside Australia

(1) Each of the following provisions:

…

extends to the engaging in conduct outside Australia by:

(g) bodies corporate incorporated or carrying on business within Australia; or

…

794 Section 5(1) of the TPA was in substantively the same terms.

795 The relevant question for determination is, therefore, whether 3A was a corporation that was carrying on business within Australia such that its conduct, including that which may be considered to have been engaged in outside Australia, is subject to the provisions of the TPA and ACL.

6.2.1 Legal principles

796 Whether a company is carrying on business within Australia is a question of fact: Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd (2018) 259 FCR 514; [2018] FCAFC 6 at 99, citing Luckins (Receiver and Manager of Australian Trailways Pty Ltd) v Highway Motel (Carnarvon) Pty Ltd (1975) 133 CLR 164 at 186 (Stephen J). As Gordon J observed in Norcast S. ár.L v Bradken Ltd (No 2) (2013) 219 FCR 14; [2013] FCA 235 at [255]:

At general law, carrying on a business generally involves conducting some form of commercial enterprise, systematically and regularly with a view to profit: [Gebo Investments (Labuan) Ltd v Signatory Investments Pty Ltd (2005) 54 ACSR 111] at [38]. It is unnecessary to restate the “usual elements” of a finding of carrying on business in Australia. It is, however, necessary to point out that a company may be found to carry on business in Australia even though the bulk of its activities are conducted elsewhere (Gebo Investments at [38]-[41]) and that it conducts its activities in Australia by reason of its control over or connection with an Australian company: Adams v Cape Industries p lc [1990] Ch 433 at 530 and Bray v F Hoffman-La Roche Ltd (2002) 118 FCR 1 at [60]-[63].

797 In Valve (No 3), Edelman J referred to the following principles at [196]-[197]:

For instance, in [Bray v F Hoffman-La Roche Ltd (2002) 118 FCR 1] at 17–18 [59]-[60], Merkel J referred to the parties’ acceptance that [sic] expression “carrying on business in Australia” should be broadly interpreted in light of its purposes of consumer protection to enable the Trade Practices Act to apply to conduct that is intended to have, and has, an adverse effect on competition in Australia. His Honour continued, saying that:

The expression “carrying on business” is not defined although s 4(1) defines “business” as including a business not carried on for profit. As was pointed out by Gibbs J in Luckins v Highway Motel (Carnarvon) Pty Ltd (1975) 133 CLR 164 at 178; 7 ALR 413 at 422 (Luckins) the expression “may have different meanings in different contexts”. The present context is s 5(1), which gives effect to the legislature’s view that comity, for the purposes of the TPA, requires that a particular nexus with Australia exist (ie citizenship or residence by a person or incorporation or the carrying on of business in the case of a body corporate) if certain Parts of the TPA are to apply to conduct engaged in outside of Australia by those persons or bodies corporate. As is clear from the judgments in Meyer Heine it was open to the legislature, as a matter of power and comity, to impose a lesser nexus requirement (eg intended and actual anti-competitive consequences in Australia) but it chose not to do so. In that context the expression should be given its ordinary or usual meaning.

As his Honour concluded, the ordinary meaning of “carrying on business” usually involves (by the words “carrying on”) a series or repetition of acts. Those acts will commonly involve “activities undertaken as a commercial enterprise in the nature of a going concern, that is, activities engaged in for the purpose of profit on a continuous and repetitive basis”: see Thiel v Federal Commissioner of Taxation (1990) 171 CLR 338 at 350; 94 ALR 647 at 654 (Dawson J); Pioneer Concrete Services Ltd v Galli [1985] VR 675 at 705; (1985) 4 IPR 227 at 235 (the Court); Hope v Bathurst City Council (1980) 144 CLR 1 at 8–9; 29 ALR 577 at 582 (Mason J; Gibbs, Stephen and Aickin JJ agreeing).

798 Barrett J referred to the following principles in Campbell v Gebo Investments (Labu a n) Ltd (2005) 190 FLR 209; [2005] NSWSC 544 at [38]:

I return to the general law concept of carrying on business. According to those concepts, carrying on of business generally involves conducting some form of commercial enterprise, systematically and regularly with a view to profit… although, as a number of cases emphasise, there may be a finding that business is carried on even where some of the usual elements are missing. The following passage in the judgment of Gibbs J in Smith v Capewell (1979) 142 CLR 509 is instructive:

The expression “carry on business” in its ordinary meaning, signifies a course of conduct involving the performance of a succession of acts, and not simply the effecting of one solitary transaction. In Smith v Anderson (1880) 15 Ch D 247 ; [1874–80] All ER Rep 1121, where the Court of Appeal considered the effect of s 4 of the Companies Act 1862 (UK) which spoke of an “association … formed … for the purpose of carrying on any … business”, Brett LJ said, Ch D at 277–8; All ER Rep at 1130: “The expression ‘carrying on’ implies a repetition of acts, and excludes the case of an association formed for doing one particular act which is never to be repeated.”

In Kirkwood v Gadd [1910] AC 422; [1908–10] All ER Rep 768 Lord Loreburn LC said (AC at 423): “What is carrying on business? It imports a series or repetition of acts.” In the same case Lord Atkinson (at 431) referred with apparent approval to the statement of Brett LJ in Smith v Anderson. Similarly, in Premier Automatic Tickets Issuers Ltd FC of T (1933) 50 CLR 268 at 298, Dixon J, in a passage frequently quoted, said that “the carrying on or carrying out of any profit-making undertaking or scheme” in a taxation statute, “appears to cover, on the one hand, the habitual pursuit of a course of conduct, and, on the other, the carrying into execution of a plan or venture which does not involve repetition or system …”.

799 In Valve FCAFC at [149], the Full Court confirmed that the territorial concept of carrying on business involves acts within the relevant territory that amount to, or are ancillary to, transactions that make up or support the business.

800 Perram J discussed this concept in further detail in Facebook where his Honour identified that the test requires (a) identifying what the transactions that make up or support that business are; and (b) then asking whether those transactions or the transactions ancillary to them occur in Australia. As this formulation recognises, it is enough that a company that conducts business in a foreign jurisdiction does acts within Australia as part of or ancillary to that business: Facebook at 103.

801 In Facebook, it was submitted before the Full Court that Facebook Inc did not carry on business in Australia for the purposes of the Privacy Act 19 8 8 (Cth) on the basis that Facebook Inc’s installation of cookies on Australian devices was part of the data processing services it provided to Facebook Ireland, in circumstances where its data processing services did not occur in Australia. In rejecting this submission, Perram J (with whom Yates J agreed at [166] and Allsop CJ generally agreed at [1]) outlined the following principles:

[92] [Facebook Inc] submitted that the fact that the installation of the cookies and the management of the Facebook login (through the Graph API) took place in Australia did not entail that the business which included them was located in Australia. Whilst it was true that these services were being provided by Facebook Inc to Facebook Ireland as part of its business of providing data processing services, this was not the business which was being conducted in Australia. The only business being conducted in Australia was that of Facebook Ireland. The users and developers in Australia had contractual relations with Facebook Ireland and the revenue which was derived from them was earned by Facebook Ireland. Facebook Inc’s role in this picture was merely to provide services to Facebook Ireland in the conduct of that quite different business.

[93] The essence of this submission is that Facebook Inc’s activities in Australia themselves lack a commercial quality because Facebook Inc is not engaged in any commerce in Australia…

…

[95] … Facebook Inc’s business of providing data processing services to Facebook Ireland is conducted from its data centres which are not in Australia. But an aspect of that business — the installation and removal of cookies and the management of the Facebook login through the Graph API — are activities which do take place in Australia... [T]hose activities do not themselves comprise the commercial dealings which are the business.

[96] … This question [now posed for determination] emerges from the description given by Mason J in Hope [v Bathurst City Council (1980) 144 CLR 1 at 8-9] of the nature of the carrying on of a business as a collection of “activities undertaken as a commercial enterprise in the nature of a going concern, that is, activities engaged in for the purpose of profit on a continuous and repetitive basis”. The concept has therefore two elements: (a) activities undertaken as a commercial enterprise as a going concern with a view to a profit; and (b) carried on in a continuous and repetitive basis. Where a company undoubtedly conducts business in one place, this two limbed definition can give rise to two distinct problems when the company then does an act or acts in another place which, however, satisfy only one of the limbs in Hope. The two problems are these:

(1) the company engages in a single commercial transaction in a place where it otherwise does not conduct business. Does the company conduct business in this place? The single transaction means that the repetition requirement in Hope is not satisfied in that place but the commerciality limb is satisfied; and

(2) the company engages in repetitive acts in the performance of its business in a place where it otherwise does not conduct business but in doing so it engages in no commercial activity. Does the company conduct business in this place? The repetition requirement in Hope is satisfied but the commerciality limb is not.

[97] Question (2) is… the question in this case…

…

[103] It is difficult to see that a different approach should be taken to the second situation, ie where there is continuous business activity in the jurisdiction but where that activity does not result in any transactions in the jurisdiction. Just as one asks whether the single act in one jurisdiction took place in the course of the business conducted in another jurisdiction one should ask, in a case such as the present, whether the repetitive but non-commercial activity occurring in one jurisdiction took place in the course of the business conducted in the other. … To put the problem in more general terms, if a company conducts business in a foreign jurisdiction and it does acts within Australia as part of that business which fall within either limb in Hope then, subject to any contrary implication arising from the statutory context, it will conduct business in Australia.

6.2.2 Consideration

802 3A submits that its business constituted the sale of Alucobond products to its worldwide distributors, including to HVG under the Distributor Agreements. 3A submits that this sale took place in Germany. 3A further submits that it was HVG that carried on business in Australia, and that HVG’s sale of the Alucobond products to purchasers in Australia constituted its own independent business, such that it was incorrect to describe such sales as transactions ancillary to 3A’s business. 3A submits that the matters which the Applicants sought to rely on as establishing 3A carried on a business in Australia were, in fact, all matters that supported HVG’s business, or otherwise were not indicative of 3A carrying on a business within Australia.

803 It can be accepted that 3A’s business involved the sale of the Alucobond products to HVG, which as per my findings above in section 6.1.1.2, occurred in Germany. Plainly however, 3A also had a direct financial interest in HVG’s success as a distributor of the Alucobond products in Australia, given the more Alucobond products HVG sold in Australia, the more Alucobond products 3A could sell to HVG. The nature of this relationship is evident from the terms of the Distributor Agreements which incorporated sales targets for HVG and included an immediate right for 3A to cancel HVG’s exclusive distribution right if HVG failed to reach 75% of the sales target in a calendar year. The Distributor Agreements dated 1 September 2015 and 1 January 2018 also incorporated provisions which required HVG to provide detailed reporting to 3A where its performance fell below 90% of its sales targets.

804 Data prepared for Dr Werner in November 2011 regarding 3A’s market share in various jurisdictions disclosed that 391,000 square metres of Alucobond PE was sold to Australia that year at a total price of USD12,766,150. 3A submits that Australia was not as large a market as the Applicants indicated, noting that only 13.1% of Alucobond PE, Alucobond Plus and A2 sold by 3A in 2011 was sold to Australia. In contrast to 3A’s submission, it appears quite clear from their own figure that Australia reflected a material part of its business.

805 3A argues that the matters the Applicants rely on as establishing that 3A carried on business in Australia are in fact all matters that supported HVG’s business. I accept the Applicants’ submission that this argument involves the false unstated premise that if HVG was operating its own business, then 3A cannot also have been carrying on business in Australia. While 3A accepts that those two propositions are not mutually exclusive, its submissions nevertheless require viewing 3A’s actions as only in support of HVG’s independent business, without reference to the fact that 3A engaged in the conduct in circumstances where it was plainly in its own commercial interest to do so as that conduct supported its own global manufacturing and distribution of Alucobond, including most directly, its sale of the Alucobond products to HVG.

806 3A was not engaged in some passive distribution arrangement with HVG which simply involved the supply of goods to HVG but which otherwise left HVG to its own devices to sell the product in Australia. The evidence demonstrates that 3A took an active role, in Australia, to promote the sales of Alucobond products in Australia and to promote the Alucobond brand more broadly, including through technical and promotional support provided to HVG. This conduct was engaged in by 3A on an ongoing basis throughout the relevant period and was ancillary to and in support of 3A’s business of manufacturing and selling Alucobond products to its global distributors. I do not accept 3A’s submission that such conduct is to be properly characterised as conduct which supported or otherwise was ancillary to only HVG’s business and not its own business. I have reached this conclusion for four main reasons, outlined in turn below.

807 Firstly, it is again relevant to consider the particular terms of the Distributor Agreements. As noted earlier in these reasons, the terms of the Distributor Agreements allowed 3A to control the promotion of Alucobond within Australia. HVG was required to obtain 3A’s approval for any publication or other material prepared by HVG in connection with the sale of Alucobond. 3A required HVG to engage in such advertising and generally carry on its business so as to maximise the Alucobond trademark, and to maximise its sales of Alucobond. 3A required HVG to present a yearly marketing plan, which was subject to 3A’s approval prior to implementation, where 3A would consider on a case-by-case basis whether to provide a cost contribution to the expenditure of any marketing and promotional material. Additionally, 3A was also obligated to provide to HVG such quantities of promotional material regarding Alucobond as required for the purposes of the Distributor Agreements, as well as provide such technical details and assistance as HVG might require from time to time. As noted previously, this assistance was to be provided by 3A for free.

808 Second ly, 3A actively exercised its right to control the marketing and promotion of Alucobond products in Australia. By way of example, Ms Haas, in an email dated 5 March 2010, directed HVG not to print a “Vision Materialized” brochure until 3A’s marketing team had reviewed it and given the “green light”. The 3A marketing team subsequently provided a series of comments on the brochure that were incorporated before its distribution.

809 Similarly, when HVG developed the “Beyond Facades” brochure, in an email dated 14 June 2017, Ms Haas sent back comments from 3A’s marketing department to HVG to incorporate into the brochure. In addition to providing comments on the brochure, Ms Haas also stated the following:

For reasons explained during my visit please ensure that in future, and what was common practise in the past, always forward draft copies of any potential print document to me for final approval. Please understand that this is not meant to make your life difficult, but this is common practise with all our other partners too and acknowledging the fact that 3A is producer and holder of the brand Alucobond and we need to ensure it’s used in the right way.

810 3A also contributed to HVG’s marketing budget as contemplated by the Distributor Agreements.

811 3A on the other hand submits that the Applicants had only been able to identify two instances where 3A provided comments on a brochure, being the two examples noted above. It also submits that Ms Haas’ email dated 14 June 2017 (extracted above) suggested that while it had been HVG’s practice at some stage in the past to have marketing materials approved, that had ceased to occur and was only then, in 2017, picked up again by HVG (albeit at 3A’s request). 3A also submits that Ms Haas’ email indicates that the purpose of 3A reserving to itself the right to review the marketing materials was to ensure that the Alucobond brand was protected and not misused.

812 While it can be accepted that Ms Haas’ email indicates that HVG’s practice of seeking approval of its marketing material from 3A at some stage ceased during the relevant period, the email, alongside the email regarding the “Vision Materialized” brochure, also indicate that such a practice did exist. Such practice is also consistent with the contractual terms of the Distributor Agreement. That practice, as Ms Haas’ email candidly reflects, is conduct on the part of 3A to control and manage the promotion of the Alucobond brand in Australia, which is designed to advance 3A’s global business.

813 Third ly, and more significantly, 3A’s representatives travelled to Australia to provide direct support in relation to HVG’s promotion and sales of Alucobond products.

814 During the relevant period and beginning in April 2009, Ms Haas completed a total of 19 trips to Australia, with the last trip ending in November 2018. The trips generally occurred twice per year, with each trip generally being for a period of two weeks.

815 The purposes of Ms Haas’ visits to Australia were noted in an email from Dr Werner to HVG on 27 May 2011, in which Dr Werner noted that “Susanne Haas will travel to Australia in a frequency of appr. 1 time per year to support you and give us insights into the Australian market. If there are urgencies like transfer to plus [sic] it could be more often.” In a further email to HVG on 21 December 2011, Dr Werner again noted the support 3A sought to provide HVG through Ms Haas’ trips to Australia stating:

In addition we agreed on the following topics to support our joint business model:

…

• Instead we will give you full support, especially through Susan, to roll out these surfaces in the Australian market to have more differentiation against competitors.

816 During these trips Ms Haas travelled throughout Australia, visiting multiple sites where Alucobond products had been used and speaking directly with architects, cladding fabricators, and other professionals who were either existing, previous, or potential clients of HVG. Ms Haas noted the purpose of her trip to Australia in her April 2009 travel report as follows:

As in previous trips, the purpose of the visit was in response to an invitation by AAPL to assist in the promotion of Alucobond by meeting their most influential customers, architects and fabricators, to grow their awareness and the profile of ALCAN and assess the current market conditions in Australia. Furthermore, to assist in the creation of new business relationships and to reinforce and enhance those that are existing.

This was to be achieved through visits to project sites and discussions with their important clients in order to assess current and potential future demands for Alucobond and the competition we face.

817 Ms Haas also attended multiple trade shows where Alucobond products were being promoted. Dr Werner’s evidence was that “HVG asked for that to show the European face behind the product”. Indeed, in relation to an exhibition in Melbourne in May 2009, Ms Haas stated in her travel report:

This exhibition attracts Australia’s best architects and interior designers and has proven to be an ideal showcase for Alucobond. Approx. 248 contacts were made during the three days the exhibition was on and it can therefore be considered as being most valuable for our business. A number of important new contacts were made for upcoming projects with clients who were not aware of Alucobond before or who had not considered Alucobond prior to the exhibition.

…

This exhibition was also successfully used to further strengthen our relationship with Alucobond Architectural [ie HVG] and Australia’s most important clients which included various architects, designers, fabricators from all states of Australia. My attendance was greatly appreciated in this respect.

818 As it would not be practical to outline the content of each of the 19 travel reports, it suffices to say the following. The travel reports throughout the relevant period prepared by Ms Haas reveal a high level of attention by 3A to the manner in which Alucobond products were marketed within Australia to ensure that the Alucobond brand was marketed consistently with 3A’s global branding for its products and in a manner that promoted the ongoing success of Alucobond products in Australia. Ms Haas, as 3A’s representative in Australia, engaged in the promotion of Alucobond in Australia directly, through her attendance at various trade shows, and through her engagement with various professionals across Australia – many of whom had specified or used Alucobond on various projects previously, or were considering the use of Alucobond products. During Ms Haas’ visits to Australia, she collected important information about the Australian market with a sharp focus on Alucobond’s competitive position in the market relative to other market participants. Much of this information was obtained directly from the professional architects and cladding specialists who made the decision to specify Alucobond as the cladding option on a project. In relation to each firm she met, Ms Haas identified their response to particular Alucobond offerings, recent projects they had completed using Alucobond, and upcoming projects where Alucobond could be specified.

819 Ms Haas’ travel reports after each visit to Australia summarised in great detail her activities and what she had learnt from the Australian market. She provided detailed insights into the state of the construction industry throughout different parts of Australia. Often, she also identified the individual projects where Alucobond was in competition with other products to be specified or used, with clear insight into why Alucobond won or lost its specification. The travel reports often included an action plan prepared by Ms Haas with HVG in relation to how the Respondents’ businesses would operate in the future, noting any new changes that might be required. The travel reports demonstrate clear and conscientious strategic decisions being made by 3A in its dealings with HVG and the marketing and sale of the Alucobond products in Australia.

820 To illustrate the scale of Ms Haas’ activities in Australia during her trips, it is helpful to consider a particular travel report as an example. The travel report for Ms Haas’ trip between 10 May 2012 and 25 May 2012 spans 44 pages and records that she visited Sydney, Melbourne, Adelaide, and Perth. During this two-week period, Ms Haas had appointments with approximately 40 different architectural firms and cladding fabricators, alongside a handful of site visits where Alucobond products had been used. Ms Haas also attended two trade shows, one in Sydney and one in Perth, promoting Alucobond products. Alongside the references to the various appointments and trade shows Ms Haas attended, Ms Haas provided detailed insight into the state of the market more generally throughout Australia, the state of Alucobond fabricators in the various cities, the extent to which particular architects or fabricators were likely to specify or use Alucobond in their projects compared to competing products, and she identified several projects throughout Australia where Alucobond either won or lost specification with competing products.

821 The importance of the role played by Ms Haas in strengthening and developing Alucobond’s success in Australia is also recognised in 3A’s own business history. In a marketing brochure celebrating 40 years of Alucobond, the National Sales and Technical Manager of Alucobond Architectural Pty Ltd (now HVG), gave thanks to Ms Haas, “whose role in our continued success over the past 15 years should never be underestimated”.

822 3A submits that Ms Haas’ visits were infrequent, and that a series of 19 visits over the span of a decade by a lone employee lacked the essential systemic or regular character inherent in the concept of carrying on business. 3A submits that it was unsurprising that 3A visited Australia to understand the performance of its Australian distributor. 3A further submits that there was nothing in Ms Haas’ visits that suggested that 3A itself carried on a business in Australia, noting that there was no evidence that Ms Haas transacted directly with customers while visiting.

823 I reject 3A’s submissions. Ms Haas’ visits were, in fact, quite clearly regular and ongoing in nature. Ms Haas generally travelled to Australia twice per year during the relevant period (2011 and 2018 being the only full calendar years in which Ms Haas only visited once), with each trip being around two weeks. It is also evident that Ms Haas’ conduct extended well beyond 3A simply seeking to understand the performance of its Australian distributor. Her visits to Australia clearly constituted activities designed to promote the sale of Alucobond throughout Australia, being activities related to and in support of 3A’s business of selling Alucobond products to HVG for distribution in Australia. Additionally, while there may be no evidence that Ms Haas transacted directly with customers while visiting, as was recognised in Facebook, it is not necessary for the business conduct in Australia to itself be commercial in nature.

824 In addition to Ms Haas’ visits, Dr Werner also visited Australia on three occasions within the relevant period in connection with 3A’s business. The first visit, in 2011, was to meet and get to know HVG. The second, in 2014, was primarily in relation to a potential corporate “acquisition” that never occurred. The third visit, in 2017, was only for a period of around 24 hours. Dr Werner flew to Australia to meet with an architect and installer of an Alucobond product on a project where a complaint had been made about the aesthetic of the product, and a concern was raised that a panel supplied was defective.

825 Dr Werner confirmed during cross-examination that on each of his visits to Australia he personally visited the HVG warehouses, and that on those visits he “had a look around” and confirmed that HVG was storing the materials correctly. While I accept that this supports a view that 3A was carrying on business in Australia, I give it little weight given the nature of Dr Werner’s visits.

826 Fourthly, 3A provided warranties upon request directly to Australian customers of HVG. The evidence demonstrates that over the course of the relevant period, HVG requested that 3A provide over 1,000 warranties directly to customers in Australia, in respect of projects using Alucobond PE and/or Alucobond Plus.

827 The evidence was that when it received a request for a warranty, HVG would send the warranty request to 3A who would consider each warranty on an individual basis.

828 Dr Werner gave evidence that it was his responsibility to determine whether 3A would grant a warranty in any given case. In certain cases, potential customers of HVG would ask for extended warranties or warranties on special terms. In those cases, Dr Werner said that he would decide whether or not to give that warranty.

829 By way of example, in June 2012, 3A was asked to approve a 15-year warranty for a project, “Global Switch”. In an email dated 18 June 2012 to Dr Werner, Ms Haas noted that “we are in competition with Vitrebond [sic], which offers a very aggressive price and at the same time offered a 20-year warranty for both components…”. In her email, Ms Haas also stated that the prospective client would not have accepted a warranty of ten years. The special warranty requested from 3A in this case was being requested in an attempt to secure a large project for HVG, utilising 9,000 m 2 of Alucobond. Plainly, it was in 3A’s financial and commercial interest for HVG to succeed in obtaining this sale, so that HVG could thereby purchase more Alucobond from 3A. As Dr Werner stated in cross-examination in response to whether the guarantee was provided to assist HVG in competition with Vitrabond: “All we did was assist HVG against competition... it was [in] our interest to – to sell product and support HVG in being able to sell the product in the market”.

830 3A, again, sought to submit that the warranties were provided in support of HVG’s business. I do not accept 3A’s submission. That the activities supported HVG’s business does not detract from the fact that 3A was undertaking these activities in Australia within a systematic pattern of conduct to further its own commercial interests in Australia, as part of its global business. The activities were directly ancillary to, and supported, 3A’s own business.

831 3A also submits that each of the warranty agreements were expressly made in Germany and nominated German law as the applicable law. While that may be the case, that does not detract from the fact that the warranties were being offered and entered into by 3A directly with customers located in Australia, in relation to Alucobond products located and used in Australia.

832 For the reasons given, I find that during the relevant period, 3A was carrying on business within Australia. It follows that ss 5(1) of the TPA and 5(1) of the CCA confer extra-territorial operation of the relevant provisions of the TPA and ACL for the purposes of the consumer guarantee claim and the misleading conduct claim, to the extent any such extra-territorial application is required.

7. CONSUMER GUARANTEE CLAIM: THRESHOLD REQUIREMENTS

833 This part of these reasons addresses the threshold requirements which the Applicants must establish to make good the Applicants’ claims under s 74D of the TPA and ss 54 and 271 of the ACL.

834 Those requirements are:

(a) that 3A supplied Alucobond PE or Alucobond Plus “in trade or commerce”: TPA, s 74D(1)(a) (issue 3);

(b) that Alucobond PE and Alucobond Plus were “goods” for the purposes of s 74D, which turns on whether they were goods of a kind ordinarily acquired for personal, domestic or household use or consumption: TPA, s 74A(2)(a); ACL, s 3(1)(b) (issue 4);

(c) that a person “supplied” Alucobond PE or Alucobond Plus to a “consumer”: TPA, s 74D(1)(b); ACL, s 54(1)(a) (issue 5(a));

(d) that each developer of the Shore Building and Five Dock Building is taken to have been “supplied” and “acquired” Alucobond PE or Alucobond Plus as a “consumer” (issue 5(b));

(e) if issue 5(a) is not established but issue 5(b) is established, that each of the Shore OC and Five Dock OC is a person who derived title to Alucobond PE or Alucobond Plus through or under the relevant developer: TPA, s 74D(1); ACL, s 271(1)-(2) (issue 6); and

(f) whether the relevant goods affixed to the Shore Building and Five Dock Building are Alucobond PE or Alucobond Plus, or have been so used up or transformed so as to be different “Third Party Products” manufactured by the “Qualified Professional(s)” who produced their façade systems: TPA, s 74D(1); ACL, s 54(1) (issue 7).

835 Prior to determining the threshold requirements, it is relevant to note that the parties made several submissions regarding the correct approach to construing the relevant sections of the TPA and the ACL.

836 I refer to my comments at [736 ]-[737 ] in relation to the object of the TPA and the ACL as “beneficial consumer protection legislation”, and the Applicants’ submission in respect of interpretating those statutes to promote that object.

837 The Applicants submit that this object is particularly relevant in the context of the relevant statutory provisions which shift the burden of legal liability for defective products from suppliers to manufacturers. The Applicants refer to the report of the Trade Practices Act Review Committee dated August 1976 (the Swanson Report), which explained (at [9.122]):

The Committee considers that the [Manufacturers Warranties Act 1974 (SA) and the Manufacturers Warranties Ordinance 1975 (ACT)] mentioned above is based upon a sound principle—that it is the manufacturer placing goods on to the market in the first place who is largely responsible for the quality of goods and that the law should require manufacturers to be directly responsible for statutorily-imposed standards in respect of the quality of those goods... We do not accept that it is appropriate for liability for a breach of that statutory standard to rest upon persons other than the manufacturer simply because the consumer has no contractual nexus with the manufacturer. Of all the persons in the distributive chain, the manufacturer is the person best placed to effect appropriate insurance against such liability and obviously is the only person who can adjust the manufacturing process to take account of any persistent defects.

838 Notwithstanding these general principles, which are not in doubt, 3A submits that the objective of threshold statutory requirements for the consumer guarantee claim is to limit the rights and remedies afforded by the consumer guarantees in the ACL and equivalent consumer protection provisions in the TPA.

839 In C hief E xecutive O fficer of Customs v Adelaide Brighton Cement Ltd (2004) 139 FCR 147; [2004] FCAFC 183, Black CJ said the following at [17], in relation to the Minister for Small Business and Consumer Affairs’ observations regarding a Bill which sought to tighten the eligibility criteria for rebates of customs or excise duty paid on purchase of diesel fuel:

[The Minister’s observations] also invite attention to the principle of statutory interpretation that although beneficial legislation (which customs rebate provisions are accepted to be…) is generally to be construed broadly in favour of its beneficiaries, excepting provisions within beneficial legislation need not for that reason be given a liberal interpretation (see Rose v Secretary, Department of Social Security (1990) 21 FCR 241 at 244). As Pearce and Geddes observe in Statutory Interpretation in Australia (5 th ed 2001) at [9.5]:

Exceptions may be included in the legislation to provide the practical balance between competing public interests. As such they should be interpreted carefully in order not to destroy that balance.

840 3A submits that the correct approach is to construe the threshold requirements according to orthodox principles regarding the text, context, and purpose of the statutory provisions but without any presumption that these limiting provisions must necessarily be construed contrary to the interests of a manufacturer.

841 The approach contended for by 3A cannot be applied as a general rule in respect of the threshold requirements, as 3A appears to suggest. In particular, such an approach would be directly contrary to a number of authorities (including those identified above) which support interpreting particular provisions of the ACL, including some which are relevantly identified in these reasons as forming part of the “threshold requirements”, broadly so as to give the fullest relief which the fair meaning of their language will allow. More generally, it is not correct to submit, as 3A appears to do, that particular language, which is necessarily defined or used to give structure and content to legislation, should be properly characterised as “limiting provisions” in the context of beneficial consumer protection legislation.

7.1 Issue 3 – Whether 3A supplied the Alucobond products to HVG “in trade or commerce”: TPA, s 74D(1)(a)

842 The consumer guarantee claim of the Applicants arises under the ACL. For claims of breach of the guarantee as to acceptable quality in s 54 of the ACL it is not necessary to prove that when goods were supplied by a manufacturer to the person who then resupplied the goods to the consumer, that this first supply from manufacturer to supplier occurred “in trade or commerce”. However, to the extent that the claims of group members depend upon s 74D(1) of the TPA, it will be necessary for the Applicants to establish on their behalf that supply by 3A to HVG for the purposes of resupply occurred “in trade or commerce”. This issue is, therefore, only relevant in respect of claims made under the TPA.

843 Section 74D(1) of the TPA relevantly provides:

74 D Actions in respect of goods of unmerchantable quality

(1) Where:

(a) a corporation, in trade or commerce, supplies goods manufactured by the corporation to another person who acquires the goods for re‑supply;

(b) a person (whether or not the person who acquired the goods from the corporation) supplies the goods (otherwise than by way of sale by auction) to a consumer;

(d) the consumer or a person who acquires the goods from, or derives title to the goods through or under, the consumer suffers loss or damage by reason that the goods are not of merchantable quality;

the corporation is liable to compensate the consumer or that other person for the loss or damage and the consumer or that other person may recover the amount of the compensation by action against the corporation in a court of competent jurisdiction.

844 “Trade or commerce” is defined in s 4 of the TPA as follows:

t rade or commerce means trade or commerce within Australia or between Australia and places outside of Australia.

845 3A submits that as their delivery of products to HVG occurred on “ex works” or “CIP” terms, the delivery of the Alucobond products occurred in Germany. 3A submits that as there was no delivery of the Alucobond products by 3A to Australia, its supply of those products was not “in trade or commerce” between Australia and places outside of Australia.

846 In particular, 3A refers to the High Court decision of Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 in which the majority (Mason CJ, Deane, Dawson and Gaudron JJ) said, in relation to the use of “in trade or commerce” in s 52 of the TPA which contained the prohibition on misleading or deceptive conduct, at 602-604:

It is well established that the words “trade” and “commerce”, when used in the context of s. 51(i) of the Constitution, are not terms of art but are terms of common knowledge of the widest import. The same may be said of those words as used in s. 52(1) of the Act. Indeed, in the light of the provisions of s. 6(2) of the Act which give an extended operation to s. 52 and which clearly use the words “trade” and “commerce” in the sense which the words bear in s. 51(i) of the Constitution, it would be difficult to maintain that those words were used in s. 52 with some different meaning. The real problem involved in the construction of s. 52 of the Act does not, however, spring from the use of the words “trade or commerce”. It arises from the requirement that the conduct to which the section refers be “ in ” trade or commerce…

As a matter of language, a prohibition against engaging in conduct “in trade or commerce” can be construed as encompassing conduct in the course of the myriad of activities which are not, of their nature, of a trading or commercial character but which are undertaken in the course of, or as incidental to, the carrying on of an overall trading or commercial business… Alternatively, the reference to conduct “in trade or commerce” in s. 52 can be construed as referring only to conduct which is itself an aspect or element of activities or transactions which, of their nature, bear a trading or commercial character…

Nonetheless, when the section is read in the context provided by other features of the Act, which is “An Act relating to certain Trade Practices”, the narrower (i.e. the second) of the alternative constructions of the requirement “in trade or commerce” is the preferable one. Indeed, in the context of Pt V of the Act with its heading “Consumer Protection”, it is plain that s. 52 was not intended to extend to all conduct, regardless of its nature, in which a corporation might engage in the course of, or for the purposes of, its overall trading or commercial business. Put differently, the section was not intended to impose, by a side-wind, an overlay of Commonwealth law upon every field of legislative control into which a corporation might stray for the purposes of, or in connection with, carrying on its trading or commercial activities. What the section is concerned with is the conduct of a corporation towards persons, be they consumers or not, with whom it (or those whose interests it represents or is seeking to promote) has or may have dealings in the course of those activities or transactions which, of their nature, bear a trading or commercial character. Such conduct includes, of course, promotional activities in relation to, or for the purposes of, the supply of goods or services to actual or potential consumers, be they identified persons or merely an unidentifiable section of the public. In some areas, the dividing line between what is and what is not conduct “in trade or commerce” may be less clear and may require the identification of what imports a trading or commercial character to an activity which is not, without more, of that character.

(Original emphasis.)

847 The Applicants submit that the TPA’s concept of “trade or commerce” picks up the constitutional concept of “trade or commerce with other countries” found in s 51(i) and, in respect of inter-State trade, s 92 of the Constitution. The Applicants refer to the High Court’s observations in that context in W & A McArthur Ltd v Queensland (1920) 28 CLR 530, where Knox CJ, Isaacs and Starke JJ said (at 546-547):

The terms "trade, commerce, and intercourse" are not terms of art. They are expressions of fact, they are terms of common knowledge, as well known to laymen as to lawyers, and better understood in detail by traders and commercial men than by Judges. But as Judges we are taken to know and do in fact in this instance know the general import of the words. The particular instances that may fall within the ambit of the expression depend upon the varying phases and development of trade, commerce and intercourse itself. Aviation and wireless telephony have lately added to the list of instances, but the essential character of the class remains the same. “Trade and commerce” between different countries — we leave out for the present the word “intercourse”— has never been confined to the mere act of transportation of merchandise over the frontier. That the words include that act is, of course, a truism. But that they go far beyond it is a fact quite as undoubted. All the commercial arrangements of which transportation is the direct and necessary result form part of “trade and commerce.” The mutual communings, the negotiations, verbal and by correspondence, the bargain, the transport and the delivery are all, but not exclusively, parts of that class of relations between mankind which the world calls “trade and commerce.”

(Emphasis added.)

848 In the present case, I accept the Applicants’ submission that 3A supplied the Alucobond products to HVG “in trade or commerce” for the purposes of s 74D of the TPA. 3A agreed to supply the Alucobond products, and did in fact supply the products, to HVG on the express condition that they be distributed in Australia. 3A also made arrangements for the delivery of the Alucobond products to Australia and engaged in various communications and negotiations between Germany (on 3A’s part) and Australia (on HVG’s part) around the supply of the Alucobond products.

849 This involved the supply of the Alucobond products “in trade or commerce” within the meaning of s 74D(1)(a) of the TPA. 3A’s submission, in effect, would require me to accept that the concept of “trade or commerce” under s 74D of the TPA should be understood to refer to, in respect of the supply of goods, the precise location where the transfer of title to the goods occurs, and that on such basis, given title to the Alucobond products transferred from 3A to HVG in Germany, the supply of goods cannot be understood to be in trade or commerce between Australia and Germany. I am not satisfied that is the case. 3A’s submissions by reference to Concrete Constructions are also of little assistance in the present case. As the High Court noted in McArthur, while the act of transportation of goods is plainly within the concept of “trade or commerce”, the concept encompasses matters beyond that including “mutual communings”, “negotiations” and “the bargain” of which the transportation or transfer of title to the goods from 3A to HVG is the direct result.

850 I find that 3A supplied Alucobond PE and Alucobond Plus to HVG in “trade or commerce” for the purposes of s 74D(1)(a) of the TPA.

7.2 Issue 4 – Whether the Alucobond products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption: TPA, s 74A(2)(a); ACL, s 3(1)(b)

851 The next threshold requirement that must be established for the purposes of the consumer guarantee claim of group members under the TPA is that the Alucobond products were “goods” for the purposes of s 74D of the TPA. Section 74A(2)(a) of the TPA provides that:

a reference to goods shall, unless the contrary intention appears, be read as a reference to goods of a kind ordinarily acquired for personal, domestic or household use or consumption;

852 The same requirement does not apply under s 54 of the ACL. However, one means by which a person is taken to have acquired a particular product as a consumer for the purposes of the ACL (being a necessary condition for s 54 to apply) is that the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption: ACL, s 3(1)(b). If that is the case, it is unnecessary to consider the alternative avenues by which a person is taken to have acquired a product as a consumer for the purposes of the ACL, including relevantly where the price paid or payable for the goods was less than $40,000: ACL, s 3(1)(a).

7.2.1 Submissions

853 The Applicants submit that composite cladding products, of which Alucobond PE and Alucobond Plus are particular branded examples, are products ordinarily used in the construction and renovation of residential buildings including both low-rise dwellings and apartment buildings of all sizes. The Applicants submit that this is a usual or regular application of that kind of goods. It is also a standard application for which the Alucobond PE and Alucobond Plus panels were advertised. The marketing brochures of the Respondents generally included a section expressly advertising the use of the Alucobond products for “residential applications”.

854 In relation to the meaning of ‘domestic’ and “household”, the Applicants submit that these are ordinary words which must be given their fullest meaning consistent with the beneficial and remedial purpose of the TPA and ACL. The Applicants submit that the Macquarie Dictionary meanings of “domestic”, being “of or relating to the home, the household, or household affairs”, and ‘household’, being “of or relating to a household; domestic” or “used for maintaining and keeping a house”, is supported by the authorities: Jillawarra Grazing Company v John Shearer Ltd (1984) ATPR 40-441 (Toohey J), citing with approval Metropolitan Water Board v Colley’s Patents Ltd [1911] 2 KB 38 at 40 where Phillimore J stated in obiter dictum that “‘domestic’ does not mean civilised or domesticated or something appertaining to man, but means something to do with man as occupying or using a house or dwelling” (noting that, whilst Phillimore J’s decision on the facts of that case was overturned on appeal by a majority of the Court of Appeal, and the Court of Appeal’s decision upheld by the House of Lords, Phillimore J’s reasoning as to the ordinary meaning of “domestic” was not specifically challenged: see Colley's Patents Ltd v Metropolitan Water Board (1912) AC 24 (Loreburn LC, Atkinson, Shaw and Mersey LJ). See also First Mortgage Managed Investments Ltd v Oberlechner [2006] NSWSC 1397 at 27, citing with approval Metropolitan Water Board v London, Brighton & South Coast Railway Co [1910] 1 KB 804 at 810 (Phillimore J).

855 The Applicants submit that the fact that the Alucobond products were commonly supplied for use as part of residential buildings is sufficient to find that they were goods of a kind ordinarily acquired for personal, domestic or household use or consumption for four reasons.

856 First, the Applicants submit that goods ordinarily acquired for use on or as part of a building intended for residential occupation are goods “of or relating to” the home and have “something to do with” the occupational use of a house or dwelling. The Applicants submit that the quality of such goods (or the lack thereof) impinges on the safety and comfort of the occupants when going about their daily lives and, therefore, they fall within the statutory definition and the core objects of the TPA and ACL.

857 Second, the Applicants refer to a number of cases in which goods used in the construction or fit-out of buildings have been held to be goods “of a kind ordinarily acquired for personal, domestic or household use or consumption”. The Applicants submit that ACPs such as Alucobond PE and Alucobond Plus do not have any relevant characteristics that distinguish them from the kinds of goods considered in those cases. This includes:

(a) reflective foil insultations products, citing Bunnings Group Ltd v Laminex Group Ltd (2006) 153 FCR 479; [2006] FCA 682 at [112]-[114];

(b) carpets, including carpets with a commercial rating or some other quality which makes the carpet last longer than other carpets normally supplied for use in a domestic setting, citing Carpet Call Pty Ltd v Chan (1987) ASC 55-553 (and Rasell v Cavalier Marketing (Australia) Pty Ltd [1991] 2 Qd R 323); and

(c) pre-fabricated formwork wall panels made up of fibre cement, citing Actol Pty Ltd v Rise Products [2022] NSWCATCD 150 at [37], [239]-[240].

858 Third, the Applicants submit that applying the consumer guarantee provisions to goods used in building residential homes is consistent with the legislative history of the provisions. The Applicants refer to the Swanson Report which recommended that the “personal, domestic or household use” test be retained in addition to the $40,000 threshold, stating at [9.44]:

But there are some transactions which will inevitably be above the monetary limit, which could be encompassed by the present definition and should continue to be encompassed – in the interests of the non-commercial consumer. A contract for the construction of a family home is one example.

(Emphasis added.)

859 The Applicants contend that the correctness of this approach is reflected in the express inclusion of fixtures in s 74A(8) of the TPA, which provided:

For the purposes of this Division, goods shall be taken to be supplied to a consumer notwithstanding that, at the time of the supply, they are affixed to land or premises.

860 Fourth, the Applicants submit that 3A’s submission that the Alucobond products could only be used with the application of special expertise does not assist, as it is factually unsound having regard to some of the methods of affixation promoted during the relevant period (eg, the flat stick method). Further, the Applicants analogise that “one could not sensibly suggest that a sink or lights are not goods of a kind ordinarily acquired for domestic or household use, just because those goods would need to be installed with the assistance of a qualified professional”, and that this is also true of the medical products considered in Ethicon (pelvic mesh devices supplied through surgeons), Medtel Pty Ltd v Courtney (2003) 130 FCR 182; [2003] FCAFC 151 (pacemakers supplied through surgeons) and Peterson v Merck Sharpe & Dohme (Aus t) Pty Ltd (2010) 184 FCR 1; [2010] FCA 180 (prescription tablets supplied by pharmacists pursuant to prescription from doctors) (which was overturned on appeal, but not on this point: Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145; [2011] FCAFC 128).

861 The Applicants rely on the decision of Young J in Bunnings, which concerned three specific reflective foil insulation products, which were supplied to various builders or contractors involved in the construction of 20 warehouses. The Applicants say that the following propositions arise from Bunnings:

(a) the statutory phrase “goods of a kind ordinarily acquired for personal, domestic or household use or consumption” should be construed broadly, wherever it appears in the TPA, so as to give the fullest relief which the fair meaning of its language will allow: at [76];

(b) the word “ordinarily” means “commonly” or “regularly”, not “principally”, “exclusively” or “predominantly”: at [81];

(c) it is preferable to pose the statutory question, of whether the goods in issue are goods of a kind ordinarily acquired for personal, domestic or household use or consumption, as a single composite question. This can be contrasted with a two-stage inquiry as to, first, the genus of goods in question, and secondly, whether that kind of good is ordinarily acquired for personal, domestic or household use or consumption. Posing the genus question separately as a threshold one runs the risk of prejudging the answer to the statutory question: at [82];

(d) depending on the precise statutory question and the circumstances of the particular case, it will be relevant to inquire as to the essential character of the goods in question. However, while the essential character test is relevant, the statutory question cannot be answered without a broader inquiry into the evidence concerning the design, marketing, pricing and potential uses of the type of goods in question: at [83], [86]; and

(e) the question posed by s 74A(2)(a) is ultimately a question of fact and degree: at [87].

862 The Respondents contend that Alucobond PE and Alucobond Plus were not goods of a kind ordinarily acquired for personal, domestic or household use or consumption. They were, rather, goods ordinarily acquired by Qualified Professionals for use and incorporation into cladding façades in residential and commercial buildings that they constructed. HVG submits that the products were sold for an inherently commercial purpose and were entirely unsuited for and incapable of use by ordinary members of the public for their personal, domestic or household use.

863 3A submits, with HVG agreeing in oral closing, that the words “ordinarily acquired for personal, domestic or household use or consumption” were introduced on 1 July 1977 to narrow the definition of “consumer”: Trade Practices Amendment Act 1977 (Cth), s 6. Prior to that, the TPA provided that a person acquired goods as a consumer if the goods were “of a kind ordinarily acquired for private use or consumption”. The Respondents note that the amendments were incorporated because the original terminology was felt to be too wide, and that the words “acquired for personal, domestic or household use or consumption” were intended by the Parliament to mean acquired for a non-commercial purpose: see second reading speech for the Trade Practices Amendment Bill (No 2) 1978 (Cth) (House of Representatives, 24 November 1978, Second Reading Speech, Hansard pp 2597-2598).

864 The Respondents refer to the decisions of the New Zealand High Court and Court of Appeal concerning the Alucobond products which held that the Alucobond products were not goods ordinarily acquired for personal, domestic or household use or consumption: Body Corporate Number DPS 91535 v 3A Composites GmbH [2022] NZCCLR 4; [2022] NZHC 985 (Body Corporate Number DPS 91535 (First Instance); Body Corporate No DPS 91535 (Appeal).

865 Body Corporate Number DPS 91535 (First Instance) dealt with claims brought against 3A in respect of Alucobond PE panels which were supplied and affixed as cladding to a residential unit building, and to some commercial properties. The first cause of action brought against 3A was under s 6 of the CGA (NZ), being the failure to satisfy the statutory guarantee that the goods were of acceptable quality: at [20]. The plaintiffs claimed in the proceeding that they were supplied with the Alucobond PE as consumers as defined in s 2 of the CGA (NZ), or alternatively that they derived their ownership or leasehold interest in a building fitted with Alucobond cladding through a predecessor in title who was a consumer as defined in the CGA (NZ): at [20]. Under s 2 of the CGA (NZ), “consumer” is defined as follows:

Consumer means a person who—

(a) acquires from a supplier goods or services of a kind ordinarily acquired for personal, domestic, or household use or consumption; and

(b) does not acquire the goods or services, or hold himself or herself out as acquiring the goods or services, for the purpose of—

(i) resupplying them in trade; or

(ii) consuming them in the course of a process of production or manufacture; or

(iii) in the case of goods, repairing or treating in trade other goods or fixtures on land.

866 In considering whether Alucobond PE was a good of a kind ordinarily acquired for personal, domestic, or household use or consumption, Davison J noted in Body Corporate Number DPS 91535 (First Instance) that the definition of “goods” in the CGA (NZ) excluded a whole building or part of a whole building, unless the building is a structure that is easily removable and is not designed for residential accommodation. Davison J noted that as the Alucobond cladding in the case before him was a building material that was used and attached to the buildings, and was not attached to an easily removable structure not designed for residential purposes, the Alucobond cladding did not come within the scope of the term “goods” under the CGA (NZ): at [58]. It is relevant to note that the CGA (NZ) differs from the TPA and ACL in this context, as the TPA and ACL do not contain an equivalent exclusion.

867 His Honour went on to consider, in case he was incorrect, whether the plaintiffs came within the definition of “consumer” under the CGA (NZ). His Honour found that the CGA (NZ) did not apply to the Alucobond cladding, saying at [59]-[60]:

A “consumer” under the CGA is a person who acquires from a supplier “goods or services of a kind ordinarily acquired for personal, domestic, or household use or consumption”, and who does not acquire the goods or services for the purpose of resupplying them in trade, or consuming them in the course of a manufacturing process. The consumer is therefore, a person who is the “end user” of the goods, and the provisions of the Act imposing the statutory guarantees are directed at the kind of goods and services “ordinarily acquired for personal, domestic, or household use or consumption”.

While the Alucobond cladding is a product that is used in the construction of residential premises used by householders, it is not a product that householders themselves ordinarily acquire for their personal use or consumption. It is a product that is ordinarily acquired by construction contractors or building companies for use and incorporation in the residential and commercial buildings that they construct, and which in the case of residential premises will be used by householders to live in. The plaintiffs’ own evidence shows this to be the case as regards the Alucobond purchased by building and construction companies in New Zealand. This interpretation is also consistent with paragraph (c) of the definition of “goods” which excludes whole buildings or parts of whole buildings unless they are easily removeable structures not designed for residential accommodation.

868 3A also referred to the decision of the New Zealand Court of Appeal in respect of Davison J’s dismissal of the CGA (NZ) claim, Body Corporate No DPS 91535 (Appeal), where Gilbert, Goddard and Mallon JJ agreed with Davison J’s conclusion that the Alucobond PE panels did not fall within the scope of “goods” under the CGA (NZ). Their Honours also went on to consider whether the Alucobond panels were goods of a kind ordinarily acquired for personal, domestic, or household use or consumption, saying at [89]:

Even if the Alucobond panels came within the definition of “goods” for the purpose of the Consumer Guarantees Act, it is we think clear that those panels are not goods of a kind ordinarily acquired for personal, domestic, or household use or consumption. There was no evidence before the High Court of sales of Alucobond panels to end-users in their original manufactured form as flat panels. It was not suggested in evidence that Alucobond panels are sold at retail for use by consumers in building or repairing their own homes. All the evidence before us … related to the use of Alucobond panels by building professionals … to carry out work on a building by fabricating and installing the panels on that building. In the process of supply, the panels are modified and lose their separate identity. They become part of the building. That is, the panels are acquired by a building professional to be used to construct, or repair, fixtures on land. The owner of the building does not acquire the panels as such; rather, the owner of the building acquires a building or part of a building as a result of the materials consumed and work performed by the building professional.

869 The New Zealand Supreme Court decided an appeal had insufficient prospects of success to warrant a grant of leave: Body Corporate Number DPS 91535 v 3A Composites GmbH [2024] NZSC 53 at 8.

870 The Applicants sought to distinguish the decisions of the New Zealand High Court and Court of Appeal on several grounds. These are considered later in these reasons.

7.2.2 Evidence

871 Evidence was led by both the Applicants and the Respondents, in respect of whether the Alucobond products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption.

872 The Applicants firstly submit that goods of the relevant kind (being ACPs) were available for purchase from retailers and use by the general public. In support of this submission, the Applicants refer to a capture of a Bunnings Warehouse website page advertising the sale of an “Aligloss Composite Panel 2440x1220x3mm” for $89. The capture is of an archived page of the website which was archived on 23 February 2014.

873 However, the extract from the website says nothing about who bought those advertised ACPs, for what purpose the ACPs were acquired, or in what quantity they were purchased, particularly where there can be no sensible disagreement that the product could also be sold to construction professionals as well as ordinary consumers.

874 The Applicants also identify a number of instances where Alucobond panels were supplied by HVG to individual purchasers for smaller residential projects. The totality of this evidence is outlined below:

(a) in an email chain from March 2012, Mr Wade Martin of HVG discussed the sale of Alucobond panels with an individual regarding his house in Hazelwood, Victoria. Mr Martin stated that anyone could purchase Alucobond from HVG directly with upfront payment, but recommended “getting the right price through the installer/contractor”.

(b) In an email chain from August 2012, Mr Steve Kelly of HVG responded to an inquiry from an individual who was seeking to use Alucobond on his “2 floor 5 bedroom residential freestanding house”. Mr Kelly responded by providing a guide around the costs of supply and installation, and providing fixing details, and said he would be “happy to recommend approved fabricator/ installers to quote you supply and install”;

(c) in another email chain from August 2012, Mr Martin sold two panels to an individual, for which she paid via VISA card;

(d) in an email chain in September 2012, a builder inquired about the use of Alucobond panels on an extension to her house. Mr Martin responded to the inquiry, including by providing an estimated cost for supply and installation and stated: “I can help you tender the package out to a few contractors to get the right price”;

(e) in three situations (in July 2015, November 2015, and July 2017), individuals inquired with HVG in relation to the supply and/or installation of Alucobond panels on their homes. HVG in each circumstance provided the individuals with fixing details for the panels and provided the details of approved installers in order for the individuals to obtain quotes; and

(f) in two other situations, by emails in October 2014 and March 2017, HVG provided information regarding the fire properties of Alucobond panels directly to individual homeowners who were considering the use of the products. This included the provision of a CodeMark Certificate (in October 2014), and information regarding the Bushfire Attack Level rating of Alucobond Plus (in March 2017).

875 The Respondents on the other hand referred to a sampling process conducted over HVG’s sales data over the relevant period. The sampling process was outlined in the affidavit of Mr Samuel James Dundas, being a partner of the firm of solicitors representing 3A. Mr Dundas was not called for cross-examination. Two separate lists were prepared from HVG’s sales data, being HVG’s 100 most frequent customers (by reference to the number of orders placed with HVG during the relevant period), and a list of 100 randomly selected customers. 3A’s solicitors ultimately determined that the most frequent customers list actually had 94 unique customers, rather than 100, as there were differences in how the names of six customers were entered. Similarly, the list of randomly selected customers had 99 unique customers.

876 Following a review of the 94 most frequent customers, 3A determined that 79 were listed on professional registers or had a website that suggested that they were Qualified Professionals. Of the 99 random customers, 75 were said to be listed on professional registers or had a website which suggested they were Qualified Professionals. Another 35 of those customers had names which suggested that those customers were also in the building trade. Accordingly, 3A submits that of the 193 sample customers, 189 were likely to be Qualified Professionals. 3A submits that this analysis supports a view that the products were commonly and regularly supplied to Qualified Professionals for use in the fulfilment of construction contracts.

7.2.3 Consideration

877 It is first important to emphasise the remedial character of the TPA and ACL. Young J summarised the statutory context of the phrase “goods of a kind ordinarily acquired for personal, domestic or household use or consumption” in the TPA in Bunnings as follows:

[73] In Project Blue Sky Inc v Australian Broadcasting A uthority (1998) 194 CLR 355 at [69]-[70], McHugh, Gummow, Kirby and Hayne JJ said:

The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole”. In Commissioner for Railways (NSW) v Agalianos [(1955) 92 CLR 390], Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”. Thus, the process of construction must always begin by examining the context of the provision that is being construed.

A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals.

[74] The policy and purposes underpinning the TPA were examined by Lockhart and Gummow JJ in Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470 (at 503-504):

As is the case with Pt IV of the [TPA], the evident purpose and policy underlying Pt V, which includes s 52, recommends a broad construction of its constituent provisions, the legislation being of a remedial character so that it should be construed so as to give the fullest relief which the fair meaning of its language will allow: see the discussion of the authorities by Mason CJ in Devenish v Jewel Food Stores Pty Ltd (1991) 172 CLR 32 at 44. The precise boundaries of the territory within which s 52 operates remain undetermined: Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 at 601.

In Webb Distributors (Aust) Pty Ltd v Victoria (1993) 179 CLR 15 at 41, McHugh J said:

The Trade Practices Act is a fundamental piece of remedial and protectionist legislation. Such legislation should be construed broadly so as “to give the fullest relief which the fair meaning of its language will allow”.

Mason CJ expressed similar views concerning the provisions of Part IV of the TPA in Devenish v Jewel Food Stores Pty Ltd (1991) 172 CLR 32 at 44.

[75] In Zaravinos v Da i ry Farmers Co-Operative Ltd and Pure -Pak Australia (1985) 7 FCR 195 at 198, Lockhart J explained the particular statutory purposes of Div 2A somewhat more narrowly:

The rationale behind Div 2A is that liability for defects in goods should be borne by the manufacturer rather than the retailer because of modern methods of packaging, labelling, distribution and promotion of goods. Division 2A does not apply where there is a contract between the manufacturer and the consumer. It applies where the manufacturer supplies goods to another person, usually a distributor or retailer, who acquires the goods for the purposes of resupply. The Division applies to the supply of goods which are of a kind ordinarily acquired for personal, domestic or household use or consumption that is, consumer goods.

[76] Notwithstanding the more particular statutory purposes which underpin Div 2A, I consider that a uniform approach should be adopted when construing the definitional phrase found in s 74A(2)(a) and in other provisions of the TPA. Moreover, in my opinion, the statutory phrase should be construed broadly, wherever it appears in the TPA, so as to give the fullest relief which the fair meaning of its language will allow.

878 Having outlined the submissions made by the parties, it is helpful to synthesise what the nub of the dispute between the parties appears to boil down to. There is no real dispute between the parties that the Alucobond products were advertised for use, and in fact used, in the construction and renovation of residential dwellings. There are multiple examples within the marketing material of the Alucobond products which both promoted the use of the panels in such residential contexts, and illustrated examples of their use on low-rise dwellings as well as larger apartment buildings in Australia. I accept that this was a usual or regular application for the panels, noting that this issue was not substantively disputed by the Respondents.

879 The real issue in dispute between the parties is the approach that should be taken in determining whether a good is of a kind ordinarily acquired for personal, domestic or household use or consumption. On the Applicants’ contention, it is sufficient for the purposes of the statutory language that the Alucobond products were commonly supplied for use as part of residential dwellings. The Applicants contend that the ordinary use of the products, which encompasses use on a building intended for residential occupation, is sufficient to characterise the products as being goods “of or relating to the home” such that they are goods of a kind ordinarily acquired for domestic or household use or consumption.

880 On the Applicants’ approach, focus is to be directed to the relevant character of the product which ultimately determines the purpose for which the good is acquired. The Applicants contend that, under this approach, there is little relevance as to who was acquiring the products from HVG and, therefore, whether or not the Alucobond panels were acquired from HVG predominantly by Qualified Professionals in the context of their commercial enterprises does not impact the overall analysis. The Applicants refer to the Explanatory Memorandum of the Tra d e Practices Amendment (Australian Consumer Law) Bill (No.2) 2010 (Cth) (ACL Explanatory Memorandum) which introduced the ACL, which stated at [2.16]-[2.17]:

The meaning of ‘consumer’

…

The definition establishes when a person is a consumer, which is determined by reference to the nature of the goods or services acquired or to be acquired…

A person is taken to have acquired goods as a consumer if:

• the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption... This is an objective assessment based on the nature and usual purpose of the goods; ...

(Emphasis added.)

881 Implicit in the Applicants’ contention that the Alucobond products are goods of a kind ordinarily acquired for personal, domestic or household use or consumption is the somewhat broad concept of “use”. The Applicants contend that a person may use a good in a passive sense – ie, an Alucobond panel applied to the exterior of a house is being “used” by a person within the home, by virtue of the effect the application of the panel has on the home, such as impinging upon the safety and comfort of a person within the home.

882 The Respondents, on the other hand, focused their submissions to the usual purpose for which the Alucobond products were acquired. In this context, they refer to the evidence outlined above regarding the predominantly commercial context in which the Alucobond products were acquired from HVG.

883 Noting the distinction in each party’s approach, it is worth considering the authorities the Applicants rely on in further detail.

884 In support of their submission that it is sufficient that a good be supplied for use as part of residential buildings for it to be of a kind ordinarily acquired for personal, domestic or household use or consumption, the Applicants refer to Bunnings.

885 It is important to note the scope of the dispute which was before Young J in Bunnings. The applicant had accepted that the particular goods in question, namely the specific three reflective foil insulation products, were not ordinarily acquired for personal, domestic or household use or consumption. The respondent on the other hand accepted that reflective foil insulation products more broadly are used in a variety of buildings, including residential buildings, and may be regarded as goods of a kind ordinarily acquired for personal, domestic or household use or consumption. Therefore, the case turned on the question of how widely or narrowly the genus or kind of goods should be drawn, having regard to the evidence before the Court: at [42].

886 The applicant contended that the particular goods are of the same kind as other reflective foil insulation products, which the respondent had conceded were goods of a kind ordinarily acquired for personal, domestic or household use or consumption. The applicant’s submission was that all such goods had the same essential character, being pliable building membranes which served three key functions, in that they provided thermal insulation, operated as a water barrier, and operated as a vapour barrier. In this way the applicant’s contentions started “from the respondent’s concession”: Bunnings at [43].

887 The respondent on the other hand contended that the products were specifically white-faced foil laminates, not reflective foil insulation products, and that white-faced foil laminates were not goods of a kind ordinarily acquired for personal, domestic or household use or consumption. The respondent’s characterisation of the products was essentially based on the contention that, by virtue of the special properties, functions, and applications of the white facing, white-faced foil laminates were fundamentally different from other reflective foil laminates.

888 Young J ultimately found that the products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption, stating at [112]-[113]:

It is correct, as the respondent argues, that white-faced foil laminates have special attributes and applications. They are, and were at all relevant times, significantly more expensive than uncoated reflective foil laminates, and are in fact used almost exclusively in commercial and industrial applications. However, as the applicant’s experts said, there is nothing other than price that would make them unsuitable for use in residential applications. The respondent contends that the special attributes, special applications and greater cost of white-faced and other decorative foil laminates render them so distinctive that they must be regarded as goods of a different kind from reflective foil laminates. I do not accept this contention.

Having regard to the whole of the evidence, I am satisfied that the products are goods of a kind ordinarily acquired for personal, domestic or household use or consumption within the meaning of s 74A(2)(a). In reaching this conclusion, I have taken into account the differences in marketing, price, attributes and ordinary use of the products by end users upon which the respondent relies. I have also taken into account the common features and applications of reflective foil laminates and white-faced foil laminates. In my opinion, the proper characterisation of the products must give due weight to the three essential properties of the products. They are and were acquired and used in building constructions because they possess those essential properties…

889 In light of the above, I accept the Respondents’ submission that the Bunnings decision, while undoubtedly significant in its elaboration of general principles, must also be considered in light of the significant concession made by the respondent.

890 It may logically follow that the concession made by the respondent, which Young J proceeded to determine the case on, was made on the basis that a product ordinarily used in the construction of a residential building (such as a reflective foil insulation product) meets the definition of a good of a kind ordinarily used for personal, domestic or household use or consumption, as the Applicants contend in this proceeding. However, this was not the subject of any detailed consideration by Young J in Bunnings and I accept the Respondents’ submission that, as a result, the significance of Young J’s decision to the present case before me is limited.

891 The Applicants also refer to Senior Member Robertson’s reasoning in the New South Wales Civil and Administrative Tribunal (NSWCAT) decision of Actol. That case concerned pre-fabricated formwork panels made up of fibre cement. Actol Pty Ltd alleged that Rise Products Pty Ltd was contracted to supply and install its pre-fabricated formwork system on four lots on which Actol was constructing houses. Among a range of claims, Actol alleged that the formwork constructed for the four houses was defective and supplied in contravention of s 54 of the ACL.

892 In determining that the formwork panels were goods of a kind ordinarily acquired for personal, domestic or household use or consumption, Senior Member Robertson noted the implicit distinction drawn in Bunnings, noting at [240]-[241]:

The evidence, as far as it goes, suggests that the product is intended for the construction of residential housing as much as for commercial buildings. Although it is not a product likely to be used by the ordinary homeowner, it is ordinarily used by licensed builders in the construction of residential buildings for ordinary homeowners. It is implicit in the distinction sought to be drawn in Bunnings Group between reflective foil laminates and the “white faced foil laminates” under consideration in that case that a product ordinarily used in the construction of residential housing is “goods of a kind ordinarily used for personal, domestic or household use or consumption”.

I further note the provisions of s 3(10) of the ACL. The onus of establishing that the product is not such a good lay upon Rise Products. I do not consider that Rise Products has led evidence to enable me to conclude that the RiseWall product is not goods of the kind ordinarily acquired for personal, domestic or household use or consumption.

893 Therefore, while I accept the Respondents’ submission that a decision of the NSWCAT is of little precedential value, I do not accept that the Senior Member failed to appreciate the significance of the respondent’s concession in Bunnings.

894 While I accept that the Alucobond products were regularly used in or installed in residential dwellings during the relevant period, I do not accept the Applicants’ submission that the evidence shows that the panels were ordinarily acquired, by individuals, from HVG. The totality of the evidence to which the Applicants refer in this context has been outlined above. The Respondents submit, and I accept, that none of the documents, whether taken individually or cumulatively, is capable of establishing that Alucobond PE or Alucobond Plus were goods of a kind ordinarily acquired, in their original manufactured form, by individuals for personal, domestic or household use or consumption, according to the narrow conception of use, as opposed to passive use. At best, the evidence referred to by the Applicants showed very occasional, ad hoc acquisitions of small quantities of goods for personal use or consumption.

895 This position is further reinforced by 3A’s analysis of HVG’s sales data discussed above. While questions of reliability may be raised in respect of how the analysis was conducted, I am satisfied that the analysis supports a view that the Alucobond products were commonly and regularly supplied to Qualified Professionals for use in the fulfilment of construction contracts. This position is unsurprising given that the Alucobond products were generally fabricated for use on a particular building by the relevant Qualified Professionals, and that the promotional material for the products was directed towards industry professionals rather than to ordinary consumers.

896 While the evidence does not establish that the Alucobond products were acquired from HVG by individuals for their domestic or household use or consumption, that is not the end of the question. I accept the Applicants’ submission that such an analysis, by focusing on an intermediate step in the chain of supply, fails to shine light on the underlying nature of the good. In other words, focusing on who acquires the panels from HVG only speaks to who the immediate acquirer is. In the context of a product used in the construction or renovation of residential dwellings, it is largely unsurprising that the Alucobond products would be primarily purchased by Qualified Professionals in the context of their trades. However, this does not speak to the manner in which that product is ultimately used and, therefore, whether the product is of a kind ordinarily acquired for personal, domestic or household use or consumption.

897 As discussed above, counsel for the Applicants referred, by way of analogy, to the example of a sink, which is plainly a good ordinarily acquired for personal, domestic or household use or consumption (notwithstanding that sinks might be installed in non-residential buildings). Counsel for the Applicants submitted that focusing only on the records of a plumbing business might show that sinks are predominantly purchased by plumbers or builders for their commercial business. Ultimately, however, it is the supply and installation of the sink into a household which is relevant for the purposes of the statutory test. This is, of course, not a perfect analogy noting that, unlike in the present case, it may be expected that there would be evidence of sinks being purchased in their original form (eg, not affixed into a building as part of a kitchen or laundry) by homeowners for their own personal, domestic or household use or consumption. Nevertheless, the example remains illustrative of the error in focusing only on who acquired the panels from HVG and the purpose for which they acquired those panels. Such an analysis fails to consider the subsequent step in the supply chain by which the relevant Qualified Professional would install the Alucobond products on a residential dwelling, at which stage it may be said that the panels are being acquired for personal, domestic or household use or consumption. As noted above, the fact that the Alucobond products were advertised for use in such residential applications, and were in fact so used, was not substantively disputed by the Respondents.

898 Noting the above, it is relevant to now consider Body Corporate No DPS 91535 (Appeal), which the Respondents rely on, in further detail. The CGA (NZ) and the ACL are closely aligned. The ACL Explanatory Memorandum stated at [7.9]:

The provisions set out in Part 3-2, Division 1 of the ACL are couched in terms broadly similar to those used in the New Zealand Consumer Guarantees Act 1993 and the jurisprudence applicable to that Act is of relevance to those provisions.

899 It is not disputed by the Applicants that jurisprudence generally applicable to the CGA (NZ) is relevant to the interpretation of the ACL. However, the Applicants seek to distinguish Body Corporate No DPS 91535 (Appeal) from the present case.

900 The first instance proceedings in New Zealand involved an application brought by two applicants. The claims were brought against 3A as the manufacturer, and against the distributors Skellerup Industries Ltd and Kaneba Ltd. Skellerup imported and distributed Alucobond products in New Zealand between 2005 and 2009, while Kaneba imported and supplied Alucobond products in New Zealand from 2009 until September 2014. From September 2014 until 2020, Kaneba continued to import Alucobond products for on-sale to other fabricators.

901 The first applicant, Cutterscove, was the body corporate of a three-storey apartment building which alleged that Alucobond PE was supplied to it and affixed to the exterior of the building in 2006 to 2008 pursuant to a construction contract with Moyle Construction Ltd, which was supplied with the Alucobond PE by Skellerup. The second applicant, Argosy, owned a Burger King restaurant that had two strips of Alucobond PE affixed to its exterior in 2011, and a second property where Kaneba was engaged in 2011 to fabricate and fit approximately 26 m 2 of Alucobond PE to a new pedestrian link bridge connecting two office buildings. Argosy purchased the second property, which incorporated the cladding, from Brookfield Multiplex Funds Management Ltd in 2013.

902 The need to look beyond just the supply of the Alucobond PE by Skellerup or Kaneba was evident in the New Zealand Court of Appeal’s reasoning. Goddard J, delivering the judgment of the Court, stated:

[89] … There was no evidence before the High Court of sales of Alucobond panels to end-users in their original manufactured form as flat panels. It was not suggested in evidence that Alucobond panels are sold at retail for use by consumers in building or repairing their own homes. All the evidence before us, including the evidence of Mr Gouws of Kaneba, related to the use of Alucobond panels by building professionals (including Kaneba) to carry out work on a building by fabricating and installing the panels on that building. In the process of supply, the panels are modified and lose their separate identity. They become part of the building. That is, the panels are acquired by a building professional to be used to construct, or repair, fixtures on land. The owner of the building does not acquire the panels as such; rather, the owner of the building acquires a building or part of a building as a result of the materials consumed and work performed by the building professional.

…

[91] …[I]n the present case, there is uncontroverted evidence that Alucobond panels are not ordinarily acquired for personal, domestic, or household use or consumption. It is not sufficient that the panels are used for residential purposes, in the sense that they are incorporated into dwellings. The question is whether individuals or households ordinarily purchase those goods. In the present case, the evidence is sufficient to show that Alucobond panels are not ordinarily acquired by individuals or households; rather, individuals and households contract for houses to be built, or work to be done on their houses, in a manner that consumes Alucobond panels in order to construct or repair the dwelling.

[92] Mr Farmer submits that a homeowner who reclads their house acquires the cladding product. They are entitled to expect that product will meet the standards prescribed by the legislation, in the same way as they would expect a domestic fridge or stove to do regardless of whether they buy it from the contractor or from the importer. He says the Consumer Guarantees Act protects the domestic end-user regardless of the chain of supply. They are entitled to seek a remedy against a supplier (which, in the circumstances, may include the tradesperson who acquires the goods on their behalf, or the distributor, where the sale contract provides for property to pass directly to the consumer) or the manufacturer.

[93] The flaw in this argument is that a homeowner who contracts with a building professional for their house to be reclad will not normally enter into a contract to purchase goods in the form of cladding panels. Rather, the homeowner will usually contract for the recladding service to be provided. In the course of providing that service, the relevant building professional purchases and uses/consumes cladding panels to (re)construct the house. The homeowner ends up with a reclad house, with cladding panels incorporated in it: the panels lose their separate identity as goods. This is quite different from direct or indirect purchase of a fridge or stove; an item distinct from the building, albeit attached to it.

(Emphasis added.)

903 The Applicants sought to distinguish this case on the basis that the Court of Appeal considered it significant that it did not have any evidence before it that the panels were “sold” to or “purchased” by consumers in building or repairing their own homes. The Applicants submit that this reasoning is unpersuasive given the broader concept of “acquire” which is used in the ACL, and the fact that in the present case, such evidence was presented. The Applicants also submit that the reasoning involves doubtful logic that a good which is purchased by a professional, for the purpose of being used in building or repairing another person’s home, is not thereby acquired for domestic or household use.

904 I am not satisfied that any such arguments provide an appropriate reason to distinguish the decision. As I have found above, the evidence in the present case does not establish that the Alucobond products were acquired in their original manufactured form for personal, domestic or household use or consumption. It is also evident from the balance of the Court of Appeal’s reasoning that it was addressing the correct statutory question and, in particular, did not focus solely on the supply of Alucobond PE to Qualified Professionals in determining whether the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption. Rather, the Court of Appeal also considered the subsequent supply of those panels to homeowners, evident by the section of the reasons emphasised in the extract above.

905 It is important to focus on the Court of Appeal’s analysis of this subsequent step in the supply chain; namely, where the owner of a residential dwelling contracts with a building professional (as that term is used in the Court of Appeal’s decision) for their house to be reclad with such panels. The Court of Appeal noted that the reason why the subsequent acquisition of panels by homeowners did not involve goods of a kind ordinarily acquired for personal, domestic or household use or consumption was because the contracts were generally not for the purchase of goods in the form of cladding panels. Rather, in the course of providing the relevant recladding services, the panels were consumed by the building professional, such that the cladding panels were incorporated into the house. Accordingly, the panels lost their “separate identity” as goods, which the Court of Appeal distinguished from the examples of a fridge or stove which, although attached to a building, remained goods distinct from the rest of the building.

906 The Applicants also submit that the Court of Appeal’s analysis, that the panels lost their separate identity as goods when incorporated into the home, must be distinguished from the present case due to the definition of goods under the CGA (NZ).

907 Under s 2 of the CGA (NZ), the term “goods” is defined as follows:

goods —

(a) means personal property of every kind (whether tangible or intangible), other than money and choses in action; and

(b) includes —

(i) goods attached to, or incorporated in, any real or personal property:

(ii) ships, aircraft, and vehicles:

(iii) animals, including fish:

(iv) minerals, trees, and crops, whether on, under, or attached to land or not:

(v) non-reticulated gas:

(vi) to avoid doubt, water and computer software; but

(c) despite paragraph (b)(i), does not include a whole building, or part of a whole building, attached to land unless the building is a structure that is easily removable and is not designed for residential accommodation

908 The Applicants refer specifically to the exclusion of a whole building, or part of a whole building from the definition of “goods” under the CGA (NZ). The TPA and ACL contain no such express exclusion.

909 By contrast, “goods” are defined under s 2 of the ACL as follows:

goods includes:

(a) ships, aircraft and other vehicles; and

(b) animals, including fish; and

(d) gas and electricity; and

(e) computer software; and

(f) second‑hand goods; and

(g) any component part of, or accessory to, goods.

910 Similarly, “goods” were defined under s 4 of the TPA as:

goods includes:

(a) ships, aircraft and other vehicles;

(b) animals, including fish;

(d) gas and electricity.

911 As noted above, the TPA and ACL also expressly capture the supply of goods where such goods are affixed to land or premises. Section 8 of the ACL provides as follows (equivalently contained in the TPA under s 74A(8)):

For the purposes of this Schedule, goods are taken to be supplied to a consumer even if they are affixed to land or premises at the time of the supply.

912 “Premises” is defined under s 2 of the ACL as follows:

premises means:

(a) an area of land or any other place (whether or not it is enclosed or built on); or

(b) a building or other structure; or

(d) a part of any such premises.

913 The Applicants submit that the Court of Appeal’s reasoning in Body Corporate No DPS 91535 (Appeal), that the goods lost their separate identity as goods when incorporated into the home, is untenable under the TPA and ACL.

914 On the other hand, the Respondents submit that the Court of Appeal relied on the exclusion under paragraph (c) of the definition of ‘goods’ in the CGA (NZ) as an additional reason why the CGA (NZ) did not apply, but submit that this was distinct from the Court’s conclusion as to the meaning of “ordinarily acquired for personal, domestic or household use or consumption”. In particular, the Respondents refer to the fact that, at [89], their Honours stated:

Even if the Alucobond panels came within the definition of “goods” for the purposes of the Consumer Guarantees Act, it is we think clear that those panels are not goods of a kind ordinarily acquired for personal, domestic or household use or consumption.

915 I do not accept the Respondents’ submission. The Court of Appeal’s reasoning shows quite evidently that the Court approached the question of whether the panels were goods of a kind ordinarily acquired for personal, domestic or household use or consumption at different stages of the supply chain. Firstly, the Court considered whether the panels were sold to end-users in their original manufactured form as flat panels. The evidence indicated that this was not the case as the panels, in their original manufactured form, were sold to building professionals to carry out their commercial work of fabricating and installing the panels on buildings: at [89]. As noted above, that is not the end of the relevant analysis and, accordingly, the Court also sought to consider the acquisition of those panels by households in the context of contracting with building professionals to install the panels on their houses: at [89].

916 At this stage of the supply chain, it appears clear the Court of Appeal considered that the panels could not be “of a kind ordinarily acquired for personal, domestic or household use or consumption” since, for the purposes of the CGA (NZ), the households could not be said to be acquiring the panels as distinct goods to which the consumer guarantees applied. Rather, in the process of being incorporated into the house, the panels lost their “separate identity as goods”, since they were no longer items distinct from the building. This is most evidently expressed in the Court of Appeal’s analysis at [93] in response to the submission made at 92.

917 It is, in my view, inescapable that the Court of Appeal’s analysis regarding the supply of panels to households, in the context of building professionals providing cladding services to a home, was reliant on the exclusion of “a building, or part of a whole building” from the definition of goods under the CGA (NZ). In each section of that analysis (at [89], [91], and [93]), the Court noted that in the process of fabricating and installing the panels on the building, the panels “lose their separate identity” or are consumed in order to construct or repair the dwelling.

918 In reaching this view, it is also relevant to consider the Court of Appeal’s earlier comments in relation to the Alucobond panels which were installed on each of the relevant properties the subject of the proceeding. The Court noted that the definition of “goods” under the CGA (NZ) was clearly intended to capture chattels that remained identifiable as separate goods, albeit attached to or incorporated into a building, but that the definition did not include elements of the building that did not retain a “separate identity” as goods. This interpretation was clearly reflected later in the Court’s reasoning when considering the supply of Alucobond panels to households in the context of work carried out by building professionals. The Court said the following:

[85] Mr Farmer placed considerable emphasis on the express inclusion in the definition of “goods” of goods attached to, or incorporated in, any real or personal property. However when this limb of the definition is read together with para (c) it seems clear to us that it refers to chattels such as kitchen appliances that remain identifiable as separate goods, albeit attached to or incorporated into a building. This limb of the definition does not include the building as a whole, or elements of the building that do not retain a separate identity as goods. Where for example Consumer A builds a new house, and purchases appliances for that house, then sells the house with those appliances to Consumer B, Consumer B will have rights of redress against the manufacturer of the appliances. But Consumer B will not have rights of redress against the manufacturer of integral elements of the structure of the house itself, such as its exterior cladding or its roof, which have been incorporated into the building and have lost any separate identity as goods.

…

[87] …It is artificial to describe the cladding which has been fabricated and installed as an integral part of the building as goods for the purposes of the Consumer Guarantees Act. The cladding has lost its separate identity. It forms part of a building which is expressly excluded from the scope of the “goods” to which the Act applies.

[88] That view is confirmed by the scheme of the Act, which assumes that the goods have a continuing separate identity. The focus of the remedial provisions is on repair of the goods or replacement of the goods, or loss in value of the goods. There are other remedies, including damages for any loss or damage to the consumer resulting from the failure to comply with the guarantee. But the remedial provisions of the Act are not readily applied to claims in respect of items that have been incorporated into a building so as to lose their separate identity.

(Emphasis added.)

919 In response to the Applicants’ submission that the approach taken by the New Zealand Court of Appeal, referring to the cladding as having lost its separate identity as a good, was untenable under the TPA and ACL, the Respondents submit that, in any case, it did not follow from the absence of a similar exclusion in the ACL or the TPA that the legislature intended that s 54 of the ACL and s 74D of the TPA would apply to “a whole building, or part of a whole building” even if that part of the building was not easily removable and not designed for residential accommodation. The Respondents submit that s 8 of the ACL and s 74A(8) of the TPA do not support such a construction; rather, they merely provide that goods should not be taken to not be consumer goods merely because they are affixed to a building. The independent question of whether they are, in fact, consumer goods still has to be answered.

920 This, as it turns out, is quite central to the conflict between the parties but was the subject of limited submissions.

921 The concept of “goods” under the TPA was discussed at some length in the case of Theo Holdings Pty Ltd v Hockey (2000) 99 FCR 232; [2000] FCA 665 (Dowsett J). The case concerned the issuing of recall notices under s 65F of the TPA by the Minister for Financial Services and Regulation in respect of fire doors manufactured by the applicants in that proceeding. The applicants in that proceeding challenged the validity of the recall notices under the Administrative Decisions (Judicial Review) Act 1977 (Cth).

922 Dowsett J discussed, at [7]-[18], the concept of “goods” under the TPA, saying:

[9] The principal commentators have generally treated the definition as reflecting the traditional common law distinction between “fixtures” and “moveables”, with some specific extensions…

…

[15] In the course of argument it was suggested that where ‘‘goods’’, although incorporated into a building, are capable of continued identification and capable of removal without substantial damage to the building (or presumably to the ‘‘goods’’), they may be goods for the purposes of s 65F(1). Nothing in the Act suggests such an approach…

…

[17] … Parliament has used a term (“goods”) which has a commonly understood meaning and has defined that term in a way which seems to reinforce that common understanding, albeit with some express extensions. If the clear distinction between goods and fixtures on land is to be abandoned, then that common understanding would be seriously undermined. Such an outcome would be inconsistent with Parliament’s adoption and definition of the term in question.

923 Ultimately, his Honour determined that the Minister’s power to issue a recall notice pursuant to s 65F(1) applied only to the extent to which the “goods” in question met that description at the time at which the relevant notice is given, and as at the time of supply by the relevant corporation: see [18]. His Honour found that the fire doors were not “goods”, as they were incorporated into buildings when the notices were issued: at [55].

924 Following the decision of Theo Holdings, s 65F(1) was amended to include a provision specifically providing that “things that are goods at the time they are supplied are taken to be goods at all times after the supply, even if they become fixtures”. The Explanatory Memorandum to the amending legislation (Trade Practices Amendment Act (No. 1) 2001 (Cth)) specifically noted that the Theo Holdings decision had significant implications as goods which had become fixtures after installation could include major household items and “dangerous goods” which had been the subject of voluntary recall. The Explanatory Memorandum stated that the definition clarified the original intention of the provision, which was that the recall power should apply to “goods” which were goods at the time of supply, regardless of whether they have subsequently become fixtures.

925 This concept appears to now be reflected in the definition of “consumer good” in s 2 of the ACL which is defined as follows:

consumer goods means goods that are intended to be used, or are of a kind likely to be used, for personal, domestic or household use or consumption, and includes any such goods that have become fixtures since the time they were supplied if:

(a) a recall notice for the goods has been issued; or

(b) a person has voluntarily taken action to recall the goods.

926 While it can be accepted that the ordinary meaning of “goods” is not taken to incorporate land and buildings, the concept of “goods” under the legislation is evidently extended to certain types of fixtures. This reflects a legislative intent to extend consumer protections under the relevant legislation to products which would otherwise not constitute “goods”. As the Applicants have identified, this is also evident in the context of the consumer guarantees under Div 1 of Pt 3-2 of the ACL. Section 259(3) of the ACL provides that where a supplier supplies goods to a consumer in respect of which consumer guarantees apply, and a guarantee is not complied with, if the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may reject the goods. This is, however, subject to the matters identified under s 262(1), including under subparagraph (d), where the goods have been attached to, or incorporated in, any real or personal property and cannot be detached or isolated without damaging them. It appears inherent in this limitation that consumer guarantees would continue to apply to goods even once attached to or incorporated in real property.

927 In the context of goods that are acquired as fixtures (rather than goods which, at some point after supply, become fixtures), the same legislative intention manifests in s 8 of the ACL, extracted above.

928 The ACL Explanatory Memorandum, in respect of s 8 of the ACL noted the following at [2.42]:

For the purposes of the ACL, goods are taken to be supplied to a consumer (within the meaning of section 3) even if they are affixed to land or premises at the time of the supply. Goods supplied in relation to another transaction, for example the transfer of an interest in a property, are subject to the ACL for certain purposes. This could include, for example, kitchen or laundry fittings supplied as part of a home construction contract, which would otherwise become fixtures at the time of their installation.

(Emphasis added.)

929 Clearly, the provision captures goods such as kitchen and laundry fittings that are affixed to real property at the time of supply. However, this does not define the scope of the provision’s application.

930 Noting the above, in the present case where the Alucobond products are said to have been supplied as affixed to the buildings, the relevant question which the statutory language directs attention to is whether the relevant goods are “affixed” to land or premises. To the extent goods can be appropriately described as being “affixed” to land or premises, for the purposes of s 8 of the ACL, they will be taken to constitute goods supplied to a consumer.

931 It is relevant at this stage to understand how the Alucobond products were installed during the relevant period on buildings. Mr Smithson, particularly in his second report, provided evidence as to how ACPs are installed on buildings. Prior to installation on a building, ACPs would need to be fabricated and prepared for installation. This is discussed later in these reasons. For present purposes, however, it is relevant to focus on how the panels were attached to a building.

932 Naturally, there are a number of ways in which panels may be installed on a building, and particular buildings may have specific installation methods specified depending on the use the panels were intended to serve, or the look that was sought to be achieved. Different installation methods will involve the incorporation of different components. The following diagrams, among others, were included in Mr Smithson’s second report as examples of particular affixation methods. Mr Smithson noted that while the examples came from a document published by the Mitsubishi Chemical Group in relation the “Alpolic” range of ACPs it manufactures, the products are equivalent to the Alucobond products:

933 There are various mutations of the affixation methods, which may change the nature of the sub-frame, or the manner in which the ACP is attached to the sub-frame. For example, certain installation methods can involve the panels being “clamped” to a sub-frame. However, the general method of installation involves the panels being, in some manner, mechanically affixed to a sub-frame, which itself is attached to the structural wall of the relevant building. The only thing that may be described as an “exception” to this generalisation is the “flat stick” method which involves panels being adhered to a building using a particular double-sided tape.

934 Considering the manner in which Alucobond panels are installed on buildings, I am satisfied that the Alucobond products should be properly characterised as being affixed to a premises at the time of supply. I am fortified in this conclusion by reference to a number of other considerations. In particular, it appears evident that the panels can be individually removed and replaced. This appears evident from the fact that such work has already been carried out in respect of the Alucobond PE that was previously used on the Shore Building. It is also evident from the “Performance Solutions” that were proposed by Mr Davis in respect of the Five Dock Building.

935 For the reasons above, I am satisfied that the Alucobond products, at the time they were installed on residential buildings, should be properly understood to involve a supply of “goods” subject to the TPA and ACL.

936 Having established the above, the question which relevantly follows is whether the installation of those panels on residential dwellings means that they are goods acquired for personal, domestic or household use or consumption. The Respondents submit that it cannot sensibly be said that building owners “use” or “consume” cladding affixed to a building by occupying the building. The Respondents submit that the combination of the words “domestic” and “household” on one hand, and “use or consumption” on the other hand, makes it clear that it is not sufficient merely for the goods to “relate to” the home, and that the relevant products are those designed to be “used” or “consumed” by consumers.

937 I do not accept the Respondents’ submission that it cannot be said that the panels are acquired for domestic or household use by a consumer where such panels are affixed to a building which a consumer occupies. The concepts of “domestic”, “household” and “use” are not defined under the TPA or ACL, and, in line with the authorities noted above, should be construed broadly so as to give the fullest relief which the fair meaning of the words will allow.

938 I have referred to the Macquarie Dictionary definitions of “domestic” and “household”. It also defines “use” in a number of ways, including (when used as a noun) “the act of employing or using, or putting into service”.

939 As noted earlier in these reasons, the Applicants, in effect, rely on what may be described as “passive use”. That is to say, that a consumer can use a good without any direct interaction with the good, in circumstances where the good directly affects the consumer’s enjoyment and beneficial use of their house.

940 In Theo Holdings, Dowsett J also considered whether the fire doors that were the subject of the product recall notice under s 65F of the TPA were “goods that are intended to be used, or are of a kind likely to be used, by a consumer”, which was a separate condition under s 65F(1) to the requirement that the fire doors were “goods”. His Honour found that the term “consumer” in s 65F(1) was defined by s 4B, which included in subparagraph (1)(a)(ii) that goods will be acquired by a consumer if “the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption”: at [19]-[24]. His Honour found that the fire doors were not intended to be used by a consumer, in the s 4B sense, as the doors were intended to be purchased by builders for installation in buildings constructed by them on land belonging to others, meaning the doors were supplied to the builder for the purposes of resupply and, therefore, not as a consumer: at [27]. As to whether the fire doors were likely to be used by a consumer (presumably by installing them in their own premises), his Honour found this was a factual question, and no doubt a complex one, that was not addressed on the evidence: at [28].

941 In my view, the language of “personal, domestic or household use or consumption” in the TPA and the ACL is sufficiently broad to encompass the passive use of the Alucobond products as advanced by the Applicants.

942 The installation of cladding panels to a residential dwelling impacts upon a consumer’s enjoyment and beneficial use of the dwelling. The manner in which cladding panels will impact upon the use of the residential dwelling will naturally depend on how the particular panels are installed and what use they are being put to, but may ordinarily be expected to include aspects of weatherproofing, insulation, and the aesthetic design of the residential dwelling. As a result, the quality or lack thereof of such cladding panels has a direct impact on a consumer’s use of their house. While this is plainly not the same “active” use as may be used to describe the use of a washing machine, given the broad construction which is to be used in construing the language, I am satisfied that a consumer, in acquiring the Alucobond products installed on the residential dwelling they occupy, is to be properly characterised as acquiring such panels for personal, domestic or household use or consumption.

943 For the reasons outlined above, I am satisfied that the Alucobond products were goods ordinarily acquired for personal, domestic or household use or consumption.

7.3 Issue 5 – Whether a person “supplied” Alucobond PE or Alucobond Plus to a “consumer”: TPA, s 74D(1)(b); ACL, s 54(1)(a)

944 For the purposes of s 54(1) of the ACL, and s 74D(1) of the TPA, the Applicants must establish that there was a “supply” of Alucobond PE or Alucobond Plus to a “consumer”. Section 54(1) of the ACL requires also that the supply to the consumer be “in trade or commerce”.

945 The Applicants submit that:

(a) as owners corporations, they were supplied with, and acquired as consumers, the Alucobond PE or Alucobond Plus (as the case may be) upon their creation under the NSW strata schemes legislation; and

(b) alternatively, the developers of the Shore Building and the Five Dock Building were consumers who were supplied with the Alucobond products, and the Applicants acquired Alucobond PE or Alucobond Plus from those consumers, or derived title to the goods through or under them.

946 On the other hand, the Respondents submit that there has been no relevant “supply” of Alucobond PE or Alucobond Plus to a “consumer” in respect of the Shore Building or the Five Dock Building for the following reasons:

(a) f irst, the vesting of the common property of a strata title building in an owners corporation does not satisfy the definition of “supply” under the TPA or ACL – issue 5(a)(i);

(b) s econd, in respect of the Shore Building, the Shore OC could not have acquired or been supplied with the Alucobond PE fitted to the Shore Building as a “consumer”, because:

(i) the price of the goods was not lower than $40,000 – issue 5(a)(ii)(A);

(ii) the products were not “of a kind ordinarily acquired for personal, domestic or household use or consumption” – issue 5(a)(ii)(B); and

(c) t hird, neither the developers of the Shore Building nor the Five Dock Building could be taken to have acquired or to have been supplied with Alucobond PE or Alucobond Plus as “consumers” for the reasons that:

(i) as to the Shore Building:

(A) the price of the goods acquired was not lower than $40,000 – issue 5(b)(i);

(B) the goods were not “of a kind ordinarily acquired for personal, domestic or household use or consumption” – issue 5(b)(ii);

(ii) the developers acquired, or held themselves out as acquiring, Alucobond PE and Alucobond Plus:

(A) for the purposes of re-supply in trade or commerce and thereby fell within the exception under s 3(2)(a)(i) of the ACL – issue 5(b)(iii)(A); or

(B) for the purposes of using the Alucobond PE and Alucobond Plus up, or transforming it, in trade or commerce, in the course of a process of production or manufacture or in the course of repairing or treating other goods or fixtures on land pursuant to s 4B(1) of the TPA, and s 3(2)(b) of the ACL – issue 5(b)(iii)(B).

947 Whilst only the ACL is relevant to the each of the Applicants, these reasons will canvass the equivalent provisions and requirements under the TPA. It is helpful at this stage to refer back to the relevant supply chain through which Alucobond PE and Alucobond Plus were installed onto the Shore Building and Five Dock Building respectively.

948 The following supply chain relates to the Shore Building and forms part of MFI-2.

949 As the extract above illustrates, and ignoring for current purposes whether any particular sequence in the supply chain constitutes a “supply” for the purposes of the TPA or ACL, the Shore Developers (Ronnstar/Lawtow) were the developers of the land at the time the Alucobond PE was supplied and affixed to the building. Prestige Apartments was engaged as the builder of the Shore Building. HVG supplied the Alucobond PE panels to Modernise Installations which was engaged as the relevant façade installer, which ultimately affixed the cladding to the Shore Building.

950 The Applicants submit that the relevant supply to a consumer was the supply to the Shore Developers, as the developers of the land at the time the Alucobond PE was supplied and affixed to the building. They submit that there was then a subsequent supply of the Alucobond PE to the Shore OC, also as a consumer, when the building was registered by the Shore Developers as a strata plan, causing the Shore OC to come into existence and to become the owner of the common property on which the Alucobond PE was affixed.

951 In relation to the Five Dock Building, the following supply chain has also been extracted from MFI-2.

952 Again, putting aside whether any particular sequence of the supply chain constituted a “supply” for the purposes of the TPA or ACL, the developer of the land when the Alucobond Plus was affixed to the Five Dock Building was Mr Abdul-Rahman. The Alucobond Plus panels were supplied by HVG to ACP Solutions, the relevant façade installer which ultimately installed the Alucobond Plus panels on the building.

953 The Applicants submit that the relevant supply to the consumer was, again, to the developer of the land, in this case Mr Abdul-Rahman, when the Alucobond Plus panels were supplied and affixed to the building. They also submit that there was then a subsequent supply of the Alucobond Plus panels to the Five Dock OC, as a consumer, when the building was registered as a strata plan, causing the Five Dock OC to come into existence and to become the owner of the common property on which the Alucobond PE was affixed.

7.3.1 To whom was a relevant supply made? Issue 5(a) (i) and 5(b) (iii)

954 Rather than addressing each of the issues in the sequence prepared in the relevant list of issues, I think it is most convenient to address the two supplies the Applicants contend for in sequence. Namely, whether there is a relevant “supply” on: (a) the creation of the owners corporations under the relevant legislation (issue 5(a)(i)) and (b) when the panels were acquired by the developers of the Shore Building and Five Dock Building (issue 5(b)(iii)).

955 It is relevant to note, as the Applicants submit, that the concept of “consumer” is not defined by reference to the person’s individual characteristics or their intended use of the goods (subject to s 3(2) of the ACL and s 4B(1)(a) of the TPA). Rather, persons are deemed to be consumers by reference to the amount paid for the particular goods, or by reference to the kind of good acquired. By not confining the class of persons who can be consumers by reference to whether they are “commercial” consumers, the breadth of the definition of “consumer” is limited by the carveouts for acquisitions (such as where goods are acquired for the purpose of re-supply or to be used up or transformed in a process of production or manufacture) which confers the legislative protections of the scheme on the consumers at the end of the supply chain, rather than persons involved at some intermediary step in the supply chain.

956 A further important consideration in determining whether a particular supply was a supply to a consumer, is the presumption in s 3(10) of the ACL (an equivalent presumption is contained in s 4B(3) of the TPA):

If it is alleged in any proceeding under this Schedule, or in any other proceeding in respect of a matter arising under this Schedule, that a person was a consumer in relation to particular goods or services, it is presumed, unless the contrary is established, that the person was a consumer in relation to those goods or services.

957 As the Applicants submitted, this thrusts the onus onto the Respondents to prove that persons alleged by the Applicants to be consumers do not fall within the above definition.

958 It is also relevant to note that, for the purposes of the consumer guarantee provisions, the “consumer” to whom goods are supplied does not need to be the person making the claim for compensation. The statutory cause of action is available to the consumer or any person who acquires the goods from the consumer, or derives title to the goods through, or under, the consumer: TPA, s 74D(1)(d); ACL, s 2 (definition of “affected person”).

7.3.1.1 “ Supply ” to the owners corporations – Issue 5(a)(i)

959 This issue considers whether the vesting of common property of a strata title building in an owners corporation constitutes a “supply” for the purposes of the TPA and ACL.

960 There is no dispute between the parties that upon registration of the strata scheme new rights in the common property are created. In summary, the Respondents submit that, therefore, the vesting of common property in an owners corporation cannot be said to involve a “supply” on the basis that under the relevant strata legislation, when common property vests in a strata scheme, new rights are created rather than a transfer of existing rights. The Respondents submit that the term “supply” is not apt to describe the circumstances by which owners corporations come to hold legal and beneficial title to the common property of a strata scheme. The Applicants, on the other hand, submit that the concept of “supply” is sufficiently broad to encompass the process of creating a new legal entity that will come into existence as the owner of title to relevant property upon its creation.

Legislative scheme

961 “Acquire” and “supply” are defined inclusively under the ACL, in s 2:

a cquire includes:

(a) in relation to goods—acquire by way of purchase, exchange or taking on lease, on hire or on hire-purchase; and

(b) in relation to services—accept.

…

s upply, when used as a verb, includes:

(a) in relation to goods—supply (including re-supply) by way of sale, exchange, lease, hire or hire-purchase; and

(b) in relation to services—provide, grant or confer;

and, when used as a noun, has a corresponding meaning, and supplied and supplier have corresponding meanings.

962 The concepts of “acquire” and “supply” are further elaborated in s 11 of the ACL:

In this Schedule:

(a) a reference to the acquisition of goods includes a reference to the acquisition of property in, or rights in relation to, goods pursuant to a supply of the goods; and

(b) a reference to the supply or acquisition of goods or services includes a reference to agreeing to supply or acquire goods or services; and

(c) a reference to the supply or acquisition of goods includes a reference to the supply or acquisition of goods together with other property or services, or both; and

(d) a reference to the supply or acquisition of services includes a reference to the supply or acquisition of services together with property or other services, or both; and

(e) a reference to the re-supply of goods acquired from a person includes a reference to:

(i) a supply of the goods to another person in an altered form or condition; and

(ii) a supply to another person of goods in which the first-mentioned goods have been incorporated; and

(f) a reference to the re-supply of services (the original services) acquired from a person (the original supplier) includes a reference to:

(i) a supply of the original services to another person in an altered form or condition; and

(ii) a supply to another person of other services that are substantially similar to the original services, and could not have been supplied if the original services had not been acquired by the person who acquired them from the original supplier.

963 The Applicants plead that they were supplied with, and acquired, the Alucobond PE or Alucobond Plus (as the case may be) as a consumer “upon [their] creation as part of the process” under the applicable strata legislation, being:

(a) the S trata S chemes (F reehold D evelopment) A ct 1973 (NSW) and the S trata S chemes M anagement A ct 1996 (NSW) in respect of the Shore Building; and

(b) the S trata S chemes D evelopment A ct 2015 (NSW) and the S trata S chemes M anagement A ct 2015 (NSW) in respect of the Five Dock Building.

964 The regimes under the SSFDA 1973 and the SSMA 1996, and the SSDA 2015 and SSMA 2015 were materially the same and relevantly included the following features:

(a) upon registration of a strata plan for a strata scheme, there was established an owners corporation (or body corporate) for the strata scheme constituted by the owners of the lots from time to time: SSMA 1996, ss 8, 11; SSMA 2015, s 8;

(b) upon registration of a strata plan, common property (being property that is not comprised in a lot) vests in the owners corporation of the strata scheme. The common property is freed and discharged from any mortgage, charge, covenant charge, lease, writ, or caveat affecting the land immediately before the registration of the plan: SSFDA 1973, s 18; SSDA 2015, s 24(2);

(c) the owners corporation holds the common property in the strata scheme as “agent” for the owners of the lots as tenants in common in shares proportional to the unit entitlement of the owners’ lots. An owner’s interest in common property cannot be severed from, or dealt with separately from, the owner’s lot: SSFDA 1973, ss 20, 24; SSDA 2015, s 28.

Submissions

965 The Respondents rely on the decision of Lindgren J in Cook v Pasminco Ltd (2000) 99 FCR 548; [2000] FCA 677 where his Honour said, at [26]:

The definitions of “supply” and “acquire” are symmetrical: a supply of goods must occur as part of a bilateral “transaction” or “dealing” under which the other party acquires them.

966 The Respondents submit that in the present case, when the strata plan for each building was registered, new rights were created. They submit that those rights did not correspond with the rights in the land that existed before registration of the strata plan and, as a consequence, there could be no transfer of rights from the building developer to the owners corporations, citing Sportscorp A ustralia Pty Ltd v Chief Commissioner of State Revenue (2004) 213 ALR 795; [2004] NSWSC 1029 at [16]-53.

967 The Respondents submit that the term “supply” is not apt to describe the circumstances by which an owners corporation comes to hold the legal and beneficial title to the common property of a strata scheme. That occurred, the Respondents submit, according to the relevant strata legislation, spontaneously, by way of the creation of the new rights “upon” the registration of the strata plan. The Respondents submit that the spontaneous way that an owners corporation comes to hold the legal and beneficial title to common property upon registration of the strata plan does not involve “a bilateral and consensual process” between two parties.

968 The Applicants, on the other hand, submit that the definition of “supply” in the legislation is sufficiently expansive to encompass the process of creating a new legal entity that will, as a necessary feature of that act of creation, come into existence as the owner of title to the relevant property upon its creation. The Applicants submit that to the extent a supply must involve a “bilateral and consensual process”, when a strata plan is registered, the congeries of rights that previously existed in the fee simple are re-subdivided so that various rights are created in different groups which are then redistributed to various parties, citing Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (No 2) (1998) 9 BPR 16,515 at 16,518-19 (Young J). The Applicants submit that this involves taking the existing rights of the developer in the part of the land that is to become the common property and redistributing those rights to the owners corporation created through the act of registration. The Applicants submit, by way of analogy, that it would be untenable to suggest that a transfer of Torrens title land from vendor to purchaser does not constitute a “supply” involving a bilateral and consensual process, even where the creation of a new title certifies a title that is not historical or derivative: Breskvar v Wall (1971) 126 CLR 376 at 385-6 (Barwick CJ).

Consideration

969 “Supply”, when used as a verb, is defined under the Macquarie Dictionary as “to furnish (a person, establishment, place, etc.) with what is lacking or requisite”, “to furnish or provide (something wanting or requisite)”, or “to make up (a deficiency); make up for (a loss, lack, absence, etc.); satisfy (a need, demand, etc.)”, or “to fill (a place, vacancy, etc.); occupy as a substitute to provide, or provide with, something”.

970 It is worth, briefly, noting the issues that were before Lindgren J in Pasminco, in which his Honour made the comments regarding a supply of goods occurring as part of a bilateral transaction or dealing. In that case, claims were brought by four applicants in relation to alleged noxious emissions emitted from the respondents’ neighbouring smelting plants. Part of the causes of actions brought included claims under ss 75AD and 75AG of the TPA, namely the supply of defective goods causing injury, and the supply of defective goods causing damage to land, buildings, or fixtures. The applicants claimed that the emissions were goods manufactured by the respondents which had a defect in that they had a deleterious effect on human health and had an adverse effect on the safety of land, buildings or fixtures. In determining an application to strike-out the claims brought under the TPA, his Honour considered the definition of “supply” in s 4(1) of the TPA and noted (at [24]):

It is true, as counsel for the applicants points out, that the definition is an inclusory one but it seems to me that an essential element of supply is that it is a bilateral and consensual process which has no application to a case such as the present one where the applicants’ case is that the emissions were inflicted upon them without their consent.

971 The facts of Pasminco are, quite plainly, some world away from the present circumstances. While the Applicants contend that the context in which Lindgren J made his comments regarding the concept of supply should not apply to them, they do not appear to challenge the correctness of his Honour's comments.

972 Indeed, his Honour’s comments at [26] were cited with approval by Gordon J in Australian Competition and Consumer Commission v Flight Centre Travel Group Ltd (2016) 261 CLR 203; [2016] HCA 49 at [172] where her Honour stated “[f]or the purposes of the TPA, ‘supply’ and ‘acquire’ are words of wide import that are inter-related or symmetrical. ‘Supply’ is the counterpart of ‘acquire’”.

973 It is also worth considering each of the authorities the parties relied on in further detail.

974 In Sportscorp one issue was whether the transfer of lots in a strata plan from a developer to the lot owners was subject to a concessional rate of duty that applied where dutiable property was transferred from a trustee to a beneficiary. In particular, s 55(1)(b) of the Duties Act 1997 (NSW) provided for a concessional duty of $10 chargeable in respect of:

[A] transfer of dutiable property from an apparent purchaser to the real purchaser, in a case where dutiable property is vested in an apparent purchaser upon trust for the real purchaser who provided the money for the purchase of the dutiable property.

975 Ultimately, Gzell J held at [51]-[53] that the concession in s 55(1)(b) did not apply because the property transferred from the developer (Queenscliff) to the lot owners (a partnership) following registration of the strata plan was not the same property vested in the developer upon the original purchase of the land. This was because the transfer to the lot owners excluded the common property, which was held on trust by the developer for the lot owners. The rights to deal with the common property were vested in the developer and not the lot owners, and the rights acquired by the lot owners to deal with the common property were significantly restricted by the operation of the strata scheme legislation (the SSFDA 1973): [38]-[44], [51], [53].

976 I accept the Applicants’ submission that reliance by the Respondents on the decision is somewhat misplaced. The issue in the case was the mismatch between the property that was originally acquired compared to the property rights that were then transferred after the registration of the strata scheme. As Gzell J stated at [44], [51] and [53]:

That which was transferred to the partners differed from what Queenscliff had purchased by exclusion of the common property and, notwithstanding that the common property was held in trust for the partners, the congeries of rights attached to it were vested in Queenscliff and not in the partners… There was a significant reduction in the rights acquired by the partners in comparison with the rights acquired by Queenscliff on purchase of the land.

…

In cases where common property is created upon registration of a strata plan, there can be no transfer of rights that in aggregate are equivalent to the congeries of rights acquired on purchase of the original properties. If no common property is created, and at least part of one lot is superimposed on at least a part of another lot, again, the congeries of rights change.

…

In my view, s 55(1)(b) of the Duties Act 1997 required an identity between the dutiable property transferred from the apparent purchaser with the dutiable property vested in the apparent purchaser and that identity was lacking in the instant circumstances. In my view s 55(1)(b) did not apply to the transfers.

977 As the extracts above illustrate, the issue in the case was that where common property is created upon the registration of a strata plan, the transfer of lots could not involve the transfer of rights that, in aggregate, were equivalent to the “congeries of rights” acquired when the property was originally purchased. I accept the Applicants’ submission that Gzell J’s reasoning does not suggest that the registration of a strata plan does not involve a transfer of any relevant property from the prior owner to the owners corporation, and nor does it suggest that such transfer of property could not be considered a “supply”.

978 His Honour noted earlier in his reasons that an analysis based upon the substitution of new rights for old rights did not apply under the Duties Act 1997 (NSW), stating at [29]:

An analysis of interests in land that attributes the creation of new rights to the issue of a new certificate of title and the cancellation of rights in the former registered proprietor does not sit well with the Duties Act 1997. If that analysis were applied, s 55(1)(b) would never relieve a real purchaser from duty upon a transfer from the apparent purchaser as the rights acquired by the real purchaser on transfer would not have been purchased by the apparent purchaser.

979 His Honour then went on to consider the decision of Young J in Ashington Holdings (which the Applicants rely upon), and noted at [36] in respect of that case:

It is to be noted that it was unnecessary for his Honour to decide whether the new congeries of rights were attributable to a redistribution of earlier rights or were new rights substituted for old rights that had been cancelled. For the reasons already indicated, I am of the view that an analysis based upon the substitution of new rights for old rights does not apply to the Duties Act 1997.

980 Turning now to the Applicants’ reliance on Ashington Holdings. The Applicants submit that, as Young J explained at 16,518-19, when a strata plan is registered, the congeries of rights that previously existed in the fee simple are re-subdivided so that various rights are created in different groups which are then redistributed to various parties. Relevantly, the Applicants submit that this includes taking the existing rights of the developer in the part of the land that is to become the common property and redistributing those rights to the owners corporation through the act of registration. 3A submits that the case supports the opposite proposition.

981 The case concerned circumstances where, in earlier proceedings, the plaintiff lessor had succeeded in its claim that the defendant tenant had exercised its option under a lease. The option provided for the lessor to grant a lease on the same terms as the previous lease with certain exceptions. However, since the grant of the initial lease, a strata plan had been registered over the relevant certificate of title. In the proceedings before Young J, the plaintiff sought an order for specific performance requiring the tenant to sign a new lease.

982 As Gzell J noted in Sportscorp, it was unnecessary in Ashington Holdings for Young J to determine whether the registration of a strata scheme involved a redistribution of rights or if new rights were substituted. Young J stated at 16,518-16,519:

[T]he process nowadays is for the Registrar General to issue a new certificate of title or the equivalent and there is authority for the proposition that every time the Registrar General does that, a new title is created as Barwick CJ said in Breskvar v Wall (1971) 126 CLR 376 at 385–6; [1972] ALR 205 at 209:

That which the certificate of title describes is not the title which the registered proprietor formerly had, or which but for registration would have had. The title it certifies is not historical or derivative. It is the title which registration itself has vested in the proprietor.

It follows that when a strata plan is registered the congerie of rights that constituted the grant of a fee simple over the whole parcel is now resubdivided so that various rights are created in different groups of cubic meterages of air space. The sum total of the whole of those rights will equal the sum total of the congerie of rights in the original certificate of title, but they will be completely redistributed. Alternatively, the old rights in land have been cancelled and new rights whose totality is the same quantum are created. It matters little for present purposes which it is.

983 Young J went on to say that because of the redistribution of rights, or because of other legislation, the rights of a freeholder in a strata were different to the rights of a freeholder who was, say, a tenant in common of the whole property with a contractual right to use a particular part of the building. His Honour concluded that although the land described in the former lease and the new lease looked the same, “juristically, they consist of quite separate congeries of rights”: at 16,519.

984 Ashington Holdings was ultimately reversed on appeal, although neither the Applicants nor the Respondents advanced submissions relating to the appeal judgment: Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (1999) 9 BPR 17,315 (Mason P and Handley JA, Fitzgerald JA dissenting). Mason P accepted that the registration of the strata scheme “brought about changes in the ‘congeries of rights’ of the lessor and lessee”: at [31], Handley JA agreeing at [41]. However, Mason P ultimately held (at [35], Handley JA agreeing at [41]), that it was:

[U]nnecessary to consider whether any of these changes…represented departures of substance from the obligations under the new lease…because all of these changes were the direct consequence of the situation brought about and intended to be brought about by the joint action of the parties when the lessor (with the lessee’s cooperation) proceeded to obtain registration of the new strata plan.

985 Nonetheless, Mason P, in obiter, doubted that the change in the “congeries of rights” was substantial: at [33], Handley JA agreeing at [41]. Fitzgerald JA, in dissent, found that “[t]he content of the parties’ relationship of lessor and lessee as it existed during the balance of the original term was altered by the registration of the strata plan”, such that the new lease was not, in substance, the same as the original lease: at [110]-[112].

986 Noting the above, I am not satisfied the authorities each of the parties rely on actually support their respective positions. In the context of what this proceeding relates to, and based on the submissions before me, I am not satisfied that the question of whether the registration of a strata scheme specifically involves the redistribution of the developer’s existing rights, or the substitution of new rights, is one I can or should appropriately seek to answer.

987 Ultimately, I also do not consider that the question is one of particular significance in the context of this proceeding; that is, it is not necessary for me to determine that question in order to make a finding as to whether there was a supply to each of the Shore OC and Five Dock OC. Considering the natural and ordinary meaning of the term “supply”, I am not satisfied that the vesting of property in an owners corporation upon the registration of a strata scheme should properly be construed to constitute a “supply”.

988 Prior to the registration of the strata plan for each of the Shore Building and Five Dock Building, the respective developers owned the lots in each building. I accept, as the Applicants submit, that, by each of their own actions, the developers registered the strata plans which had the legal consequences of establishing body corporates in which common property was vested. In doing so, ownership of the common property changes, whether by way of some redistribution of existing rights or by way of the substitution of new rights, to the owners corporations.

989 However, I am not satisfied that such a process, involving the spontaneous vesting of rights upon the registration of a strata plan, is apt to be described as a “supply” by the developer to the owners corporation that also comes into existence upon the registration of that strata plan. In my view, the circumstances lack the bilateral nature of a dealing that would ordinarily be understood to be involved in a supply of goods, in the sense discussed by Lindgren J in Pasminco. To construe the concept of supplying goods as encompassing the creation of a new legal entity that would, as a feature of its creation, simultaneously become the owner of the goods, is to adopt, in my view, a rather artificial concept of “supply”.

990 In this context, the Applicants’ references to the Torrens title system are not of much assistance. There is, plainly, a difference between circumstances in which two or more persons come together to effect a sale of land where title vests in the purchaser through registration, compared to the present circumstances.

991 While only the ACL applies to the Applicants’ claims, the same reasoning will apply under both the ACL and the TPA in respect of any group member who claims to have been supplied and to have acquired Alucobond PE or Alucobond Plus as a consumer by operation of vesting provisions in the strata legislation for other states and territories.

7.3.1.2 Did the developers acquire the Alucobond products as “consumers” – Issue 5(b)(iii)

992 In contrast to the issue above concerning whether there was a “supply” to the owners corporations by way of registration of the relevant strata schemes in respect of the Shore Building and Five Dock Building, there is no dispute that there was a supply of the Alucobond products to the developers from the relevant façade installers who in turn were supplied the products from HVG. As noted in section 7.3 of these reasons above, the Alucobond products were supplied to the Shore Developers by Modernise Installations, and in respect of the Five Dock Building were supplied to Mr Abdul-Rahman by ACP Solutions. The relevant question under this issue is whether that supply to the developers constituted a supply to a “consumer”.

993 “Consumer” is defined under s 3 of the ACL as follows:

Acquiring goods as a consumer

(1) A person is taken to have acquired particular goods as a consumer if, and only if:

(a) the amount paid or payable for the goods, as worked out under subsections (4) to (9), did not exceed:

(i) $40,000; or

(ii) if a greater amount is prescribed for the purposes of this paragraph—that greater amount; or

(b) the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption; or

(2) However, subsection (1) does not apply if the person acquired the goods, or held himself or herself out as acquiring the goods:

(a) for the following purpose:

(i) for goods other than gift cards—for the purpose of re-supply;

…

(b) for the purpose of using them up or transforming them, in trade or commerce:

(i) in the course of a process of production or manufacture; or

(ii) in the course of repairing or treating other goods or fixtures on land.

994 Consumer is defined in s 4B of the TPA as follows:

(1) For the purposes of this Act, unless the contrary intention appears:

(a) a person shall be taken to have acquired particular goods as a consumer if, and only if:

(i) the price of the goods did not exceed the prescribed amount; or

(ii) where that price exceeded the prescribed amount—the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption or the goods consisted of a commercial road vehicle;

and the person did not acquire the goods, or hold himself or herself out as acquiring the goods, for the purpose of re‑supply or for the purpose of using them up or transforming them, in trade or commerce, in the course of a process of production or manufacture or of repairing or treating other goods or fixtures on land; and

…

(2) For the purposes of subsection (1):

(a) the prescribed amount is $40,000 or, if a greater amount is prescribed for the purposes of this paragraph, that greater amount;

(b) subject to paragraph (c), the price of goods or services purchased by a person shall be taken to have been the amount paid or payable by the person for the goods or services;

(c) where a person purchased goods or services together with other property or services, or with both other property and services, and a specified price was not allocated to the goods or services in the contract under which they were purchased, the price of the goods or services shall be taken to have been:

(i) the price at which, at the time of the acquisition, the person could have purchased from the supplier the goods or services without the other property or services;

(ii) if, at the time of the acquisition, the goods or services were not available for purchase from the supplier except together with the other property or services but, at that time, goods or services of the kind acquired were available for purchase from another supplier without other property or services—the lowest price at which the person could, at that time, reasonably have purchased goods or services of that kind from another supplier; or

(iii) if, at the time of the acquisition, goods or services of the kind acquired were not available for purchase from any supplier except together with other property or services—the value of the goods or services at that time;

…

(3) Where it is alleged in any proceeding under this Act or in any other proceeding in respect of a matter arising under this Act that a person was a consumer in relation to particular goods or services, it shall be presumed, unless the contrary is established, that the person was a consumer in relation to those goods or services.

…

995 The Respondents contend that the developer of each building did not acquire the goods as consumers because when the panels were acquired, the developer acquired, or held themselves out as acquiring the panels:

(a) for the purpose of re-supply under s 3(2)(a)(i) of the ACL or s 4B(1) of the TPA; or

(b) for the purpose of using them up or transforming them, in trade or commerce, in the course of a process of production or manufacture, or in the course of repairing or treating other goods or fixtures on land under s 3(2)(b) of the ACL or s 4B(1) of the TPA.

For the purpose of re-supply – I ssue 5(b)(iii)(A)

996 Naturally, given the Respondents’ argument in respect of issue 5(a)(i), that the vesting of common property in the owners corporations did not constitute a “supply” for the purposes of the TPA and ACL, the Respondents could not contend that the Alucobond products were acquired by the developers for the purpose of re-supplying the panels to the relevant owners corporations. In the absence of the submissions made in respect of issue 5(a)(i), this would have been the natural argument to make.

997 Instead, the Respondents submit that upon registration of the strata scheme by the developers, the developers became the owners of the units in those buildings. While legal title to the common property vested in the owners corporations, as owners of the units, the developers held beneficial title in the common property of the buildings, including in respect of the Alucobond products. The Respondents submit that as developers, it can be reasonably inferred that they intended, at all times, to transfer the beneficial title in the common property to persons who would purchase the units in the buildings. The Respondents submit that as this involves a re-supply of the beneficial title to the Alucobond products affixed to the buildings, the developers acquired their interest in those products for the purposes of that re-supply. The Respondents refer to s 11(a) of the ACL which states that “a reference to the acquisition of goods includes a reference to the acquisition of property in, or rights in relation to, goods pursuant to a supply of the goods”. An equivalent provision is contained in s 4C of the TPA.

998 I do not accept the Respondents’ submissions.

999 Upon the registration of the relevant strata schemes, the Shore OC and Five Dock OC came into existence and title to the common property was vested in those owners corporations. The fact that the owners corporations hold title to the common property as trustee, or in a manner that is analogous to a trustee, for individual lot owners does not invite the analysis to simply be directed at the underlying equitable interests of the common property. The Respondents did not identify any authority in support of their approach. To focus the analysis of the consumer guarantee scheme in the manner contended for by the Respondents, again, carries a degree of artificiality that is not, in my view, evident from the language of the scheme.

1000 Following the acquisition of the Alucobond products by the developers, the only further transaction or dealing which occurred in respect of the panels was the registration of the relevant strata schemes which thereby created the Shore OC and Five Dock OC and vested title in the common property in those owners corporations. Noting the symmetrical nature of “supply” and “acquire” as referred to in Pasminco (at [26], Lindgren J) and Flight Centre (at [172], Gordon J), and that the definition of “supply” is defined to include “re-supply”, given my findings above that the developers did not “supply” the Alucobond products to the relevant owners corporations upon registration of the strata schemes, I am not satisfied that in acquiring the products, the developers acquired the products for the purposes of “re-supply”.

1001 If the Respondents’ analysis were correct, it would mean that individual lot owners would need to claim for losses they have suffered (in respect of their equitable interests in the common property), even though that loss is properly considered to be reflective of the owners corporation’s loss.

1002 The Respondents’ analysis also requires the Court to adopt a construction of the TPA or ACL in which there is no supply to a consumer at any point in the supply chain. I accept the Applicants’ submission that this would be an improbable result. Goods that otherwise meet the definition of consumer goods would find their way onto residential buildings with no one, whether the first owner or the eventual owner, having a remedy against the manufacturer or the supplier if the goods were defective.

1003 For completeness, I note that, if I am wrong in respect of issue 5(a)(i), it would be appropriate, in my view, to determine that the developers acquired the Alucobond products for the purposes of re-supply. In other words, if the vesting of common property in the owners corporations through the registration of a strata scheme properly constitutes a “supply” for the purposes of the TPA and ACL, it would follow that when the Alucobond products were acquired by the developers, they were acquired for the purpose of “re-supply”. Were that so, therefore, the developers would not have acquired the Alucobond products as ‘consumers’, by operation of s 3(2)(a)(i) of the ACL.

For the purpose of using up or transforming – I ssue 5(b)(iii)(B)

1004 The Respondents alternatively submit that the developers of the Shore Building and Five Dock Building acquired, or held themselves out as acquiring, Alucobond PE or Alucobond Plus for the purposes of using the products up or transforming them, in trade or commerce:

(a) first, in the process of producing or manufacturing a façade system for those buildings; and

(b) second, in the course of treating fixtures on land, being the Shore Building and Five Dock Building.

1005 The Respondents submit that the raw panels supplied by HVG are not capable of being affixed to a building without being processed and fabricated and combined with other materials and components to develop a façade system. The Respondents submit that these methods of fabrication required specialist knowledge, expertise, and machinery. Mr Smithson, in his expert reports within the context of Expert Group 7, explained a number of different methods of fabrication and discussed the various specialist equipment used in the fabrication process.

1006 The Respondents submit that this fabrication process amounts to the manufacture of a façade system, and that the fabrication of the Alucobond products in such a manner was sufficient to constitute “using them up” and “transforming them” in the process of producing or manufacturing façade systems for the Shore Building and Five Dock Building, or alternatively, in the course of treating fixtures on land, being those buildings.

1007 I do not accept the Respondents’ submission that the developers acquired the Alucobond products for the purpose of using them up or transforming them in trade or commerce.

1008 The primary reason is simply that the Respondents seek to conflate the purpose for which the Alucobond products were acquired by the relevant façade installers, with the purpose of the developers. The developers acquired the goods in the form of cladding affixed to their relevant buildings. The developers themselves did not acquire the panels for the purposes of “using them up” or “transforming” them in trade or commerce, either in the course of production or manufacture, or in the course of repairing or treating the relevant buildings. Irrespective of whether any manipulation and fabrication of the panels can be said to amount to “using them up” or “transforming” the panels, that manipulation was done by the relevant façade installers who acquired the panels for that purpose in the course of operating their businesses. I am not satisfied that this purpose can or should be attributed to the developers in circumstances where the developers acquired the panels as affixed to their relevant buildings.

1009 The Respondents submit that such an approach reflects an “unduly artificial approach” since the relevant façade installers did what the developers intended them to do. I do not accept this submission. The purpose of s 3(2)(b) of the ACL (and s 4B(1) of the TPA) is to exclude a person from being a consumer, for the purposes of the legislation, where they acquire the relevant goods for the commercial purpose of using up or transforming the goods. This necessarily directs attention to the person who acquires the product to undertake the relevant using up or transformation in trade or commerce – not, in the present case, the developers who acquire the goods in the form of cladding affixed to their relevant buildings.

1010 Given the above, I am not required to determine whether the fabrication of the panels used on the Shore Building or Five Dock Building amounts to “using up” or “transforming” the relevant Alucobond products. However, as this issue is also relevant to issue 7 (third party products), it is convenient to address it in further detail here.

1011 The term “transform” is not defined under the ACL. It is defined in the Macquarie Dictionary as “to change in form; change into something of a different form” and “to change in appearance, condition, nature or character, especially completely or extensively”.

1012 Section 11(e) of the ACL provides that a reference to the re-supply of goods acquired from a person includes a reference to a supply of the goods to another person in an altered form or condition, and a supply to another person of goods in which the first-mentioned goods have been incorporated.

1013 The reference in s 3(2)(b) to “using… up” and “transforming” must be something more than an alteration to the form or condition of the goods. That is plainly captured by the concept of re-supply, as might be expected to occur in an ordinary supply chain. This also appears to be accepted by 3A in its closing submissions at [474]. The concept of “using up” or “transforming”, in the context of the legislation, must involve a more fundamental change to the nature of the relevant goods.

1014 In my view, the concept of “using up” should be understood as akin to a good being consumed; in that, through the relevant process of production or manufacture, or treatment of goods or fixtures, the good is used up or expended. Similarly, the concept of transform, for the purposes of the statute, should also be understood to involve some significant change in the condition, nature, or character of the good, such that the good has, in effect, been transformed into something new. This would, in my view, give the language its natural and ordinary meaning. What constitutes “using up” or “transforming” goods will depend on the particular goods.

1015 Turning now to the Alucobond products used in the Shore Building and the Five Dock Building, it is worth outlining 3A’s evidence regarding the fabrication of the Alucobond products in some further detail.

1016 The Alucobond products were, it is to be recalled, supplied from 3A to HVG, and by HVG to façade installers, in the form of “raw” flat panels. In order for the panels to be affixed to a building, it was necessary for the panels, in some way, to be processed and fabricated. The nature and extent of this fabrication would, naturally, depend on how the panels were intended to be used on the building, the method of installation, and the overall look intended to be achieved. Therefore, it is difficult to generalise how, in practice, the Alucobond products would be fabricated and affixed to a particular building.

1017 A critical feature of the Alucobond products, and a benefit of ACPs generally, is the ease of working with them. Expert Group 7 noted that advantages offered by the use of ACPs was that they allowed less robust fabrication of individual cladding components, and could be easily fabricated either in the factory or on-site (although Mr Smithson noted in his second report that he considered that façade systems incorporating ACPs should be machined in a factory or workshop).

1018 Noting that the extent of any fabrication would obviously depend on how the relevant panels were intended to be used and the overall look that was intended to be achieved, the ways in which panels could be processed or fabricated included cutting, punching, routing and folding, drilling, bending, and shearing. These were methods of processing the panels that were identified in various product brochures for the Alucobond products. Even what would appear to be the most basic of affixation methods, being the “flat stick” method which involved adhering panels to a building using double-sided tape, would be expected to involve, at least, cutting panels to size.

1019 As Mr Smithson identified in both of his reports, there are many specialist pieces of equipment which may be used to process the Alucobond products in such manner. This includes, for example, computerised numerical control routers/mill machines, guillotines, press brakes, double-headed saws, machining centres, and roll-formers.

1020 The panels, having been fabricated or processed as required, would then be affixed to a building. This process of affixation would generally involve the incorporation of other products, depending on the particular method of affixation, that collectively form the overall “façade system”. Without seeking to outline the specifics of any particular affixation method, it can be said generally that the other items that might be expected to be involved in the affixation of the Alucobond products to a building may include metal sub-frame members, gaskets, sealants, mechanical fixings, insulation, and other like components.

1021 Considering the evidence outlined above, I am not satisfied that the process by which the Alucobond products may be processed and fabricated, and ultimately affixed to a building as part of the overall “façade system”, is apt to be described as involving the panels being “used up” or “transformed” in the course of production or manufacture, or in the course of repairing or treating the buildings. At most, it involved an alteration of the goods in form or condition. The panels were fabricated and affixed in different ways to form the façade of buildings. However, the evidence does not establish that the Alucobond products were transformed in such manner so as to no longer be identifiable as the same individual panels; in other words, it cannot be said that the Alucobond products were transformed into something other than the Alucobond products, or that they were used up, through the process of fabrication and affixation.

1022 For these reasons, and in light of my decision in respect of issue 5(a)(i), neither of the carveouts in s 3(2) of the ACL (or s 4B(1) of the TPA) apply to the developers of the Shore Building and the Five Dock Building, meaning the developers will be taken to have acquired the Alucobond products as “consumers” if one of the circumstances in s 3(1) applies.

7.3.1.3 “In trade or commerce”

1023 If I am wrong on the above analysis in issue 5(a)(i), and there was a supply to the Shore OC and Five Dock OC, one further question arises.

1024 For the purposes of s 54(1) of the ACL, the supply to the consumer must have occurred “in trade or commerce”. It was not in dispute, that the supply to the developers occurred “in trade or commerce”.

1025 I have already referred above (see issue 3) to the majority (Mason CJ, Deane, Dawson and Gaudron JJ) in Concrete Constructions which held that, when assessing whether conduct was “in trade or commerce”, it was insufficient that the conduct was “in the course of the myriad of activities which are not, of their nature, of a trading or commercial character but which are undertaken in the course of, or as incidental to, the carrying on of an overall trading or commercial business”: at 602-603. Conduct that is “in trade or commerce” is limited to “conduct which is itself an aspect or element of activities or transactions which, of their nature, bear a trading or commercial character”: at 603.

1026 The Respondents submit that in the case of both the Shore Building and Five Dock Building, the vesting of rights in the common property by the owners corporation at the time of the registration of the strata plan did not occur “in trade or commerce”.

1027 I do not accept the Respondents’ submission. There is no dispute that the developers acquired the land and developed the relevant buildings as part of their commercial property development businesses. The intention of the developers was, plainly, to register a strata scheme in respect of the properties in order to sell the individual apartments. The registration of the strata scheme in respect of the properties, through which the owners corporations were established and ownership of common property was vested in them, was an essential step in the commercialisation of the developments. I am satisfied that the registration of the strata scheme, and the vesting of common property in the owners corporations which necessarily followed from that registration, was conduct of a commercial character and, therefore, “in trade or commerce”.

7.3.2 The price limb – I ssue 5(a)(ii)(A) and 5(b) (i)

1028 If there is a relevant “supply” to the owners corporations (under issue 5(a)(i)), or, as I have found above, each of the developers acquires the Alucobond products in circumstances where neither of the carveouts under s 3(2) of the ACL apply, the relevant developer (or owners corporation, if I am incorrect in respect of issue 5(a)(i)) would only acquire the Alucobond products as a “consumer” if (s 3(1) of the ACL):

(a) the amount paid or payable for the Alucobond products, as worked out under subsections 3(4) to (9), did not exceed $40,000; or

(b) the Alucobond products were goods of a kind ordinarily acquired for personal, domestic or household use or consumption.

1029 This section of the reasons addresses the “price limb” issue: namely, the correct application of the monetary threshold under s 3(1)(a)(i). While this is an individual question that must be determined for the Shore OC and the Five Dock OC, the resolution of the correct approach may be relevant to a number of group members.

1030 The Respondents accept that the Five Dock OC acquired the Alucobond Plus fitted to the Five Dock Building as a consumer because the amount paid for that Alucobond Plus was less than $40,000 (incl GST).

1031 In respect of the Shore Building, the amount paid for the Alucobond PE fitted to that building was $41,158.68 (incl GST).

1032 During the trial, the Applicants sought to argue that any GST payable in respect of the panels ought not to be included within the relevant price threshold. However, during the course of closing submissions, counsel for the Applicants accepted that GST was to be properly included within the price threshold given s 177-12 of A N ew Tax System (Goods and Services Tax) Act 1999 (Cth) which provides that, with the exception of a number of identified Acts (of which the TPA and CCA are not included), in any Act unless the contrary intention appears, a reference to a price relating to a supply, or proposed supply, is taken to include the net GST (if any) that is, or would be, payable by an entity making the supply. Accordingly, further references to dollar amounts in this section of these reasons are all GST inclusive (unless specified otherwise).

1033 In light of the concession made by the Applicants, the issue between the parties effectively boils down to the following. The Applicants contend that for the purposes of determining whether the amount paid for the goods exceeded the statutory threshold of $40,000, the relevant amount is the amount paid for each individual panel of Alucobond PE or Alucobond Plus (as the case may be). On the other hand, the Respondents contend that the appropriate approach is to consider the aggregate price paid in respect of the panels acquired.

1034 The relevant parts of s 3 of the ACL to this analysis are as follows:

3 Meaning of consumer

Acquiring goods as a consumer

(1) A person is taken to have acquired particular goods as a consumer if, and only if:

(a) the amount paid or payable for the goods, as worked out under subsections (4) to (9), did not exceed:

(i) $40,000

…

Amounts paid or payable for purchases

(4) For the purposes of subsection (1) or (3), the amount paid or payable for goods or services purchased by a person is taken to be the price paid or payable by the person for the goods or services, unless subsection (5) applies.

(5) For the purposes of subsection (1) or (3), if a person purchased goods or services by a mixed supply and a specified price was not allocated to the goods or services in the contract under which they were purchased, the amount paid or payable for goods or services is taken to be:

(a) if, at the time of the acquisition, the person could have purchased from the supplier the goods or services other than by a mixed supply—the price at which they could have been purchased from the supplier; or

(b) if:

(i) paragraph (a) does not apply; but

(ii) at the time of the acquisition, goods or services of the kind acquired could have been purchased from another supplier other than by a mixed supply;

the lowest price at which the person could, at that time, reasonably have purchased goods or services of that kind from another supplier; or

(c) if, at the time of the acquisition, goods or services of the kind acquired could not have been purchased from any supplier except by a mixed supply—the value of the goods or services at that time.

…

Mixed supplies

(11) A purchase or other acquisition of goods or services is made by a mixed supply if the goods or services are purchased or acquired together with other property or services, or together with both other property and other services.

1035 The Alucobond products supplied to the developers in respect of the Shore Building and Five Dock Building were supplied by the relevant façade installers as a mixed supply together with installation services. There is no evidence that the panels could have been acquired from the façade installers or builders otherwise than by way of mixed supply, such that s 3(5)(a) could not apply. But the evidence of HVG’s operations showed that the panels could be purchased from HVG separately from any installation services. Therefore, s 3(5)(b) of the ACL applies; the cost of the Alucobond products is to be worked out by reference to the lowest price at which goods of that kind could, at that time, have reasonably been purchased from another supplier by way of supply other than a mixed supply. Where the evidence of the Distributor Agreements made clear that HVG was the sole distributor of Alucobond products in Australia during the relevant period, the relevant “amount paid” is accordingly to be determined by reference to the lowest price at which the panels could, at the same time, have reasonably been purchased direct from HVG without any concurrent supply of services. This is not disputed by the Respondents.

1036 In relation to the Five Dock Building, the aggregate amount paid or payable in respect of the Alucobond Plus panels was approximately $9,825.20 (incl GST), and clearly less than $40,000. As noted above, the Respondents accept that the Five Dock OC was a consumer on this basis. The total cost of the Alucobond PE panels affixed to the Shore Building was $41,158.68. Invoices from HVG show that the total cost of each individual panel supplied in relation to the Shore Building ranged from $233.23 to $367.29. More broadly, the evidence demonstrates that, during the relevant period, the typical price of an Alucobond PE panel purchased from HVG was between $165.00 to $348.30 (excl GST) depending on size, with a range of $156.25 to $422.10 (excl GST) in respect of Alucobond Plus. It is not disputed that the cost of individual Alucobond PE and Alucobond Plus panels is lower than the statutory threshold.

1037 The Respondents make a number of submissions as to why it is appropriate to consider the aggregate figure paid in respect of the panels. They submit that the “goods” being referred to in s 3(1)(a) of the ACL are the “particular goods” that the relevant person is said to have acquired. They submit that this language is concerned with the amount paid or payable for all of the “particular goods” that person claims to have acquired as a consumer, rather than any individual item of those goods. The Respondents also submit, by reference to the definition of “goods” in s 2 which includes “any component part of, or accessory to, goods”, that goods which a person claims to acquire as a consumer may include multiple components or accessories, each of which is itself a good. The Respondents submit that on the Applicants’ construction, there would be no reason to draw the line at the price for an individual item of the goods acquired, as it would make just as much sense to isolate the amount paid or payable for an individual component or accessory forming part of the goods.

1038 The Respondents also refer to the concept of acquiring services as a consumer under s 3(3)(a). The Respondents submit that the provision should be construed consistently with the concept of acquiring goods as a consumer under s 3(1)(a), and that, under the Applicants’ construction, the relevant amount would be that paid or payable for any individual service under the relevant contract, rather than for all of the relevant services the person claimed to have acquired as a consumer. The Respondents provided the example of professional services, arguing that the relevant amount paid or payable for a contract applying time-based charging would, on the Applicants’ construction, presumably be said to be the charge for the smallest unit at which time was charged.

1039 Further, the Respondents submit that the purpose of the monetary threshold is to delineate when a person is taken to have acquired goods as a “consumer”, and that such purpose can only sensibly be achieved by focusing on the total amount paid or payable for the goods in question, not the amount paid or payable for an individual item of the goods. The Respondents submit that a construction otherwise would mean that large corporations purchasing commercial quantities of goods (which individually fall below the $40,000 threshold) that are not of a kind ordinarily acquired for personal, domestic or household use or consumption would be taken to have acquired those goods as consumers.

1040 I do not accept the Respondents’ submissions.

1041 The Applicants submit, and I accept, that s 3(1)(a) of the ACL can only sensibly be read as referring to the cost of the goods in the form of individual panels. That is the relevant unit of sale that the suppliers use. Any other unit of calculating cost introduces an element of arbitrariness to the operation of the ACL which cannot have been intended. I agree with that submission for the reasons that follow.

1042 Section 3 of the ACL applies to “particular goods” and dictates how the price of those “goods” is to be determined. Significantly, those provisions deal explicitly with the concept of a “mixed supply”, being the supply of goods with other property or services, and direct attention to the price at which the goods “could have been purchased” and the “lowest price at which the person could… reasonably have purchased goods”: s 3(5), ACL.

1043 These provisions are referring to the price of each item, rather than any particular quantity of goods that may happen to have been supplied. They necessarily direct attention to the retail price of the individual items offered by the supplier for the specific goods or, if unavailable as an individual item from that supplier, offered by other suppliers.

1044 Additionally, in s 3(1), the word “particular” specifically qualifies the reference to “goods”. The ordinary and natural meaning of “particular” in that context directs attention to the individual or particular item. This also appears to be reinforced by s 3(1)(c) which deems “particular goods” to have been acquired as a consumer where “the goods consisted of a vehicle or trailer acquired for use principally in the transport of goods on public roads”. The reference in s 3(1)(c) refers specifically to a singular vehicle or trailer.

1045 This approach is also consistent with the history and object of this aspect of the “consumer” definition. The $40,000 threshold was explicitly inserted to extend the protections under the TPA (and now the ACL) to small businesses by including low-value goods that are not ordinarily acquired for personal, domestic or household use: Swanson Report, [9.38]-[9.43]. The chosen legislative technique is to single out goods of a particular kind, by reference to their cost, as the method of defining a consumer in relation to goods. It would be anomalous, and would serve no legislative purpose, if the question of whether or not goods were “consumer” goods for the purposes of the statute depended on the number of goods bought or how the purchase and delivery was structured (eg, whether the goods were all purchased under one invoice or multiple invoices, each less than $40,000). It is, therefore, also not accurate for the Respondents to submit that the purpose of the monetary threshold can only be achieved by focusing on the total amount paid or payable by the person for the goods in question. The TPA and ACL identify, by reference to a monetary threshold, the kinds of goods which are taken to be acquired by consumers.

1046 I accept the Applicants’ submission that the Respondents’ approach gives rise to an unacceptable level of uncertainty in the application of the provisions. As soon as one moves away from considering the products as individual goods, with a readily identifiable price based on the unit of sale, a series of questions arise which are not readily answerable by reference to the statute. For example, can a person attract the application of the ACL simply by dividing up its purchases of goods into separate groups or tranches, such that the amount paid or payable for a particular transaction is below $40,000? Such an approach would appear, on its face, quite arbitrary. To the extent that separate purchases of goods, over a period of time, should be aggregated to avoid such arbitrariness, further questions arise around the necessary connection between purchases for them to be aggregated.

1047 I am also not satisfied that the Respondents’ references to services acquired as a consumer are of particular assistance. Plainly, goods are generally tangible and capable of being separately identified, while services are generally intangible and cannot readily be analysed in this way. The question posed under s 3(3)(a) is not whether the physical or mental act constituting the service is valued at more than $40,000, but whether the amount paid or payable for the particular right, benefit, privilege or facility under the relevant contract for services is more than $40,000, as worked out under subsections 3(4) to (9).

1048 For the reasons outlined above, I am satisfied that the correct approach in respect of the price limb is to consider the price of each identifiable item supplied. As noted above, the Respondents accept that the price of each of the individual Alucobond PE and Alucobond Plus panels supplied in respect of the Shore Building and Five Dock Building were below the statutory threshold of $40,000.

7.3.3 The consumer goods limb - Issue 5(a)(ii)(B), 5(b)(ii)

1049 As noted above, this issue relates to whether the Alucobond PE and Alucobond Plus panels were goods “of a kind ordinarily acquired for personal, domestic or household use or consumption”: TPA, s 4B(1)(a)(i)-(ii); ACL, s 3(1)(b).

1050 Given the conclusion noted above in respect of the price limb issue, it is not necessary to examine this issue for the purposes of whether the Applicants (and any group members) are taken to have acquired the Alucobond products as “consumers” for the purposes of the TPA and ACL.

1051 However, as noted in respect of issue 4, whether or not the panels are goods of a kind ordinarily acquired for personal, domestic or household use or consumption remains a separate threshold issue in respect of the consumer guarantee claim brought under the TPA. For the reasons given under issue 4, the Alucobond products were goods of such a kind.

1052 Therefore, the Applicants have made out issue 5. The developers of the Shore Building and the Five Dock Building are taken to have acquired the Alucobond PE and Alucobond Plus, respectively, as consumers, because the amount paid or payable for them (assessed at the unit of individual panels) did not exceed $40,000 and the carveouts in s 3(2) do not apply to them. As was observed above, it is not in dispute that the Shore Developers in respect of the Shore Building and Mr Abdul-Rahman in respect of the Five Dock Building were ‘supplied’, in trade or commerce, with the Alucobond PE and Alucobond Plus in the relevant sense.

7.4 Issue 6 – Whether the Applicants derived title to the Alucobond products through or under the developers?

1053 The issue of whether the Applicants derived title to the Alucobond products through or under the developers is an issue that arises only if it is determined (as I have found above), that the Alucobond products were supplied to the developers as consumers, but not to the Applicants.

1054 The right to recovery in respect of a supply of goods to a consumer where the guarantee of acceptable quality in s 54 of the ACL is not complied with is made available to an “affected person” under s 271 of the ACL. Relevantly, “affected person” is defined under s 2 of the ACL in the following terms:

a ffected person, in relation to goods, means:

(a) a consumer who acquires the goods; or

(b) a person who acquires the goods from the consumer (other than for the purpose of re-supply); or

1055 The Applicants submit that they are able to make a claim under s 271 of the ACL as an “affected person” on the basis that they acquired the goods from the developers (other than for the purpose of re-supply) or derived title to the goods through or under the developers.

1056 While only the ACL is relevant to the individual claims of the Applicants, the issue is also relevant to claims of group members brought under the TPA. In particular, s 74D(1)(d) of the TPA provided in relation to goods of unmerchantable quality that “the consumer or a person who acquires the goods from, or derives title to the goods through or under, the consumer” can bring an action under that section.

1057 As mentioned previously, “acquire” is defined under s 2 of the ACL to include, in relation to goods “acquire by way of purchase, exchange or taking on lease, on hire or on hire-purchase”.

1058 The Respondents submit that, for the same reasons raised in respect of issue 5(a)(i) (see section 7.3.1.1 of these reasons; regarding the effect of registration of the relevant strata plans by which title in common property was vested in the owners corporations), it cannot be said that the Applicants acquired the goods from the developers or derived title in them from the developers. The Respondents submit that the Applicants did not derive title to the Alucobond products through the mechanism of the registration of the strata scheme. Rather, they submit the Applicants derived title to the goods by a statutory deeming provision in the relevant strata legislation. The Respondents submit that whether or not the relevant strata legislation is conceived of as a “redistribution” of rights or the substitution of new rights, the authorities support the proposition that the rights that exist before registration are different to the rights that exist after registration.

1059 The Respondents submit that while the concept of deriving title to goods must mean something different to “acquire”, there is no basis to think that it was intended to substantially increase the breadth of “affected person”.

1060 The Applicants on the other hand submit that the better view is that the registration of a strata plan does not involve the extinguishment of pre-existing rights and the creation of new rights, but rather, a redistribution of existing rights to new parties, citing Ashington Holdings at 16,518-519 (Young J); that is the same argument which the Applicants contend for in relation to issue 5(a)(i). The Applicants submit that this interpretation is most consistent with the statutory language of the relevant strata legislation, which refers to land in fee-simple being subdivided into lots, or lots and common property, by registration of the plan.

1061 For the reasons I have already provided in relation to issue 5(a)(i), the authorities the parties rely on do not determine whether the registration of a strata scheme involves the redistribution of existing rights, or if existing rights are cancelled and new rights are vested by operation of the relevant strata legislation. Additionally, as I have identified above, the authorities also do not support the Respondents’ generalised submission that: “the rights that exist before registration are different to the rights that exist after registration”. Ultimately, I do not consider this to be a question to be appropriately answered within the context of this proceeding, based on the material before me. However, I would accept that, plainly, to the extent the registration of a strata scheme involves the redistribution of existing rights, each of the Shore OC and Five Dock OC could be said to have acquired the Alucobond products from the developers, or at least, to have derived title to the goods through or under the developers.

1062 However, to the extent it is accepted that a registration of a strata plan involves the extinguishment of existing rights and the creation of new rights in the owners corporation by operation of the statute, the Applicants submit that this would still involve the owners corporations deriving title through or under the developers.

1063 The Applicants refer to the High Court’s decision in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37. That case concerned the construction of an agreement made in 1970 in the context of a mining joint venture. Under the agreement, M ount B ruce M ining Pty Ltd acquired from Wright Prospecting Pty Ltd and Hancock Prospecting Pty Ltd (collectively, Hanwright) the entire rights in relation to the “MBM area” being a term defined by reference to “temporary reserves” granted under the Mining Act 1904 (WA). Under the agreement, royalties were payable to Hanwright on ore won by MBM from the MBM area. The obligation to pay royalties extended to “all persons or corporations deriving title through or under” MBM to the MBM area. One of the questions which came before the High Court was whether the ore mined in a particular part of the MBM area was mined by entities “deriving title through or under” MBM.

1064 French CJ, Nettle and Gordon JJ held that, in the context of the contract, the phrase “deriving title through or under” did not require an unbroken chain of title and that it was sufficient, in the circumstances, that there was a practical or causal connection between the two sets of rights without any formal succession, assignment, or conveyance. Their Honours stated:

[73] … Are the Channar Joint Venturers “persons or corporations deriving title through or under [MBM] to [Channar A]”?

[74] That question raises a constructional choice. Is the phrase “persons or corporations deriving title through or under” MBM limited to succession, assignment or conveyance or is it sufficiently broad to cover a close practical or causal connection between the rights exercised by the Channar Joint Venturers and the rights which MBM obtained from Hanwright under the 1970 Agreement? The Court of Appeal adopted the former, narrow construction and held that the Channar Joint Venturers’ rights in respect of Channar A could not be traced back to any “title” of MBM to the land.

[75] The text of the 1970 Agreement itself provides indications that the phrase “through or under” is broader than formal succession, assignment or conveyance.

[76] First, cl 3.1 of the 1970 Agreement read with cl 24(iii) of the 1962 Agreement extends the royalty obligation. It is a royalty obligation of MBM which was and remains tied to identified areas of land – the MBM area. But, as has been seen, that area of land was accepted to be likely to be subject to some adjustment and change. Secondly, cl 3.1 does not refer to deriving title “from” MBM but rather it refers to deriving title “through or under” MBM. The expression “through or under” has been acknowledged to be a relatively flexible one.

…

[81] … [T]he Court of Appeal erred in adopting a narrow construction of the phrase “through or under”. The Court of Appeal correctly identified that it was faced with a constructional choice that had to be resolved not by reference to authority but by reference to the text and context of the 1970 Agreement. However, the Court took as its starting point its decision in Sahab Holdings Pty Ltd v Registrar-General (No 2), which concerned the statutory phrase “any person claiming through or under that person” in the Real Property Act 1900 (NSW). It did not follow from Sahab that continuity of a chain of title is always invoked by the phrase any person “deriving title through or under”. Having regard to the proper construction of “through or under” in the context of the 1970 Agreement, the want of unbroken chain of “title” which the Court of Appeal relied upon was not determinative. The Court’s reasoning would have had more force if cl 3.1 of the 1970 Agreement (incorporating cl 24(iii) of the 1962 Agreement) had referred to deriving title “from” MBM. That was not the language of the clause.

(Citations omitted.)

1065 I accept the Respondents’ submission that the conclusion reached in Mount Bruce Mining was informed by the commercial context of the agreement. So much is plainly evident from the plurality’s reasoning. However, as the plurality noted, the expression “through or under” has been acknowledged to be a relatively flexible one. This is also to be considered in light of the admission, correctly made, by the Respondents that plainly deriving title “through or under” the consumer must mean something more than just acquiring the good from the consumer.

1066 In the context of consumer protection legislation such as the ACL, I accept the Applicants’ submission that it is appropriate to adopt a similar interpretation that looks to the substance of what has occurred rather than focusing purely on the technical chain of title. In the present case, the developers of the Shore Building and Five Dock Building held title to the common property. The developers caused the strata plans in respect of each of the buildings to be registered, and thereby, brought about the existence of the Shore OC and Five Dock OC and the vesting of title in the common property in those owners corporations (whether by way of redistribution of existing rights, or the substitution of new rights). A close practical or causal connection exists between the vesting of title in each of the owners corporations and the title previously held by the developers such that the Shore OC and the Five Dock OC should be properly considered, for the purposes of the ACL, to have derived title to the Alucobond products through or under the relevant consumers, being the Shore Developers and Mr Abdul-Rahman, respectively. It follows that the Shore OC and the Five Dock OC are properly to be considered as “affected persons” under the ACL and would meet the equivalent provision in s 74D(1)(d) of the TPA.

1067 The above analysis addresses the submissions of the parties that were made in final written and oral submissions. Subsequent to the Court reserving its decision in this matter, Perram J delivered a decision of Capic v Ford Motor Company of Australia Pty Ltd (S upplementary C ommon Q uestions and O ther I ssues) [2026] FCA 38 on 2 February 2026 which, relevantly, considered the meaning of an “affected person” in s 2 of the ACL which occurred in the context of the guarantee of acceptable quality in s 54(1) and the right conferred on an affected person by s 271 to claim damages. On 10 February 2026, my chambers wrote to the parties and enquired whether any party would wish to make any submissions in relation to Capic SCQOI. On 24 February 2026, both the Applicants and 3A filed short further written submissions. HVG advised that it adopted 3A’s further written submissions on the point. On 3 March 2026, the Applicants filed further, short written submissions in reply. I now turn to consider those further written submissions.

1068 The question which arises is whether the Applicants derived title to the Alucobond products “through or under” the owners’ corporations/developers for the purpose of “affected person” in s 2 of the ACL by registration of a strata plan. The same considerations would apply to meet the equivalent provision in s 74D(1)(d) of the TPA.

1069 The Applicants submit that the decision of Capic SCQOI supports their construction of limb (c) of the definition of “affected person” under the ACL or the equivalent in s 74D(1)(d) of the TPA, namely, that the reference to a person who “derives title to the goods through or under a consumer” encompasses a person who acquired title in the relevant ACPs following the registration of a strata plan by the prior owner, generally an owner/developer.

1070 The Capic SCQOI class action concerned motor vehicles manufactured by Ford that were fitted with “Powershift” transmission. At the initial trial, the Court held that the vehicles had a series of deficiencies which meant that they were not of acceptable quality within the meaning of s 54 of the ACL. This decision was appealed to the Full Court and then the High Court (on the issue of the quantification of damages), with the matter ultimately being remitted to the primary judge to consider a potential adjustment to the lead applicant’s damages award. The award was confirmed on remitter: Capic SCQOI [2]-[12].

1071 Following the determination of the Applicants individual claims, an issue arose as to viability of certain claims brought on behalf of the remaining group members. The lead Applicant contended that all successors in title to each of the relevant motor vehicles could bring a claim for damages under s 271 of the ACL because they fell within limb (c) of the definition of “affected person” in s 2 of the ACL, namely, “a person who derives title to the goods through or under the consumer”. This was contested by Ford, who contended that this limb was confined to liquidators, trustees in bankruptcy or donees: Capic SCQOI [45]

1072 The Respondents advance two submissions as to why Capic SCQOI does not advance the Applicants case on this issue.

1073 First, the Respondents submit that if Perram J is correct that limb (c) of the definition of “affected person” extends to “all successors in title”, it does not assist the Applicants. While the purchaser of a second-hand car is surely a “successor in title” of the original owner, the Applicants are not successors in title to the owners/developers in this case. The Respondents rely upon the meaning of “successor in title” that was considered by Hammerschlag J in Gardez Nominees Pty Ltd v NSW Self Insurance Corporation [2016] NSWSC 532 that “successor in title” denotes no more than a person who holds title after another: [37]-[64], approved in The Owners - Strata Plan No 91322 v Trustees of the Roman Catholic Church for the Archdiocese of Sydney [2019] NSWCA 89 at [28] and 50. The Respondents submit that the definition of an “affected person” is a reference to title being “derived…through or under the consumer” and describes the transfer of title down a chain of title. The Respondents also submit that it coheres with the ordinary meaning of the word “derive”, ie, “to receive or obtain from a source or origin” or “to trace, as from a source or origin” (Macquarie Dictionary).

1074 The Respondents submit that in the present case there was no transfer of title to the Applicants. They were deemed to have title under a statutory deeming provision. The Respondents submit that whether the effect of the strata title legislation is conceived of as a redistribution of rights or the cancellation of rights and the issue of new rights, it is clear that the rights that exist before the registration are different to the rights that exist after registration.

1075 Second, the Respondents submit that in the event that this Court construes Perram J’s use of the phrase “successor in title” to include the Applicants, the Respondents submit that his Honour was plainly wrong to construe limb (c) as extending the definition of “affected person” to every such successor in title. The Respondents submit that that construction is inconsistent with the plain words of the provision and would have the consequence:

(a) of rendering limb (b) of the definition of “affected person” otiose contrary to the principles in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 (McHugh, Gummow, Kirby and Hayne JJ); and

(b) that the general words of limb (c) will outflank the qualification contained in the parenthesise in limb (b) contrary to the principle in David Grant & Co Pty Ltd v Westpac Banking Corp oration (1995) 184 CLR 265 at 276 (Brennan CJ, Gummow J, Dawson, Gaudron and McHugh JJ agreeing).

1076 The Applicants submit that Gardez and The Owners - Strata Plan No 91322 do not support 3A’s submissions for the following reasons. Hammerschlag J held that determination of whether party B is a “successor in title” to party A “require[d] identification of the relevant title held by Party A at the time of the warranties, and assessment of whether title has passed to party B”. The claim in Gardez by a mortgagee in possession of being a successor in title failed because the “relevant title” was the owner’s interest in the freehold title, but the mortgagee merely had possession of the property pursuant to its statutory right: at [55]-[64]. Similarly, The Owners - Strata Plan No 91322, concerned the position of a strata corporation with a 99-year leasehold interest, which did not amount to a relevant identity of interest with the title held by the original owner, being title to the fee simple: at [24]-[25], [28], [46]-[50]. In contrast, the Applicants submit that in this case, the developers held legal title to the cladding products as fixtures to its freehold land and then caused the strata plan to be registered, upon which each of the Shore OC and Five Dock OC acquired legal title to the cladding as fixtures to the common property. Therefore, the Applicants say there was no disconformity of title.

1077 Further, the Applicants submit that 3A’s submission that there must be “transfer of title down a chain” is a gloss on the statutory language, which was not used in Capic SCQOI, Gardez or The Owners - Strata Plan No 91322. The Applicants submit that 3A’s reliance on the dictionary definition of “derive” does not assist, and to the extent it is relevant, the Applicants have received title to the goods “from a source of origin” (being the developer, who caused the strata plan to be registered) and is able “to trace” their title back to that original title. The Applicants submit the fact that the transmission of title occurred by means of a statutory deeming provision is not a relevant distinguishing factor.

1078 I do not accept the Respondents submissions for the reasons that follow.

1079 First, I accept, respectfully, as correct, Perram J’s analysis in relation to the text, context, purpose and legislative history of the definition of “affected person”, which requires the acceptance of the broader construction advanced by the lead applicant in Capic SCQOI [67]. I accept the Applicants submissions that this was essentially for three reasons:

(a) the words “through or under” must take their meaning from the context in which they appear: Capic SCQOI [64], [67], citing Mount Bruce Mining [96] and Kain v R&B Investments Pty Ltd [2025] HCA 28; 423 ALR 413 at [30]. The relevant context here is remedial consumer protection legislation;

(b) the applicant’s interpretation was supported by extrinsic material. The second reading speech and explanatory memoranda for the amending legislation that introduced the predecessor provision into the TPA (s 74D, which incorporates the same language as s 2 of the ACL) included explicit statements that the statutory protections would be “extended to successors in title to a consumer” and that a manufacturer’s liability “follows title in the goods”: Capic SCQOI [51]. This supported the applicant’s interpretation: Capic SCQOI [52], [64(1)]; and

(c) there was no reason why the Parliament would have adopted the narrow (and idiosyncratic) interpretation contended for by Ford. As Perram J explained at Capic SCQOI [66]:

[T]he extrinsic materials do not provide any explanation for why it was thought appropriate to afford consumer remedies to persons who derived their title from a consumer by devolution (such as a trustee in bankruptcy or a legatee) but to deny it to persons who derived their title to goods more conventionally by an act of acquisition such as a purchase…it is difficult to see what end could have been intended by such an idiosyncratic operation for limb (c).

1080 I respectfully agree with, and adopt as correct, the reasoning of Perram J in Capic SCQOI. As a consequence, I hold that the words “derive title to the goods through or under” in s 2 of the ACL and s 74D(1)(c) of the TPA, include “all successors in title” to the original consumer. I further hold that Perram J’s approach to the interpretation of “affected person” supports the Applicants’ submission that those circumstances fall naturally within the statutory phrase. I respectfully agree and adopt Perram J’s observations that the Court must construe the ACL and by parity of reasoning, the TPA, having regard to its context and purpose: Capic SCQOI [64]-[67]. The context and purpose include, relevantly, the beneficial and remedial purpose of provisions dealing with a manufacturers’ liability for damage suffered by goods supplied to Australia that are not of acceptable quality. I agree with his Honour’s reasoning that it is apparent from the three-prong definition of “affected person” (and the equivalent language in s 74D(1)(c)), that a deliberate choice was made not to confine the class of persons entitled to such protection to the original purchaser or persons who acquire their goods from the original purchaser. I also respectfully accept and adopt as correct Perram J’s analysis that the intent as disclosed by the extrinsic materials, was that manufacturers’ liability would follow title in the goods. There is no obvious reason why a regime framed in this way, with this explicit purpose, would not encompass the transfer or the evolution of title from an owner/developer to an owners’ corporation by means of the registration of a strata plan.

1081 I accept the Applicants’ submission that nothing in the context of s 2 of the ACL or s 74D of the TPA indicates the relationship connoted by the words “through or under” is confined to a circumstance where there is a direct or immediate transfer or assignment of title from one person to another by way of contract or other dealing. A contextual and purposive interpretation of the provisions, as adopted by Perram J in Capic SCQOI, strongly suggests that the statutory phrase captures the circumstance where a person derives their title to goods through the intermediation of a statutory deeming provision that has been invoked by the original owner. Whether the provision in question involves a redistribution of existing rights, a transfer of rights, or a creation of entirely new rights is not of any matter.

1082 I accept the Applicants submission that the effect of what has occurred is title to goods that resided in one person immediately prior to the registration of the strata plan has, by reason of their act in causing the strata plan to be registered, come to reside in another person immediately afterwards. In so doing, this involves a derivation of title “ through or under ” the original owner in the sense contemplated by the legislature. I accept the Applicants’ submission that if it were otherwise, the legislative intent that a manufacturers liability follow title in the goods would be frustrated wherever goods are affixed to land that is later sub-divided or converted into strata title.

1083 For the reasons given above, the Shore OC and the Five Dock OC are properly to be considered as “affected persons” under the ACL and would meet the equivalent provision in s 74D(1)(d) of the TPA.

7.5 Issue 7 – Third party products

1084 The Respondents submit that, if there is a “supply” to a “consumer”, an additional question arises as to what was actually supplied to the consumer. The Respondents allege that rather than acquiring the Alucobond products, what the relevant consumer acquired was the “façade system” for the Shore Building and Five Dock Building – being different goods manufactured by the relevant façade installers.

1085 The submissions made by the Respondents appear, in substance, to be another way of relying on the exclusion from the definition of consumer under s 3(2)(b) of the ACL (see section 7.3.1.2 of these reasons). That is, that because the façade installers acquired the panels for the purpose of using up or transforming the panels, in the course of production or manufacture, or in the course of treating the relevant buildings, there was never a supply of the Alucobond products to the relevant consumer, as, by that stage, the panels had ceased to exist as panels and had become entirely new “third party products” being the façade systems that were installed on the buildings.

1086 I do not accept the Respondents’ submission. I am not satisfied that the fabrication and affixation of the Alucobond products was of such a nature as to involve the “using up” or “transforming” of the panels such that what the relevant consumers acquired was an entirely new “third party product”. The reasons for this conclusion are the same as those already outlined in respect of issue 5(b)(iii)(B) above, which I do not propose to restate here.

8. WHETHER THE ALUCOBOND PRODUCTS WERE NOT OF MERCHANTABLE OR ACCEPTABLE QUALITY: ACL, S 54(2)-(3); TPA, S 74D(2)-(3) (ISSUE 8)

8.1 Legislation

1087 The TPA and ACL require the goods to which they apply to be of merchantable or acceptable quality respectively. Although expressed in different language, the test under each of s 74D(2)-(3) of the TPA and s 54(2)-(3) of the ACL is not materially different: Ethicon at [3529]. The parties proceeded on the basis that the same analysis would apply in respect of both tests. The analysis on this issue will therefore be addressed primarily by reference to the test of “acceptable quality” under s 54 of the ACL.

1088 It is helpful to briefly outline the relevant legislative provisions. The relevant subsections of s 54 are as follows:

54 Guarantee as to acceptable quality

(1) If:

(a) a person supplies, in trade or commerce, goods to a consumer; and

(b) the supply does not occur by way of sale by auction;

there is a guarantee that the goods are of acceptable quality.

(2) Goods are of acceptable quality if they are as:

(a) fit for all the purposes for which goods of that kind are commonly supplied; and

(b) acceptable in appearance and finish; and

(d) safe; and

(e) durable;

as a reasonable consumer fully acquainted with the state and condition of the goods (including any hidden defects of the goods), would regard as acceptable having regard to the matters in subsection (3).

(3) The matters for the purposes of subsection (2) are:

(a) the nature of the goods; and

(b) the price of the goods (if relevant); and

(d) any representation made about the goods by the supplier or manufacturer of the goods; and

(e) any other relevant circumstances relating to the supply of the goods.

1089 Section 74D of the TPA is as follows:

74 D Actions in respect of goods of unmerchantable quality

(1) Where:

(a) a corporation, in trade or commerce, supplies goods manufactured by the corporation to another person who acquires the goods for re-supply;

(b) a person (whether or not the person who acquired the goods from the corporation) supplies the goods (otherwise than by way of sale by auction) to a consumer;

(d) the consumer or a person who acquires the goods from, or derives title to the goods through or under, the consumer suffers loss or damage by reason that the goods are not of merchantable quality;

…

(3) Goods of any kind are of merchantable quality within the meaning of this section if they are as fit for the purpose or purposes for which goods of that kind are commonly bought as it is reasonable to expect having regard to:

(a) any description applied to the goods by the corporation;

(b) the price received by the corporation for the goods (if relevant); and

8.2 The pleaded claim

1090 It is worth outlining, in greater detail, the claim against the Respondents.

1091 The consumer guarantee claim is brought on two primary grounds. The first relates to the fire risk posed by the products. The second relates to an allegation that the Alucobond products, when used for all the purposes for which the Alucobond products were commonly supplied, were non-compliant with the BCA. The Shore OC plead that Alucobond PE was commonly bought and supplied in Australia for use as part of an external wall (or as an attachment thereto or other building element) on high-rise or low-rise buildings, where such buildings were for residential purposes, commercial purposes or public or government administration purposes. The Shore OC define these as the relevant “Purposes” of Alucobond PE.

8.2.1 Fire Risk

1092 The Shore OC plead that Alucobond PE is flammable and combustible, due to its PE core and the failure of the aluminium cover sheets to protect the core. Consequently, when used as cladding fitted as part of or as an attachment to an external wall or other building element, there was a material risk that the Alucobond PE cladding would, in the event of a fire in or adjacent to the building to which it is affixed, cause or contribute to:

(a) the spread and severity of the fire, including: the rapid vertical spread and/or horizontal spread of the fire on and in the building; the loss of fire compartmentation; and/or the spread of fire to multiple floors of a multi-storey building;

(b) debris falling from the building, including: molten or burning material from the PE core; and/or the whole or part of the aluminium cover sheets;

(c) the fire, and smoke from the fire, overwhelming or compromising any fire safety, suppression and/or smoke control systems in the building; and

(d) the release of toxic products of combustion.

1093 Further, the Shore OC plead that due to all, any, or a combination of the above, there was a material risk that the Alucobond PE cladding would:

(a) increase the risk of loss of life;

(b) increase the risk of damage to the building or an adjacent building, and/or building contents in either building;

(d) adversely impact the ability of the firefighting authorities to minimise the damage to the building and building contents, and to mitigate against the loss of life or injury to persons in the building.

1094 As mentioned in section 3 of these reasons, the matters above are defined by the Applicants as the “Material Fire Risk Properties” of Alucobond PE.

1095 The Shore OC further plead that by reason of the Material Fire Risk Properties, there was at all times a material risk that any Alucobond PE used on any building in Australia (emphasis added):

(a) could be determined by relevant government authorities to be unsafe or create a risk of death or serious injury regardless of its compliance or otherwise with the BCA; and

(b) could be the subject of a legally-binding direction to be removed and/or replaced,

together referred to as Alucobond PE’s “Prohibition Risk Properties”.

1096 The Shore OC refer to the numerous product bans relating to Alucobond PE, and orders requiring Alucobond PE fitted to buildings to be removed and/or replaced, said to have been introduced because of the Material Fire Risk Properties.

1097 The Shore OC plead that having regard to the Purposes for which Alucobond PE was commonly bought and supplied, and considering both the various representations made in respect of the product, and the absence of warnings as to risks, it was reasonable to expect that:

(a) Alucobond PE was fit for all of the relevant Purposes;

(b) Alucobond PE did not have the Material Fire Risk Properties and/or the Prohibition Risk Properties;

(c) when used on any building, or for any of the Purposes, Alucobond PE was safe, did not pose a material risk (or materially increased risk) to the health or safety of occupants of the building to which the cladding was fitted, and did not pose a material risk (or materially increased risk) of damage to the building or to property therein; and/or

(d) Alucobond PE could be fabricated and affixed to a building using any of a number of suggested fabrication and affixation methods without compromising its fire performance and/or giving rise to the Material Fire Risk Properties.

1098 The Shore OC plead that in respect of all Relevant Buildings (defined as a building in Australia) or part thereof, by reason of the Material Fire Risk Properties and/or the Prohibition Risk Properties, Alucobond PE was not:

(a) fit for all of the purposes for which goods of the kind were commonly bought; and/or

(b) safe,

to the degree that a reasonable consumer fully acquainted with the relevant properties would regard as acceptable (by reference to the expectation outlined above). On this basis, the Shore OC plead that Alucobond PE is not of acceptable quality.

1099 Under the Five Dock OC’s Second Further Amended Points of Claim (2FAPOC), the same manner of pleading is made in respect of Alucobond Plus, including adopting the same definition of Purposes.

8.2.2 BCA N on-compliance

1100 The second iteration of the consumer guarantee claim relates to the Alucobond products’ alleged non-compliance with the BCA. The Applicants submit that this second iteration is independent of the first.

1101 The Applicants plead that all Class 2 to 9 buildings were required to be constructed in an appropriate manner that met the fire resistance performance requirements under Section C of the BCA. The Applicants plead that Alucobond PE could not comply with the relevant DtS Provisions of the BCA as the product was a “combustible” material and otherwise did not fall within a relevant exemption. The Applicants also plead that the use of Alucobond PE for Class 2 to 9 Buildings could not meet the relevant fire resistance performance requirements by a Performance Solution for all Class 2 to 9 buildings. The Applicants plead in the alternative, that it was not possible (or reasonably practicable) to design or certify a Performance Solution allowing the use of Alucobond PE for Class 2 to 9 buildings in accordance with the fire resistance performance requirements, other than where the Alucobond PE was used in insubstantial quantities.

1102 The Applicants plead that, by reason of the above, Alucobond PE, when fitted as part of or as an attachment to an external wall or other building element of a Class 2 to 9 building in any type of construction, does not and did not comply with the BCA, or that there was a material risk thereof. The Applicants define this as the “BCA Non-compliance Properties” and the “BCA Non-compliance Risk Properties” respectively.

1103 The Applicants plead further (or in the alternative) that, by reason of the BCA Non-compliance Properties and/or the BCA Non-compliance Risk Properties, there was at all material times a risk that any Alucobond PE used as part of or as an attachment to an external wall or other building element of a Class 2 to 9 building could be:

(a) determined by relevant government authorities to be non-compliant with relevant building codes and standards; and

(b) the subject of a legally-binding direction to be removed and/or replaced.

Akin to the Prohibition Risk Properties, the Applicants define this as the “BCA-Related Prohibition Risk Properties”.

1104 The Applicants plead that, having regard to the Purposes, and considering the various representations made in respect of the product, it was reasonable to expect that

(a) Alucobond PE was compliant with the BCA when fitted as part of or as an attachment to an external wall or other building element of Class 2 to 9 buildings;

(b) the use of Alucobond PE for any of the “Purposes” would not cause any Class 2 to 9 building to be or to become non-compliant; and/or

1105 The Applicants plead that, in respect of Class 2 to 9 buildings, by reason of the BCA Non-compliance Properties, the BCA Non-compliance Risk Properties, and/or the BCA-related Prohibition Risk Properties, at all material times, Alucobond PE was not:

(a) fit for all of the purposes for which goods of the kind were commonly brought; and/or

(b) safe,

as a reasonable consumer fully acquainted with the relevant properties would regard as acceptable (by reference to the expectation outlined above). On this basis, the Applicants plead that Alucobond PE is not of acceptable quality.

1106 Under the 2FAPOC, a pleading to the same effect is made in respect of Alucobond Plus.

8.3 Legal principles

1107 Under the TPA, to be of merchantable quality the goods must be as fit for the purpose or purposes for which goods of that kind are commonly bought as it is reasonable to expect: s 74D(3). Under the ACL, to be of acceptable quality the goods must be as fit for all the purposes for which goods of that kind are commonly supplied as a reasonable consumer fully acquainted with the state and condition of the goods (including any hidden defects of the goods) would regard as acceptable: s 54(2)(a). The goods must also be as safe as a reasonable consumer would regard as acceptable: s 54(2)(d).

1108 The relevant principles can be summarised as follows.

1109 First, the ACL and the TPA make clear that the goods must be of acceptable/merchantable quality by reference to the specific purpose or purposes for which the goods of that kind are commonly supplied. Therefore, the purpose for which the goods are bought must be determined. “The relevant inquiry is into the purpose or purposes for which goods of the relevant kind are commonly bought as is reasonable to expect, having regard to the manufacturer’s description, the price received for the goods, and all other relevant circumstances”: Ethicon at [3535].

1110 Second, the touchstone of both provisions, and the lens through which the qualities of the relevant products must be assessed, is the reasonable expectation or understanding of the hypothetical consumer: Toyota Motor Corporation Australia Limited v Williams (2023) 296 FCR 514; [2023] FCAFC 50 at 43, affirmed in Williams v Toyota Motor Corp Australia Ltd (2024) 419 ALR 373; [2024] HCA 38. The hypothetical reasonable consumer, is, as made clear by the wording of s 54(3) of the ACL, taken to be “fully acquainted with the state and condition of the goods (including any hidden defects of the goods)”: Toyota at [43], affirmed in Williams at 33. The focus of the ACL is upon the expectations and rights of consumers, rather than professional merchants engaged in commercial trade: Rasell at 348, Australian Competition and Consumer Commission v Jayco Corp oration Pty Ltd [2020] FCA 1672 at 37. Similarly, it has been held in respect of s 74D of the TPA, to “be wrong to measure the reasonable expectations of the hypothetical reasonable consumer against the specialist technical knowledge of the manufacturer”: Ethicon at [3537], citing in turn Graham Barclay Oysters Pty Ltd v Ryan (2000) 102 FCR 307; [2000] FCA 1099 at [536].

1111 Third, the question of whether goods are of acceptable quality, is to be answered by comparing the actual fitness for purpose and safety of the goods against what it was objectively reasonable to expect, in terms of fitness for purpose and safety, in all the relevant circumstances, at the time of the supply of the goods: Medtel at [64], 70. However, the quality, or fitness for purpose, of the goods is to be measured “in the light of information concerning the goods available at the time of the trial”, including such information as is known at the time of the trial “about the defect and its capacity to be repaired, as well as when, how and at what cost that repair would take place”: Williams at [33], 40, discussing Medtel at [70]), (Branson J, Jacobson J agreeing at [81]).

1112 Fourth, to determine the reasonable expectations of the hypothetical consumer, s 74D(3) of the TPA and s 54(3) of the ACL each require the Court to have regard to the description applied to the goods, the price received for the goods, and all other relevant circumstances. Under the ACL, the Court must also have regard to the nature of the goods, statements made about the goods on any packaging or label, and any representations made about the goods by the supplier or manufacturer of the goods: s 54(3)(a), (c) and (d).

1113 Fifth, the requirement as to quality imposed by s 54 of the ACL and s 74D of the TPA is not absolute, nor is it a standard of perfection. Rather, it is a test of what a reasonable consumer would regard as acceptable having regard to all the relevant circumstances relating to the supply of the goods: Jayco Corp at [27]. The answer will always depend on the circumstances. As Branson J explained in Medtel at 64:

The test contained in s 74D(3) is a test that requires the making of a comparison. It calls for the fitness for purpose of the goods in question to be measured against what it was objectively reasonable to expect, in terms of fitness for purpose, in all the relevant circumstances. Those circumstances include the description applied to the goods by the manufacturer and the price received by the manufacturer for the goods. What it is objectively reasonable to expect in terms of fitness for purpose of goods of one description may be quite different from what it would be reasonable to expect of goods of another description. What it would be reasonable to expect in terms of fitness for purpose of an inexpensive product might be quite different from what it would be reasonable to expect of an expensive product of the same kind.

1114 Goods may be not of merchantable quality “if the evidence shows that there is a risk they may fail; it is unnecessary to prove actual failure”: Ethicon at [3540], citing in turn Medtel at [72]-74, and see Williams endorsing Medtel at 64. Goods may not be of merchantable or acceptable quality if, at the time of supply, the goods have a characteristic that meant that they had a propensity to fail or a superadded risk of failure. These are sometimes referred to as “propensity cases”. They turn on two inter-related variables: the severity of the problem if it arises and the probability of the problem arising: Ford Motor Company of Australia Pty Ltd v Capic (2023) 300 FCR 1; [2023] FCAFC 179 at [48]-49 (Capic (Full Court)), overturned in Capic v Ford Motor Company of Australia Pty Ltd (2024) 419 ALR 437; [2024] HCA 39 (Capic (High Court)) by reference to the reasons in Williams, but not in respect of this principle. In such cases, it does not matter if in a particular individual case, the risk may not transpire. The conclusion as to acceptable quality “will be a function of the nature of the feared failure and the extent of the risk of its occurrence, measured against the consumer’s reasonable expectations of how the products ought to behave”: Capic v Ford Motor Co of Australia Pty Ltd (2021) 154 ACSR 235; [2021] FCA 715 at 612 (Capic (First Instance)), approved on appeal in Capic (Full Court) at [49], and see Williams at [64]. In ascertaining the reasonable consumer’s tolerance for risk regarding “acceptable quality” the Full Court in Capic (Full Court) made clear at [53] that:

There is no textual basis for confining the statutory language of “acceptable quality” in s 54 of the ACL, to “not potentially fatal” or “unusable”. This is demonstrated by the nature of the requirements in s 54(2) which include but are not limited to the appearance or finish of the goods and durability. Thus, the guarantee may be breached in circumstances which fall short of a possible fatality or complete uselessness.

1115 Sixth, Lindgren J described the underlying legislative policy to s 74D of the TPA, in Graham Barclay Oysters at [538], as being “to require manufacturers to meet the reasonable expectations of consumers as to the fitness of their goods for their purpose or purposes”. Lindgren J stated that:

Consistently with that policy, if the manufacturer knows that it cannot be sure to meet those expectations, it must cease manufacturing, or, if possible, ensure that the consumer has agreed to bear the risk (perhaps by an appropriate warning with the result that the consumer’s otherwise reasonable expectations are made unreasonable).

1116 This was quoted with approval by Katzmann J in Ethicon at [3541].

1117 Seventh, the contention that it is “usual” or “normal” for goods to have a particular characteristic does not assist in the inquiry. The focus must be on the characteristic itself through the lens of a reasonable consumer in the circumstances outlined in the provision: Capic (Full Court) at [72].

8.4 The Applicants’ merchantable and acceptable quality case

1118 The Applicants submit that Alucobond PE and Alucobond Plus were not of merchantable or acceptable quality because, at the time of supply, they carried the Material Fire Risk Properties; the BCA Non-compliance Properties; the BCA Non-compliance Risk Properties; the Prohibition Risk Properties; and the BCA-related Prohibition Risk Properties.

1119 The Applicants contend that these risks are all inherent, because:

(a) the Alucobond products’ combustible core had a significant calorific value and was encapsulated only by thin sheets of aluminium. Therefore, each product had a propensity to burn and spread fire when exposed to relatively small fires in a building (Material Fire Risk Properties). The BCA Non-compliance Risk Properties and the BCA-Related Prohibition Risk Properties were, in the Applicants’ submission, a result of these inherent qualities in the Alucobond products; and

(b) due to the danger that the Alucobond products presented, they could not be used compliantly with the DtS Provisions of the BCA for all of the uses for which they were commonly bought during the relevant period (ie, the Purposes). And the assistance of an unusually knowledgeable and skilful FSE was required if they were to be used at all.

1120 The Applicants submit that the representations would induce a reasonable consumer, and those Qualified Professionals involved in specifying products, to expect that Alucobond PE and Alucobond Plus:

(a) were suitable products for use as external cladding on all building types including high-rise buildings and residential applications;

(b) did not present a material fire hazard and could be used in the manner set out in the Respondents’ brochures and technical material without compromising their fire properties; and

1121 In addition to the principles outlined in section 8.3, the Applicants contend that in this case, it is important to consider the role played by Qualified Professionals (a term that was discussed above and later in these reasons in section 8.8). This is because the Applicants submit that where a manufacturer or supplier fails to adequately disclose limitations or conditions on the purposes for which the goods may be used, then the hypothetical consumer is entitled to expect that the goods can be used for all relevant purposes, without regard to those limitations or conditions. The Applicants submit that where a product will no longer be safe or fit for purpose if used in a particular manner, it is the responsibility of the manufacturer to limit that reasonable consumer’s expectations as to quality or provide sufficient information to enable the consumer to decide for him or herself. In Ethicon at [3172] the principle was explained as being that “even if a product presents certain risks, the product may well not have a defect if the manufacturer gives appropriate warnings about those risks, identifies appropriate limitations on the indications of use, and does not promise more in terms of safety than the product can deliver.”

8.5 Findings regarding Material Fire Risk Properties

1122 It is necessary to establish the true properties of the Alucobond products for there to be an assessment made against what a reasonable consumer would regard as acceptable for the purposes of the statutory test.

1123 The properties of the Alucobond products were the subject of extensive expert evidence which has been outlined in these reasons above, in section 5. Despite the extensive nature of the expert evidence, the extent of the disagreement between the experts as to the nature of the Alucobond products was fairly limited. The relevant properties of the Alucobond products are:

(a) the composition of the core of Alucobond Plus;

(b) the composition of the core of Alucobond PE;

(d) as a result of the above, the risks associated with the reaction-to-fire properties of Alucobond PE and Alucobond Plus.

8.5.1 The core of Alucobond Plus

1124 It is agreed that the core of Alucobond Plus is comprised of EVA and aluminium hydroxide, where the aluminium hydroxide performs the role of a non-combustible mineral filler. The question which remains in dispute between the parties is the extent to which the advertisements about Alucobond Plus’ core being comprised of only 30% combustible material are true (or put another way, 70% non-combustible material).

1125 The Applicants submit that the evidence supports a finding that 70% was not the minimum amount of non-combustible material in the core of Alucobond Plus. Rather, the Applicants submit that 70% was the target amount in the “recipe” used by 3A to manufacture the product and that there was a degree of variability in the industrial manufacturing process which produced a variability in the plastic content above and below 30% within the end product. The Applicants submit that, as a result, individual panels supplied into Australia could and did vary above and below the advertised proportions, such that the Respondents had no way of knowing which panels had more or less than 70% non-combustible materials.

1126 The Applicants refer to a number of pieces of evidence in support of their proposed finding.

1127 Firstly, the Applicants refer to the evidence of Dr Werner. In his two affidavits, Dr Werner deposed that the core of Alucobond Plus consisted of 15% linear low-density PE, 15% EVA, and 70% ATH by weight. He said that raw materials for the core were received in bulk trucks of 20 tonnes each and stored in several large containers of approximately 100 tonnes capacity each. Dr Werner deposed that a normal production run of Alucobond Plus would produce in the order of 12,000 m 2 of panels, and would usually contain 8.6 tonnes of PE, 8.6 tonnes of EVA and 40 tonnes of mineral ATH. Those materials were said to be transported through separate pipes to an automatic scale which weighed each of the components following which small measured proportions were continuously fed into the production machine in relevant proportions. Dr Werner deposed that, during the relevant period, 3A’s acceptable production tolerances were +/- 0.5% variability by weight for each of the three inputs.

1128 The Applicants submit that, based on the relative weights deposed to by Dr Werner in his affidavit, the weight of the PE/EVA component calculates to 30.07% of the total weight of the core, while the ATH comprises only 69.93%. The Applicants submit that even the recipe was not conducive to the product having “no more than” 30% plastic binder.

1129 I do not accept the Applicants’ submission. As 3A submits, the figures provided by Dr Werner were obviously round numbers and do not cast proper doubt on the actual proportions of each ingredient actually used in the manufacturing process.

1130 Secondly, the Applicants also submit that 3A’s production process was not properly set up or operated to ensure precise compliance with the recipe. The Applicants submit that the machinery’s acceptable production tolerances meant that, in practice, the proportion of the material fed into the machine at any given time could be above or below the relevant proportion related to the recipe, such that this necessarily meant that some batches or panels would be above the target and others below. The Applicants submit that if 3A had wanted to produce a product that had no more than 30% combustible material, as they advertised, then it ought to have set the inputs so that the combustible material was less than 30% to allow a buffer for production tolerances.

1131 I do not accept the Applicants’ submission. The manufacturing process involved continuous incremental inputs of the three ingredients in their necessary proportions. While in each incremental input, there may be some degree of variance (as would be expected in any production process, let alone an industrial manufacturing process involving the production of 12,000 m 2 of ACPs), I accept, as Dr Werner stated during cross-examination, that any such variance would be expected to average out over the entirety of a panel. The fact that such tolerances existed in the production process is not evidence that the core of any particular panel as a whole was more than 30%.

1132 Thirdly, the Applicants submit that the conclusion that at least some panels of Alucobond Plus supplied into Australia during the relevant period had a mineral content of less than 70% is confirmed by 3A’s repeated refusal to provide supporting evidence of the mineral content of the Alucobond Plus core when requested by HVG in 2018, in the context of the foreshadowed product bans. The Applicants refer to a number of emails sent around the time of the introduction of product bans in Australia.

1133 On 18 March 2018, Dr Amin Emami (3A’s Head of Technical Department, Head of Technology Centre) emailed HVG, supposedly in response to a request for information about the mineral content of Alucobond Plus’ core, stating:

The calorific values rather than the mineral content are the metrics that are being measures [sic] for the certifications therefore we do not have certificates for ALUCOBOND Plus that explicitly mention its mineral content.

1134 Mr Wade Martin, HVG’s National Technical Manager, responded the same day stating:

The request is very specific, we need to provide evidence of the mineral content. It has been marketed as min 70% for as long as I have been with Alucobond Architectural, this must have come from somewhere.

Do you have contacts with local testing labs that can provide the data?

I can’t stress how critical this is.

1135 On 26 March 2018, Dr Emami sent HVG the results of a new test conducted in relation to Alucobond Plus samples. The results comprised a one-page document from Suisse Technology Partners dated 23 March 2018 which stated that the inorganic filler in the sample was determined to be 70.0%. It appears that a TGA was conducted.

1136 Mr Martin responded the following day, stating:

This is not good news, 70% seems very specific after a burn test.

We have tech data attached showing more than 70% mineral content, now we can’t prove this?

It now brings in to question whether we have changed the PLUS formulation.

1137 Mr Martin attached to his email technical data sheets for Alucobond Plus from 2004 and 2005 which respectively stated that the core comprised of 71% and 72.5% hydroxides.

1138 Dr Emami responded to Mr Martin’s email stating:

When changing to the industrial production of Plus we changed to a formulation containing less PE. This optimized formulation does not change the fire behaviour and complies with all regulations and approvals for Alucobond Plus. We are preparing a product description of our formulation and I will send you this soon.

1139 It is not clear what precisely Dr Emami was referring to when referring to the change to the “industrial production of Plus”.

1140 In a separate email chain, on 10 April 2018, Dr Werner sent an email to Mr Bruce Rayment, HVG’s CEO, regarding the proposed restrictions to be implemented by the Victorian Government. His email read:

Regarding the Victorian Government Ruling it is very confusing for us:

Our ALUCOBOND plus does contain significantly less Polyethylen [sic] than the mentioned 30%.

The Polyethylene content of the core is less than 20% by weight, so significantly less than required.

The rest of the core is mineral content and other plastics.

This is the case already for many years.

If the Victorian Government only limits Polyethylene, we are fine.

The documents you sent only refer to Polyethylene, I did read them carefully, they do not mention other plastics.

All the recent questions from your people had been on mineral content, but not on Polyethylene content.

We on our end think in combustion load not in material content.

Please clarify whether our ALUCOBOND plus with a Polyethylene content of less than 20% is still a good enough product.

If so, Amin Emami can send an official document giving the Polyethylene content.

(Original emphasis.)

1141 The Applicants submit that while Dr Werner stated in his email that the core of Alucobond Plus had less than 30% PE, he declined to identify whether the combination of PE and “other plastics” is greater than 30%.

1142 On 15 May 2018, Dr Emami sent HVG a document titled “Composite Panel Specification”, dated 12 April 2018, that he had signed as Director of the Technical Department. The document stated that the core material of Alucobond Plus was 15% PE and 85% Inorganic Filler & Adhesion/Cohesion enhancing Additives. The Applicants submit that the “Adhesion/Cohesion enhancing Additives” must have been intended to refer to the EVA component within the core, and that by combining the component with the mineral filler, the document sought to obscure the total plastic content of the core. While this may be accepted, it does not support a view that the core of Alucobond Plus had a plastic content of greater than 30%.

1143 In August 2018, NSW introduced the product ban for ACPs with a core of more than 30% PE. On 13 August 2018, Mr Rayment forwarded a copy of the ban to Dr Werner and others at 3A stating:

This brings NSW into line with Victoria to a great extent and we supported the ban on 100% PE material in a submission a couple of months ago.

Note the 30% limit. It is critically important that EVERY shipment of Alucobond PLUS we receive has non-combustible core material of greater than 70% and a PE content of less than 30%.

1144 In a separate email chain, on 20 August 2018, Mr Mark Bradfield, HVG’s General Manager – Façade Divisions, wrote to Mr Frank Ritter, 3A’s Senior Engineer, saying:

Is it possible to determine which batches of material have a higher mineral content?

With chain of custody requirements for testing, we are being asked to also test from stock.

If we knew which products were higher content, we can put those forward.

Not sure if it can be done but thought I would ask.

Apologies for all the communications, it’s really ridiculous what is going on here. We are just trying to defend our position.

1145 Mr Ritter responded to Mr Bradfield’s email the same day stating:

[T]hat's hardly possible.

The only fact is, that panels longer than 6800 mm and wider than 1575 mm, 6 mm thickness and NaturAl Reflect have lower mineral content than the rest.

1146 The following day, on 21 August 2018, Mr Bradfield responded:

Is it safe to assume that whatever sample that is tested from our stock will be less than 70%?

1147 Mr Ritter responded the same day:

[T]he nominal mineral content is 70%, the tolerance is ±3% by the balances.

Hence there are panels above and below…

Panels produced before 2015 have in [sic] tendency an [sic] higher mineral content (the mineral component is cheaper) and have predominantly a mineral content ≥70%.

Due to the reconstruction of the lamination line during 2015, the scrap rate rises now dramatically when we increase the mineral content. Therefore we are investigating a new formulation.

Only panels from line 4 (see previous email) use the edge trimming “scrap” (incl. adhesive foil) of line 2 and therefore have in tendency [sic] lower mineral content.

1148 The emails the Applicants refer to show a keen focus by the Respondents regarding the mineral content of the Alucobond Plus panels at the time the product bans were being introduced in Australia and attempting to identify data or evidence which could be relied upon to show that Alucobond Plus’ core was not comprised of combustible plastics greater than 30%. This is unsurprising given the commercial importance of such evidence to both Respondents. The communications themselves, however, say little about the core of Alucobond Plus actually being comprised of more than 30% combustible plastic content.

1149 The only exception to this may be Mr Ritter’s email on 21 August 2018 stating that while the nominal mineral content was 70%, there was a tolerance of ±3%. This evidence is not consistent with the evidence of Dr Werner. 3A submits that Mr Ritter was not involved in the production process, and was rather, a member of the sales team such that he was not in a position to reliably know about the production tolerances. From the face of the email chain alone, it does appear that Mr Ritter had a fairly developed understanding of the issues around the mineral content in Alucobond Plus’ core, as illustrated by his understanding of how different production lines impacted the overall mineral content in different panels, and the impact of increasing mineral content on 3A’s scrap rate. It is difficult to reconcile this apparent knowledge with 3A’s suggestion that Mr Ritter was not in a position to reliably know about the production tolerances. At the same time, it is difficult to take much away from Mr Ritter’s email in isolation and without further substantiation. It is not that clear what tolerance Mr Ritter is specifically referring to in his email, how such a tolerance was determined, and if there is any underlying data which supports Mr Ritter’s statement.

1150 In addition to the emails outlined above, the Applicants refer to the samples of Alucobond Plus that the parties’ chemistry experts (Expert Group 1) undertook. The Applicants submit that the results of the testing confirm the variability in the composition of Alucobond Plus’ core.

1151 The nature and extent of this testing has been outlined in detail under section 5.1 of these reasons which I will not seek to repeat here.

1152 Noting the small variations across each of the tests conducted by Dr Kirk, Associate Professor Lange, and Mr Carrascal, the following points are the most significant.

1153 Each of the tests was conducted using a tiny (up to 2 g) sample of the core, taken from a larger sample, which itself formed part of one of the panels taken from the Five Dock Building. Therefore, while the tests were conducted to be representative of the particular sub-sample being tested (with multiple tests being conducted to obtain an average for each sub-sample), the experts agreed that the testing was inadequate to determine whether the results were representative of the panel as a whole, let alone across a production run, or across different production runs.

1154 Associate Professor Lange identified the need to conduct additional testing involving more locations on a particular panel to understand how the concentration of EVA may vary across a panel. Dr Kirk also identified the need to sample different points across a larger piece of cladding to understand the homogeneity of an entire panel. Dr Kirk also agreed that the problem became more acute when considering the composition of the core across an entire manufacturing run, which would require surveying multiple panels of that manufacturing run, and potentially, in multiple places of those panels, to come up with enough information to form an opinion as to the average content of EVA in the panels as a whole and the degree of variability across a batch.

1155 It is clear from the views expressed by Expert Group 1 that the results of the experts’ testing cannot be understood as representative of the composition of a panel’s core as a whole. This alone is fatal to the Applicants’ reliance on the expert evidence in this respect.

1156 It is also worth noting that the results across the various testing methods and laboratories are close. The experts agreed that while it was difficult to specify an appropriate margin of error, 1-2% was likely to be reasonable.

1157 The Applicants’ submission that the purpose of conducting multiple runs of the same test across each sample was to address the possibility of a margin for error, fails to overcome the key issue identified above: the samples themselves cannot be regarded as representative of the Alucobond Plus panels as a whole. Similarly, the Applicants’ submission that the results of the testing are the best evidence of the true composition of the core of the samples tested, while true, is not of assistance since the samples cannot be regarded as representative of the panels as a whole.

1158 The Applicants also argue that the principle in Blatch v Archer (1774) 1 Cowp 63 at 65; 98 ER 969 at 970 should be applied, on the basis that the Applicants are plainly not in a position to carry out large-scale testing of all Alucobond Plus panels supplied in Australia, and that if production tolerances were as tight as Dr Werner asserted, then it was peculiarly within 3A’s knowledge and power to produce evidence that this was the case, including through evidence of the type of machinery used by 3A, the calibration of the scales, production guidelines, or the results of any regular testing of production. I do not accept the Applicants’ submission. The Blatch v Archer principle has no application here. 3A adduced evidence from Dr Werner regarding the manufacturing process, albeit that it may be argued that the evidence was relatively light. In any case, it was open to the Applicants to conduct a more detailed sampling exercise over panels from the Five Dock Building, or even a single panel from the building.

1159 For the reasons outlined above, I reject the Applicants’ contention that any particular panel of Alucobond Plus had a mineral content of less than 70% by weight.

1160 To the extent that the Applicants sought to make the related contention that there was any relevant variation in the composition of Alucobond Plus which could give rise to the Material Fire Risk Properties, this must be rejected. As the discussion in section 8.5.4 below demonstrates, calculating and understanding the fire risk posed by the particular use of a panel is complex and can be impacted by a range of factors. It is difficult to understand how minor differences in the percentage of organic content of an ACP core can be correlated with actual burning behaviour and the fire risk thereby posed. Therefore, I am also not persuaded there is any relevance to whether or not the Respondents had any way of knowing which panels had more or less that 70% of non-combustible materials.

8.5.2 The c ore of Alucobond PE

1161 As has been discussed in section 5.3.2, Expert Group 3 agreed that the core of Alucobond PE is ‘essentially pure polyethylene’, the heat combustion is similar to derivatives of petrol such as polypropylene, polystyrene, paraffin or diesel fuel, and that PE melts, drips and flows at comparatively low temperatures, possibly whilst also flaming.

1162 The effects of this on the risks associated with fire behaviour is discussed below.

8.5.3 Do the cover sheets protect the core of Alucobond PE or Alucobond Plus?

1163 Expert evidence regarding the extent to which the cover sheets protect the core of Alucobond PE and Alucobond Plus has been outlined in detail under sections 5.3.2.1 and 5.3.3.1 of these reasons in some detail. I will not seek to repeat the depth of that detail here. It suffices to say the following.

1164 The experts agreed that the cover sheets provide some level of protection, in that the cover sheets will absorb and dissipate some of the energy that might otherwise raise the temperature of the core. The cover sheet may also initially act as an impermeable barrier preventing direct impingement of a flame on the core, so as to prevent the involvement of the core material in the fire.

1165 Ultimately, it is agreed that the cover sheets do not provide absolute protection. Indeed, it appears that any protection afforded by the cover sheets is quite limited; in particular, they have very little capability to prevent ignition of the core material. The core material of an Alucobond panel may become involved even in the case of, what may be quite loosely described, as a relatively modest fire, noting that the melting temperature of aluminium is lower than the typical temperature of a flame.

1166 Aluminium has a high coefficient of thermal expansion, and can be expected to warp or deform when heated. Aluminium will also melt at temperatures of between 580°C and 660°C. This is considerably lower than most other metals used in building construction, and lower than the temperatures likely to be experienced in a typical cladding design fire scenario in the vicinity of any openings through which flames are emitted. There are, therefore, a number of possible “failure modes” relating to the cover sheets, which may cause the core of the panels to become involved in a fire. First, connection failures may occur or cavities may open up within products formed by aluminium sheets. Second, the cover sheets may warp or deform, or otherwise dis-bond from the core, exposing the core of the panels. Third, the PE core may melt and flow out from between cover sheets.

1167 The nature of how aluminium cover sheets may react in the context of a typical fire also does not account for the various ways in which Alucobond panels may be fabricated. For example, panels may be cut, routed and folded, punched, or otherwise fabricated in a manner where sections of the cover sheets are removed and the core of the panels remains exposed. In such scenarios, flames could impinge directly on the core without any relevant failure of the aluminium cover sheets.

1168 Noting the above, it cannot be said that the aluminium cover sheets “protect” the core of the panels, to prevent the involvement of a panel’s core in what may be described as a typical fire scenario. The most that may reasonably be said is that the cover sheets provide some, relatively modest, level of protection.

1169 It is worth pausing at this stage to note that Expert Group 3 noted that statements contained in marketing for the Alucobond products regarding the protection afforded by the cover sheets were not qualified in terms of the specific circumstances in which the “protection” afforded by the cover sheets could or could not be relied upon. The nature of these representations is the subject of further discussion later in these reasons.

1170 Noting the agreed position that the cover sheets did not provide absolute protection, the question which Expert Group 3 discussed at length was whether the protection afforded by the cover sheets would be “sufficient”. “Sufficient” in this context may be properly described as delaying the involvement of the core material in the event of a fire to an extent compatible with the remainder of the fire safety strategy. The experts agreed that whether the protection afforded by the cover sheets would be sufficient in any application of Alucobond would depend on a range of factors specific to each application. This would, the experts agreed, need to be carefully and competently considered by the relevant building’s designers and approvers. This, it appears to me, is to say little more than what the experts say regarding the use of the Alucobond products generally, which is that the risk posed by a particular use of the panels requires consideration of the particular application and the fire safety strategy of a building. This is plainly the case. As Professor Torero and Associate Professor Lange were at pains to emphasise throughout the trial, fire risk cannot be appropriately quantified in abstract and without consideration of a particular application. It appears similarly that whether the degree of protection that a cover sheet provides may be described as “sufficient” is not a question that can be answered in abstract.

1171 Accepting the above, it was unclear from the evidence to what extent reliance could be placed on, howsoever modest, the degree of protection afforded by the cover sheets of the panels. Professor Bisby noted, in the Group 3 Joint Report, his view that in cases involving substantial use of such products on the outside of buildings, in the event of a significant fire developing within or adjacent to a building clad in Alucobond PE, and where the Alucobond PE was directly exposed to heating from the fire for any appreciable period of time, the level of protection was unlikely to be sufficient or adequate to prevent the core material’s involvement in the fire. Professor Torero and Associate Professor Lange did not appear to disagree, in substance, with Professor Bisby’s opinion, although both noted that the ignition of the core and fire spread also depends on there being a sufficient source of oxygen. Indeed, Professor Bisby’s opinion is largely a reflection of the agreed position that the cover sheets do not provide absolute protection and, therefore, in such a scenario, would be expected to result in the core becoming involved in the fire.

1172 Associate Professor Lange, as explained earlier in these reasons, noted that the question of whether protection afforded by cover sheets is sufficient, is different to whether the coversheets will prevent the involvement of core materials. In the context of a building’s specific fire safety strategy, the relevant question for consideration would be whether the protection afforded by the cover sheets is sufficient. Professor Torero noted that subjective terms, including “significant”, “adequate”, “appreciable” and “sufficient” were terms that could be quantified by a competent FSE, and that such quantification was the necessary engineering design process which would be required to demonstrate the safe use of a product within a building. Professor Torero also stated that it was possible for a competent FSE to quantify the importance of any cuts, edges and penetrations in the cover sheet to the level of protection the aluminium provides.

1173 Professor Torero also opined that an FSE could take a conservative stand of fully ignoring the protection offered by the aluminium and assume that the PE would burn, and still demonstrate that the building offers a level of safety consistent with the requirements of the NCC. This appears to say little about the extent to which the cover sheets may protect the core, and more so, that a combustible product can be used as external cladding in a way that remains compliant with the NCC. Similarly, Associate Professor Lange also opined that to address the fact that the actual protection afforded by aluminium cover sheets would be difficult to determine in practice, it could be acknowledged that they provide some protection, but ignore that protection when determining flammability properties for design purposes as a conservative input.

1174 As the above discussion illustrates, there is limited, if any, actual disagreement between the parties regarding the extent to which the cover sheets “protect” the core of the Alucobond panels. Whether the limited degree of protection provided by the cover sheets is “sufficient” or “adequate”, depends on the particular building, and its fire strategy. I am, therefore, not in a position to make a determination as to whether, at a general level, the cover sheets of Alucobond PE and Alucobond Plus provided “sufficient” protection. This is a question that necessarily must be answered by careful and competent Qualified Professionals in relation to each specific building.

8.5.4 Risks associated with the fire behaviour of Alucobond PE and Alucobond Plus

1175 The reaction-to-fire behaviour of Alucobond PE and Alucobond Plus has been outlined in detail in the evidence given by Expert Group 3. The experts were largely in agreement regarding the actual reaction-to-fire behaviour of the products, noting that much of the discussion focused on the practical likelihood of the products being used in a compliant manner during the relevant period. It is, therefore, unnecessary to repeat the reaction-to-fire behaviour of either Alucobond PE or Alucobond Plus in any detail here. It is, however, helpful to note the following key paragraphs from the Group 3 Joint Report:

54. The extent to which all of the above reaction-to-fire behaviours will occur in any given situation, the consequences of their occurrence for any given building, and the need for specific design measures to prevent or mitigate these behaviours will all depend on the particular building under consideration and the fire safety strategy of that building.

55. As a result, assessment of any specific external wall system incorporating Alucobond PE ACPs, by a suitably careful and competent engineering professional, is necessary in order to properly establish its performance. Only practitioners who are sufficiently informed of the reaction-to-fire properties of the products, or who are otherwise advised of potential hazards associated with their use, and who are qualified with the relevant expertise, will be able to engage with such considerations and make appropriate judgements.

56. For the above reasons, manufacturers of ACP cladding products need to behave with competency and integrity in the use of the test methods and in the reporting of the data. Test data and marketing claims need to be relevant, credible, transparent, easily accessible, complete, and unambiguously presented within product literature and brochures; full and transparent disclosure of the testing conditions used in any compliance testing is therefore essential.

1176 The experts made the same observations in respect of Alucobond Plus at [150]-[152] of the Group 3 Joint Report.

1177 One matter of contest which remained between the parties, was the extent to which Alucobond Plus promoted flame spread without exposure to an external heat source. As I have already outlined in these reasons above, whether this is the case is a matter more of academic debate than one that I am required to resolve in the context of these proceedings.

1178 As the experts emphasised throughout the trial, not all experiments are designed to be a reflection of reality. It is not necessary to make definitive determinations regarding Alucobond Plus’ properties from Mr Carrascal’s LIFT. The relevant point is that Mr Carrascal’s test contributes to the data and knowledge that a competent FSE can use to develop an appropriate fire engineering design. Given the limitations identified and discussed in detail by the experts, appropriate care and caution would need to be exercised by a competent FSE in considering how the behaviour of Alucobond Plus may impact the fire safety strategy of a particular building. This is, as the discussion between the experts clearly illustrates, not a simple task and one requiring specialist expertise.

1179 It is also relevant to briefly note the impact on firefighting efforts that the use of Alucobond prodcuts may have. In this respect, the Applicants rely on the expert evidence of Mr Youssef. I accept Mr Youssef’s evidence, but note that it must be considered within the context of the other expert evidence before me. In particular, I accept Mr Youssef’s evidence that the use of ACPs (with PE cores) as façades on multi-storey buildings introduces significant operational firefighting challenges, particularly due to the fact that such ACPs can provide an external bridge during a fire, allowing a fire to spread rapidly between floors, as well as laterally across floors.

1180 However, as 3A submits, to accept that the use of the Alucobond products may adversely impact the ability of fire services to effectively conduct firefighting operations, is not to accept that such an adverse impact arises whenever Alucobond PE and Alucobond Plus are used on mid and high-rise buildings. Mr Youssef’s evidence does not support such a broad submission. The extent to which the use of the Alucobond products may undermine firefighting efforts naturally requires consideration of how the products are used in the context of a particular building.

1181 The risks associated with the fire behaviour of Alucobond PE and Alucobond Plus are also largely agreed by the experts, noting the intensity or magnitude of those behaviours is diminished in respect of Alucobond Plus. The experts agreed that the extent to which the particular reaction-to-fire behaviours of the Alucobond panels would occur in any given situation depends on the particular building under consideration. It similarly follows that the risks associated with such reaction-to-fire behaviours are necessarily a function of the manner in which the panels have been used and the fire safety strategy of that particular building. The experts accepted that, in principle, it was possible for Alucobond PE and Alucobond Plus to be used on a building in a manner that was safe (in the sense of representing an acceptable residual level of fire risk to occupants and/or property), where an appropriate fire safety strategy was in place.

1182 The following paragraphs of the Group 3 Joint Report are of particular relevance in this context:

104. Understanding the risk to life and/or property presented by the use of Alucobond PE as part of or as an attachment to an external wall or building element requires consideration of the potential external fire spread mechanisms via the building façade system and the interactions with, and impacts upon, the overall fire safety strategy of any specific building to this event. Where such understanding does not exist or cannot be developed for a given product that generates such hazards (as in the case of Alucobond PE) this product should not be used.

…

109. Any cladding element installed on a building will present certain hazards which need to be managed through the fire safety strategy of that building to such an extent that the residual risk is at a level that is satisfactory for all stakeholders…

1183 The experts noted at [193] of the Group 3 Joint Report, that their response in respect of the risks to life and/or property presented by the use of Alucobond Plus was largely the same as that provided in respect of Alucobond PE.

1184 The next question is the extent to which risk to life and/or property could be mitigated by the design of the building as a whole. Again, Expert Group 3 agreed that, given the overall performance of a building in the event of a fire was defined by the many variables involved in the design, hazards could be mitigated with appropriate design decisions. The experts agreed that the use of Alucobond PE and Alucobond Plus result in a series of specific hazards that requires the designer to conduct an analysis that informs particular design choices. However, the experts also agreed that specific measures could be undertaken to mitigate the hazards introduced by the products (albeit the experts noted that it was not common practice for this to occur during the relevant period), particularly focusing on the potential loss of vertical compartmentation, the heat released by the burning core of the panels, the potential for molten and burning polymer flowing downwards (or in the case of Alucobond Plus, burning polymer falling downwards), and the potential for burning debris.

1185 As the discussion of the experts’ position above illustrates, it is not possible to generalise about whether and to what extent the reaction-to-fire behaviours of Alucobond PE or Alucobond Plus, or the adverse consequences from those behaviours, are likely to occur without reference to a particular building. The manner in which the panels are used can, quite evidently, involve significant risk to life and/or property, and can require a number of special measures to be taken, having regard to the particular nature of risks that the use of the panels in a building’s façade may represent. Ultimately, whether any risk to life and/or property represented by the use of the panels is unacceptable or acceptable is a function of the potential external fire spread mechanisms via the building façade system, and its interactions with the overall fire safety strategy of the building. This is necessarily a building specific task.

8.5.5 Summary of Material Fire Risk Properties

1186 First, I have found that Alucobond Plus had a core of not more than 30% combustible material, and any slight deviation above that has not been established as having an effect on the fire behaviour of Alucobond Plus. Therefore, by extension whether or not the Respondents did or did not know which panels had more or less than 70% non-combustible materials is of no consequence.

1187 Second, the experts agreed that the core of Alucobond PE was essentially purely PE.

1188 Third, the experts agreed that the cover sheets only provided some level of protection of the core of both Alucobond PE and Alucobond Plus. I have found that whether the protection is sufficient can only be determined on a building specific analysis by the relevant Qualified Professionals.

1189 Fourth, the fire risks associated with the use of the products, and the consequences, for all purposes for which they were commonly bought and supplied, is not answered solely by findings as to the actual reaction-to-fire behaviour of the products, but by analysis of the reaction-to-fire behaviour of the products in the particular situation, which is dependent on the specific use on, and the overall fire safety strategy, of the specific building. In principle, it was possible for Alucobond PE and Alucobond Plus to be used on a building in a manner that was safe, where an appropriate fire safety strategy was in place, including appropriate measures to mitigate the hazards introduced by the products.

1190 Therefore, whilst a particular use of the Alucobond products may lead to them having the Material Fire Risk Properties, I am not satisfied that Alucobond PE and Alucobond Plus inherently possess the Material Fire Risk Properties.

8.6 Findings regarding BCA compliance

1191 The Applicants also allege that the Alucobond products had what they define as the “BCA Non-compliance properties” and the related “BCA Non-compliance Risk Properties” when acquired for use on Class 2 to 9 buildings. This is, in effect, an allegation that the Alucobond products could not be used as external cladding on multi-storey buildings in a way that was consistent with the BCA or that there was at least a material risk that the use of those products in that way would be determined to be non-compliant.

1192 This allegation is said to be separate and independent from the allegation concerning the Material Fire Risk Properties of the Alucobond products. In support of this, the Applicants submit that goods may not be of acceptable quality due to some inherent quality even if they are, at the time of supply, compliant with relevant regulations.

1193 There is no dispute that the use of the Alucobond products was, in fact, accepted by building certifiers, building surveyors, or other approval bodies as being compliant with the BCA during the relevant period. As the Applicants submit, if this were not the case, the panels would not have found their way onto so many Australian buildings. This was, it can be accepted, inappropriate in many cases.

1194 It is, however, necessary to consider specifically how the BCA applied in respect of Alucobond PE and Alucobond Plus during the relevant period. As noted above, this requires consideration of whether and how the Alucobond products could be used as part of a DtS Solution, or as a Performance Solution, or a combination thereof. The Applicants submit that none of the options provided a pathway for the substantial use of combustible ACPs on Class 2-9 buildings as external wall cladding, as in fact occurred during the relevant period, in a manner that was BCA compliant.

8.6.1 CodeMark Certificates

1195 The Applicants submit that CodeMark Certificates were a means by which combustible ACPs, including Alucobond PE and Alucobond Plus, were used and approved during the relevant period without an assessment by a competent FSE.

1196 The nature of the CodeMark regime has been outlined in detail in the context of the evidence of Expert Group 6, in particular section 5.5.2. I will not restate that here, other than to note that generally the scheme involves a voluntary third party building product certification scheme which sets a nationally accepted process to demonstrate compliance with the BCA. Certification bodies issue Certificates of Conformity which certify that the use of particular products will comply with identified provisions of the BCA, subject to conditions and limitations identified within the certificate. Under the BCA, a Certificate of Conformity can be used as evidence that the use of a material meets particular performance requirements or DtS Provisions.

1197 The Applicants submit that, to the extent the Respondents submit that the CodeMark Certificates support a finding that the Alucobond products did not have the BCA Non-compliance Properties pleaded, then the submission should be rejected for two primary reasons.

1198 First, the Applicants submit that the certificates issued for Alucobond PE and Alucobond Plus were based on the assessment by private certification bodies of information – including fire test results provided by HVG. The Applicants submit that the certification bodies did not have sufficient information to reach the conclusions they did, such that the certificates should never have been issued. The Applicants refer particularly to the criticisms made by Mr Kip in his first report regarding the issuance of the certificates. Mr Kip stated that many of the fire tests included in the materials submitted to building certifiers did not reflect the use of the product as set out in the relevant installation manuals and, therefore, did not support the proposed use of the panels. Professor Torero agreed with Mr Kip’s view that the certificates should never have been issued based on the material provided. Professor Torero stated in his report that the issuing of the certificates promoted the incorrect use of the products under the DtS Provisions.

1199 The Applicants, as an example, refer to the CodeMark Certificate issued for Alucobond Plus in August 2015 (CMA-CM40032 (Rev 3)) which certified Alucobond Plus’ compliance, when used as an attachment, with the criteria in Specification C1.1 – cl 2.4. The certificate certifies that the product complies with cl 2.4(a)(ii) and (iii) (the nature of these requirements is discussed in the context of the attachment exception above), stating:

The evaluation of compliance to Clause 2.4(a)(ii) and (iii) of Specification C1.1 has been reviewed in fire product assessment M13074 dated 19 July 2013 and deemed compliant based on their evaluation and the supporting information including international test results included within the evaluation.

1200 The certificate referred to the results of a standard AS 1530.3 test, and two international tests: the NFPA 285 test undertaken on 7 October 1999, and the B.s1.d0 classification pursuant to EN 13501.1 as recorded in a test report dated 26 July 2004. The nature and limitations of these tests is discussed within the context of the Expert Group 4-5 evidence.

1201 Secondly, the Applicants submit that the CodeMark Certificates were only in place for part of the relevant period and were increasingly subject to significant limitations.

1202 In respect of Alucobond PE, the certificates were only issued for Type C construction. The last version of the CodeMark Certificate for Alucobond PE expired in July 2016.

1203 In respect of Alucobond Plus, the product was initially only certified for use as a decorative system for internal lining or external attachment. It was not until 12 July 2016, when certificate GM-CM30070 (Rev A) was issued, that the product was certified in relation to its use as a component of an external wall, or as an attachment thereto. The Applicants submit that the version of the Alucobond Plus certificate that applied at the end of the relevant period, issued 20 July 2017, placed significant restrictions on the use of the good, including to incorporate cavity breaks, or to have sprinklers, among other requirements.

1204 There is a fundamental difficulty with the Applicants’ first submission, namely that the CodeMark Certificates should not have been issued. I accept, as Mr Kip and Professor Torero stated, that the fire tests included in the material provided for the certificates did not support their proposed use, and that the certificates should not have been issued. Indeed, it appears to be a significant matter of concern that the certificates were issued and may have been relied upon in a manner that was inconsistent with the performance requirements under the BCA.

1205 However, the certificates were issued and were not held to not be “valid” under the BCA. Accordingly, the certificates were available to be relied upon during the relevant period as evidence of compliance with the BCA.

1206 There is a distinction between actual compliance under the BCA, and reliance on a CodeMark Certificate. Under cl A0.1 of the BCA, compliance with the NCC is achieved by satisfying the performance requirements. Under cl A0.2, the performance requirements can only be satisfied by a Performance Solution, or a DtS Solution, or a combination of the two. A DtS Solution, and a Performance Solution must be assessed for compliance according to one or more “Assessment Methods”. “Assessment Methods” under cl A0.5, incorporates the following: comparison to DtS Provisions, expert judgment, “Verification Methods”, and evidence to support that the use of a material or product, form of construction or design meets a performance requirement or a DtS Provision, as described in A2.2. Pursuant to A2.2, such evidence may be in the form of a current Certificate of Conformity or a Certificate of Accreditation.

1207 While the BCA provides certain methods which can be used in assessing compliance with the performance requirements, reliance on those methods does not, in and of itself, deem the relevant building to be BCA compliant. Where CodeMark Certificates were relied upon in a manner that promoted the incorrect use of the panels, reliance on a CodeMark Certificate would not have rendered – and does not render – the building BCA compliant if it was determined that, in fact, the building did not satisfy the performance requirement. The fact that a building certifier was not entitled to refuse to issue a construction certificate if a Certificate of Conformity had been issued in accordance with the CodeMark scheme under the EPA Act does not appear to change the correctness of this view.

1208 In any case, the intention of the scheme is clearly to enable Qualified Professionals to rely on the certificates issued thereunder as evidence of the fact that a particular application of the materials will be consistent with the performance requirements of the BCA. This was the agreed evidence of both Expert Groups 4-5 and 6. In particular, Ms Halstead and Mr Kip agreed in the Group 6 Joint Report that Alucobond PE and Alucobond Plus could be used in conformance with a CodeMark Certificate, if the relevant conditions and limitations in the certificates were satisfied.

1209 I also do not accept the Applicants’ submission that the increasing number of limitations and conditions on the use of the products in the certificates, undermined the ability for certifiers to rely on the certificates. The increasing number of conditions may be seen as reflective of the fact that the earlier certificates lacked appropriate conditions and limitations. However, the limitations did not preclude the substantial use of the products. The limitations do not weigh against the ability to place reliance on the certificates. What is relevant is the limited scope of applications which the CodeMark Certificates actually certified. In particular, the Alucobond PE certificates, which were in operation collectively from 12 July 2013 to 12 July 2016, only applied to the use of Alucobond PE as a decorative and protective attachment system for internal and external use. The certificates were also limited to Type C construction only.

1210 However, it is evident, particularly from the marketing material, that Alucobond PE was advertised, commonly supplied, and used for a range of purposes, beyond an attachment to Type C construction. For example, Alucobond PE was advertised as being able to be used as part of an external wall, or an attachment thereto, on both Type A and Type B construction. Therefore, I do not accept that the fact Alucobond PE could be used in conformity with the relevant CodeMark Certificates during the relevant period speaks substantively to the product not having the relevant BCA Non-compliance properties, because Alucobond PE must be of acceptable, or merchantable, quality for all the purposes that it was commonly supplied and bought. To the extent that Alucobond PE was sought to be used as part of an attachment on a Type A or Type B construction, or otherwise to form a component of an external wall assembly, as the product appears to have been used during the relevant period, the use would still have needed to comply with a DtS pathway or form part of a Performance Solution.

1211 As noted above, the Alucobond Plus certificates only certified its use from 12 July 2013 to 12 July 2016 as a decorative system for internal lining or external attachment. Unlike the Alucobond PE certificates, the Alucobond Plus certificates applied in relation to Type A, B and C construction. Alucobond Plus was only certified for use on Type A and Type B construction as both a component of an external wall assembly, as well as an attachment thereto, on 12 July 2016. Again, akin to Alucobond PE, Alucobond Plus was evidently advertised, commonly supplied and used, both as part of and as an attachment to an external wall on Type A, B and C constructions. Until 12 July 2016, to the extent that Alucobond Plus was sought to be used as part of an external wall on any type of construction, reference to other DtS compliance pathways or a Performance Solution would have been required. I accept that from at least 12 July 2016, Alucobond Plus cannot be said to have had the BCA Non-compliance Properties as it could be used in conformance with a CodeMark Certificate as part of an external wall (or as an attachment thereto) on a building of Type A, B or C construction, and the conformance with the CodeMark Certificate would have been valid evidence of compliance with the BCA performance requirements.

8.6.2 DtS pathways

1212 As noted in [541 ] above, it is not in dispute that:

(a) Alucobond PE and Alucobond Plus are combustible for the purposes of the BCA;

(b) under the DtS Provisions of the BCA, the external walls of Type A and Type B construction must be non-combustible: Specification C1.1 – 3.1(b); Specification C1.1 – 4.1(b);

(c) the two relevant potential exceptions are the bonded laminate exception under C1.12(f) of the BCA, and the attachment exception under Specification C1.1, cl 2.4, both of which appear to have been used as compliance pathways during the relevant period.

1213 The Applicants submit that the use of both the bonded laminate and the attachment exceptions during the relevant period was based on a misunderstanding of the exceptions.

8.6.2.1 Bonded l aminate exception

1214 In respect of the bonded laminate exception, as has been noted above at [543 ], Mr Kip and Mr Halstead, the BCA compliance experts (Expert Group 6), agreed that the exception could not apply to Alucobond products because the bonded laminate exception requires each individual laminate to be non-combustible.

1215 The Applicants submit that the interpretation of the BCA that was commonly adopted was that the core of the ACPs was not a “laminate”, and therefore, that combustible ACPs fell within the bonded laminate exception since the cover sheets were non-combustible. Mr Halstead, being the BCA compliance expert engaged by 3A for the purposes of this proceeding stated in his expert report dated 9 March 2023, that the Alucobond products could fall within the bonded laminate exception. I accept the Applicants’ submission that this supports a finding that a competent building certifier during the relevant period could genuinely (albeit incorrectly) consider that the exception provided a DtS compliance pathway in relation to the use of combustible ACPs. It should be noted that Mr Halstead’s report was prepared just under two years following the Supreme Court of Victoria – Court of Appeal’s decision in Tanah Merah that a combustible ACP would not fall within the exception since the core of the product is also a laminate for the purposes of the exception. It is also to be noted that the application of the bonded laminate exception was put into issue in each of the Respondents’ defences. I note, however, that on the evidence before me, I am not in a position to make findings in respect of the extent to which the particular exemption may have been relied on by building certifiers during the relevant period, or to what extent it can be said that this incorrect interpretation was one that was “commonly adopted”.

1216 The experts agreed that Alucobond PE and Alucobond Plus could not be used compliantly with the BCA through reliance on the bonded laminate exception, as was also found by the Victorian Supreme Court in Tan a h Merah. To the extent that any Qualified Professionals wrongly relied on the bonded laminate exception during the relevant period, the liability for so doing rests with those Qualified Professionals, as discussed in section 8.10.1, in the context of the Respondents’ defence under s 271(2) of the ACL. The finding of the non-availability of the bonded laminate exception will only have significance to the Applicants’ consumer guarantee claim if I find that the products were not otherwise able to be used in compliance with the BCA, other than in insubstantial quantities.

8.6.2.2 Attachment exception

1217 The evidence in respect of the attachment exception has been outlined in detail in the context of Expert Group 6 – see section 5.5.1.2. The attachment exception allows a combustible material to be used as a finish or lining to a wall or roof, or in a sign, sunscreen or blind, awning, or other attachment to a building element which has the required FRL if the requirements of cl 2.4 of Specification C1.1 of the BCA, which I have set out in full and considered the meaning of in section 5.5.1.2, are fulfilled.

1218 The parties agree that for an ACP to be an “attachment”, it cannot be “part of” the relevant external wall. For example, where the Alucobond products are used as part of the rainscreen for a building or where the panels provide the weatherproofing of the external façade of a building, the attachment exception does not apply. I note that the Applicants’ submission that the Alucobond products will only be deemed to have been used as an attachment if the Alucobond products were being used as a “decorative” attachment, appears too narrow. Clearly, the references to signs, sunscreens, blinds, awnings and “other attachment[s]” encompasses a wider variety of uses beyond purely decorative attachments. Additionally, Mr Kip’s first expert report also stated that an ACP could constitute an internal or external lining where it is the outer layer of a wall or the bottom layer of a ceiling.

1219 In any case, it must be noted that the scope of the attachment exception is necessarily limited and would not apply where the Alucobond products are used as cladding which performs a functional role as part of an external wall. For example, this may include where the panels contribute to weatherproofing, air infiltration, thermal insulation, acoustic insulation, or otherwise contributes to the durability of the wall system. Given this, irrespective of whether the attachment exception was available as a DtS compliant pathway, it does not provide a full answer to the BCA Non-compliance case brought against the Respondents. This is because it would only provide an answer to whether the Alucobond panels could be used in a manner that was BCA compliant when those panels were used as an attachment to an external wall. It would not provide an answer to whether the Alucobond panels could be used in a manner that was compliant with the BCA where the panels formed part of the external wall (which is consistent with how the Alucobond panels were commonly acquired and advertised), noting the claim of acceptable quality requires the relevant goods to be fit for all of the purposes for which goods of that kind are commonly supplied.

1220 To the extent that the attachment exception may have been available in respect of a particular application of Alucobond panels, there are two key areas of disagreement between the Applicants and the Respondents. The first relates to the requirement under Specification C1.1 – 2.4(a)(i) which provides that the exception can apply in respect of the material if:

[T]he material is exempted under C1.10 or complies with the fire hazard properties prescribed in Specification C1.10

1221 I have found, in section 5.5.1.2, that the Alucobond products are not exempted under C1.10 and must comply with the fire hazard properties prescribed in Specification C1.10. I have also found that the Alucobond products, on the basis they fall under “other materials” under Specification C1.10, are required to meet a Spread-of-Flame Index that does not exceed 9, and, if the Spread-of-Flame Index is more than 5, a Smoke-Developed Index that does not exceed 8.

1222 It is at this point necessary to consider in further detail what specifically “fire hazard properties” are. “Fire hazard properties” is defined in the BCA as follows:

Fire hazard properties means the following properties of a material or assembly that indicate how they behave under specific fire test conditions:

…

(b) Smoke-Developed Index, smoke development rate and Spread-of-Flame Index, determined in accordance with Specification A2.4.

1223 Specification A2.4 in turn provided the following:

Scope

This Specification sets out the procedures for determining the fire hazard properties of assemblies tested to AS/NZS 1530.3.

Assemblies

2.1 General requirement

The fire hazard properties of assemblies and their ability to screen their core materials as required under Specification C1.10 must be determined by testing in accordance with this Clause.

2.2 Form of test

Tests must be carried out in accordance with–

(a) for the determination of the Spread-of-Flame Index and Smoke-Developed Index – AS/NZS 1530.3; and

(b) for the determination of the ability to prevent ignition and to screen its core material from free air – AS 1530.4.

2.3 Test specimens

Test specimens must incorporate–

(a) all types of joints; and

(b) all types of perforations, recesses or the like for pipes, light switches or other fittings, which are proposed to be used for the member or assembly of members in the building.

2.4 Concession

Clause 2.3 does not apply to joints, perforations, recesses or the like that are larger than those in the proposed application and have already been tested in the particular form of construction concerned and found to comply with the conditions of the test.

1224 The Guide to the BCA 2016 also provides in relation to Specification A2.4, cl 2.3 the following:

2.3 Test specimens

| Intent |
| To specify the details required for the test specimen. |
The assembly to be tested must include all joints, perforations, recesses, and the like. These parts may affect not only its early fire-hazard properties, but are also more likely to affect the passage of air and fire to the assembly’s inner core. The requirements for the test specimen apply to both tests required by Clause 2.

1225 It is also relevant that cl 7 of Specification C1.10 of the BCA contains the following note which applies to “[o]ther materials or locations and insulation materials other than sarking-type materials ”:

3. In the case of a composite member or assembly, the member or assembly must be constructed so that when assembled as proposed in a building–

(a) any material which does not comply with this Table is protected on all sides and edges from exposure to the air; and

(b) the member or assembly, when tested in accordance with Specification A2.4, has a Spread-of-Flame Index and a Smoke-Developed Index not exceeding those prescribed in this Table; and

(c) the member or assembly retains the protection in position so that it prevents ignition of the material and continues to screen it from access to free air for a period of not less than 10 minutes.

1226 The AS 1530.3 test results for both Alucobond PE and Alucobond Plus resulted in a Spread-of-Flame Index of 0 and a Smoke-Developed Index of 0-1.

1227 Mr Kip’s position, as expressed in the Group 6 Joint Report, and during the expert conclave, was effectively that he had not seen an AS 1530.3 test for Alucobond PE or Alucobond Plus that had been performed in the manner required under Specification A2.4 of the BCA; that is, where the test specimen of Alucobond PE or Alucobond Plus incorporated any joints, perforations, recesses or the like which would be proposed to be used in a building. The Respondents do not appear to submit that (i) such a test did not need to be conducted for the purposes of the BCA, or that (ii) such a test was, in fact, conducted. There may be an argument that Specification A2.4 deals specifically with determining the fire hazard properties of assemblies, rather than materials only. However, this argument did not appear to be pressed by the Respondents, and it is unclear how such a test would be conducted in conformity with the requirements of AS 1530.3. Without intending any criticism, I note that Mr Halstead’s evidence on this issue was not particularly helpful as he noted that he relied on the disclosed results of the AS 1530.3 test but had not considered how specifically the test had been conducted.

1228 To the extent it is accepted that Specification A2.4 required an Alucobond PE or Alucobond Plus specimen to incorporate such joints and perforations which are proposed to be used for the member or assembly as part of an AS 1530.3 test to determine the materials’ fire hazard properties for the purposes of Specification C1.10, it is evident that no such test was or has been conducted on the evidence before me. The clear rationale for this requirement appears to be for the fire hazard properties of such a member or assembly to reflect that combustible parts of the relevant material or assembly may be exposed due to joints and perforations which may be used in a building. Indeed, it does not appear consistent with the requirements of the BCA that an AS 1530.3 test can be conducted to determine the fire hazard properties for the purposes of Specification C1.10 of a composite material such as Alucobond PE and Alucobond Plus, where the aluminium cover sheets may screen the core from direct exposure, but where the manner in which the material is proposed to be used in a building may incorporate certain joints and perforations which expose the core. For these reasons, I am not satisfied that the AS 1530.3 tests conducted in relation to Alucobond PE and Alucobond Plus were conducted in the manner required under the BCA.

1229 The Respondents submit that Mr Kip has not advanced any reason for thinking that if AS 1530.3 tests were done for Alucobond PE and Alucobond Plus in the particular manner in which Mr Kip contended, the results would be so much worse that the requirements of Specification C1.10 would not be met. Mr Kip accepted in the course of the expert conclave that he does not state that the Alucobond products would, in fact, fail to meet the relevant fire hazard properties; rather, Mr Kip stated that he has not seen an AS 1530.3 test report which complies with the requirements under Specification A2.4. No evidence has been put forward by the Applicants of a test being conducted on a specimen prepared in the manner Mr Kip contended which could show that the Alucobond products would fail to meet the relevant fire hazard properties.

1230 For the reasons identified by the Respondents above, I am not in a position to make a determination as to whether Alucobond PE and Alucobond Plus would, in fact, fail to meet the fire hazard properties in Specification C1.10 if an AS 1530.3 test was conducted in the manner which Mr Kip contended. However, to the extent it is accepted that Specification A2.4 requires such a test to be conducted, it cannot be said that there is material available which confirms that Alucobond PE and Alucobond Plus meet the fire hazard properties in Specification C1.10.

1231 I find, therefore, that there is no, or insufficient, evidence as to whether the attachment exception was available as a pathway for BCA compliance. As 3A submits, the onus rest on the Applicants to establish that the Alucobond products could not have been used, during the relevant period, in compliance with the attachment exception. The Applicants have failed to establish this was not possible.

1232 I note for completeness that the Respondents also submit that Mr Kip’s evidence regarding the application of Specification A1.1, cl 2.4(a)(i) is inconsistent with a number of reports Mr Kip has been involved in, which indicated that the attachment exception could apply in respect of Alucobond PE and Alucobond Plus. Mr Kip accepted in the course of the expert conclave that this was the case and stated that, in hindsight, it was a mistake to have not identified the issues around cl 2.4(a)(i) which he identified in his evidence in these proceedings, but maintained that he did not consider the Alucobond products could meet the requirements in cl 2.4(a)(i) at the time of those reports.

1233 I do not accept the Respondents’ submission that Mr Kip’s previous views, as expressed in the number of reports that Mr Kip was taken to during the conclave, provide a basis to undermine the correct application of cl 2.4(a)(i). The correct application of cl 2.4(a)(i) is one that turns on its correct interpretation; not one that turns on a particular expert’s view, including any interpretation now or previously adopted by Mr Kip or Mr Halstead.

1234 If I am wrong and it is found that Alucobond PE and Alucobond Plus could have passed the AS 1530.3 test, the second requirement in respect of the attachment exception is Specification C1.1, cl 2.4(a)(ii) which requires that the relevant combustible material must not be located near or directly above a required exit so as to make the exit unusable in a fire. The Applicants accept that this is a requirement which could be satisfied depending on the number and location of Alucobond panels. Naturally, to the extent any panels were located around or directly above a required exit, an assessment as to whether the exit is usable in the fire would be necessary.

1235 The third requirement for the attachment exception, which forms the second area of disagreement between the parties, is the requirement under cl 2.4(a)(iii) which requires that use of the combustible material does “not otherwise constitute an undue risk of fire spread via the façade of the building”.

1236 The concept of what constitutes an “undue risk of fire spread” is undefined in the BCA. The reference to “undue” inherently indicates that the requirement is not directed towards preventing any and all risks of fire spread. Henry J stated the following in respect of the phrase “undue risk” in the context of the attachment exception in Taylor Construction Group Pty Ltd v Strata Plan 9288 t/as The Owners Strata Plan 9288 [2021] NSWSC 1315 at [140]-[141]:

[T]here is no real dispute that undue risk for the purposes of cl 2.4(a)(iii) means risk of fire spread via the façade of the Buildings that is unwarranted or excessive. The meaning given by the Appeal Panel to “undue” accords with the ordinary English meaning of the word and, in my view, correctly reflects that the word has no unusual or technical meaning, unlike some other terms used in the BCA, such as “Spread of Flame Index”. The Appeal Panel did not err by adopting that meaning.

The BCA does not specify the particular matters or precise parameters for determining whether the use of combustible material as an attachment constitutes a risk of fire spread via a building façade that is unwarranted or excessive for the purposes of cl 2.4(a)(iii). In my view, the determination as to whether the risk is undue (or unwarranted or excessive) involves an evaluative task that requires consideration of the circumstances and context in which the Biowood combustible cladding is used as an attachment to the external walls of the Buildings. That includes consideration of the objective of Section C of the BCA of ensuring the safety of people from fire, the BCA requirement that external walls in Type A buildings are to be constructed using non-combustible material, the possibility of fire spread eventuating, and the gravity of the risk from such use. Factors such as the ignitability of the combustible material and the likely rate of fire spread, the location of the material, and relevant safety features of the Buildings would also be germane to consider.

1237 As the above extract of Henry J’s reasons indicates, the assessment of whether the use of a particular material constitutes an “undue risk of fire spread” is an evaluative task requiring professional assessment to be made of how the products are used in the particular context of the building.

1238 Given the nature of the assessment which is properly required, it may reasonably be questioned why such a provision forms part of a DtS compliance pathway where it would be expected that this assessment would initially be one confronted by a building certifier. There are obvious difficulties with this. While Mr Davis gave evidence that he had been asked to assist in such an assessment on one occasion, he accepted that this was “unique” and a “bit of an outlier”. Mr Moore also gave evidence in his expert report that many building surveyors incorrectly interpreted the attachment exception by considering that a material that passed AS 1530.3 with a Spread-of-Flame Index of 0 would mean that the product would not constitute an undue risk of fire spread. As the nuance in the opinions of the FSEs illustrates, fire engineering is an inherently complex discipline which requires proper expertise to assess matters of fire risk and safety. The evidence given by each of the FSEs regarding the inappropriateness of relying simply on the results of small-scale fire tests, and the need to understand how particular combustible material relate to each other element of a building, is similarly illustrative of this problem. This issue appears to have been recognised quite some time ago. Mr Kip identified in his first report that, in a report titled Fire Performance of Exterior Cladding s by the Fire Code Research Reform Program published in April 2000, it was stated:

The current BCA…. [G]enerally uses the combustibility test AS1530.1… and the early fire hazard test AS1530.3… to control materials used for external walls and claddings. The existing controls are in some cases not sufficiently specific, for example, the expression “it does not otherwise constitute an undue risk of fire spread via the façade of the building” seems out of place in a deemed-to-satisfy solution. The existing AS1530.3 requirements may also not be able to adequately evaluate the performance of full-scale cladding systems in their end-use installation.

1239 The requirement nevertheless forms part of the DtS compliance pathway. Mr Kip stated in the Group 6 Joint Report the following in respect of the requirement:

In my opinion the criteria for undue risk of fire spread could not be satisfied for Alucobond PE in any circumstances, and would be extremely difficult or expensive to satisfy for Alucobond Plus

1240 Mr Kip’s opinion was subject to strenuous challenge, as has been detailed in these reasons above. In particular, Mr Kip was taken to a number of reports that he was involved in or cosigned in which an opinion was expressed that the use of the relevant Alucobond product on the building did not present an undue risk of fire spread.

1241 I do not accept the generality of Mr Kip’s statement in the Group 6 Joint Report in respect of Alucobond PE or Alucobond Plus. As was illustrated by the number of reports Mr Kip was taken to, whether the particular use of Alucobond PE or Alucobond Plus will involve an undue risk of fire spread will depend on a number of factors relevant to its specific application and the particular building. This is the natural result of the evaluative assessment required to be undertaken in assessing whether the application of a combustible material, for the purposes of the attachment exception, constitutes an undue fire risk. This is also consistent with the evidence arising out of Expert Group 3, which is discussed in the context of the fire risk properties of the Alucobond products above, that the reaction-to-fire behaviour and risks associated therewith are a function of a large number of factors that are building specific and must be assessed in the context of their relationship with the overall fire safety strategy of a building.

1242 It can be accepted that many circumstances involving the application of Alucobond PE and Alucobond Plus may constitute an undue risk of fire spread; however, this is ultimately an assessment that must be undertaken in respect of each building, and does not detract from the fact that, subject to how the Alucobond products are used in a particular building, it can be used in a manner that does not constitute an undue risk of fire spread. The reports Mr Kip was taken to in the course of the Expert Groups 4-5 and 6 conclave are reflective of this fact.

1243 In this context, it is relevant to address a number of submissions made in respect of Mr Kip’s reliability as an independent expert. As has been noted above, over the course of the conclaves in Expert Group 4-5 and 6, Mr Kip was confronted on a number of occasions with reports he had prepared or cosigned in which opinions were expressed to the effect that the particular use of Alucobond PE or Alucobond Plus did not constitute an undue risk of fire spread, or that particular buildings on which Alucobond PE or Alucobond Plus was applied met the relevant performance requirements. On a number of these occasions, Mr Kip sought to draw distinctions between what might be described as a “post-construction” environment and the “design phase” of construction, and suggested that different considerations applied depending on the assessment undertaken.

1244 3A submits that Mr Kip’s insistence on seeking this “refuge” without identifying a rational basis for the distinction was illogical and did not reflect well on the reliability of Mr Kip’s evidence. 3A submits that when Mr Kip was confronted with statements made in his reports which contradicted opinions expressed in his evidence, that he sought to evade their obvious implications by variously claiming to have been mistaken, seeking to draw unjustifiable distinctions or offering non-responsive answers. 3A submits that Mr Kip presented as lacking the independence and objectivity required of an expert witness, and accordingly, little weight should be attributed to his evidence. HVG makes a similar submission that Mr Kip did not conduct himself in the independent and impartial manner that would be expected from an expert witness such that his evidence should not be accepted where inconsistent with the evidence of other experts in Expert Groups 4-5 and 6.

1245 I am not satisfied that it is appropriate to approach Mr Kip’s evidence with such a degree of caution. It is important to note that the BCA sets a functional requirement system which places reliance on those involved in designing and constructing a building to ensure that they are designed and constructed in a manner that is acceptable. The relevant performance requirements, such as CP2 and CP4, and concepts such as undue risk of fire spread, are qualitative concepts. While the DtS Provisions are designed to ensure compliance with the relevant performance requirements, there is no specific quantitative measure of what constitutes compliance with the performance requirements. In this sense, there may well be a difference between what might be considered an undue risk of fire spread in the context of a post-construction environment, relative to a building in the design phase. This is not to say that the performance requirements for a building as constructed or in a design phase are different, just that it may inform part of the analysis.

1246 Of more relevance, however, is the context in which Mr Kip’s statements were made. Mr Kip, at a number of times during cross-examination in Expert Groups 4-5 [T534-539] and Expert Group 6 [T614-615], referred to the need, in standard engineering practice, to consider the cost of using a product relative to its benefits. In particular, Mr Kip stated the following under cross-examination during the Expert Group 4-5 conclave:

[S]o you’re saying designing a product to the compliance of the building code using engineering principles around cost benefit and – because, in my view, for example, you can theoretically design anything to comply but the cost of compliance will mean you would never actually do it… I don’t think you can get through the design process to design a façade using PE at any point in the relevant period based on normal engineering practice.

…

[I]f I can explain the process as it would happen in my period of practice, so if you came to me and said, “I want to put aluminium composite panels on my building”, I wouldn’t design it. I would say, “well, what are the products that we have got to choose here and what is the cost per square metre and what will the cost penalty be for the cheaper products?” And that analysis, which is not really engineering, it’s just accounting, would be probably that would knock back PE out on almost every project and I would argue actually every project because an engineer’s responsibility is to make sure their clients have an economical building… It’s not enough to say, “I can build you the most expensive building ever using the worst products as long as it’s shiny.” That’s not what engineering is.

…

[T]he evidence around a polyethylene core ACP, compared to a product that is modestly more expensive and is better… in the relevant period, there was PE, Plus and A2, and solid aluminium and other products, and in some jurisdictions stainless steel composite panels and zinc composite panels, and a whole range of panels. That’s the boots on the ground engineering analysis. What are you trying to do? It sounds like it will fail the cost benefit analysis pretty quickly. So you wouldn’t proceed.

1247 The point Mr Kip sought to emphasise was that, from a practical engineering standpoint, when considering the use of Alucobond PE and Alucobond Plus on a building, given the need to ensure that the fire risks posed by their use were properly assessed and managed through the design of the building, and given the number of alternative products available with better fire behaviour, as a practical design issue, it would be difficult to justify the use of Alucobond PE. The point raised by Mr Kip is inherently relevant only to a building where it is in its design phase. In a post-construction environment where Alucobond PE or Alucobond Plus have already been used, different considerations would apply.

1248 The above is not to say that the generality of the statements made by Mr Kip are to be accepted. It is to say that I do not accept that it is appropriate to approach Mr Kip’s evidence with the degree of caution the Respondents submit. As I have expressly noted above, it cannot be said, as a general statement, that any use of Alucobond PE or Alucobond Plus would constitute an undue risk of fire spread, even in a design context. The generality of Mr Kip’s statements must be qualified by the fact that the application of Alucobond PE and Alucobond Plus to a particular building is necessarily idiosyncratic. Mr Kip’s statements illuminate a slightly different point which is whether the use of Alucobond PE or Alucobond Plus would be considered or pursued from a practical engineering perspective, noting the practical and potential cost implications of ensuring that any fire risk was appropriately managed when alternative non-combustible products were available. It should be noted that such statements, while relevant, do not go to whether or not Alucobond PE or Alucobond Plus can, in fact, be used in a manner that is compliant with the BCA.

1249 I have found that due to the lack of positive evidence regarding AS 1530.3, the Applicants have not established the non-availability of the attachment exception as a pathway for BCA compliance. However, if I am wrong on this point, then Alucobond PE and Alucobond Plus could be used as an attachment on a Class 2 to 9 building in compliance with the BCA, through the attachment exception to the DtS pathway. This is because the second and third requirements of the BCA discussed above were able to be satisfied.

1250 In the following section I discuss the availability of the use of Alucobond PE and Alucobond Plus through a Performance Solution, such that my finding in regard to the attachment exception assumes less significance. That is, if I find that the Alucobond products were (or were not) capable of being used as an attachment through a Performance Solution, then the failure of the Applicants to establish the non-availability of the attachment exception will assume less significance.

8.6.3 Performance Solution

1251 If a building product does not comply with the DtS Provisions, it can only be BCA compliant if it complies with the applicable performance requirements of the BCA, by means of a Performance Solution, or a combination of both pathways. The process by which this is undertaken is outlined in detail in the Expert Groups 4-5 and 6 evidence, in sections 5.4 and 5.5 of these reasons.

1252 The Applicants accept that it was theoretically possible to ask an FSE to prepare a Performance Solution that may have permitted the use of combustible ACPs in relation to some buildings. However, the Applicants submit that there are a number of unlikely conditions that would need to exist for that “theoretical possibility” to become “reality”.

8.6.3.1 Engagement of FSEs to design a Performance Solution

1253 The first issue the Applicants refer to is that a Performance Solution would not even be considered unless the product was identified as being non-compliant with the DtS Provisions.

1254 I accept that this was the case. The Group 4-5 Joint Report stated each of the experts’ agreement that it was not common practice for FSEs to assess the proposed use of ACPs as part of or as an attachment to an external wall or building element during the relevant period. The experts agreed that this was because the trigger for an FSE to be engaged on a project was the identification of a deviation from the DtS Provisions by the relevant building certifier. The experts noted their agreement that during the relevant period, ACPs were considered by building certifiers to be compliant with the DtS Provisions. This was subject to isolated instances in which Mr Davis and Mr Moore were engaged in particular projects to assess the use of ACPs.

1255 The evidence of Expert Group 4-5 indicates that FSEs principally prepared Performance Solutions where deviations from the DtS Provisions were identified. It is unclear if, or to what extent, FSEs were engaged in projects that involved the use of ACPs, but where the use of ACPs was not identified as a relevant matter requiring consideration by the FSEs, or, to the extent FSEs were engaged, whether FSEs sought to raise issues with respect to any proposed application of ACPs.

1256 The above is, of course, not to say that this reflected appropriate conduct during the relevant period; only that this was the practical reality during the relevant period. The experts noted their agreement in the Group 4-5 Joint Report that during the relevant period, FSEs should always have been requested to prepare a fire safety Performance Solution for the use of ACPs, unless there was a valid CodeMark Certificate of Conformity.

1257 3A submits that the Applicants’ assertions that it was not common practice for FSEs to be asked to assess the proposed use of combustible ACPs during the relevant period is a bald assertion, and that to be meaningful, such submissions would need to be supported by quantitative evidence of some kind. I do not accept 3A’s submission. The position asserted by the Applicants reflects the evidence agreed to by each of the practising FSEs in Expert Group 4-5 who are well qualified to speak to common practice in the industry around when FSEs were engaged to assess the use of combustible ACPs. Indeed, 3A made no substantive challenge in respect of the agreed evidence during the expert conclave. The identification of particular projects in which a Performance Solution may have been prepared during the relevant period does not support a finding contrary to the agreed evidence given by the relevant experts.

1258 One further point should be noted. From the evidence given by Expert Group 4-5, I accept that it was not common practice during the relevant period for FSEs to be engaged to assess the particular use of ACPs on buildings. However, it is not clear why this was the case, beyond the fact that building certifiers did not consider it necessary. For example, it is not clear to what extent building certifiers may have relied on an incorrect interpretation of the bonded laminate exemption, to what extent building certifiers may have sought to, incorrectly, rely upon the attachment exception, or to what extent building certifiers relied on relevant CodeMark Certificates during the relevant period. There may not be one answer to these questions. However, it remains relevant to note that, for the purposes of this proceeding, the evidence before me does not enable me to make such a determination, nor to determine how practices may have emerged or otherwise changed during the relevant period. It is similarly not possible on the evidence before me to determine whether or to what extent any such practice could be attributed back to the Respondents.

8.6.3.2 What would have occurred if an FSE was engaged

1259 The Applicants’ primary position is that the knowledge of FSEs during the relevant period is not relevant to the question of acceptable quality, and in particular to the reasonable expectation of a consumer, given that FSEs were not commonly engaged during the relevant period to assess the use of ACPs. To the extent an FSE was engaged to develop a Performance Solution for the use of the Alucobond products, the Applicants submit that the process would not have been straightforward and that the results of the exercise would have been uncertain, such that it would carry attendant risks of non-compliance. The Applicants submit that there are at least three reasons why it was unlikely that the process of preparing a Performance Solution would have resulted in the substantial use of Alucobond PE or Alucobond Plus on any Class 2 to 9 building.

1260 First, the Applicants submit that there was limited information available concerning the reaction-to-fire properties of ACPs. The Applicants submit that, although FSEs could look up the basic properties of PE and aluminium, there was no easily accessible information about the fire performance of ACPs as a product, let alone façade systems incorporating ACPs. The Applicants submit that this was the reason that Professor Torero and his colleagues established the Cladding Materials Library at the University of Queensland, in around 2017-18 following the Grenfell Fire and which was made public around 2018-19.

1261 Second, the Applicants submit that FSEs were ill-equipped to address the fire hazards of ACPs during the relevant period. The Applicants refer to Associate Professor Lange’s evidence that there were limited practical barriers for practice as an FSE in many jurisdictions in Australia, leading to “a wide range of competence of those individuals practising as fire safety engineers”. The Applicants also refer to Professor Torero’s evidence that his assessment was that the knowledge of the fire behaviour of complex flammable façade systems within the engineering industry was “extremely poor” and “needed serious improvement”.

1262 In further support of this submission, the Applicants refer primarily to two matters. The first is the paper jointly authored by, amongst others, Professor Torero and Associate Professor Lange published in September 2021 titled, “Towards a better understanding of fire performance assessment of façade systems: Current situation and proposed new assessment framework” (Torero and Lange September 2021 Paper). It stated the following:

The conclusion of all the work conducted, post-Grenfell demonstrated that the existing tools and testing practices are inadequate for the assessment of the performance of modern facade systems. None of the existing tools can reproduce the different phenomena observed, in particular, the strongly coupled thermal mechanical behaviour that results in deformations, rupture and complex interactions between combustible and non-combustible materials. Existing standard testing methodologies have proven incapable of delivering adequate, relevant or sufficient information for performance assessment of systems, and scenario testing are not only too complex, lack adequate instrumentation are too sensitive to construction detailing but more fundamentally cannot recreate the desired conditions or deliver the necessary information for design.

1263 The second matter the Applicants refer to is the CPD program that Professor Torero developed for FSEs and other professionals, with a view to upskilling them in their ability to analyse complex cladding fire risks. The Applicants submit that the fact this was deemed necessary after the Grenfell Fire underlined that many, if not most, FSEs in Australia did not have the necessary skills available to carefully and competently assess the use of ACPs as part of a building façade.

1264 Third, the Applicants submit that even if FSEs were equipped with sufficient knowledge and skill to design a Performance Solution for the use of Alucobond PE and/or Alucobond Plus during the relevant period, it was apparent they would not have recommended the use of ACPs in the way that the Respondents advertised. Rather, the Applicants submit that they would have recommended a much more limited use than that displayed in the Respondents’ advertising material. I will deal with each of these points in turn.

1265 In respect of the first submission, the Applicants, in effect, seek to establish that the information available to FSEs during the relevant period was insufficient to enable FSEs to properly understand and assess the reaction-to-fire behaviour of the Alucobond panels, and therefore, to properly assess the risks associated with their use. I am not satisfied that such a finding can be supported on the evidence.

1266 Firstly, in relation to the establishment of the Cladding Materials Library, Professor Torero stated the following during the Expert Group 3 conclave:

Mr Free: [The Cladding Material Library] was developed in response to a perceived lack of information being available to fire safety engineers and other professionals within Australia?

Professor Torero: I mean, technically speaking, you can argue that, and I think many times a perceived lack of information is simply not being able to have that information at the tip of your fingers. But, yes, I think, in the period, there was a sense that there was a need to compile all that information and put it in one specific place, and whenever there were uncertainties, try to do the testing to try to enable people to make refined assessments of the performance of existing systems.

1267 Professor Torero’s comments do not suggest that the relevant information did not exist or was not available, or even that it could not otherwise be sourced, but rather that the Cladding Materials Library sought to bring all the relevant information into one specific place.

1268 The Applicants’ submission is also not consistent with broader evidence given in this proceeding by a number of the experts. This includes the following:

(a) the Group 3 Joint Report noted that an assessment of the hazards posed by Alucobond PE and Alucobond Plus could have been developed using the available properties of construction materials (including PE and aluminium) and relatively simple methods of analysis, as was illustrated by the analysis utilised in Professor Torero’s assessment of the Shore Building. None of the data or information used in Professor Torero’s analysis was unavailable to FSEs in Australia. While a simpler analysis and solution may require a greater number of safety factors to be incorporated, which may restrict how Alucobond PE or Alucobond Plus is used as part of the Performance Solution, it is not the case that a proper assessment of Alucobond PE and Alucobond Plus was not possible on the information available;

(b) Professor Torero’s evidence that, to assess the more complex behaviour of Alucobond Plus where combustible material was diluted through the use of an inert filler, a conservative approach could only be taken by considering a fraction of the gain that may be obtained relative to Alucobond PE’s reaction-to-fire behaviour;

(c) the Expert Group 4-5 evidence that, in assessing the suitability of combustible ACPs being used on a building, FSEs would consider the relevant fire tests identified in the BCA, or if such tests were not available or insufficient, the results of overseas tests. As the Group 4-5 Joint Report stated, the results of these tests would need to be properly understood and contextualised. Additionally, consideration might also be given to scientific papers, fire engineering principles, reports or investigations of cladding fires, relevant textbooks and other resources;

(d) the Applicants sought to identify a number of limitations in respect of how particular fire tests were conducted (setting aside, for the moment, issues of propriety in doing so). But the evidence of the experts was not that the information from the fire tests could not be used in the development of an appropriate Performance Solution. Rather, the evidence was that the relevant limitations in each test would need to be properly understood, so that a careful assessment could be made as to the extent to which the results of particular fire tests could inform the development of a Performance Solution for a particular application of panels. It may be the case that a particular fire test, for one reason or another, cannot be meaningfully extrapolated. For example, Mr Moore provided the following evidence in the course of the Expert Group 4-5 conclave:

If the fire engineer asks for a test and they come back with something that was tested to, say, this arrangement that is very atypical of what would be put on a building, then you would start to look at those factors, say, the edge is being protected in this test, is it protected in a similar way? So we don’t – when we request a test, it’s not like we give a test tick, you look at the test, you look at the results and you look at the limitations of that test, one of them being how the material is fixed and whether it’s applicable to your one.

(e) Additionally, Expert Group 4-5 agreed that theoretically, a Performance Solution could be designed without having large-scale fire results for ACPs. The experts recognised that the use of small-scale fire tests to understand the reaction-to-fire behaviour of the Alucobond panels allows for only limited and conservative extrapolation of any results. Again, while this would narrow what might be determined as an acceptable application of ACPs, it cannot be said that the lack of large-scale fire results would, by itself, prevent the formulation of a Performance Solution: [T533.15-45]. As an illustration of this point, Professor Torero noted that a conservative assumption could be made that all of the PE would burn, and consider a Performance Solution on that basis (noting that such an assumption would not be necessary to develop a Performance Solution): [T534.2-46]. While making such conservative assumptions would, naturally, significantly restrict what might be considered an acceptable use of the Alucobond panels, it is illustrative of the point the experts sought to make.

1269 Turning to the second submission – the competency of FSEs during the relevant period – as has been discussed earlier in these reasons, broadly speaking, the evidence establishes that the competency of FSEs and their ability to properly assess and manage the risks associated with the use of combustible ACPs was varied. It can, therefore, be accepted that to the extent an FSE was engaged to assess the use of combustible ACPs on a particular project during the relevant period, there was a risk the FSE may have lacked the level of competency required to properly analyse and manage the risks associated with the use of the ACPs. It is not possible, on the evidence before me, to make an informed finding as to the overall competency of FSEs in Australia as a whole during the relevant period and to, therefore, make a finding that FSEs were generally ill-equipped at dealing with the fire hazards arising from the use of ACPs. As Associate Professor Lange stated during the Expert Group 3 conclave:

[T]here is a risk that the fire engineer appointed to a project would not have competence to deal with the challenges of that project. I don’t think there is a way to say with any degree of certainty what the level of competence of fire safety engineers broadly was over the period in question.

1270 The evidence in respect of the competency of FSEs has been largely outlined in the context of Expert Group 3’s evidence above. However, it is helpful to consider this again briefly. The Group 3 Joint Report stated Professor Torero and Associate Professor Lange’s view that it is not possible to make broad sweeping statements about the diligence or competence of FSEs in Australia over the relevant period. Clearly, there were varying degrees of competency; as Associate Professor Lange stated in the Group 3 Joint Report, there were individuals who had very low levels of both competence and professionalism and those who had very high levels of the same. This is demonstrated by the concerns raised, at large, of the competency of FSEs during the relevant period. As noted in Professor Torero’s report, these concerns led to a series of reports, including the Warren Centre Report in 2019 which addressed the lack of national consistency in the approach to regulation and controls over fire safety engineering practice in Australia. The Warren Centre Report stated that there was a lack of: controls over the practice of fire safety engineering, audit and enforcement of FSEs and their performance, and no standards against which to judge performance and competency. Professor Torero stated in his report that the practice of fire safety engineering in Australia during the relevant period, could not be considered as reflecting the quality and consistency of practice expected by the NCC. The experts noted in the Group 3 Joint Report that a fundamental problem in Australia during the relevant period was the inconsistencies in the barriers to practice, such that there was no consistency as to the level of competency of FSEs.

1271 In light of this, it is relevant to note additional aspects of the Professor Torero and Associate Professor Lange September 2021 Paper:

The manner in which high-rise building construction has evolved in the last two decades has resulted in the number of very large-scale building fires increasing in a dramatic way… These fires have been documented extensively and in the majority of the cases the fast spread and ultimate magnitude of the fire is related to the manner in which the façade system was designed. Despite the numerous failures, it remains unclear how to address these complex systems to deliver a quantitative performance assessment that enables fire safety engineers to establish, in an explicit manner, an adequate fire safety strategy.

…

Other drivers such as ease of construction, cost, aesthetics and acoustics have also emerged, and the continuous building envelope has become the preferred solution for retrofit and new builds.

The continuous building envelope brings an inherent problem in that it is susceptible to deformations that are very different to the structure to which it is attached. This creates the potential to render firestop arrangements ineffective, and allow penetration of the fire from a lower compartment to one above. This problem is further exacerbated by the use of specific materials, such as aluminium, to respond to other drivers such as weight reduction and ease of manufacturing. Aluminium loses all mechanical integrity by 550°C and melts at 650°C, which are well below the temperatures of typical fires… Thus, these materials represent no barrier to a fire.

…

In summary, compartmentation provided by façade systems is critical to the fire safety strategy. The capacity of façade systems to constrain and slow the spread of a fire needs to be quantified to establish the adequacy of the fire safety strategy. Extrinsic drivers have resulted in façade systems of unknown fire performance and unpredictable fire safety outcomes. Therefore, it is essential to revisit the fundamental processes determining how a façade system supports the desired level of fire safety performance and, as a result, delivers tools that enable engineers to quantify such performance.

…

The strategy of encapsulation thus became a driving force for the use of combustible materials within the building envelope. Aluminium Composite Panels (ACPs) or aluminium foil covered cellular plastic insulation are perfect examples of systems where encapsulated combustible materials are used. These systems spread widely because of their reduced cost and because they provided an effective solution to many of the required building functionalities.

The combination of an encapsulated combustible product added to a continuous, lightweight building envelope results in systems of enormous complexity and innumerable components. Many of these components have been fixed in manners that favour ease of construction but do not necessarily take into consideration their performance in fire.

As a consequence, existing combustibility tests can no longer be used in their standardised form for these encapsulated products in a way that gives meaningful data. This is because they are designed to assess individual materials rather than composite products.

1272 Professor Torero, during the Expert Group 3 conclave, also addressed the issue of the speed of the evolution of cladding systems resulting in façade systems becoming too complex for FSEs to be capable of properly assessing the associated fire risks and develop appropriate fire safety strategies: [T372.39-46]-[T373.1-21]. As the Torero and Lange September 2021 Paper notes, the complexities created by such systems undermined the ability of FSEs to properly quantify the performance of the systems and deliver, explicitly, an adequate fire safety strategy. The Torero and Lange September 2021 Paper identifies a number of contributing factors which resulted in the development of systems of “unknown fire performance”, including the prioritisation of the ease of construction, cost and aesthetics. This is also reflected in the following comments made in the Group 3 Joint Report:

The statements above do not negate the fact that ACPs such as Alucobond PE and Alucobond Plus, and the external wall systems in which they are commonly used, are very complex systems. Nor does it negate the fact that the properties of these products’ component materials can lead to significant fire hazards. A detailed hazard analysis can therefore be extremely complex and might not have been accessible to a typical FSE in Australia during the relevant period … Nevertheless, simpler solutions that carry large factors of safety and restrict the manner and extent of ACP use on any particular building could – in principle – have been demonstrated to result in adequate safety using simpler tools and methods that may have been in common use by FSEs in Australia during the relevant period.

1273 It is not the case that the incorporation of a combustible ACP into a façade system, alone, would undermine the capacity of an FSE to properly assess the use of the combustible ACP. Such a finding would be inconsistent with much of the evidence outlined above in respect of the Applicants’ first submission. To the extent relevant, it was also not the evidence given by the practising FSEs (Expert Group 4-5).

1274 In respect of the Applicants’ third submission that an FSE would not have recommended the use of ACPs in the way that the Respondents advertised, the Applicants submit that while the fire engineering experts were understandably reluctant to comment on whether the use of Alucobond PE or Alucobond Plus had been used inappropriately on any particular building without undertaking a full assessment of the fire safety strategy of the building, it was apparent from their evidence that the likelihood of a careful and competent FSE approving the use of continuous lengths of the products along the façade of a building, in the way shown in the Respondents’ marketing material, was low.

1275 A number of points should be made in respect of the Applicants’ submission.

1276 First, the most obvious difficulty with the Applicants’ submission is that none of the Applicants’ experts were asked to opine on the question by reference to any of the buildings shown in the Alucobond brochures. It is not contested that a Performance Solution is building specific. If the Applicants wished to submit that Alucobond PE and Alucobond Plus could not have been used under a Performance Solution on a particular building as shown in the advertising brochures, they ought to have asked their experts that question and put on relevant evidence. Professor Bisby accepted that:

(a) the Alucobond brochures to which he was referred did not provide adequate information for him to assess the overall fire safety strategies for the buildings shown in the brochures;

(b) he had not made any inspection of those buildings; and

(c) he could not say whether the use of Alucobond PE or Alucobond Plus on those buildings gave rise to a risk to life or property that had not been adequately mitigated [T419.43-420.24].

(d) he could give no evidence as to whether any particular use of the Alucobond PE or Alucobond Plus shown in the brochures or otherwise, would or would not comply with the BCA [T378.12-24].

1277 Second, the expert evidence on the point was limited given that compliance with the BCA is building specific. The expert evidence does not support the conclusion contended for by the Applicants.

1278 Mr Kip, in giving evidence in Expert Groups 4-5 and 6, accepted that he had himself approved the use of Alucobond Plus in continuous lengths along the façade of a multi-storey building in Northcote, Victoria [T611.31-40], [T492-493]. This was a mixed commercial/residential building, with “27 apartments and 3 retail/office tenancies”. A photograph of the building shows the combustible cladding extends over three stories, from above the awning at ground level up to beneath the roof, on two adjacent façades of the seven-storey building [T611.23-31]. The cladding also wraps into the openings of the windows. Mr Kip concluded that the building with the combustible cladding installed on it was low-risk from a fire engineering point of view and that none of the cladding needed to be removed. That was, in Mr Kip’s opinion, because “an ACP with 30% polyethylene core can often perform similarly to BCA DtS compliant replacement products such as cement sheet, solid aluminium or bonded laminates on a low-rise sprinkler protected building such as this”. Mr Kip plainly took care in forming the opinions expressed in his report.

1279 Professor Torero’s evidence does not support the Applicants’ submission that there was a low likelihood of a careful and competent FSE approving the use of continuous lengths of Alucobond PE and Alucobond Plus along the façade of a building. Professor Torero made clear that, in his view, “you can put the appropriate provisions” into a building to enable combustible ACP cladding to be used”: [T540.46].

1280 Professor Torero agreed, in cross-examination, with the abstract proposition that, “as a designer” considering the use of Alucobond PE, “you would want to avoid vertical runs up the whole of the building”: [T543.27]. Professor Torero was not initially asked that question by reference to any specific building, or any dimensions or other characteristics of the building: [T543.25]. When he was taken to a picture in an Alucobond brochure showing continuous cladding panels arranged vertically and asked to assume that the cladding shown was all Alucobond PE, he made it clear that it was “simply an impossibility” to offer any view about whether what was shown was acceptable from a fire safety perspective: [T544.12-19]. The mere fact that the building included “vertical runs from the ground to the top of the building” and cladding wrapping around windows was not sufficient for Professor Torero to make any assessment at all of the building’s fire safety [T544.2]. Professor Torero said that he would need to know all the fire safety provisions of the relevant building has before he could do so: [T544.12-19]. Professor Torero’s evidence was that he could not opine on the use of Alucobond panels as depicted in the Alucobond brochures and BCA compliance without assessing the fire risk having regard to the characteristics of the building as a whole.

1281 The expert evidence of Mr Moore was to similar effect as that of Professor Torero. Mr Moore said that whether the use of Alucobond PE or Alucobond Plus could be demonstrated as satisfying the performance requirements of the BCA throughout the relevant period depended upon the particular details of the use of Alucobond panels within the building and of the design of the building. Mr Moore stated in his report that “the use of Alucobond PE would depend on the location of the panels and the fire-safety systems within the building”.

1282 To the extent the Applicants rely upon the evidence of Mr Davis and, specifically, his Performance Solutions for the Shore Building and the Five Dock Building, the changes to the design for those buildings recommended by Mr Davis are specific to the relevant building. That is plain from the close analysis of the design of the building Mr Davis undertook to arrive at his recommended solution. I accept 3A’s submission that it is not possible to extrapolate from that exercise to a conclusion that Mr Davis considered that there was a “low” likelihood of an FSE “approving the use of continuous lengths” of Alucobond PE or Alucobond Plus. Rather, Mr Davis said in his oral evidence that he considered it “possible to use 100% PE on some of the buildings some of the time”: [T541.14]. As to Alucobond Plus, Mr Davis’ Performance Solution for the Five Dock Building involved retaining significant amounts of Alucobond Plus. Specifically, Mr Davis considered that the panels arranged in continuous vertical strips across the entire façade could remain. Only the panels above and below each window required replacement with a non-combustible alternative.

1283 I find that none of the expert evidence establishes that Alucobond PE and Alucobond Plus were not capable of being used pursuant to a Performance Solution in the manner shown in the advertising material.

1284 Third, insofar as the Applicants’ submissions refer to the “low” likelihood of a proposed Performance Solution being “agreed to” by stakeholders, that submission fails to grapple with the relevant question, namely, whether Alucobond PE or Alucobond Plus were capable of being specified and approved by a reasonable and competent Qualified Professional. A conclusion reached by a competent FSE that a particular use is appropriate under a Performance Solution is treated by the BCA as constituting compliance. The Applicants have not established on the expert evidence that Alucobond PE and Alucobond Plus could not be used in a compliant manner with the BCA as depicted in the Alucobond advertising brochures.

8.6.3.3 Practical barriers to the pursuit of a Performance Solution

1285 The Applicants make further submissions which may be properly described as the “practical barriers” which may have prevented a Performance Solution from being either pursued or approved.

1286 The Applicants submit that even if, during the relevant period, an FSE had been able to prepare a proposed Performance Solution involving the substantial use of Alucobond PE or Alucobond Plus, there would have been no assurance that it would have been agreed to by the building owners, the fire brigade, and other stakeholders as part of the FEB process. The Applicants refer, in support of this submission, primarily to the evidence of Mr Youssef regarding the fire brigade’s concerns about the use of combustible ACPs. The Applicants submit that the fire brigade was the most significant stakeholder. Further, that Mr Youssef’s unchallenged evidence is that it was unlikely any Performance Solution for the use of Alucobond PE or Alucobond Plus in any substantial quantity would have been supported by the fire brigade. The Applicants also refer to a number of documents produced by the City of Sydney Council and Fire & Rescue NSW which the Applicants submit record the significant concerns held by the relevant bodies, even where a report had been prepared by a certifier or an FSE. While each of the cases identified by the Applicants occurred after the relevant period, the Applicants submit that the Court should infer the same results would have occurred had information about the risks associated with the use of ACPs been available and stakeholder input sought as part of a Performance Solution during the relevant period.

1287 The Applicants further submit that even if an FEB could have been prepared and agreed to by stakeholders, there was no guarantee that the Performance Solution would ultimately have been approved. The Applicants submit, therefore, that consumers of the relevant cladding product would have risked wasting significant time and cost for an uncertain result. The Applicants note that when regulatory authorities in the ACT first started to question the compliance of ACPs with the DtS Provisions of the BCA, HVG submitted a proposal to amend C1.12 of the BCA to explicitly allow the use of certain ACPs (although the proposal was never adopted). The Applicants submit that the reasons put forward by HVG are illuminating. The report prepared by Defire dated 31 January 2011 stated the following:

Introduction

Aluminium composite panels (ACPs) are widely used for external cladding throughout Australia and the world. Concerns have been raised in the Australian Capital Territory (ACT) regarding whether the material complies with the deemed-to-satisfy (DTS) provisions of the Building Code of Australia 2010 (BCA). Given the economic, social and environmental impacts that have emerged from this issue it is important that the matter be readily resolved.

This report is intended as a proposal for change (PFC)… Defire undertook application at the request of Alucobond Architectural and SGI Architectural.

…

The current problem

3.1 The issue to be resolved

The main building code compliance issue associated with ACPs is that clauses 3.1(b) and 4.1(b) of specification C1.1 of the BCA require external walls to be non-combustible for buildings are of type A and type B construction.

The BCA specifies AS1530.1 – 1994 as the relevant test procedure to determine combustibility of a material for the use in external facades. Clause 1.4 of AS1530.1 – 1994 requires each individual component to be tested separately. On this basis the test is not demonstrative on how the products are applied to a building. It is likely that the majority of products tested under this test method will be deemed combustible due to the composition of the core layer – even those containing in most part a non-combustible mineral filled core. For this reason particular [sic], ACPs cannot be used on buildings of type A or type B construction.

It is also noted that clause 2.4 of specification C1.1 provides a concession which allows the use [sic] combustible finishes for external walls if certain requirements are met. This clause is open to interpretation regarding whether products such as ACPs can or can’t be used.

On this basis the ACT Fire Brigade have noted that ACPs may be assumed to be DTS where they are attached to an external wall. This is appropriate when the element behind the attachment is still able to function as an external wall and be weatherproof, etc – ie attached to masonry walls that achieve the required FRL. The requirements in clause 2.4 of specification C1.1 are not fully understood and may be interpreted that ACPs are suitable for use as long as the product meets the requirements for fire hazard properties prescribed in clause 2 of specification C1.10 or clause 2 and 3 of specification C1.10a.

…

Objective

4.1 How the proposal will solve the problem

It must be noted that this issue currently seems to be isolated to the ACT, but it is beginning to advance to other States and Territories. If concerns progress widespread to other States and Territories prior to amendment, modification or technical change to the BCA, it is likely that a large portion of the ACP industry may collapse and the number of people affected will increase tenfold.

…

4.2 Alternatives to the problem

The preferred outcome for this application is to allow the use of ACPs that achieve the appropriate fire resisting properties so they be used [sic] on buildings of type A and type B construction. It may be possible to provide BCA compliance on a performance basis through an alternative solution. However, each job would be site specific and all aspects of the building would require consideration. This is neither a practical nor a fully effective solution to the problem and should only be used as a temporary measure until the ABCB can modify or provide a technical change to the BCA.

There are also cost implications involved with providing individual alternative solution reports for the use of these products. Depending on the size and scale of each building or development costs may vary from $1500 to $7000. These are not costs that can be endured by the manufacturers, nor is it practical to pass costs on the client.

(Emphasis added.)

1288 The Applicants submit that the statements emphasised above reflect the unreality of the position the Respondents adopt in this proceeding, and that while a Performance Solution could, conceptually, have been developed for the use of Alucobond PE or Alucobond Plus (or indeed any material) in some capacity on a building, nobody would have practically done so for a low-cost cladding material. The Applicants submit that most developers informed of the risks involved in the use of Alucobond PE and Alucobond Plus would have simply opted for a non-combustible alternative that avoided such cost and risk of non-compliance.

1289 Insofar as the Applicants’ submissions refer to the practical difficulties of pursuing a Performance Solution, including potential issues with obtaining the agreement of relevant stakeholders, and the cost and risks associated with putting a Performance Solution in place, the submissions do not substantively grapple with the core question, being: whether, during the relevant period, the Alucobond panels were, in fact, capable of being approved as an attachment to, or a component of, an external wall of a Class 2 to 9 building as part of a Performance Solution. I accept 3A’s submission that while the Applicants refer to the risk that agreement by stakeholders might not be forthcoming, which as a standalone statement must be accepted, the evidence before me does not enable me to make any informed assessment to quantify the likelihood of that risk. I also accept 3A’s submission that references to Mr Youssef’s evidence in this respect are not particularly illuminative given that his evidence was not specifically directed to the process by which a fire brigade would assess a Performance Solution. Of course, it would seem relatively uncontroversial that the use of combustible ACPs would be a matter of particular concern for fire brigades. However, the evidence does not go so far as to suggest that it would not be reasonably practicable to design a Performance Solution incorporating Alucobond PE and/or Alucobond Plus.

1290 More problematic is the Applicants’ submission that FSEs would not have sought to use Alucobond PE or Alucobond Plus through a Performance Solution given the non-combustible alternatives available. This is because designing and constructing a building pursuant to DtS Provisions might be considered the preferable solution in a number of circumstances. DtS compliance provides what might generally be considered a simpler and potentially more cost-effective – relative to the cost that might be involved in engaging a relevant specialist to prepare a Performance Solution – pathway to compliance. It is not in dispute that a Performance Solution pathway may be more costly than a DtS pathway. Once again, this is not responsive to the core question of whether Alucobond PE or Alucobond Plus could, in fact, be used in a manner that was compliant with the BCA.

1291 The Applicants’ consumer guarantee claim is, on a plain reading, advanced on the footing that Alucobond PE and/or Alucobond Plus were not of acceptable quality because of the BCA Non-compliance Properties (or the associated BCA Non-compliance Risk Properties, and BCA-Related Prohibition Risk Properties). Without seeking to outline the pleadings in detail, one basis on which the BCA Non-compliance Properties are alleged, is that it was not possible (or reasonably practicable) to design a Performance Solution that would allow the use of Alucobond PE and/or Alucobond Plus, as part of or as an attachment to an external wall or other building element, other than where the Alucobond Plus was used in insubstantial quantities.

1292 The Applicants did not plead a case to the effect that Alucobond PE and/or Alucobond Plus were not of acceptable quality because, use of the products as part of an external wall on a Class 2-9 building of Type A or Type B construction would require an FSE to conduct an assessment of the product and prepare a Performance Solution, such that it would have rendered the product uneconomical compared to other non-combustible alternatives available on the market. Rather, this claim is based on a generalised cost/benefit analysis.

1293 The 2FASOC includes the following particular to [32A]:

A. It was not possible, or alternatively reasonably practicable, to design or certify an Alternative Solution incorporating Alucobond Plus because at all material times:

…

d. even assuming stakeholder approval was obtained, significant fire mitigation measures would be required including (at a minimum) fire breaks, fire sprinklers, shielding of the PE Core with non-combustible or fire-resting construction, limited combustibility insulation, sarkings and fixings behind the cladding, and limitations on the use of areas such as balconies, all of which are expensive and onerous (as compared to using a non-combustible alternative product).

1294 The difficulty with the above is that, first, the Applicants have not established that a Performance Solution incorporating Alucobond PE and/or Alucobond Plus would require significant fire mitigation measures. Indeed, as noted above, the risk posed by the use of Alucobond PE and/or Alucobond Plus is one that must be assessed by reference to each building, and therefore, the extent to which fire mitigation measures must be incorporated depends on the particular application of the panels.

1295 However, picking up the broader point above, the suggestion that the product would have been rendered uneconomical due to the need to incorporate fire mitigation measures does not answer the question of whether or not it was, in fact, reasonably practicable to prepare a compliant Performance Solution. For the numerous reasons submitted by the Applicants, such a pathway may not practically be pursued. However, this does not itself render the pathway to compliance redundant.

1296 It is also relevant to appreciate the context in which Alucobond materials are supplied. In Australia, the BCA does not require buildings to be built pursuant to prescriptive requirements. While a DtS Solution can be pursued, the BCA sets performance requirements, creating a functional requirements system which enables relevant professionals to design buildings using different tools and products, so long as the building as a whole achieves the performance it is required to achieve. While this places a significant degree of responsibility on relevant professionals, it is the system subject to which building products, including the Alucobond panels, are supplied in Australia.

1297 In this context, it is somewhat difficult to reconcile the idea that because the Alucobond products cannot be used in a DtS compliant manner in all relevant applications, and might otherwise become uneconomical if a Performance Solution was pursued, that the Alucobond products would be considered not of acceptable quality. Noting that the Alucobond products could be used in a manner that was compliant with the BCA, a Qualified Professional might seek to use the panels where such use was not inconsistent with the DtS Provisions, and otherwise seek to implement a Performance Solution where the use was inconsistent with the DtS Provision. Naturally, such use may be restricted by the relevant performance requirements, but the ability to use the product in such a way is built into the manner in which the BCA operates.

1298 Additionally, there may theoretically be any number of reasons why a Performance Solution might be pursued in one particular case and not another, including considerations of cost, weight, ease of fabrication, the design intention, overall aesthetic impacts, availability of products, etc. It might be accepted that a DtS Solution would be preferable as a generalised statement as it avoids the potential for risk, delay and may be more cost-effective. But, in my view it is too simplistic to suggest that the non-availability of a DtS Solution renders a product not of acceptable quality, even though it is capable of being used via a Performance Solution. I find that Alucobond PE and Alucobond Plus could be used as part of or as an attachment to an external wall or building element during the relevant period in compliance with the BCA through the implementation of a Performance Solution, and such was use not necessarily limited to only insubstantial quantities.

8.6.4 Summary of BCA Non-compliance Properties

1299 First, I do not accept that the use of Alucobond PE and Alucobond Plus on the façade of a Class 2 to 9 building during the relevant period was not supported by valid CodeMark Certificates, provided the use complied with a DtS pathway or formed part of a Performance Solution. Further, from 12 July 2013 to 12 July 2016, Alucobond PE could be used as a decorative and protective attachment system for internal and external use, on Type C construction in conformance with the BCA through valid reliance on a CodeMark Certificate. Until 12 July 2016, Alucobond Plus could be used, as a decorative system for internal lining or external attachment in respect of a building of Type A, B or C construction in conformance with the BCA valid reliance on a CodeMark Certificate. From 12 July 2016, Alucobond Plus could be used as part of an external wall (or as an attachment thereto) on a building of Type A, B or C construction in conformance with the BCA’s valid reliance on a CodeMark Certificate.

1300 Second, as agreed by the experts, the bonded laminate exception could not be used for Alucobond PE or Alucobond Plus as a valid exception for compliance with the DtS Provisions of the BCA.

1301 Third, I find that there is insufficient evidence to make a finding that Alucobond PE and Alucobond Plus could or could not be used compliantly with Specification C 1.1, cl 2.4(a), as an attachment to an external wall. The Applicants have not established that the attachment exception could not be used.

1302 Fourth, I do not accept that the use of Alucobond PE and Alucobond Plus on the façade of a Class 2 to 9 building during the relevant period was unlikely to be the subject of a compliant Performance Solution designed by an FSE. The evidence does not establish that Alucobond PE and Alucobond Plus when fitted as part of an external wall or as an attachment does not comply with the BCA. The evidence does not establish that it was not possible for Alucobond PE or Alucobond Plus to be used on a relevant building as part of a Performance Solution under the BCA, as part of an external wall, or as an attachment thereto, on buildings of Type A, B or C construction.

1303 The Applicants have not established that the use of Alucobond PE and Alucobond Plus on the façade of a Class 2 to 9 building during the relevant period was unlikely to be the subject of a compliant Performance Solution designed by an FSE in a manner consistent with the uses advertised in the marketing brochures. There is no evidence which would support that proposition. Therefore, I find that the Applicants have not established the existence of the BCA Non-compliance Properties and the BCA Non-compliance Risk Properties.

8.7 The Purposes for which Alucobond PE and Alucobond Plus were commonly supplied

1304 To determine whether Alucobond PE or Alucobond Plus were of merchantable or acceptable quality, it is fundamental to correctly identify the “purposes” for which the Alucobond products were commonly supplied in the relevant period. HVG submits, and I accept, that the purpose for which a product is supplied is not the same thing as the specific uses to which the product may be put in attempted fulfilment of that purpose. Put another way, it is wrong to identify the relevant purpose at such a level of specificity that it constitutes no more than a particular use of the product.

1305 As set out earlier in these reasons, the Purposes pleaded by the Applicants are that Alucobond PE and Alucobond Plus was commonly bought and supplied in Australia for use as part of an external wall (and/or as an attachment thereto or other building element) on high-rise and/or low-rise buildings, where such buildings were for residential purposes, commercial purposes or public or government administration purposes.

1306 3A pleads in its defence that the purposes include the Purposes pleaded by the Applicants, but with the limitation that a use in pursuit of such purpose must be: in accordance with designs, plans and specifications prepared, reviewed, approved, certified and/or used by Qualified Professionals – which includes architects, engineers, FSEs, and façade engineers, installers and consultants, consent authorities designated or appointed under legislation of each Australian State and Territory, builders, developers, and sub-contractors, with appropriate qualifications and/or experience – in accordance with the requirements of the applicable BCA and other applicable legislative and regulatory requirements in force at the relevant time.

1307 HVG’s defence also admits that the purposes include those pleaded by the Applicants, amongst a long list of pleaded uses, but with the caveat that at all material times Alucobond PE and/or Alucobond Plus were supplied to Qualified Professionals in the Construction Industry Market with responsibility to assess the use of ACPs and for ACPs to be used in a safe manner, compliant with all relevant standards, codes and legislation or regulations applicable to the design and/or construction of buildings in Australia as in force at the relevant time.

1308 The Applicants submit that the most common use of ACPs (including Alucobond PE and Alucobond Plus) was on façades and more generally the envelopes of buildings for weatherproofing either as a sealed system or as part of a rainscreen where a waterproof wall sat behind the screen, or as an attachment such as a perforated sunscreen, soffit lining, internal wall cladding, rooftop feature and signage: Group 7 Joint Report.

1309 In support of this, the Applicants referred to Mr Quigley’s oral evidence that he had observed during the relevant period, the greatest use of ACPs as being for external cladding, on either high-rise residential buildings, commercial buildings and institutional buildings such as hospitals as well as low-rise buildings: [T623:38-47]. Mr Incoll described that he had personally observed cladding as being used as external façades of institutional and commercial buildings, and he was also aware of ACPs being used on residential façades during the relevant period: [T636:5-11]. Mr Smithson agreed that ACPs were commonly used in each of the ways described in the Group 7 Joint Report: [T636:17-19]. Mr Smithson also agreed that ACPs were commonly used in those ways long before the start of the relevant period: [T969:23-28].

1310 The Applicants submit that these common uses as a façade or envelope of both high-rise and low-rise buildings, including residential buildings, are the most relevant uses that must be borne in mind when analysing the expectations of the reasonable consumer. The Applicants refer to the images in the marketing brochures produced by the Respondents as demonstrating that when ACPs were used as a façade or as the envelope of a building, it was typically the case that the ACPs were used to make up the entire or the majority of the façade of a building, including on high-rise and residential applications.

1311 The Applicants submit that there was nothing contained in the materials or information provided by either of the Respondents that would have caused the reasonable consumer to appreciate that the Alucobond PE or Alucobond Plus panels could not in fact be used for those purposes in a safe way, unless the proposed usage of such panels was first considered and approved by a careful and competent FSE. Nor was there any warning conveyed that there was any reason that an FSE would not be able to approve such use of the ACP products. There was, in all the circumstances, no reason for the reasonable consumer to expect anything less than that the panels would be fit for each of the purposes described in the brochures.

1312 I accept HVG’s submission that one of the purposes for which ACP cladding was commonly supplied was for use as external cladding on façades of buildings. But, there are a wide range of specific uses of ACP cladding to achieve that purpose in the context of a particular building. Some of those uses may be lawful, others may not be. But the consumer guarantee provisions of the TPA and ACL do not direct attention to those specific modes of use in determining compliance with the statutory guarantee. The consumer guarantee provisions in the TPA and the ACL speak of purpose, not specific use.

1313 Graham Barclay Oysters endorses such an interpretation. It may be accepted that the purpose for which oysters are supplied is singular and simple, to be consumed as food. Lindgren J in Graham Barclay Oysters at [536] said that the oysters were “put into the market for the one and only purpose of being eaten”. It may be accepted that the reasonable consumer would regard them as being required to be safe for that purpose, whatever the precise and particular use to which they were put in order to fulfil that purpose may be (Natural, Kilpatrick, Rockefeller or Chowder). In Graham Barclay Oysters there was no sensible scenario in which any particular use could logically make any difference as to the safety of the oyster itself for that purpose. The result of the analysis simply does not change whether one frames the analysis by reference to purpose or use. But that does not alter the fact that the statutory question in the consumer guarantee provisions of the ACL and the TPA relates to “purpose” and not “use”. This distinction must be carefully observed where the law provides restrictions on some uses of the product. The building and safety regulations embodied in the BCA limit and define the uses to which Alucobond PE and Alucobond Plus may be put.

8.8 Role of Qualified Professionals

1314 In the context of these proceedings, Qualified Professionals is a broad term that encompasses a wide range of persons involved in the design, approval and construction of buildings to which ACPs were applied. This includes architects, FSEs, façade engineers and installers, building certifiers and surveyors, and builders, developers, and project managers.

1315 The Applicants submit that the role of Qualified Professionals in the current proceedings is relevant to both the consumer guarantee claim and the misleading and deceptive conduct claim in two ways.

1316 In relation to the consumer guarantee claim, the Applicants plead that the “consumer” was the developer, but accept that Alucobond PE and Alucobond Plus were supplied through or used with the assistance of at least some Qualified Professionals on most building projects during the relevant period. The Applicants submit that the general state of knowledge of those professionals commonly involved in building projects about the specific risks associated with the use of the Alucobond products is relevant to the objective assessment of whether the safety and fitness of the goods was such as a reasonable consumer was entitled to expect or would regard as acceptable: Ethicon S à rl and Others v Gill and Others (2021) 288 FCR 338; [2021] FCAFC 29 (Ethico n (F ull Court)) at [389(3)]. It is also relevant to the adequacy of the information provided by the manufacturers of the products, including the adequacy of the information which is to be provided to the relevant professionals: Ethicon (Full Court) at [602], and see Ethicon at [3210].

1317 The Applicants submit that while a reasonable consumer may accept a good as being of merchantable or acceptable quality if it carries a risk that is well known and understood by professionals who are commonly engaged to assist in the use of that product, they are less likely to do so where that risk is not well known or understood and no warnings are provided by the manufacturer to bring that risk to the attention of the relevant professional: Ethicon (Full Court) at [398]. In Ethicon (Full Court), the Full Court noted, at [608], that having regard to the explanatory memorandum relating to the defect provisions of the TPA:

[I]t is clear that parliament intended that in relation to medical goods supplied to doctors rather than directly to patients, manufacturers provide doctors with sufficient information, advice and warnings about any material risk of harm presented by the goods so as to properly inform the doctor about the risk, in order that the doctor can appropriately inform or warn his or her patient”:

1318 The Applicants submit that the Court must be wary about going further than this as, contrary to the manner in which the Respondents opened their case, the Court is not being asked to engage in a Royal Commission into whether the many Qualified Professionals who specified, used and approved the use of combustible ACPs such as Alucobond PE and Alucobond Plus were negligent. The Applicants submit that this is not the burden of their case. Rather, that the Applicants’ case is that a reasonable consumer would not regard the goods as safe and fit for purpose if the use of those goods carried significant inherent risks to life and property such that the only way the goods could be used safely and compliantly (if at all) was with the assistance of an unusually skilled and knowledgeable FSE, in circumstances where such FSEs were not commonly engaged to consider the use of such building products during the relevant period.

1319 3A submits that the Court is not required to make generalised findings about the negligence of Qualified Professionals. 3A’s point is that it is impermissible to reason backwards from the existence of occasions on which Alucobond PE and Alucobond Plus were used non-compliantly by Qualified Professionals acting in breach of their duty of care to a conclusion that the products are inherently incapable of being used compliantly. 3A submits that their case is that the role of Qualified Professionals in specifying, using and approving combustible ACPs such as the Alucobond products during the relevant period is important for a different reason, which is that they were responsible for selecting the ACPs and deciding how they should be used on the buildings in question.

1320 The position of each of the Respondents is that the “consumer” was not the building developers, but rather Qualified Professionals. Nonetheless, HVG agrees that the roles of Qualified Professionals in the relevant period must be considered but submits that it is not open on the evidence for me to make a finding that a particular level of knowledge or ignorance can be imputed to classes of professionals. HVG submits that the Applicants have failed to establish any causal connection between the conduct of the Respondents and the (alleged) generalised findings of the knowledge of the relevant professionals. Further, HVG emphasises that the expert witnesses unanimously agreed – except for Professor Bisby, who conceded he lacked the relevant experience – that whether a façade complied with the relevant sections of the BCA was a building specific exercise.

8.8.1 FSEs

1321 The Applicants submit the following three key aspects relating to FSEs in Australia during the relevant period:

(a) firstly, that FSEs were not commonly involved in assessing the use of combustible ACPs on buildings during the relevant period as those responsible for specifying and approving the use of ACPs generally considered that the products were DtS compliant or otherwise complied with CodeMark Certificates. The Applicants submit that on this basis the general state of knowledge held by FSEs of the specific risks associated with the use of Alucobond Plus is, therefore, strictly irrelevant to the reasonable expectation of a consumer;

(b) secondly, to the extent that the state of knowledge of FSEs is relevant, that FSEs were not aware of the specific risks associated with the use of combustible ACPs during the relevant period and were ill-equipped to deal with those risks;

(c) thirdly, even if an FSE was engaged, the limited knowledge and expertise of FSEs at the time meant that there was no assurance that the risks associated with the use of combustible ACPs would be adequately addressed.

1322 The fire engineer experts agreed in the Group 4-5 Joint Report that FSEs were used during the relevant period to develop Performance Solutions where deviations from the BCA DtS Provisions were identified by a building certifier or surveyor.

1323 3A rejects that, during the relevant period, FSEs were not aware of the specific risks associated with the use of combustible ACPs and point to the material gathered by Professor Torero and Associate Professor Lange in the Cladding Materials Library which was available to FSEs during the relevant period.

1324 I find, based on the expert evidence, that FSEs during the relevant period were principally used to prepare Performance Solutions where deviations from the BCA DtS Provisions were identified by a building certifier.

1325 I find, based on the expert evidence, that during the relevant period it was not common practice for an FSE to be asked to assess the proposed use of combustible ACPs as part of, or as an attachment to, an external wall or building element as they were considered by building certifiers to be compliant with the BCA DtS Provisions, and the role of identifying deviations from the BCA DtS Provisions was the role of a building certifier. However, FSEs were still one of the Qualified Professionals involved in the assessment of the use of ACPs, during the relevant period.

8.8.2 Building c ertifiers/building surveyors

1326 During the relevant period, certification that buildings were designed and constructed in accordance with the BCA was generally the responsibility of individuals accredited to provide private certification services, namely certifiers or building surveyors.

1327 The Applicants submit that the evidence shows that it was common practice for certifiers and building surveyors to approve the use of combustible ACPs, including Alucobond PE and Alucobond Plus, for use as part of, or an attachment to, the façade on the basis that those products were DtS compliant (either as part of the bonded laminate exception or the attachment exception), or covered by an applicable CodeMark Certificate.

1328 3A submits that there is no evidence to establish the common practice of building certifiers and building surveyors during the relevant time.

1329 I find, on the expert evidence, that during the relevant period, building certifiers and building surveyors approved the use of combustible ACPs, including Alucobond PE and Alucobond Plus, for use as part of, or an attachment to, the façade on the basis that those products were DtS compliant (either as part of the bonded laminate exception or the attachment exception) or covered by an applicable CodeMark Certificate. This finding is to be contrasted with my earlier findings that, in fact: (a) the bonded laminate exception was not available; and (b) the attachment exception was incorrectly relied on as the AS 1530.3 tests were not BCA compliant and the Applicants have not proved the attachment exception was not available as a pathway to BCA compliance.

8.8.3 Architects/other building professionals

1330 The evidence given by Mr Quigley and Mr Incoll must be weighed in light of my rejection of their evidence where they sought to give evidence regarding the general understanding or state-of-mind of architects and other building professionals in Australia during the relevant period. To the extent the Group 7 Joint Report contained such generalised evidence about industry knowledge, as was agreed by the parties, they are to be read as an expression of each expert’s own knowledge.

1331 The distinction above is relevant to note as 3A make a number of submissions that the Applicants failed to respect the proper limits of the Expert Group 7 witnesses.

1332 As I have noted in the context of the Expert Group 7 evidence, I accept that architects have primary responsibility for the selection of materials, and that this responsibility would be exercised taking into consideration any advice from relevant specialist consultants on particular projects. Of course, how architects selected particular materials, and the extent to which their specification was subject to input from different specialist consultants, would depend on the particulars of the relevant project. There is no evidence before me to form a view as to how often, as a generalised statement during the relevant period, an architect’s selection of an ACP was the subject of any particular input from a building certifier or an FSE. However, it is evident from the fact that combustible ACPs found their way onto a great number of buildings across Australia that ACPs were specified for use in a number of applications by architects, given they carried primary responsibility for the selection of materials.

1333 The Applicants submit that a number of findings should be made in respect of the practise and knowledge of architects (and other building professionals) during the relevant period. In summary, these include the following:

(a) first, that where a material was in common usage or had been previously used successfully on a project on which they were involved, it was common for architects and building professionals to rely on marketing material provided by suppliers or manufacturers, unless contradicted by any other building specialists;

(b) second, that ACPs were used by architects (and other building professionals) up until 2017-18 on the basis that they were (and were promoted as) appropriate, and that issues of combustibility did not arise with Alucobond products whether with architects, building surveyors, building certifiers and FSEs during the relevant period, and that these building professionals were not aware of the combustibility or non-compliance of Alucobond PE or Alucobond Plus being raised by the manufacturer or supplier, professional journals, lectures or industry façade experts in the period prior to 2017-18;

(c) third, that following the Grenfell Fire, the architects relied on representations made in marketing materials to select products that were perceived to have better fire performance; and

(d) fourth, that it was unlikely that a reasonably competent architect or project manager would support the use of Alucobond PE or Alucobond Plus had those professionals been made aware that the goods were combustible, non-compliant, and had the relevant fire risk properties.

1334 3A’s submission that there is no admissible evidence before the Court that it was common for architects to rely on marketing material, fails to appreciate the distinction which I have noted above. In particular, the evidence given by each of the experts was that it was common practise for architects to rely on information contained in marketing materials of products which were provided to them by suppliers or manufacturers. To a certain degree, it is difficult to understand 3A’s suggestion otherwise; clearly, marketing material was targeted towards architects as those responsible for specifying the use of the Alucobond products, with architects being influenced by or otherwise relying on the information contained therein to support the specification of the relevant product.

1335 Accepting this, the real question which arises is the degree of reliance which could be placed on marketing material by architects, and in respect of what matters. There appeared to be some degree of disagreement regarding this between Mr Quigley and Mr Smithson. In particular, Mr Quigley gave evidence to the effect that architects would rely on information provided by the supplier and/or manufacturer, including in respect of matters such as compliance with Australian Standards and technical data, to the extent provided in the material.

1336 As mentioned above (at [650 ]), Mr Smithson on the other hand, gave evidence to the effect that architects would be less likely to pay attention to technical information as they would be more interested in the appearance of the products and their capacity to be transformed into a façade. Mr Smithson’s evidence was that an architect would expect the technical details to be examined closely during the iterative design process and would seek to rely on the advice of relevant specialists.

1337 I accept that an architect would expect the technical details of a product to be examined closely during the iterative design process. However, Mr Smithson’s evidence must also be considered in light of my finding above that it was not common practice during the relevant period for an FSE to be engaged to assess the use of ACPs on a building, and that the trigger for an FSE to be so engaged would be the identification of a possible non-compliance by a building certifier.

1338 Ultimately, the extent to which an architect may rely on certain information contained in marketing material must be informed by an analysis of the relevant material itself. In my view, it is somewhat abstract to suggest generally what an architect would or would not rely on in marketing material without specifically considering the nature of the representations being made. At this point, it is sufficient to note that it would be expected that architects would rely on marketing material to some degree. The extent to which such reliance may be expected, or is reasonable, must be informed by the relevant material, that is the specific representations in specific marketing material.

1339 The Applicants accept that the Court has ruled that the generalised evidence of Expert Group 7, regarding the knowledge and state-of-mind of industry participants generally, is not evidence of what every professional knew at the time. But, the Applicants submit the fact that three experienced working professionals working in different parts of the industry and in different locations in Australia all had the same experience supports an inference that architects, façade consultants and other building professionals did commonly rely on marketing literature when forming the view that Alucobond PE and Alucobond Plus were appropriate products and that issues of combustibility were not commonly raised.

1340 The Applicants also note that, in the Group 7 Joint Report, the experts referred to the Lacrosse Fire and the supposition that it may have been caused by substitution of an Alucobond product for an inferior product. The point being that the Lacrosse Fire did not alert the industry to the fact that all ACPs with a PE core may have the same fire hazards.

1341 I am not satisfied that the evidence of Expert Group 7 supports the making of the broad inference that the Applicants seek. While I accept that the individual experts were not aware of the combustibility of the Alucobond products, or any non-compliance with the BCA, this evidence is insufficient to extrapolate into an inference which extends to the industry as a whole.

1342 I have outlined above, in respect of building certifiers, that the evidence before me does not support a finding beyond the fact that FSEs were not commonly engaged to assess the use of ACPs on buildings, other than that building certifiers did not consider it necessary. Similarly, in respect of architects, it is not possible, on the evidence before me, to make a finding that (i) architects, as a whole, in Australia during the relevant period, were not aware of Alucobond PE and Alucobond Plus being combustible or having “issues of combustibility”, or (ii) to the extent that architects were not aware that Alucobond PE and Alucobond Plus were combustible (or did not have “issues of combustibility”), that this was due to reliance on any particular marketing literature. This is not to say that such a finding is not possible in a particular individual circumstance; only that the evidence currently before me does not support the broad finding which the Applicants seek.

1343 The same applies in respect of the evidence given by Expert Group 7 regarding other building professionals. Indeed, to the extent that the Applicants seek such findings specifically in relation to building surveyors/certifiers or FSEs, it is unclear on what basis Expert Group 7 can speak to the knowledge of those professionals at all. It also appears inconsistent with the evidence given by the actual certifiers and FSEs in the context of their relevant expert groups.

1344 The Applicants also refer to Mr Quigley and Mr Incoll’s evidence that it was unlikely that a reasonably competent architect or project manager would support the use of Alucobond PE or Alucobond Plus had those professionals been made aware that the goods were combustible, non-compliant, and had the fire risk properties. The Applicants, in this context, refer to the following statement from Mr Incoll’s during the Expert Group 7 conclave regarding the Alucobond products not being DtS compliant and, therefore, requiring a Performance Solution:

What I would say, put simply, is that it would have taken extra costs and time and significantly heightened the approvals risk for a reasonably prudent building professional to have gone down the path of designing a performance solution… and the reasonable risk management approach would have been to specify alternative non- combustible facade material at that time. And even at that time, there were very few fire engineers around and there would have been significant risk in even finding a fire engineer, let alone going through that alternative process.

1345 There are a number of difficulties with the Applicants’ submissions. Firstly, the architects accept that they could have considered using Alucobond PE and Alucobond Plus if a Performance Solution was prepared such that it was used in a manner that was compliant with the BCA.

1346 Secondly, as I have found above, the relevant fire risk properties of Alucobond PE and Alucobond Plus are a function of a number of factors far beyond just the fact that the panels have been used. That is, the fire risk of the products cannot be divorced from the specific factors applicable to a specific building. This includes the extent to which the panels are used, where they are used, what other components form part of the façade or external wall, and the nature and characteristics of the building. Mr Quigley and Mr Incoll gave evidence that a reasonably competent architect or project manager was unlikely to support the use of Alucobond PE or Alucobond Plus had those professionals been made aware that the goods were combustible, non-compliant, and had the relevant fire risk properties. This evidence is to be understood as only evidence of Mr Incoll and Mr Quigley’s personal experience. It must also be properly understood as being made in relation to particular applications of the panels; namely, where the use of the panels posed a risk of being non-compliant or carrying an unacceptable degree of fire risk.

1347 Noting the above, there is a distinction to be drawn between, on the one hand, whether an architect or project manager would accept a particular application of Alucobond panels as acceptable, and, on the other hand, whether an architect or project manager would pursue a Performance Solution in the first place. The effect of the submissions made by the Applicants is that, to the extent that the panels could not be used in a manner that was considered DtS compliant, architects and other relevant building professionals would not have sought to use the panels as part of a Performance Solution due to the risks, delay and costs involved in designing the Performance Solution, particularly when alternatives were available.

1348 This submission traverses much of the same ground as was discussed in the context of the “practical barriers to the pursuit of a Performance Solution” in section 8.6.3.3 of these reasons above. It can be accepted that, for reasons of certainty, efficiency, and potentially cost, pursuing a DtS compliant pathway may be the preferred approach to designing a particular building, and that non-combustible ACPs could have been chosen in the place of combustible ACPs. For the reasons outlined in section 8.6.3.3, this alternative product, cost/benefit argument, in my view, directs attention away from the operative question of whether the Alucobond products could be used in a manner that was safe and compliant.

1349 Based on the reasons outlined above, I find that the relevant hypothetical consumer was a Qualified Professional, for the purposes of the consumer guarantee claim. I note that this is consistent with my findings as to whom the products were supplied in section 7.3.1 (as the developers are part of the defined group of Qualified Professionals).

1350 Therefore, the relevance of the knowledge of the Qualified Professionals assumes a different importance than that which the Applicants contend. This is not a case analogous to Ethicon where the Qualified Professionals were intermediaries, as the medical professionals were in that case, whose knowledge could have an effect on the actions of the consumer. Rather, the knowledge of the Qualified Professionals is relevant to the knowledge of the products, and the regulatory regime which is imputed to the reasonable, hypothetical consumer. My findings in the below section are, therefore, based on my findings as to the knowledge and role of each of the Qualified Professionals.

8.9 Findings on the merchantable or acceptable quality of Alucobond PE or Alucobond Plus

1351 The central inquiry for the purposes of s 54 of the ACL and s 74D of the TPA is whether Alucobond PE and Alucobond Plus were as fit for the purposes for which they were commonly supplied as a reasonable consumer would expect or regard as acceptable having regard to the description of the goods and any other relevant circumstances.

1352 I find that the hypothetical reasonable consumers in this case are Qualified Professionals, being the developers, builders, façade fabricators, architects, building certifiers and fire risk engineers. Those Qualified Professionals would be aware that:

(a) there are laws and regulations that govern minimum requirements, including the safety requirements, of a building;

(b) the regime requires that buildings must be designed and constructed by Qualified Professionals;

(c) buildings may be constructed out of many different materials, some of which have complex properties, some of which might be combustible in a fire, or otherwise dangerous, if used improperly; and

(d) it was the responsibility of Qualified Professionals to ensure that the materials used on a building were used in a way to ensure the building complied with applicable building and safety regulations.

1353 Having regard to this imputed knowledge, a hypothetical, reasonable consumer, being the Qualified Professionals, would not expect ACPs, including Alucobond PE and Alucobond Plus or indeed any building material to be risk-free, regardless of how they were used. This hypothetical, reasonable consumer would expect that ACPs can be capable of being used as cladding on buildings in accordance with the prevailing building and safety regulations, including the BCA. A further context in which the question of merchantable or acceptable quality must be considered is what a hypothetical, reasonable consumer (Qualified Professional) would regard as acceptable in relation to the “purposes for which goods of that kind are commonly supplied”. A reasonable consumer (Qualified Professional) would only assess acceptability in relation to achievement of a relevant purpose by reference to lawful uses. A reasonable consumer (Qualified Professional) must be assumed to be law-abiding, and it would be perverse to attribute to parliament an intention to fix manufacturers with liability for the unlawful use of their goods by a third party.

1354 Manufacturers such as 3A are entitled to assume that the market into which they supply goods is a law-abiding one, and to the extent that the market is not law-abiding, consequences of non-compliance must fall on those who do not comply with the law rather than the manufacturer.

1355 The Group 4-5 Joint Report (answers (b)-(c)) establishes that Alucobond PE and Alucobond Plus were able to be used by way of a Performance Solution. Any reasonable Qualified Professional knew that the BCA did not permit ACPs to be used in any way on any building. Thus, the fact that Alucobond PE and Alucobond Plus were constrained by the BCA as to particular uses does not mean that the panels were not of merchantable or acceptable quality.

1356 The consumer guarantee provisions of the TPA and ACL do not require that goods must be free of risk to be of merchantable or acceptable quality: Jayco Corp at [27], Medtel at [64]. A reasonable Qualified Professional would accept that there is a balance to be struck to minimise risk to an acceptable level. That balance is struck by the building and safety requirements of the BCA. A hypothetical, reasonable Qualified Professional would not regard Alucobond PE and Alucobond Plus as not of merchantable or acceptable quality simply because their misuse by Qualified Professionals posed a risk of harm. That is particularly the case where, as here, the nature and extent of any risk depended on the particular use of those ACPs on any given building and not because of any inherent properties in Alucobond ACPs.

1357 A hypothetical reasonable Qualified Professional would expect the Alucobond PE and Alucobond Plus panels to be used in specific applications in compliance with the Building and Safety Regulations embodied in the BCA. A reasonable Qualified Professional would expect that whether Alucobond panels are of merchantable or acceptable quality is to be determined by reference to a lawful use and in compliance with the Building and Safety Regulations of the BCA. This reasonable consumer would not assess whether Alucobond panels are of a merchantable or acceptable quality by reference to an unlawful use and a failure to comply with the Building and Safety Regulations of the BCA.

1358 I find that Alucobond PE and Alucobond Plus were of merchantable and acceptable quality as they were capable of being used for the Purposes, if they were used lawfully for a specific use in compliance with the building and safety regulatory regime which required the expertise and judgment of Qualified Professionals.

1359 I find that whether a particular use of Alucobond PE and Alucobond Plus complied, or did not comply, with the BCA was fundamentally dependent on how it was used by Qualified Professionals. If the Alucobond panels were used in compliance with the BCA then they were, by definition, safe and suitable for the purposes of the BCA and were of merchantable and acceptable quality.

1360 The unlawful and non-compliant use of Alucobond PE and Alucobond Plus under the BCA occurred because of the negligence of the Qualified Professionals, not because of any inherent defect in the Alucobond PE or Alucobond Plus which rendered them not of merchantable or acceptable quality under the consumer guarantee provisions of the TPA and ACL.

1361 The Applicants have not established, on the evidence, that Alucobond PE or Alucobond Plus were not of merchantable or acceptable quality.

8.10 Issue 9 – Defences

1362 Notwithstanding that I have found that the Applicants have not established the consumer guarantee claim under s 74D of the TPA and ss 54 and 271 of the ACL and as a consequence, it is not necessary for me to decide the defences to the consumer guarantee claim under issue 9, I have decided to nonetheless determine this issue in case a Full Court should decide the consumer guarantee claim differently.

1363 It was common ground between the parties that the statutory defences relied upon by the Respondents turn on the individual circumstances of the supply of the goods. These are, accordingly, individual issues that are not being determined on a common basis at this initial trial.

8.10.1 Acts or omissions of third parties: ACL s 271(2)(a)

1364 The first defence relied upon by the Respondents is found in s 271(2) of the ACL. That section relevantly provides:

(2) subsection (1) does not apply if the guarantee under section 54 is not complied with only because of:

(a) an act, default or omission of, or any representation made by, any person other than the manufacturer or an employee or agent of the manufacturer, or …

1365 The ACL Explanatory Memorandum at 7.117 to the introduction of section 271 provides:

A manufacturer is not required to pay damages to a consumer if an act, default or omission or representation made by some other person, not being an employee or agent of the manufacturer, resulted in or caused goods to be of less than acceptable quality. This ensures that manufacturers are not held liable for issues with goods that are beyond their control.

(Emphasis added.)

1366 The evident purpose of the defence provided for by s 271(2) is to prevent the manufacturer from being held liable for a contravention of the statutory guarantee where that contravention was wholly caused by a third party. This is apparent from the use of the word “only”.

1367 The Respondents submit that the defence under s 271(2)(a) operates as follows. If Alucobond PE or Alucobond Plus was used negligently or inappropriately by a Qualified Professional so as to give rise to material fire risk or non-compliance with the BCA – and it is held that the product was therefore not of acceptable quality – that was only because of the misuse by the Qualified Professionals. In those circumstances, 3A as manufacturer is not liable for any loss suffered by the Applicants.

1368 The Applicants submit that there is no proper foundation for the defence under s 271(2)(a) to apply for three reasons.

1369 First, the focus is on why the guarantee under s 54 is not complied with. The lack of acceptable quality of Alucobond PE and Alucobond Plus arises from the inherent qualities of the goods. It is those qualities that create risks to safety and limit the use to which the goods can be put. The Applicants submit that no actions by third party professionals are said to create or even affect these inherent qualities. I do not accept this argument. The expert evidence established that Alucobond PE and Alucobond Plus could be used in accordance with the BCA fire safety performance requirements. This denies the proposition (relied upon by the Applicants) that the Alucobond products had inherent properties rendering them dangerous. I have found that Qualified Professionals would not have interpreted the brochures distributed by HVG as recommending the use of Alucobond PE or Alucobond Plus without the need to consider each building on its own merits. Qualified Professionals, acting reasonably, would have known that Alucobond PE or Alucobond Plus could not be used on any building without considering the unique BCA fire safety performance requirements of each particular building.

1370 Second, the Applicants submit that the Qualified Professionals used the products in exactly the manner described and promoted in the Respondents’ brochures and websites. The Applicants submit that there is no suggestion in the evidence of misuse by the parties creating a risk that otherwise did not exist. I do not accept this argument as it ignores the expert evidence that the use of Alucobond PE or Alucobond Plus must be assessed by reference to each individual building on its own merits. The experts were unanimous in their view that the use to which Alucobond PE or Alucobond Plus may be put must be determined by a Qualified Professional by reference to the particular circumstances of each individual building.

1371 Third, the Applicants argue that any contravention of the statutory guarantee under s 54 arises because of a supply of goods with particular qualities in particular circumstances of supply. I do not accept this argument. The expert evidence establishes that Alucobond PE and Alucobond Plus were able to be used in accordance with the BCA fire safety performance requirements. This denies the proposition that the panels had inherent properties rendering them “dangerous”.

1372 I accept that the defence under s 271(2)(a) of the ACL may be invoked in circumstances where the specification by an architect or an FSE in the course of preparing the design of a cladding façade using Alucobond PE or Alucobond Plus may give rise to an “act, default or omission” or an “act or default” of a person for the purposes of s 271(2)(a) of the ACL. I also accept that there may be circumstances where the physical installation of Alucobond PE or Alucobond Plus in or on a building by a cladding fabricator would also qualify as an “act, default or omission” or an “act or default” of a person for the purposes of s 271(2)(a) of the ACL.

1373 I now turn to consider the particular circumstances of the supply of Alucobond products for the purposes of the Shore Building and the Five Dock Building.

1374 The expert evidence established that the Shore Building could have been fitted with Alucobond PE in a manner which complied with the BCA but was not. The missing step was the preparation of a Performance Solution to justify the use of Alucobond PE on that particular building. Professor Torero’s unanswered evidence was that the cladding installed on the Shore Building did not “add significant additional risk to occupants and fire fighters”: first expert report of Professor Torero dated 10 March 2023 at 52. Mr Davis also considered the Shore Building and, on the basis of his analysis, prepared a Performance Solution that involved minimal changes to the layout of the Alucobond PE to introduce separation between apartments: second expert report of Mr Davis dated 22 September 2023 at 10.

1375 The expert evidence establishes that in relation to the Five Dock Building, the use of Alucobond Plus was plainly non-compliant because it did not comply with the relevant CodeMark Certificate, and no Performance Solution was prepared. However, with some minor adjustments to the layout of the Alucobond Plus on the eastern façade, Mr Davis was able to prepare a Performance Solution that he considered achieved compliance with the BCA. Mr Davis’ adjustments involved replacing the combustible cladding above and below windows with a solid non-combustible alternative and introducing mineral wool batting behind the panels around all of the windows.

1376 I find that the expert evidence established that Alucobond PE on the Shore Building and Alucobond Plus on the Five Dock Building were used negligently or inappropriately by the Qualified Professionals who designed and built those buildings so as to give rise to a material fire risk or non-compliance with the BCA. It follows that the only reason for any non-compliance of Alucobond PE or Alucobond Plus under the consumer guarantee claim in relation to the Shore Building and the Five Dock Building was the negligence of the Qualified Professionals who designed and built those buildings, not because of any inherent defect in the Alucobond products.

1377 The expert evidence establishes that Alucobond PE on the Shore Building and Alucobond Plus on the Five Dock Building could have been used so as not to give rise to a material fire risk and in compliance with the BCA fire safety performance requirements. I reject the Applicants’ submission that Alucobond PE and Alucobond Plus had inherent qualities which rendered them not of merchantable and acceptable quality for the purposes of s 54(2)-(3) of the ACL and s 74D(2)-(3) of the TPA. I find that it was not an inherent defect or defects in the Alucobond PE on the Shore Building and the Alucobond Plus on the Five Dock Building that meant they were not of merchantable and acceptable quality but that the manner in which they were employed in the cladding façades and the extent of the cladding on the respective buildings, as designed and specified by the Qualified Professionals, was the reason that gave rise to a material fire risk or non-compliance with the BCA.

8.10.2 Other defences

1378 The Respondents have also pleaded defences under s 74D(2)(b)-(c) of the TPA and s 54(4) and 54(7) of the ACL. Those defences were not addressed in either Respondents’ opening submissions or identified. 3A submitted, in its closing, that the other defences pleaded are not pressed in respect of the claims brought by the Applicants, as they raise issues that fall to be considered against the claims of the individual group members. The Applicants submit that if the defences in ss 74D(2)(c) and 54(7) are relied upon, the Court can determine, as a common question, whether any examination of the goods ought reasonably to have revealed that they were not of merchantable or acceptable quality.

1379 I find the availability of the defences under s 74D(2)(b)-(c) of the TPA and s 54(4) and 54(7) of the ACL must be considered against the claims of individual group members. I accept 3A’s submission that the question as to whether any examination of the goods ought reasonably to have revealed that Alucobond PE and Alucobond Plus were not of merchantable or acceptable quality cannot be answered in the abstract. That analysis depends on matters which include the circumstances in which the examination took place, the extent and duration of the examination, and the knowledge possessed by the person examining the goods.

9. MISLEADING CONDUCT CLAIM

9.1 Introduction

1380 The misleading conduct claim encompasses issues 10-12 of the Issues List. The issues are divided between the “Positive misrepresentations” claim and the “Warnings” claim. The relevant issues are as follows:

10. [Positive misrepresentations ] Whether, by distributing and/or publishing and/or authorising or approving HVG to distribute or publish certain brochures in Australia, 3A made, in trade or commerce, in connection with the supply, possible supply or promotion of Alucobond PE or Alucobond Plus, each of the Suitability Representation, Plus Composition Representation, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation, and/or Compliance Representation, which depends on:

(a) whether 3A distributed and/or published the brochures in Australia;

(b) whether 3A authorised or approved HVG distributing and/or publishing the brochures in Australia;

(c) whether, if 10(b) is established, that is sufficient to establish that 3A “made” any representations conveyed by the brochures;

(d) whether the brochures conveyed the alleged representations.

11. Whether the alleged representations were misleading for the reasons alleged in the SOC.

12. [Warnings ] Whether 3A or HVG were obliged to, and did not, publicly disclose, adequately or at all, the Suitability Warning, Limitation of Use Warning, Fabrication and Affixation Warning, Fire Risk Warning, Plus Composition Warning, Non-compliance Warning, Non-compliance Limitation Warning or the Fire Advice Limitation Warnings.

1381 The Applicants allege that each of the Respondents contravened ss 53 and 55 of the TPA and ss 29 and 33 of the ACL by marketing their goods as suitable, safe, and compliant, without disclosing the significant risks associated with their use and/or the limited ways they could be used safely. The representations the Applicants rely on are contained in marketing brochures and on websites hosted by either one or both of HVG and 3A.

1382 Sections 29 and 33 of the ACL provide as follows:

29 False or misleading representations about goods or services

(1) A person must not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services:

(a) make a false or misleading representation that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use; or

…

(g) make a false or misleading representation that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits; or

…

33 Misleading conduct as to the nature etc. of goods

A person must not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose or the quantity of any goods.

1383 Sections 53 and 55 of the TPA are in materially the same terms as ss 29 and 33 of the ACL. The parties approached the TPA and ACL provisions in the same manner. Section 53 of the TPA and s 29 of the ACL apply where representations are made, in trade or commerce, in connection with the supply or possible supply of goods, or in connection with the promotion by any means of the supply or use of goods. The relevant representations must be in relation to, among other matters, the standard, quality, value, grade, composition, performance characteristics, uses or benefits of the product.

1384 Section 55 of the TPA and s 33 of the ACL apply to conduct, in trade or commerce, relating to the nature, manufacturing process, characteristics, suitability for their purpose or the quantity of any goods.

1385 There does not appear to be any debate that the relevant representations and conduct relied upon in this case, if made out, meet each of these criteria.

9.2 Issue 10 – Positive misrepresentation case

1386 The Applicants allege that, at all material times, the Respondents made the following representations:

(a) Alucobond PE and Alucobond Plus were suitable for all of the uses for which they were commonly acquired (which included use as external cladding on high or low-rise buildings used for residential, commercial or public purposes), and would be suitable for such uses once affixed to a building (Suitability Representation);

(b) Alucobond PE and Alucobond Plus could be fabricated and affixed to buildings by third parties prior to (or as part of) being fitted to buildings, in accordance with the methodologies set out in the technical manuals and marketing materials, without materially affecting their fire performance and safety (Fabrication and Affixation Representation);

(c) Alucobond PE and Alucobond Plus were safe and suitable, and would present no material increase in risk to the life or safety of occupants, or damage to property in the event of a building fire, because:

(i) in the case of both Alucobond PE and Alucobond Plus, the aluminium cover sheets protected the core and/or they had passed or satisfied various local and international fire performance tests; and

(ii) additionally, in the case of Alucobond Plus, it was fire resistant, hardly inflammable and/or had low flammability,

(respectively, the PE Fire Performance Representations and Plus Fire Performance Representations);

(d) Alucobond PE and Alucobond Plus were compliant with all relevant building codes and standards for use on all buildings in Australia as part of or as an attachment to an external wall or other building element for its common uses, or would be so compliant once affixed (Compliance Representation);

(e) the core of Alucobond Plus contained no more than 30% plastic binders and/or not less than 70% non-combustible mineral filler (Plus Composition Representation),

collectively, the Positive Representations.

1387 The Positive Representations are said to have been made partly expressly and partly impliedly in a number of brochures allegedly published by 3A in Australia or published by HVG but authorised and approved by 3A, and on a number of websites “controlled by 3A and its related entities”. The Positive Representations are alleged to have been conveyed by a combination of text and images used in the marketing material. The relevant parts of the documents that convey the Positive Representations alleged by the Applicants were identified in detail in Annexure D to the Applicants’ closing written submissions to which 3A responded in Schedule B to its closing written submissions, and HVG responded in Part J of its closing written submissions. The parties’ positions on the Positive Representations were consolidated in an aide-memoire entitled “Consolidated Schedule of Relevant Publications” which was marked MFI-11 and comprised of 105 pages.

1388 There were a series of “generations” of Alucobond brochures and websites during the relevant period. Over time, the precise content of the brochures and websites changed. The Applicants submit that the dominant message remained the same: Alucobond PE and Alucobond Plus were suitable, safe and compliant with the BCA.

1389 I will deal briefly with the Plus Composition Representation here. 3A accepts that the Plus Composition Representation is contained in two brochures identified by the Applicants, being versions two of the generation three brochures titled “At a Glance” and the generation four brochure “Beyond Facades”: [ HVG.001.001.0106], [APP.001.005.0945]. There is a third brochure which the Applicants contend conveyed the Plus Composition Representation – the Alucobond Fire Product Information Guide: [HVG.001.001.0048]. There are also two websites which the Applicants contend conveyed the Plus Composition Representation. For the reasons above in section 8.5.1 of these reasons, I have found that the Applicants have not established that the core of Alucobond Plus was more than 30% combustible material. Therefore, the Applicants have failed to prove that the Plus Composition Representation contained in those brochures was misleading. It is unnecessary to consider the issue in further detail.

9.2.1 The Positive R epresentations

1390 As noted above, the relevant Positive Representations are said to have been made across a number of brochures and on a number of websites over the course of the relevant period. There are a number of disputes regarding the relevant dates during which particular material was published, and the extent to which it can be said that 3A was involved in the making of the Positive Representations.

1391 The relevant material the Applicants rely on, and the disputes regarding it, are summarised in the following table. The column titled “Publication period” outlines the publication date range alleged by the Applicants, and whether (in brackets) HVG admits or does not admit the relevant publication period. 3A generally does not admit the alleged publication periods. The column titled “Product” identifies which Alucobond product the brochure deals with. The column titled “3A/HVG document” identifies whether the document is a document published by 3A or HVG. The final column “Australian Document/Website” identifies whether the Respondents admit that relevant material was published or distributed in Australia.

[HVG.001.001.0052] | 2004 – 2013

[HVG.005.050.7307] | 2005 – at least 2009

(not admitted) | Alucobond PE,

Alucobond Plus,

[3AC.600.001.0001] | ~ 2009

(admitted) | Alucobond SB1,

Alucobond PE,

Alucobond Plus,

[HVG.001.001.0042] | 2009 – 2013

[PAA.021.001.004]

[PAA.021.001.006]

[PAA.021.001.007] | ~ 2011

[HVG.001.001.0056] | 2012

[HVG.006.015.5554] | ~ 2013

(admitted) | Alucobond PE,

Alucobond Plus,

[HVG.001.001.0106] | 2013 – 2015

(admitted) | Alucobond PE,

Alucobond Plus,

Alucobond A2

[APP.001.005.0945] | 2017 – 2018

(admitted) | Alucobond PE,

Alucobond Plus,

[HVG.006.025.1306] | 2012 – 2015

[HVG.001.001.0048] | 2017 – 2018

[3AC.402.001.3969] | 2015

(not admitted) | Alucobond PE,

Alucobond Plus | HVG | Not admitted |
| 13 | “Own Database Engagement ” [3AC.402.001.3969] | 2015

(not admitted) | Alucobond PE,

[3AC.402.001.3969 /0001 ] | 2015

(not admitted) | Alucobond PE,

[3AC.402.001.3969/0004] | 2015

(not admitted) | Alucobond PE,

http://www.alucobond.com.au

[TEN.001.001.0102 ]

[TEN.001.001.0103]

[TEN.001.001.0104]

[TEN.001.001.0135]

[TEN.001.001.0143]

[TEN.001.001.0146 ]

[TEN.001.001.0150]

[TEN.001.001.0156]

[TEN.001.001.0184]

[TEN.001.001.0189]

[TEN.001.001.0196]

[TEN.001.001.0201]

[TEN.001.001.0207]

[TEN.001.001.0215]

[TEN.001.001.0236]

[TEN.001.001.0237]

[TEN.001.001.0238]

[TEN.001.001.0239]

[TEN.001.001.0264]

[TEN.001.001.0265]

[TEN.001.001.0269]

[TEN.001.001.0278]

[TEN.001.001.0286]

[TEN.001.001.0288] | 2009 (admitted -

where references are to listed Australian website) | Alucobond generally | HVG | Admitted (*where references are to listed Australian website) _ | | 22 | Alucobond AU home page

http://www.alucobond.com.au

[TEN.001.001.0103] | 2011 (admitted) | Alucobond generally | HVG | Admitted |
| 2 3 | Alucobond AU home page

http://www.alucobond.com.au

[TEN.001.001.0104] | 201 4 (admitted) | Alucobond generally | HVG | Admitted |
| 2 4 | Alucobond AU home page

http://www.alucobond.com.au

[TEN.001.001.0135] | 201 5 (admitted) | Alucobond generally | HVG | Admitted |
| 2 5 | Alucobond AU home page

http://www.alucobond.com.au

http://www.alucobond.com.au

[TEN.001.001.0150] | August 2017 (admitted) | Alucobond generally | HVG | Admitted |
| 27 | Alucobond AU home page

http://www.alucobond.com.au

https://alucobond.com/references 0.html ; http://www.alucobond.com /products.html

2008:

[TEN.001.001.0226]

[TEN.001.001.0007]

[TEN.001.001.0257]

[TEN.001.001.0255]

2009:

[TEN.001.001.0263] | 2008

2009

https://alucobond.com/project-case-studies.html

2008:

[TEN.001.001.0216]

[TEN.001.001.0217]

[TEN.001.001.0218]

[TEN.001.001.0219]

[TEN.001.001.0220]

[TEN.001.001.0221]

[TEN.001.001.0222]

[TEN.001.001.0223]

[TEN.001.001.0009]

2009:

[TEN.001.001.0247]

[TEN.001.001.0248]

[TEN.001.001.0249],

[TEN.001.001.0250],

[TEN.001.001.0251],

[TEN.001.001.0252]

[TEN.001.001.0253]

[TEN.001.001.0254]

[TEN.001.001.0260]

[TEN.001.001.0261] | 2008

2009

https://alucobond.com/applications -markets

2008:

[TEN.001.001.0010]

[TEN.001.001.0258]

2009:

[TEN.001.001.0256] | 2008

2009

https://alucobond.com/architecture.html

[TEN.001.001.0224]

[TEN.001.001.0246] | 2008

2009

http://www.alucobond.com.au/ products/alucobond

[TEN.001.001.0080]

[TEN.001.001.0083] | 2011

2014

http://alucobond.com.au/product/ alucobond-pe

2015:

[TEN.001.001.0069] [TEN.001.001.0138] [TEN.001.001.0140]

[TEN.001.001.0145]

August 2017:

[TEN.001.001.0081] | 201 5

August

201 7

http://alucobond.com.au/product/ alucobond-pe

August 2017:

[TEN.001.001.0079]

[TEN.001.001.0147]

October 2017:

[TEN.001.001.0153] | August

2017

October 2017

http://alucobond.com.au/specify-now/alucobond-pe

2015:

[TEN.001.001.0074]

[TEN.001.001.0137/0002]

[TEN.001.001.0137/0005]

[TEN.001.001.0142]

[TEN.001.001.0148].

2017:

[TEN.001.001.0078] | 2015

2017

Product – Product Properties (PE)

2008:

[TEN.001.001.0231]

[TEN.001.001.0270]

2016:

[TEN.001.001.0017] | 2008

2016

Products – ALUCOBOND (PE) – Approvals and Fire Classification

2008:

[TEN.001.001.0232]

[TEN.001.001.0001] [TEN.001.001.0241]

2015:

[TEN.001.001.0283]

[TEN.001.001.0004]

[TEN.001.001.0005] | 2008

2015

http://www.alucobond.com/alucobond-processing.html

2008:

[TEN.001.001.0233]

[TEN.001.001.0048]

[TEN.001.001.0020]

[TEN.001.001.0021]

[TEN.001.001.0025]

[TEN.001.001.0033]

[TEN.001.001.0046]

[TEN.001.001.0049]

[TEN.001.001.0051]

[TEN.001.001.0057]

[TEN.001.001.0058]

[TEN.001.001.0060]

[TEN.001.001.0062]

[TEN.001.001.0063]

[TEN.001.001.0026]

[TEN.001.001.0030]

[TEN.001.001.0032]

[TEN.001.001.0037]

[TEN.001.001.0272]

[TEN.001.001.0284]

[TEN.001.001.0043]

[TEN.001.001.0047]

2017:

[TEN.001.001.0018]

[TEN.001.001.0036]

[TEN.001.001.0038] | 2008

2017

2008:

[TEN.001.001.0012]

[TEN.001.001.0013]

[TEN.001.001.0227]

[TEN.001.001.0243]

[TEN.001.001.0271]

2015:

[TEN.001.001.0011]

[TEN.001.001.0277]

[TEN.001.001.0282] | 2008

2015

www.alucobond.com/plus-product-properties.html

2008:

[TEN.001.001.0014]

[TEN.001.001.0229]

[TEN.001.001.0245]

2015:

[TEN.001.001.0276]

[TEN.001.001.0281] | 2008

2015

[TEN.001.001.0068]

[TEN.001.001.0065] | 2011

2014

[TEN.001.001.0082]

[TEN.001.001.0067]

[TEN.001.001.0136]

[TEN.001.001.0073] | 2015

2016:

[TEN.001.001.0072]

[TEN.001.001.0144]

2017:

[TEN.001.001.0149]

[TEN.001.001.0151] | 2016

2017

[TEN.001.001.0066]

[TEN.001.001.0070]

[TEN.001.001.0075] | February 2015

February 2016:

[TEN.001.001.0141]

December 2017:

[TEN.001.001.0152]

[TEN.001.001.0155] | February 2016

December 2017

2008:

[TEN.001.001.0230]

[TEN.001.001.0003]

[TEN.001.001.0244]

2015:

[TEN.001.001.0275]

[TEN.001.001.0280] | 2008

2015 | Alucobond Plus | 3A | Not admitted |
| 4 7 | Alucobond.com Products – Alucobond (Plus) – Processing

[TEN.001.001.0044]

[TEN.001.001.0055]

[TEN.001.001.0061]

[TEN.001.001.0228]

[TEN.001.001.0039]

[TEN.001.001.0041]

[TEN.001.001.004]

[TEN.001.001.0050] [TEN.001.001.0052]

[TEN.001.001.0053]

[TEN.001.001.0054]

[TEN.001.001.0059]

[TEN.001.001.0064] [TEN.001.001.0274]

[TEN.001.001.0279]

2017

[TEN.001.001.0018]

[TEN.001.001.0023]

[TEN.001.001.0024]

[TEN.001.001.0027] [TEN.001.001.0031]

[TEN.001.001.0034]

[TEN.001.001.0035]

[TEN.001.001.0040]

[TEN.001.001.0045]

[TEN.001.001.0056] | 2008

2017 | Alucobond Plus | 3A | Not admitted |
| 48 | Alucobond.com.au -- Gallery http://alucobond.com.au/gallery

[TEN.001.001.0109]

[TEN.001.001.0110]

[TEN.001.001.0111] [TEN.001.001.0112]

[TEN.001.001.0113]

[TEN.001.001.0114]

[TEN.001.001.0115]

[TEN.001.001.0116]

[TEN.001.001.0117]

[TEN.001.001.0118]

[TEN.001.001.0119]

[TEN.001.001.0120]

[TEN.001.001.0121]

[TEN.001.001.0122]

[TEN.001.001.0123]

[TEN.001.001.0124]

[TEN.001.001.0125]

[TEN.001.001.0126]

[TEN.001.001.0127]

[TEN.001.001.0128]

[TEN.001.001.0129]

[TEN.001.001.0130]

[TEN.001.001.0131]

[TEN.001.001.0132]

[TEN.001.001.0133]

[TEN.001.001.0134] | 2015 | Alucobond PE,

Alucobond Plus | HVG | Admitted |
1392 Save for the admissions made by the Respondents in relation to the Relevant Publication Periods, the evidence does not provide a satisfactory basis upon which I can make findings in relation to when each brochure was published and for how long.

9.2.2 Who made the representations?

1393 The first relevant question to address is who can be said to have made the alleged Representations.

1394 Clearly, HVG is responsible for representations made in HVG brochures which were distributed in Australia, and representations contained on its website (www.alucobond.com.au) and other online materials which were directed to customers within Australia.

1395 Similarly, 3A made the representations in the 3A brochures and the representations contained on its website (www.alucobond.com).

9.2.2.1 3A’s website

1396 First, regarding representations on 3A’s website and other online material published by 3A, 3A submits that there is no evidence that any person in Australia downloaded the relevant pages that the Applicants rely on from 3A’s website. 3A submits that the only website directed to persons in Australia was HVG’s website.

1397 Accepting that HVG’s website was specifically directed to people in Australia, it should be noted that 3A’s website was accessible, and was in fact accessed, by potential customers in Australia. The website includes a “Contact Us” page listing a 3A employee as the contact for Australia. Additionally, a handful of email records showing that, during the relevant period, 3A received direct enquiries through its global website from potential customers in Australia. While the enquiries made directly to 3A from Australia appear limited in the context of the lengthy relevant period, and that, in most cases, the enquiries appear to have been passed directly on to HVG, the relevant point is that 3A’s website, and the representations contained therein, were accessible to persons in Australia.

1398 There is no evidence that any person in Australia during the relevant period downloaded or viewed the particular pages and material from 3A’s website that the Applicants rely on. In paragraphs [785 ]-[791 ], I considered whether the conduct impugned in the misleading conduct claim occurred in Australia, including, relevantly, allegedly misleading statements published on 3A’s website. I referred to 3A’s submission that “[u]ntil the representations were accessed, the representations were meaningless and could not be the subject of any alleged contravening conduct”, and the cases cited in support of that proposition. I am not persuaded the evidence which points to customer enquiries from prospective Australian customers is sufficient for me to draw an inference that the statements relied on by the Applicants which are on 3A’s websites were actually viewed by a consumer in Australia. For the avoidance of doubt, I am not at this stage concerned with whether there is evidence of anyone actually being misled, but rather, whether it can be said that the Positive Representations were actually conveyed to consumers in Australia. Evidently, if no person, in Australia, has viewed the Positive Representations, then they cannot be said to have been conveyed.

1399 Similarly, 3A notes that many of the 3A brochures were not directed to an Australian market. This is a matter relevant to the consideration of whether the alleged representations were, in fact, made by the brochures. Again, in the absence of evidence demonstrating that a person in Australia viewed the Positive Representations contained in these brochures, I am not persuaded that the Positive Representations were conveyed.

1400 However, questions regarding when the material was published, and whether the brochure was in fact received by relevant persons in Australia appears to be a question more relevantly considered in the context of individual questions of loss and causation.

1401 If I am wrong as to whether the Positive Representations in 3A’s brochures and on its websites were viewed by a person in Australia or the effect of the lack of evidence going to that issue, I will nonetheless consider whether the Positive Representations were conveyed in respect of those publications.

9.2.2.2 3A’s liability for representations in HVG’s brochures

1402 Second, the more significant question is whether 3A can be said to have also made the representations that were contained in HVG’s Australian brochures distributed by HVG in Australia.

1403 The Applicants submit that the Court can readily reach this conclusion as 3A’s name appears on all of the brochures together with its trademark. The Applicants submit that the evidence also discloses that those brochures contained information supplied by 3A and were authorised and approved by 3A before being distributed. The Applicants submit that the representations made in those brochures were accordingly jointly made by the Respondents. The Applicants submit that it would also follow that it was equally incumbent on 3A to give the relevant warnings.

1404 It is uncontroversial that there may be more than one maker of a representation: Cassidy v Saatchi & Saatchi Aust ralia Pty Ltd (2004) 134 FCR 585; [2004] FCAFC 34 at [31], 37, in relation to s 12DA of the Australian Securities and Investment s Commission Act 2001 (Cth) (misleading and deceptive conduct in relation to financial services). The identity of the maker of a representation is a question of fact to be determined in all of the relevant circumstances: Saatchi at [39]-40.

1405 The Applicants refer to Barton v Croner Trading Pty Ltd (1984) 3 FCR 95 (Bowen CJ, Beaumont and Wilcox JJ) in which the Full Court found that a wholesaler had made misleading representations by reason of the information contained on the label of products displayed in a retail store, in contravention of s 53(a) and (c) of the TPA. The Full Court said the following at 106-107 regarding the wholesaler’s potential for liability in respect of representations being made to prospective purchasers, including where the wholesaler has no direct contact with the potential purchaser:

In our opinion, the determination of the question whether any, and, if so, when a representation of the kind proscribed by s. 53(a) or (c) has been made is essentially one of fact. In a case such as this, it is possible that a number of representations as to the goods will be made to a number of persons by the wholesale distributor: he may make representations to the reseller on their wholesale acquisition, although no charge is made here on this account; and he may make representations to the ultimate purchaser even if, as a matter of contract, that purchaser deals only with the retailer. In our opinion, there is no reason of principle, derived from the construction of the statute or otherwise, why the defendant may not be liable for contraventions of s. 53(a) and (c) in the event that it be established that it made representations of the proscribed kind to prospective retail purchasers, even if it were also previously engaged in a transaction with Woolworths for the sale by wholesale of those goods and whether or not it made similar representations to Woolworths: the question is whether the defendant made a representation to prospective purchasers by means of the label affixed to the goods upon the occasion when Woolworths displayed them for sale. In this connection, the circumstance that Woolworths may be making a concurrent representation to the same effect is, in our view, irrelevant to the question whether the defendant made such a representation. This is not to say that, ultimately, the position under the Act of Woolworths would be the same as that of the defendant: for example: Woolworths may have the benefit of a defence under s 85(4) of the Act.

In our opinion, when the conduct of the defendant is looked at as a whole and all the surrounding circumstances are taken into account, the statements made in the labels affixed by the defendant to the goods displayed for sale to the public by Woolworths can properly be treated as representations made by the defendant at that point of time. We see nothing artificial or oppressive in such a result: it was the very thing the defendant wished to happen.

It is true, as the defendant submits, that the prospective purchaser never made any direct contact with the defendant. It may also be accepted, for present purposes, as the defendant contends, that Woolworths was at liberty to do what itliked [sic] with the goods and that the defendant had no control over Woolworths in this respect. It is also true, as the defendant argues, that the defendant cannot be held vicariously liable for the actions of Woolworths: the parties were at arms’ length, there was no joint enterprise between them and the defendant had no claim to share in any part of the proceeds of sale of the goods by Woolworths. Nonetheless, the surrounding circumstances indicate that the defendant was seeking to implement a scheme for the marketing of the goods, a central feature of which was the display for sale to the public of goods bearing labels intended to be read by the public. The defendant required a retail outlet to market its product, and Woolworths, by assuming that role in the defendant's marketing plan, acted as an intermediary between the defendant and the ultimate purchasers.

In this sense, the defendant's conduct may be seen as the projection by it of the goods into the course of trade accompanied by representations as to their history, standard and sponsorship, intended for publication, not to its retail outlet, Woolworths, or some other reseller, but to potential purchasers in the form of members of the public who might be expected to see the labels on display with the goods at the retail outlet. In this sense also the position of Woolworths may be seen, not as the agent of the defendant in any strict sense, but rather as a convenient medium through which the defendant chose to pass its message — as a channel for communication between the defendant and consumers, the class of persons primarily intended to be protected by s. 53. We think that representations made under these circumstances may properly be characterised as a representation of the kind contemplated by s. 53(a) and (c) and that such representations should be regarded as having been made whenever they are communicated to consumers. In the present case, since Woolworths was chosen by the defendant as its vehicle for the purpose of communicating with the public, the representations in question should be regarded as having occurred whenever Woolworths offered the goods to the public for sale.

1406 The Applicants also refer to the Queensland Court of Appeal decision of Downey v Carlson Hotels Asia Pacific Pty Ltd [2005] QCA 199 (Williams, Keane JJA and Atkinson J), in which one of the causes of action was an alleged contravention of s 52 of the TPA (misleading or deceptive conduct). In that case, the appellant company submitted that it should not be held to have made the representations contained in certain documents which it had approved, because that approval was “given only in the context of protecting the goodwill in its name and logo”: at [48] Keane JA (as his Honour then was) rejected that submission, saying at [48]-49:

[48] … The difficulty with this submission is that the obvious reason for wanting to protect the goodwill in the appellant's name and logo is to prevent either of them being associated with content in the brochure that the appellant did not actually endorse. It is this authorized association that the appellant now seeks to deny. The presence of the official name and logo of the appellant means that a reader of the advertising material was entitled to conclude that the information about the reasons for the appellant's involvement in the project presented in the material was a statement of the appellant's actual reasons for its involvement. As in Barton v Croner Trading Pty Ltd, the publication of the material was merely providing the means for the appellant to communicate its own message to prospective consumers.

[49] In my opinion, the learned primary judge was correct to conclude that the appellant would be regarded by those to whom the advertising material was published as having adopted the representations conveyed thereby.

1407 The authorities emphasise that the ultimate question is whether 3A would be regarded by the relevant section of the public as adopting the representations contained in the HVG brochures; if so, 3A will have made the representation: Gardam v George Wills & Co Ltd (1988) 82 ALR 415 at 427 (French J), quoted in Downey at 45, Barton at 106-107, Saatchi at [39]-40. The determination of that factual question depends on consideration of all the circumstances, including the form and content of the documents in question, such as the role of the person or company in their preparation, any terms of the documents and the prominence of the person or company’s name or logo: Downey at [42]-43, Saatchi at 28.

1408 Whether the representations made in HVG’s brochures can be properly characterised as having also been made by 3A must be considered within the broader context in which the brochures were prepared.

1409 First, the nature of 3A’s Distributor Agreements must be considered. The relevant provisions of the four Distributor Agreements entered into between the Respondents have been outlined in section 6.1.2 of these reasons, in particular at paragraph [777 ]. It is unnecessary to repeat these provisions in the same detail. However, the following terms of the Distributor Agreements should be noted:

(a) HVG was required to obtain 3A’s approval of any publication or material prepared by HVG in connection with the sale of the Alucobond products prior to any use, and had an obligation to not do anything which might contest or impair the Alucobond trademark;

(b) Whenever HVG used the Alucobond trademark, it was required to clearly indicate in each publication 3A’s ownership of the trademark by displaying 3A’s logo and the address of 3A’s office;

(c) HVG was required to present a marketing plan each year, explicitly said to include advertisements, which required 3A’s approval prior to implementation;

(d) 3A was required to consider, on a case-by-case basis, a cost contribution to the expenditure for marketing and promotional activities by HVG;

(e) 3A was required to provide HVG with such quantities of promotional material and literature of Alucobond as published from time to time by 3A, as necessary for the purposes of the Distributor Agreements. 3A was also required to give HVG technical details and assistance as HVG might require from time to time. The relevant promotional material, literature, technical details and assistance were required to be provided by 3A free of charge.

1410 It is also evident that 3A did, in fact, provide marketing brochures to HVG for dissemination in Australia, and that 3A did contribute to the cost of marketing and promotion of Alucobond products within Australia. I note, however, that the extent of this assistance over the entire duration of the relevant period is not clear.

1411 Considering the terms of the Distributor Agreement and the observations of Keane JA in Downey, I accept that 3A wanted to protect the goodwill in its name and logo by avoiding it being associated with content in the brochures that it did not approve of. This is plainly the intention sought to be achieved through the various clauses of the Distributor Agreements identified above. However, the Distributor Agreement required HVG to both prepare advertisements in respect of the Alucobond products, and then obtain 3A’s approval of that material prior to its use. HVG’s activities in doing so were supported financially and through the provision of the required information by 3A. By providing such assistance in the preparation of the brochures and approving the brochures, 3A can be taken to have approved their content for distribution in Australia.

1412 I find that a reader of the brochures was entitled to conclude that the representations contained in the brochures were made jointly by the Respondents.

1413 3A seeks to distinguish the present case from Barton on the basis that in Barton the relevant wholesaler was the one responsible for affixing the label to the good. 3A submits that this case concerns brochures that were prepared by HVG, not 3A. I am not satisfied this is a relevant basis on which to distinguish the present case from Barton. While the conduct in the present case is clearly different to that in Barton, being the review and/or approval of marketing material prepared by HVG, the principle from Barton remains applicable. The terms of the Distributor Agreements, and the exercise thereof, were intended by 3A to enable it to ensure Alucobond was being advertised to consumers in Australia, that 3A had control over those advertisements, and that 3A’s ownership of the Alucobond brand was clear. While 3A was not the one who prepared the brochures and may not have provided them itself to potential consumers, the HVG brochures were the means by which 3A sought to advertise the use of Alucobond in Australia. I also find that this case is analogous to Downey, where Keane JA explicitly referred to the analysis in Barton at [46]-[48].

1414 In Downey, brochures advertising a development under the appellant company’s brand were produced and disseminated by a third party. The appellant company admitted it had in fact approved one brochure (and even suggested amendments to the draft), admitted it approved and authorised the use of the brand name in a second brochure, but in respect of the third brochure did not admit that it knew of or approved the brochures’ content, rather the allegations against the company were deemed to have been admitted: at [13]-[16]. On appeal, the company admitted to authorising the inclusion of some statements in the brochures, but denied approving their actual publication, and submitted that the primary judge erred in concluding that the company had engaged in the making of any representations to the respondents: at [34]. Keane JA distinguished this case from Saatchi, because here, whilst the brochures were disseminated by a third party, the representations conveyed the appellant’s own views about the project and the appellant company had the capacity to and did control what information was published on its behalf: at [42].

1415 3A also seeks to distinguish the present case from Downey on a factual basis submitting that, in Downey, it was found that the relevant company had, in fact, approved the marketing materials through which it made certain representations.

1416 In the present case, there are two relevant instances to discuss.

1417 The first instance was in March 2010 in respect of the “Vision Materialized” brochure (the second generation brochure). A draft of the brochure was provided by Mr Bruce Rayment (HVG) to Ms Haas (3A). Ms Haas responded in an email dated 5 March 2010 saying:

Dear Bruce,

thanks for sending the draft of the “Australian Market Brochure”. As expected it shows the outstanding work done at your end, congratulations this is really fantastic !

…

With regards to the manufacturer name our new company name is 3A Composites GmbH. So, the correct way to mention this on the leaflet is Manufactured by 3A Composites GmbH, 78224 Singen / Germany.

However, before you initiate the final print pls await our green light first, just in case there is any unforeseen changes at last minutes….you never know. Thanks for your understanding.

We will go through this comprehensive brochure with Guntram and his marketing team and come back with final comments within the next 1-2 weeks. Please bear with us until then.

1418 A further email followed on 22 March 2010 from Ms Haas to Mr Rayment and others at HVG in which Ms Haas said:

Bruce,

Had a discussion with Guntram Eydner in the morning with regards to what we think should be amended on the brochure. We have scanned the relevant pages and put some handwritten comments on it. Can you please have a look at our comments and give me a call once you had a chance to look into it. It is probably easier to discuss details over the phone.

1419 The email attached various pages of the “Vision Materialized” brochure with various handwritten comments. The comments range from minor changes such as moving particular text up or down by a few centimetres, to corrections to various pieces of technical information, to a suggestion to replace a whole page with a page from a newer brochure.

1420 Outside of the above example, the only other evidence of 3A specifically reviewing a brochure is in June 2017. In particular, on 13 June 2017, Ms Kate Patterson (HVG’s Marketing Co-ordinator) sent an email to Ms Haas attaching a copy of the “Beyond Facades” brochure that had been prepared. Ms Haas responded the following day saying: [3AC.402.001.4313]

Dear Kate,

thanks for forwarding the latest version of the Beyond Facades.

As discussed during our meeting in Australia I have asked Elfie from our marketing dept. to run through the document. As anticipated there are a couple of changes necessary, mainly of “cosmetic” nature with our product names not typed in line with our 3A Corporate design…

To facilitate things all changes are marked in yellow, together with comments from Elfie.

Can I ask you to please consider these changes in your next edition, when you re-print the brochure.

For reasons explained during my visit please ensure that in future, and what was common practise in the past, always forward draft copies of any potential print document to me for final approval. Please understand that this is not meant to make your life more difficult, but this is common practise with all our other partners too and acknowledging the fact that 3A is producer and holder of the brand Alucobond and we need to ensure it’s used in the right way. Thanks for your understanding and continued support, which you know I value a lot.

1421 Ms Haas’ email attached a copy of the “Beyond Facades” brochure containing a number of comments from 3A.

1422 As noted above, these are the only two available examples where 3A reviewed and approved the content of HVG’s brochures. The Applicants and 3A submit that different things should be inferred from the last paragraph of Ms Haas’ 14 June 2017 email extracted above. The Applicants submit that it can be inferred from Ms Haas’ email that the common practice over the relevant period was for any marketing material to be provided to 3A for final approval, as described in the email, with the suggestion that there may have been a brief deviation from such practice. 3A on the other hand submits that the email suggests a common practice at some unidentified time “in the past”, and submits that given HVG had been selling Alucobond products since 2007, there was no reason to think that Ms Haas was referring to any significant period of time within the relevant period. 3A submits that the Court should not infer on the basis of such evidence that there was a common practice of 3A approving HVG’s brochures during the relevant period.

1423 On the evidence before me, the Applicants’ contention is to be preferred. As Ms Haas’ email stated, it was common practice at some time prior to 2017 for draft copies of potential brochures to be provided to 3A for its approval. An example of this appears to be the “Vision Materialized” brochure discussed above in 2010, during the relevant period. While Ms Haas’ email indicates that there was some deviation from the common practice for some unknown period of time, I am not satisfied that any of the specific material the Applicants rely on should be taken to have been so subject to the deviation. This is particularly in light of the obligations imposed on HVG under the Distributor Agreements to seek 3A’s approval of such material throughout the relevant period, noting that HVG entered four Distributor Agreements over the course of the relevant period.

1424 It is also relevant to note that 3A was directly involved in the distribution of the marketing materials and making representations about the Alucobond products during Ms Haas’ bi-annual visits to Australia. Ms Haas’ travel reports detailed her meetings and discussions with numerous relevant personnel from the industry on each visit in cities throughout Australia. Ms Haas’ travel reports also evidence her attendance at trades shows where the Respondents had stalls with marketing materials available for distribution to interested persons.

1425 Further, the salient point in Downey was not that the company had made the representations because it had in fact approved the contents of the marketing material in respect of each brochure, but rather, that in looking at all the circumstances, the company would be regarded by those to whom the advertising material was published as having adopted the representations conveyed thereby. I find that, in all the circumstances of this case, 3A would be regarded by those to whom the advertising material was published as having adopted the representations conveyed in HVG’s brochures.

1426 In addition, a number of the HVG brochures referenced 3A or included 3A’s logo. By way of illustration, the following statements all appear in (a) generation two: “Vision Materialized”; (b) generation three “At a Glance” (versions one and two); and (c) generation four “Beyond Facades”:

(a) “3A Composites and Alucobond Architectural do not recommend installation of untrimmed ALUCOBOND® panels;

(b) “[t]he quality of coating is tested according to standards established by E.C.C.A…of which 3A Composites is a member”;

(d) “3A Composites were one of the first companies to develop its own environmental management system.”

1427 The brochures also have on the back of the brochure, a statement that “Alucobond is manufactured by 3A Composites GmbH, 78224 Singen / Germany”, and generation three ‘At a Glance’ (version one), and generation four ‘Beyond Facades’ display 3A’s logo alongside that statement.

1428 The brochure known as generation one, “The Face of Tomorrow” has the following statements:

(a) “…Alcan Singen GmhB has been a pioneer in processing aluminium for more than 90 years”;

(b) “Manufactured since 1969, by one of the world’s largest and longest established aluminium producers, Alcan Singen GmbH;

(d) “[t]he quality of coating is tested according to standards established by E.C.C.A…of which 3A Composites is a member”;

(e) “[t]hese eye-catching finishes…provide evidence of Alcan’s know-how and competency”; and

(f) “Alucobond, Alucore and Dibond are manufactured by Alcan Singen GmbH, 78224 Singen / Germany”.

1429 Alcan Singen GmbH was the previous corporate name for 3A.

1430 The inclusion of these references to 3A in the brochure fortify my view that 3A would be regarded as adopting the representations contained in the HVG brochures as its own: see Downey at [48]-49 in respect of the inclusion of the company’s name and logo.

9.3 The Relevant Class

1431 It is convenient at this point to address an issue of contention between the parties. The Applicants submit that the conduct in question was directed to the public, or part of the public and, therefore, the conduct must be assessed by reference to the ordinary and reasonable members of the relevant class of persons: Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 277 CLR 186; [2023] HCA 8 at [83].

1432 In contrast, 3A submits that in cases where damages are claimed as a remedy for alleged misleading or deceptive conduct, it is necessary to look at the particular circumstances of the claimant to assess causation, as opposed to some abstract class of persons, to determine whether the impugned conduct was misleading or deceptive: Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 at [36].

1433 HVG also refers to Butcher and submits that the Applicants plead the Positive Representations (and Warnings) were directed to a specified class – being the market of all persons in the building and construction industry who were involved in the design, specification, preparation, certification and use of Alucobond PE and Alucobond Plus in Australia. However, HVG submits that it should not be permitted to disguise the fact that the Applicants’, and group members’, only viable pathway to damages or compensation is to prove actual reliance by the relevant Qualified Professional(s) involved in the selection and application of Alucobond PE or Alucobond Plus to the specific building – that is, identified individuals. Therefore, HVG submits the allegations do not invoke an analysis of whether the representations were false or misleading by considering the reaction of hypothetical members of a class.

1434 In considering this issue it is useful to set out the settled principles. In Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304, 319, French CJ said at [26]:

This Court has drawn a practical distinction between the approach to characterisation of conduct as misleading or deceptive when the public is involved, on the one hand, and where the conduct occurs in dealings between individuals on the other. In the former case, the sufficiency of the connection between the conduct and the misleading or deception of prospective purchasers “is to be approached at a level of abstraction not present where the case is one involving an express untrue representation allegedly made only to identified individuals”. Where the conduct is directed to members of a class in a general sense, then the characterisation inquiry is to be made with respect to a hypothetical individual “isolate[d] by some criterion” as a “representative member of that class”. In the case of an individual it is not necessary that he or she be reconstructed into a hypothetical, “ordinary” person. Characterisation may proceed by reference to the circumstances and context of the questioned conduct. The state of knowledge of the person to whom the conduct is directed may be relevant, at least in so far as it relates to the content and circumstances of the conduct.

1435 In upholding claims for misleading or deceptive conduct and passing off, the High Court unanimously held in Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45 at [103]:

Where the persons in question are not identified individuals to whom a particular misrepresentation has been made or from whom a relevant fact, circumstance or proposal was withheld, but are members of a class to which the conduct in question was directed in a general sense, it is necessary to isolate by some criterion a representative member of that class. The inquiry thus is to be made with respect to this hypothetical individual why the misconception complained has arisen or is likely to arise if no injunctive relief be granted.

1436 In Butcher, the majority (Gleeson CJ, Hayne and Heydon JJ) said:

[36] The relevant class addressed. Questions of allegedly misleading conduct, including questions as to what the conduct was, can be analysed from two points of view. One is employed in relation to “members of a class to which the conduct in question [is] directed in a general sense”. The other, urged by the purchasers here, is employed where the objects of the conduct are “identified individuals to whom a particular misrepresentation has been made or from whom a relevant fact, circumstance or proposal was withheld”; they are considered quite apart from any class into which they fall. Adoption of the former point of view requires isolation by some criterion or criteria of a representative member of the class. To some extent the trial judge adopted the former approach, pointing out that the class — potential home buyers for Pittwater properties in a price range exceeding $1m — was small (as suggested by the fact that only 100 brochures were printed), and its members could be expected to have access to legal advice.

[37] The former approach is common when remedies other than those conferred by s 82 (or s 87) of the Act are under consideration. But the former approach is inappropriate, and the latter is inevitable, in cases like the present, where monetary relief is sought by a plaintiff who alleges that a particular misrepresentation was made to identified persons, of whom the plaintiff was one. The plaintiff must establish a causal link between the impugned conduct and the loss that is claimed. That depends on analysing the conduct of the defendant in relation to that plaintiff alone. So here, it is necessary to consider the character of the particular conduct of the particular agent in relation to the particular purchasers, bearing in mind what matters of fact each knew about the other as a result of the nature of their dealings and the conversations between them, or which each may be taken to have known. Indeed, counsel for the purchasers conceded that the mere fact that a person had engaged in the conduct of supplying a document containing misleading information did not mean that that person had engaged in misleading conduct: it was crucial to examine the role of the person in question.

1437 Finally, Gummow J held in Elders Trustee & Executor Co Ltd v EG Reeves Pty Ltd (1987) 78 ALR 19, at 241:

In the present case, the complaint is made in an action to recover actual loss or damage, not an application for injunctive relief brought by one trader concerning conduct of another trader in respect of third parties. Further, the complaint arises from particular negotiations and other conduct of identified individuals with reference to particular transactions. In such proceedings, primary attention will of necessity be focused upon the conduct of those individuals and the establishment of a sufficient causal link between the respondent's conduct and the applicant's loss or damage…

1438 In Ethicon, the conduct complained of was the marketing and promotion of pelvic mesh devices and continuing to market and promote the devices without proper disclosure or warnings: at [3576]. Katzmann J found the conduct was directed towards both medical practitioners, principally gynaecologists and urogynaecologists, and to women suffering from stress urinary incontinence and/or pelvic organ prolapse: at [3552]. The proceeding was also a representative action, where causation and loss were not determined as common questions. Nonetheless, the applicant, and other sub-group member representatives sought damages in respect of the misleading conduct. Katzmann J found the correct characterisation of the case was one of conduct directed towards a sector of the public – although, it does not appear that issue was in contention in the proceeding. This characterisation was upheld on appeal: see Ethicon (Full Court) at [796]-[802].

1439 I am of the view that this case is best characterised as conduct directed to a class of persons for the following reasons:

(a) the conduct in question, being advertising and promoting the Alucobond products, was directed towards the Design Professionals (defined below); it was not, as advertising almost invariably is not, directed or targeted towards a specific, identifiable person or persons; and

(b) in any event, the Applicants accept that the question of causation and loss are not common questions, but rather require the Applicants to prove that each of the Shore OC and Five Dock OC have suffered loss as a consequence of the alleged misleading conduct.

1440 In reaching this view it is important to emphasise that the above authorities, in particular the extract from Butcher, which is relied on by the Respondents, cannot be reduced to a principle that where a plaintiff seeks monetary damages in respect of misleading and deceptive conduct, such a claim cannot be assessed by reference to a class of persons. To do so, is to focus on only one part of the High Court’s reasoning. The majority said that such an approach is inappropriate “where monetary relief is sought by a plaintiff who alleges that a particular misrepresentation was made to identified persons, of whom the plaintiff was one ” (emphasis added). The other authorities I have referred to above also emphasise the question of to whom the conduct in question was directed. Whilst I accept that the Applicants are claiming relief in the form of damages, the conduct in question was directed towards a class of persons; this is not a case of a specific impugned negotiation or representation directed towards specified people. The conduct in question is clearly the advertising and promotion, over a sustained period of time, directed towards the relevant class of persons interested in the products, not any specified individuals.

1441 The relevant question is then, who is the Relevant Class? I find on the evidence that the Relevant Class to whom the brochures and websites are directed are the Qualified Professionals who were responsible for designing, constructing and certifying buildings that complied with the BCA. Those Qualified Professionals included architects and designers who specified ACPs, façade fabricators, who constructed façades using ACPs and building certifiers who certified compliance with the BCA (collectively referred to as Design Professionals). I make this finding for the following reasons.

1442 First, it is clear that the relevant class of persons the alleged representations were directed to were predominantly architects and persons responsible for the design choices on buildings. This is consistent with the express language of the brochures which often explicitly refer to architects and designers. It is also consistent with the purpose of the brochures, being for the Alucobond products to be specified for use on building projects.

1443 Second, the representations were clearly not directed to FSEs, and as the evidence of Expert Group 4-5 established, FSEs would not have sought to rely on such marketing material in any case.

1444 Third, this is consistent with the evidence of Group 7 (architects and building professionals):

(a) Mr Incoll, in his first expert report in the Expert Group 7 (Architects) discussed the role of a number of Qualified Professionals, including that architects were the principal product specifiers, with façade subcontractors and design consultants sometimes being involved, and certifiers commenting on material selection where relevant. Later in his first expert report, Mr Incoll said that ACPs were marketed to building industry participants which included façade fabricators/contractors. Mr Incoll said that façade fabricators/contractors used information in marketing brochures to suggest alternative ACPs;

(b) Mr Incoll said in his first expert report that the suitability of ACPs was informed by the wide-spread dissemination of product information, brochures and promotional material from companies that manufactured and/or supplied ACPs to building industry participants which included façade fabricators/contractors; and

(c) Mr Smithson, in his expert report, said that façade fabricators/contractors would provide technical input regarding installation of ACPs. Façade fabricators/contractors would provide design advice as how best to transform the ACPs and install them in a façade system. Mr Smithson said that façade fabricators/contractors and designers would advise on developing the façade system by applying their own skill, experience, and expertise to procure, fabricate, and install the façade system on buildings.

1445 Accordingly, the Court’s task is to consider whether the alleged representations were likely to mislead an ordinary and reasonable member of the class (Design Professionals) and objectively attribute characteristics and knowledge to that hypothetical person (or persons), and to consider the effect or likely effect of the conduct on their state of mind. This hypothetical construct “avoids using the very ignorant or the very knowledgeable to assess effect or likely effect; it also avoids using those credited with habitual caution or exceptional carelessness; it also avoids considering the assumptions of persons which are extreme or fanciful”: Self Care at [83]. When I refer to Design Professionals, unless otherwise specified, that is a reference to a reasonable and ordinary Design Professional.

1446 A difficulty which arises in respect of the Applicants’ case is the proper characterisation of an ordinary and reasonable member of the class, namely Design Professionals, and in particular architects. Given the rejection of large swathes of Mr Quigley’s and Mr Incoll’s evidence, in which the experts sought to give their view on the general state of knowledge and understanding of those professionals during the relevant period – including the combustibility of ACPs and the regulatory landscape – the evidence regarding the standard of knowledge that would be expected of ordinary and reasonable Design Professionals during the relevant period is quite vague and uninformative.

1447 As has already been noted above, the evidence before me does not support a generalised finding that a particular level of knowledge, or in this case, ignorance, as to those issues can be imputed to Design Professionals across Australia during the relevant period. In this context, and noting that the evidence of what could be attributed to an ordinary and reasonable Design Professional during the relevant period is quite vague, I make the following comments.

1448 Firstly, I find on the expert evidence that an ordinary and reasonable Design Professional would be expected to have a working knowledge of the BCA. While this may not be to the level of detail that might be expected of an ordinary and reasonable certifier, an architect could be expected to have a general understanding of basic matters such as:

(a) the different compliance pathways available under the BCA;

(b) the different classes of buildings and types of construction under the BCA;

(c) that a building’s compliance with the performance requirements depends on the particular characteristics and use of the building as a whole, and particularly in relation to fire resistance requirements under the BCA; and

(d) that the BCA imposes stricter fire resistance requirements in respect of Type A and Type B construction relative to Type C construction.

1449 Secondly, I find on the expert evidence that an ordinary and reasonable architect would not be expected to have the depth of understanding that might be attributed to an ordinary and reasonable FSE when it comes to matters of interpreting technical information regarding fire performance.

1450 Thirdly, I find on the expert evidence that architects would place a degree of reliance upon certifiers or other consultants to ensure that the use of a product complied with the BCA.

1451 The following evidence given by Mr Quigley during the Expert Group 7 conclave is relevant in this respect:

[T652.13-36]: MR SHIPWAY: … I understand that it’s your opinion, isn’t it, that a reasonably prudent and suitably qualified architect could have been expected to have had a working knowledge, at least, of the BCA during the relevant period.

MR QUIGLEY: That’s correct.

MR SHIPWAY: Because some understanding of the requirements of the BCA was essential, wasn’t it, to the architect discharging his or her professional obligations?

MR QUIGLEY: That is correct, but it also was so that you didn’t have to backtrack. So that if you designed something and the building certifier said it doesn’t comply, you would have to go back and start again… [s]o it was important that you had a basic understanding of the BCA.

MR SHIPWAY: A qualified architect would have been aware then, during the relevant period, that the BCA requires compliance with what I call performance requirements. Is that correct?

MR QUIGLEY: That’s correct from my own experience, yes. I can’t speak for other architects.

…

[T654.1-46]: MR SHIPWAY: So a qualified architect would have been aware, to your understanding, that the BCA divides buildings into different classes depending on the building’s use. Is that correct?

MR QUIGLEY: That’s correct.

MR SHIPWAY: Sometimes different parts of a single building will be different classes; correct?

MR QUIGLEY: Correct.

MR SHIPWAY: A qualified architect would also have appreciated during the relevant period that compliance with the performance requirements depended on the characteristics, then, of a building as a whole and its function and use; correct?

MR QUIGLEY: Correct.

MR SHIPWAY: A qualified architect would have been aware that there were two pathways to comply with the performance requirements that we have seen. The first is satisfying the deemed-to-satisfy provisions. You are aware of that pathway?

MR QUIGLEY: I am.

MR SHIPWAY: The second is preparing what’s called a performance solution. You are aware of that pathway?

MR QUIGLEY: I am, yes.

MR SHIPWAY: And there is also the third pathway, which is a combination of the first two; correct?

MR QUIGLEY: Yes.

MR SHIPWAY: A qualified architect would have been aware that if we are looking at the deemed-to-satisfy pathway, the deemed-to-satisfy provisions prescribed three types of construction: Types A, B and C; correct?

MR QUIGLEY: Correct.

MR SHIPWAY: And the fire resistance requirements differ between those types. The most stringent apply to larger buildings, which are type A, relatively larger, whereas the least stringent fire resistance requirements apply to smaller buildings, type C; correct?

MR QUIGLEY: Not absolutely. So I mean type A is generally defined by the height of the building rather than the size of the building.

…

[T655.5-10]: MR SHIPWAY: Thank you. A qualified architect would have been aware that, by reason of those building specific requirements, the obligation to comply with the performance requirements mandated in the BCA is an obligation that applies to the building as a whole. I think you would agree with me about that; correct?

MR QUIGLEY: Yes.

1452 In respect of the second and third matters noted above, Mr Quigley was later cross-examined in respect of the statement in his expert report that the identical AS 1530.3 test results reported for each of Alucobond PE, Alucobond Plus and A2 would mean to an architect that the fire properties for Alucobond PE, Alucobond Plus and A2 were identical. Mr Quigley said the following: [T658.12-15]:

MR QUIGLEY: Well, I – when I read those results, back at that time, my understanding – the way I took those results was it meant that the material was not combustible. Now, I didn’t appreciate at the time that there were various parts of AS 1530 and that it was part 1 that the BCA relied on in testing for combustibility rather than part 3.

1453 Mr Quigley was then taken through the “International Fire Classifications” table in the “Vision Materialized” brochure along with the representations made about the differing degrees of combustibility of the cores of Alucobond PE, Alucobond Plus and A2. Having been taken through the relevant material, Mr Quigley gave the following evidence at [T660.31-661.3]:

MR SHIPWAY: So it must be the case, mustn’t it, that a reasonably prudent and qualified architect would have appreciated, having regard to those international fire classifications and these descriptions in the product range page, that the products were not identical in terms of their combustibility; correct?

MR QUIGLEY: That’s correct, yes. Well, it certainly would indicate that the cores of those products were – had a different degree of fire resistance.

MR SHIPWAY: Thank you.

MR QUIGLEY: However, the same document makes reference to a suggestion from the supplier that the aluminium skin protected the core and, as a result, the fire properties of the core were less relevant. Now, the standards referred to here are international standards that I am not, and wasn’t at the time, familiar with. And in selecting these products I relied on the expertise of the building certifier to determine whether, in their opinion, the product was non-combustible and, therefore, satisfied the deemed-to-satisfy requirements of the BCA. And I, in my experience, have not had a building certifier raising any issues or any concerns about the fire performance of that – of Alucobond. And my assumption was that they had a much more detailed knowledge of the fire performance of these materials.

1454 I therefore find that a Design Professional would have known that the fire properties of Alucobond PE and Alucobond Plus were not equivalent, and that Alucobond Plus was less combustible than Alucobond PE.

9.4 Whether the marketing material conveyed the alleged Positive Representations (Issue 10(d))?

1455 I have considered each of the brochures and websites and the parties’ submissions in the Consolidated Schedule of Relevant Publications – MFI-11 – and have concluded that the brochures and websites referred to in MFI-11 do not convey the pleaded Positive Representations, apart from the Plus Composition Representation.

1456 It is convenient at this point to consider HVG’s submissions regarding a number of authorities on puffery. In particular, HVG refer to the decision of RB (Hygiene Home) Australia Pty Ltd v SC Johnson & Son Pty Ltd [2020] FCA 1783 where Griffiths J said at [10]-[12]:

[10] In the ordinary course of commercial dealings, a certain degree of puffery or exaggeration is to be expected. Indeed, puffery has been taken to be part of the ordinary stuff of commerce. This is particularly so in the case of advertising where a degree of latitude is to be allowed given the nature of advertising reflects the enthusiasm of the advertiser to place its product or service in a favourable light…

[11] That is not to say that representations which could be characterised as puffery are immune from provisions prohibiting misleading or deceptive conduct. The applicant relied upon the following statements by Murphy J in REA Group Ltd v Fairfax Media Ltd [2017] FCA 91 at [89]–[90] :

[89] That is not to say that puffed statements cannot convey a definite meaning upon which an ordinary or reasonable reader could rely…

[90] However the question of whether a puffing advertising claim conveys a definite representation or not will depend upon the context and setting in which the claims appear and may involve questions of degree and impression. To a significant extent the authorities turn on their own facts.

(Citations omitted.)

1457 Also, in Overlook v Foxtel (2002) ATPR (Digest) 46-219; [2002] NSWSC 17, Barrett J said at [119]:

The reality is that a certain amount of hyperbole is permissible and to be expected in business without attracting legal sanctions. Thus, a statement that a bank customer’s affairs “will be in the best of hands” or that someone will “guarantee payment for the shipments with his life” must be recognised as a mere puff not actionable under s 52.

(Citations omitted.)

1458 HVG submits that the Applicants’ pleaded Positive Representations posit extreme interpretations of selective statements in the Respondents’ advertising, many of which were mere puffery.

1459 The breadth and scope of the relevant text consolidated in MFI-11 means that it is impractical and not of any particular assistance to refer to each of the brochures and websites in these reasons for judgment. It is apparent that the text relied upon by the Applicants in the brochures is repetitive and to the same effect, and so voluminous that it would require an unjustifiable amount of the Court’s time and resources to consider each text and image in each brochure, and would not be consistent with the overarching purpose in s 37M of the FCA Act. I propose to deal with the brochures specifically referred to by the Applicants in their closing submissions at [649]-[687].

1460 I have read each of the brochures referred to in the consolidated schedule MFI-11 and am satisfied that the sample brochures identified and relied upon by the Applicants are representative of the Representations contained in the totality of the brochures referred to in the consolidated schedule MFI-11. Because of the repetitive nature of the Representations there is no utility in undertaking a consideration of each text referred to in each brochure because they are not sufficiently different in their nature and it would be impractical and not of any real assistance and not consistent with the overarching purpose in s 37M of the FCA Act.

9.4.1 Generation One: The Face of Tomorrow, Today (2004 to 2013)

1461 The “Face of Tomorrow, Today” brochure is alleged by the Applicants to have been published between 2009-2013. HVG accepts this was an Australian brochure, but the Respondents do not admit the publication period: [HVG.001.001.0052].

1462 This is an HVG brochure. The brochure refers to “ALUCOBOND”; the parties accepted this was a reference to Alucobond PE and that the brochure does not mention Alucobond Plus.

9.4.1.1 Suitability Representation

1463 The Applicants submit that images of buildings in Australia with Alucobond cladding visibly affixed throughout the brochure and the following text conveyed the Suitability Representation:

(a) “anything is possible with Alucobond”;

(b) “[s]ince 1969, building owners and architects have successfully chosen Alucobond as a versatile construction material to turn their ideas into reality and to give buildings and skylines the shape of the future”.;

(d) “Australia’s most popular composite panel”;

(e) “Alucobond can be used as a facia, as a cladding panel for interiors or signage”;

(f) “Alucobond is ideal to fit into any curtain wall system”

(g) “exceptional strength for resistance to blows and breakage”;

(h) “simple but extremely versatile product concept has been developed “ to provide a façade material with a host of distinct advantages for architects ”; and

(i) “ the ideal material for suspended rear-ventilated fa ç ades, claddings for roof edges and fascias ”.

1464 I reject that submission. As an initial observation, it is not precisely clear what is meant by Alucobond PE and/or Alucobond Plus being “suitable” for each of the “Purposes” alleged under the 2FASOC. Ostensibly, the suitability of an ACP such as Alucobond PE and Alucobond Plus to be used for a particular purpose would involve consideration of any number of matters from the overall aesthetic of the product, the ability to fabricate and manipulate the product, the quality and consistency of its finish, its durability in different environments, its flexibility or rigidity, its other mechanical properties, its acoustic properties, its insulating properties, and any number of other matters. However, in the context of this particular proceeding, it appears that when discussing the Alucobond products being “suitable” for use for each of its relevant purposes, the relevant aspects of suitability that are particularly in focus are whether the panels are used safely and compliantly with the BCA.

1465 It should be noted that each of the Representations alleged by the Applicants are very broad. In relation to the Suitability Representation, the allegation is that Alucobond PE and Alucobond Plus were suitable for all of the uses for which it was commonly acquired (including as external cladding on high-rise residential, commercial or public buildings), and would be suitable for such uses once affixed to a building. Similarly, in respect of the Compliance Representation, the alleged representation is that Alucobond PE and Alucobond Plus were compliant with all relevant building codes and standards for use on all buildings in Australia, or would be so compliant once affixed. In each of these cases, the Positive Representations are effectively alleged at the broadest level, which is to say that, in effect, the panels could be used in any way, and when so used, would be suitable and compliant for that use.

1466 It is also to be noted that the Positive Representations are alleged to largely be implied from images of buildings on which Alucobond products have been affixed and accompanying marketing statements as to the versatility and popularity of the products.

1467 Noting the above, it is relevant to turn to the particular material contained within the brochure. The brochure contains a number of photos of different buildings. While the images are all quite different, they broadly reflect the use of Alucobond PE on a number of large public, commercial and residential buildings. The images also show the panels being used, in a number of scenarios, in undisturbed vertical and horizontal runs up and around buildings. The images are supported by a number of text extracts such as “anything is possible with Alucobond”, “Australia’s most popular composite panel”, and “Alucobond is ideal to fit into any curtain wall system”.

1468 I accept that the general impression given by the brochures is that Alucobond PE can be used in a broad variety of applications, including in the context of large commercial, residential, and public buildings. I also accept that a reasonable Design Professional who reviewed the brochure would assume, in viewing images of buildings on which Alucobond PE was used, that the use of the particular product on that building was safe and compliant with the BCA.

1469 Having accepted the above, the difficulty which the Applicants face is that it is one thing for the images and text in the brochures to indicate that the use of the panels depicted on a particular building was safe and/or compliant (setting aside whether this was actually the case), and quite another to suggest that the images represent that the panels can be used in any way and in any particular application on another building, without consideration of how the building depicted may have been designed and how that might differ to the particular building that the architect or designer was dealing with.

1470 In understanding this distinction, it must be understood what is implicit in the broad Positive Representations alleged by the Applicants. The Applicants’ positive misrepresentation case is premised on the notion that the marketing material conveyed to Design Professionals that they could use Alucobond PE and/or Alucobond Plus on any particular building and in any way, implicit within which is that they did not need to specifically and independently concern themselves as to how compliance or safety was being achieved on their particular building. This is most discernible from the manner in which the Suitability (and the Compliance Representation) are pleaded where the Applicants allege that, by reference to the images and text of the brochures, a reasonable Design Professional would be led to believe that, in effect, any use of Alucobond PE and/or Alucobond Plus would be suitable and compliant.

1471 I am not satisfied that such a broad representation can be implied from the text and images of the brochure. A reasonable Design Professional who reviewed the brochure would assume that the relevant buildings contained in the brochure were designed and constructed by relevant Qualified Professionals, who exercised their own expertise and engaged the relevant professionals required to construct a safe and/or compliant building. A reasonable Design Professional would also understand that compliance under the BCA can be achieved through different pathways, and that a building’s compliance against relevant performance requirements is assessed against the building as a whole. Similarly, the overall safety delivered by a building would be properly understood by reference to the building as a whole, rather than by reference to the fact that Alucobond PE panels have been used.

1472 Ultimately, the key point is that a reasonable Design Professional, with a working understanding of the BCA, would understand that a fundamental premise of the BCA is that it provides a functional requirement system for buildings. It does not provide a single prescriptive system of how safety and compliance are to be achieved in buildings, and in this sense, requires relevant buildings professionals to exercise their professional expertise in determining that a particular building, as a whole, meets the relevant performance requirements.

1473 In this context, while it can be accepted that a reasonable Design Professional may look at the photos of buildings contained within the brochure as inspiration or an indication as to the possible ways in which Alucobond PE could be used, and assume that in each of those cases, the use of Alucobond PE was safe and/or compliant, this cannot be properly translated into an unqualified representation to reasonable architects or designers that Alucobond PE could be used as external cladding in any way on their own building, and that when so used, it would be safe and/or compliant. No express representation to such effect was made, and such a broad representation cannot be properly implied from the brochure as a whole.

1474 A reasonable Design Professional reviewing the brochure would be cognisant that the advertising would portray Alucobond PE in a favourable light, but that the examples of use in other buildings did not, without further information, translate to use in their own building. Indeed, a reasonable Design Professional would appear to have no real way of understanding how safety or compliance was achieved in relation to any particular building depicted in the brochure. The accompanying textual representations do not change this. It follows that a reasonable Design Professional would understand that they were still required to exercise their own independent professional skill and judgment in determining whether an Alucobond product was suitable and or compliant for their particular building. No such representation could realistically be made about any building product. I will now consider some of the specific aspects of the brochure said to convey the Suitability Representation.

1475 The brochure explained the versatile uses of Alucobond which it described as a “simple but extremely versatile product” which had been developed “to provide a façade material with a host of distinct advantages for architects”. The brochure said Alucobond was “the ideal material for suspended rear-ventilated façades, claddings for roof edges and fascias”, and “ideal to fit into any curtain wall system”.

1476 A statement that Alucobond PE or Alucobond Plus was ideal to be used in curtain wall systems would not have been construed by a Design Professional that the Alucobond product could be used on any wall in any quantity but, rather, that they may possibly be used to form part of a curtain wall system to a greater or lesser extent depending upon compliance with the BCA. The same reasoning applies to the statements about the use of Alucobond PE as a cladding panel for interiors, roof edges or fascias, signage, or suspended rear-ventilated façades.

1477 The images and text relied upon by the Applicants would not have conveyed to a Design Professional an unqualified representation that Alucobond cladding was suitable for any use on any building. It is doubtful any such representation could realistically be made about any building product, and there was no evidence that a Design Professional would have derived such a message from the brochure. A Design Professional would have understood the images and text to indicate the possible use of Alucobond products with those possibilities being subject to the design and BCA requirements applicable to each particular building.

9.4.1.2 Fire Performance and Compliance Representation

1478 The Applicants submit that the images in the brochure, the text, “the non-combustible aluminium cover sheets protect the plastic core” and the images adjacent to that statement (an image of a flame impinging on an individual ACP placed above the flame), and the reproduction of fire test results, including under the heading “Australia” results for the AS 1530.3, conveyed the PE Fire Performance Representations and, impliedly, the Compliance Representation. In particular the Applicants submit that the language in this brochure was apt to be understood by architects as indicating DtS compliance. I reject that submission.

1479 As a preliminary point further to my comments regarding the Suitability Representation, a representation that Alucobond PE and/or Alucobond Plus is compliant with all relevant building codes, and would be so compliant once affixed, would also, presumably, incorporate a broad number of matters relevant to compliance under the BCA which are matters beyond the scope of this proceeding. Again, I understand that the Compliance Representation, in the context of the present proceeding, is focused primarily on compliance with the BCA in respect of the fire resistance requirements under the BCA.

1480 I will deal first with the reproduction of the results for the AS 1530.3 test. The brochure, at page 0008, gives the results of the product under the AS 1530.3, and other test results. Those fire performance results would not convey to a Qualified Professional with an understanding of the BCA that the Alucobond product was not combustible. The relevant test to determine whether a material was combustible or non-combustible for the purposes of the BCA was AS 1530. The brochure says nothing about that test.

1481 Further, I have found the brochures were addressed to Design Professionals. As I expand on in paragraphs [1446 ]-[1453 ], whilst an ordinary and reasonable architect would have been expected to have a working knowledge of the BCA, this may not have been to the level of detail expected of a building certifier or FSE, including interpreting technical information and data regarding fire performance, such as the meaning of test results under AS 1530.3. I refer also to paragraphs [642 ]-[652 ] which record Mr Smithson and Mr Quigley’s views respectively (taken to be evidence of personal knowledge) that, as architects, they relied on building certifiers to determine whether products were combustible and did not pay attention to the technical information. For this reason, I do not find that a Design Professional would have read the AS 1530.3 test results (and the other test results there set out) as conveying the Compliance and PE Fire Performance Representations.

1482 Nonetheless, if a reasonable Design Professional would have understood and paid regard to the reproduction of the AS 1530.3 test results, they would not have conveyed that Alucobond PE was non-combustible. I outlined AS 1530 in section 5.4.4, including that AS 1530.1 is the relevant test for determining whether a material is combustible. AS 1530.3 does not determine combustibility; it assesses the fire hazard properties of materials, namely: ignitability, flame propagation, heat release, and smoke release. Given external walls are required to be non-combustible, AS 1530.3 does not assist in determining whether a material complies with the DtS requirements of the BCA, other than perhaps for use as an attachment to an external wall, under the attachment exception. Therefore, the Applicants’ reliance on this part of the brochure as conveying the Compliance and PE Fire Performance Representations, is misplaced.

1483 Further, even in so far as it could be said the AS 1530.3 results conveyed the use of Alucobond PE would be compliant with the DtS Provisions in relation to the attachment exception, the experts agreed that AS 1530.3 (and AS 1530.1), being small-scale tests, were not representative of the types of circumstances that would be expected in a façade fire, and were therefore of limited, if any, utility. The FSEs in the Group 4-5 Joint Report agreed that “[a] reasonable and competent FSE would not rely upon any test results stated in the marketing material but should ask to be provided with the relevant test reports and results, including certificates”. In any event, the Applicants’ pleaded Compliance and PE Fire Performance Representations relate to the use of the Alucobond products on all buildings as part of or as an attachment to an external wall or other building element.

1484 I will turn now to the text, “the non-combustible aluminium cover sheets protect the plastic core” and the images adjacent to that statement (an image of a flame impinging on an individual ACP placed above the flame).

1485 It may be accepted that a Design Professional may interpret the phrase “the non-combustible aluminium cover sheets protect the plastic core” at face value. However, I do not find that Design Professionals would, therefore, infer that Alucobond PE would be non-combustible. That is, I find that Design Professionals’ knowledge of ACPs as comprising a core between two cover sheets and their knowledge of the requirements of the BCA, would not infer that because the cover sheet of an ACP is non-combustible, that has a readily ascertainable impact on the combustibility of the ACP as a whole. I find that a Design Professional would defer to the relevant expertise of other Qualified Professionals, such as FSEs and certifiers, as to the combustibility of a building product, and its associated reaction-to-fire properties and BCA compliance. I do not find that a competent Design Professional would infer from that one statement in a twelve-page brochure, the Fire Performance or Compliance Representations, both such matters being complex concepts requiring considered analysis by reference to a particular building and its fire safety strategy.

1486 Taking the brochure as a whole, I find that the brochure did not convey the PE Fire Performance or Compliance Representations to Design Professionals.

9.4.1.3 Fabrication and Affixation Representation

1487 The Applicants submit the fabrication and fixing methods described under the heading “Fabrication” in the brochure including images depicting the relevant methods of fabrication, conveyed the Fabrication and Affixation Representation. In particular, the Applicants submit this is conveyed through the description of these methods in the brochure, which otherwise addresses “Fire Behaviour”, without a qualification to suggest that the method of fabrication or affixation might affect fire behaviour of Alucobond PE. I reject that submission.

1488 The text and images of fabrication and fixing methods in the brochure would not have conveyed to a Design Professional a representation that none of those methods would make any difference to the fire performance of the Alucobond product. The statements relied upon by the Applicants to the effect that Alucobond products could be processed in certain ways do not amount to an unqualified representation that those processing methods would not impact on the fire performance of the products in the event of a building fire. A Design Professional would not have understood the statements relied upon by the Applicants as a representation that the products could be safely and compliantly used in any way in any building. A Design Professional who read such material in the brochure would reasonably have concluded that the particular use to which Alucobond PE could be put depended on the fire characteristics of the particular building and on the Design Professional using their own professional skill and judgment to comply with the relevant provisions of the BCA. I am fortified in my view by the experts’ agreement that compliance with the BCA, and the fire properties of complex façade systems, such as ones incorporating ACPs, is dependent on the particular building, which self-evidently includes the method of fabrication and affixation.

1489 It would have been obvious from the text of the brochure to a Design Professional that the core of Alucobond PE was combustible, so that any processing method which exposed the core could impact on the fire performance of Alucobond PE. As a consequence, the Design Professional would need to use their own professional skill and judgment, and that of the relevant Qualified Professional, as to how any processing method affected the fire performance of the Alucobond PE product on a particular building.

9.4.2 Generation Two: Vision Materiali z ed (2009-2013)

1490 The “Vision Materialized” brochure is an HVG brochure: [HVG.001.001.0042]. HVG does not admit the alleged publication period of 2009-2013. The content of this brochure appears to be based on 3A's “Alucobond at a Glance” brochure [3AC.600.001.4025] which was designed for an international audience. The brochure refers to “ALUCOBOND” (the parties accepted this was a reference to Alucobond PE), Alucobond Plus, as well as Alucobond A2, Alucore and Alucobond Photovoltaic.

1491 The Applicants submit that this brochure’s structure is much the same as the previous brochure, generation one “The Face of Tomorrow, Today”, including the first 13 pages promoting the versatility of the product and its many possible uses. Following that, there are two pages for each of ‘Product Range’; ‘Product Information’; ‘Fabrication’; and one page for each of ‘Construction’; ‘Structural Behaviour’; ‘International Fire Classifications’; and ‘Useful Information’.

9.4.2.1 Suitability Representation

1492 The Applicants submit the images in the brochure and the following text, conveyed the Suitability Representation:

(a) “…architects and designers soon discovered the host of advantages of Alucobond for the use in exterior architectural applications and corporate identity programs, particularly in façades, wall cladding, and roof edging”;

(b) “…the possibilities for implementing the Alucobond for interior and exterior applications are extremely varied. It is used in projects ranging from the precise construction of residential buildings, representative public buildings, company headquarters, commercial and industrial buildings to the prestigious landmarks of modern urban construction”;

(c) “Alucobond offers architects and designers unlimited opportunities…the wide range of interior and exterior applications are matched only by the products’ versatility”;

(d) “[o]ur product and application expertise is the fastest and safest way to success, whether it be for buildings, renovation projects, or interior and exterior applications”;

(e) “Alucobond is ideal to fit into any curtain wall system”;

(f) the headings: “High Rise”, “Low rise”, and “Public Buildings”;

(g) under the heading “Residential Applications”: “allows almost unlimited scope to create the ultimate dream home”;

(h) “the most efficient and effective way to restore exterior surfaces and protect asset value is with Alucobond”; and

(i) “Alucobond…is a “prominent feature in a large number of attractive, distinctive architectural projects around the world”

1493 I reject that the images in the brochure and the accompanying text referred to above conveyed the Suitability Representation.

1494 The key development between the first and second generations of brochures is that the Vision Materialized brochure covers not only Alucobond PE, but also covers Alucobond Plus and Alucobond A2. I make the same comments as I have made above in respect of “The Face of Tomorrow Today” brochure. The nature of the representations alleged are broadly similar and I am not satisfied that the additional number or styles of photographs, or the additional textual representations accompanying them, change, in substance, the matters I have already addressed above in respect of “The Face of Tomorrow Today” brochure.

1495 The first point of note is that the brochure makes no distinction within the images of the buildings to which Alucobond products are affixed. This is a matter that substantively undermines much of the Applicants’ alleged Suitability Representation, which is said to be implied, largely, by reference to the various images of buildings clad with Alucobond. The images relied upon as conveying the alleged Suitability Representation depict a wide variety of buildings and structures, although all of them are large public or commercial projects which could only have been designed, constructed, and certified as BCA compliant by Qualified Professionals. The images of the buildings, and the accompanying text, could not represent to a reasonable Design Professional that Alucobond PE or Alucobond Plus could be used in any particular manner depicted, and when so used be suitable and compliant, when it is not clear from the images depicted which particular Alucobond product has been affixed. Further, it would appear logical from the product range which the brochure covered, that it would be a matter for each Design Professional to determine which of the particular products within the Alucobond range might be appropriate for the particular use and building which they were considering. This is also a matter which is relevant to the implied Fire Performance Representations, noting that the images of various buildings could not suggest to a reasonable Design Professional that the images depicted uses of Alucobond PE and/or Alucobond Plus. A Design Professional would not have drawn the Suitability Representation from the broad and general statements in the brochure about the varied and diverse uses of the Alucobond products. A statement to the effect that Alucobond can be used in “varied” applications is not a representation that Alucobond is suitable for use on any building and in any way or in any quantity or configuration.

1496 HVG also points to the below text from page four of the brochure:

The technical service teams at Alucobond Architectural support architects and building owners right from the planning stage. They provide comprehensive technical information and customized advice to assist with the perfect implementation of all ideas and plans. For every project, the proven strategy to achieve a smooth completion lies in an early coordination between vision, architectural plans and the many possibilities which our unique panels give to fabricators and installers. Our product and application expertise is the fastest and safest way to success, whether it be for buildings, renovation projects or interior and exterior applications.

1497 I find, in addition to my finding that the parts of the brochure the Applicants have highlighted did not convey the Suitability Representation, the above text mitigates against the Suitability Representation having been conveyed by the brochure as a whole. A Design Professional would understand this text, in the context of the brochure as a whole, as implying that Alucobond is not necessarily appropriate for any use on any building, and that any proposed use requires individual assessment by a Qualified Professional regarding design and BCA requirements applicable to each particular building.

1498 The Suitability Representation is not conveyed by the images and text relied upon by the Applicants.

9.4.2.2 Fire Performance Representations and Compliance Representation

1499 The Applicants submit the following text in the brochure conveyed the alleged Fire Performance Representations and Compliance Representation:

(a) Alucobond Plus is “hardly inflammable”;

(b) “[t]he non-combustible aluminium cover sheets protect the PE core”, together with the visual images depicted; and

(c) “[w]hen properly designed and installed, Alucobond panels will keep their shape and remain flat for life, even when exposed to extreme temperature changes”.

1500 The Applicants also rely upon the fire test results and international fire classifications reproduced in the brochure. On page 0022, there is the heading “International Fire Classifications” and beneath that a table which has across the top Alucobond, Alucobond Plus and Alucobond A2, with the test results for 18 different regions for each of the three products. The table includes:

(a) identical results under AS1530.3 for all three products;

(b) classification under EN 13501-1 of Class D for Alucobond PE and Class B, s1, d0 for Alucobond Plus;

(d) a statement that Alucobond Plus had “ passed ” UBC 26-9 (NFPA 285).

1501 I reject that the images in the brochure and the accompanying text referred to above conveyed the Fire Performance Representations and Compliance Representation.

1502 The statements relied upon by the Applicants as conveying the Fire Performance Representations and Compliance Representation would not have conveyed to a Design Professional that Alucobond PE and Alucobond Plus could be used in any way on any building without materially increasing the risks associated with a building fire. A Design Professional would know that whether Alucobond PE or Alucobond Plus could be used was dependent upon compliance with the provisions of the BCA, and that required the exercise by Qualified Professionals of their own professional skill and judgment to assess the fire risks associated with a particular building.

1503 The Applicants rely on the statement that Alucobond Plus is “hardly inflammable”. That statement has been taken out of context. In its totality, the statement is “hardly inflammable according to EN13501-1”. It would have been obvious to a Design Professional that the meaning of “hardly inflammable” was to be found in EN13501-1, even accepting a Design Professional would not have knowledge of or familiarity with that test.

1504 Moreover, the description of Alucobond Plus as “hardly inflammable” according to EN13501-1 occurs on a page which also includes short descriptions of Alucobond PE (“virgin PE core”) and Alucobond A2 (“Non-combustible according to EN13501-1”). To the extent any questions might be raised whether the first generation of brochures – being the above generation one “The Face of Tomorrow, Today” – represented that Alucobond PE was combustible, that is not in issue in “Vision Materialized”. In the product range section, Alucobond PE is referred to as “Virgin PE core”, Alucobond Plus is referred to as “mineral filled core (hardly inflammable according to EN13501-1)”, and Alucobond A2 is referred to as “mineral core (non-combustible according to EN13501-1)”. The statement that Alucobond A2 was non-combustible is clearly made in contradistinction of both Alucobond PE and Plus.

1505 A Design Professional would have known from those descriptions that Alucobond Plus was more fire resistant than Alucobond PE, but not as fire resistant as Alucobond A2, which was “non-combustible”. This would also have been obvious from the International Fire Classifications table reproduced, which shows clearly that the three Alucobond products are classified differently under the fire classifications and that Alucobond A2 was the only product described as “non-combustible”.

1506 The same representation regarding the cover sheets protecting the Alucobond PE core is made in Vision Materialized, followed by the identification of the same fire tests, and in particular, AS 1530.3. Additionally, the Applicants also focus on the description of Alucobond Plus as “hardly inflammable”.

1507 I am not satisfied that this conveyed the Fire Representations. In relation to the representation regarding the cover sheets protecting the PE core, as has been noted above, there are no images of buildings which can be identified as clad specifically with Alucobond PE. It cannot be suggested by reference to such photos that the protection afforded by the cover sheets would be such as to promote the use of Alucobond PE in a similar way.

1508 Additionally, representations regarding the protection afforded by the cover sheets must also be considered in the context of the table of International Fire Classifications. While the Applicants seek to make much of how particular fire tests were conducted, and how they were represented within the marketing material, the primary issue that the Applicants face is in being able to show that ordinary and reasonable Design Professionals would be able to properly interpret and otherwise seek to make use of the reporting of such results in the marketing material. The expert evidence establishes that knowledge of international fire classifications falls within the expertise and knowledge of FSEs. I repeat my comments above at [1481 ]-[1483 ] in respect of the level of knowledge that might be appropriately attributed to a reasonable Design Professional. That is, I do not find that a Design Professional would have read the AS 1530.3 test results (and the other test results there set out) as conveying the Compliance and PE Fire Performance Representations.

1509 Noting the above, when considering the table of International Fire Classifications, I accept the evidence given by Mr Quigley during cross-examination that a reasonable architect would have appreciated, by reference to the table of international fire classifications, that each of the products in the Alucobond product range had different fire behaviours, where Alucobond PE was the worst, where Alucobond A2 was the best, and where Alucobond Plus sat somewhere between the two. Beyond this, it is difficult to suggest that the international fire classifications table would represent anything more to a Design Professional, other than the fact that a number of tests had been conducted on the products, and that such information would be able to be obtained if required.

1510 In this context, I do not accept that the representation that the “cover sheets protect the core” would indicate to a Design Professional that any use of Alucobond PE and/or Alucobond Plus would be safe and suitable, and would present no material increase in risk to life or safety of occupants, or damage to property in the event of a building fire. Such a generalised blanket statement as to the reaction to fire behaviour of Alucobond PE and/or Alucobond Plus would be inconsistent with the clearly differing reaction to fire behaviours of Alucobond PE and Alucobond Plus reflected in the International Fire Classification table, when compared to the non-combustible alternative of Alucobond A2.

1511 In other words, a Design Professional would not have reviewed the brochure and concluded that all the Alucobond products performed to the same standard in a fire, such that all of them could be considered equally safe and suitable in the event of a building fire. This is particularly the case when the primary point of distinction between each of the products is the combustibility of its core. The representation that Alucobond Plus was “hardly inflammable” does not elevate the representation regarding the product into the generalised form alleged by the Applicants.

1512 The images and text relied upon by the Applicants do not convey the Fire Performance Representations and Compliance Representation.

9.4.2.3 Fabrication and Affixation Representation

1513 The Applicants submit the images in the brochure and the following text conveyed the alleged Fabrication and Affixation Representation:

(a) “the components can easily be fabricated and fitted onsite”; and

(b) “Alucobond can be bent, curved, or shaped to any required angle”.

1514 The Applicants rely upon the fabrication and fixing methods described, including images demonstrating the fabrication and affixing methods.

1515 I reject that submission. The statements relied upon by the Applicants to the effect that Alucobond products could be processed in certain ways do not amount to an unqualified representation that those processing methods would not impact on the fire performance of the products in the event of a building fire.

1516 The Applicants also refer to the following statement within the brochure: “When properly designed and installed, ALUCOBOND® panels will keep their shape and remain flat for life, even when exposed to extreme temperature changes”. This statement appears in a section of the brochure dealing with Alucobond’s structural behaviour, and under the heading “Comparison of thickness and panel weight with equal rigidity”. The statement was made in the context of the structural behaviour of the Alucobond panels and could not be properly understood as a representation regarding the behaviour of Alucobond panels in the context of a building fire.

1517 It would have been obvious from the text of the brochure to a Design Professional that the core of Alucobond PE and Alucobond Plus was combustible, so that any processing method which exposed the core could impact on the fire performance of the Alucobond product and, as a consequence, the Design Professional, and the relevant Qualified Professional, would need to use their own professional skill and judgment as to how any processing method affected the fire performance of the Alucobond product on a particular building.

1518 Further, HVG emphasised the following text:

(a) “[t]he plastic core of ALUCOBOND® can be hot-air welded using conventional hot-air welding equipment and plastic filler rod. Hot-air welding provides a water-tight joint for decorative purpose only. It is not suitable for joints where structural strength is required”;

(b) “[a]dhesives and sealants do not adhere to the plastic core”;

(d) “ALUCOBOND® composite panels can be shaped using a very simple processing method. The technique, called the routing and folding method, enables a fabricator to produce shapes of various kinds and sizes”;

(e) under the heading, “Fabrication Centres”:

During the past 40 years, qualified, independent fabricators and installers have become firmly established, offering professional service to the building industry. They have acquired deep knowledge in the processing of ALUCOBOND® and their skilled personnel and specialised processing equipment ensure that your project is completed on time and within budget.

(f) under the heading, “Comprehensive Service”:

1519 I find that these statements, conveyed that first, not all fabrication and affixation methods would be appropriate for all uses of Alucobond PE or Alucobond Plus and second, that the expertise of the relevant Qualified Professional, including a fabricator, would be required to determine the appropriate method for a particular building.

1520 The Applicants’ submissions also briefly refer to a one-page flyer version of this brochure, featuring the façade of the Sydney Water HQ in Parramatta [PAA.021.001.004], which prominently stated that “Alucobond has you covered, inside and out”, referring to its use for exterior, interior or roof cladding applications. A copy of this flyer was given to the builder and developer of the Shore Building, together with safety data sheets and fire test reports (the latter said to be irrelevant). I was not addressed on this brochure, including as to its effect on the builder and developer of the Shore Building. I do not propose to consider this brochure in any further detail, apart from noting, as the Applicants do, that it comprised similar content to the “Vision Materialized” brochure.

9.4.3 Generation 3: At a G lance (2013-2015)

1521 The next generation of brochures was branded “At a Glance”. There were two versions of this brochure: [HVG.006.015.5554], [HVG.001.001.0106]. Version one was published in 2013, and version two was published between 2013-2015, and this is admitted by HVG.

9.4.3.1 Suitability Representation

1522 The Applicants submit that the images in the brochure and the following text conveyed the alleged Suitability Representation:

(b) “…the possibilities for implementing Alucobond for interior and exterior applications are extremely varied. It is used in projects ranging from the precise construction of residential buildings, representative public buildings, company headquarters, commercial and industrial buildings, to prestigious landmarks of modern construction”;

(c) “Alucobond offers architects and designers unlimited opportunities…The wide range of interior and exterior applications are matched only by the product’s versatility”;

(d) “Alucobond is ideal to fit into any curtain wall system”;

(e) “Alucobond can be used as a facia, as a cladding panel for interiors, or signage”;

(f) “[s]ince 1976, numerous prestigious projects have been carried out in Australia using Alucobond” and “high rise, low rise, public buildings, residential applications”;

(g) the headings “High Rise”, “Low Rise”, “Public Buildings” and, “Residential Applications”; and

(h) “…they [Alucobond panels] are highly rigid and strong, thus making them the most suitable for exterior wall cladding.”

1523 Version two of the brochure also had the text, “Now CodeMark Certified for complete compliance with fire requirements of the BCA 2013”: [HVG.001.001.0106]. The CodeMark certificates were then specifically identified on page 12, titled “Alucobond Technical Data Sheet”, under a heading “Fire Behaviour”, together with the AS 1530.3 results and new results for the ISO 9705 test. The Applicants submit the ISO 9705 classifications for Alucobond PE and Alucobond Plus must have been based on the 2010 tests described in paragraph 498 .

1524 I reject the Applicants’ submission that the brochure with the images and the above text conveyed the alleged Suitability Representation.

1525 The images relied upon as conveying the alleged Suitability Representation depict a wide variety of buildings and structures, although all of them are large public or commercial projects which could only have been designed, constructed and certified as compliant under the BCA by Qualified Professionals. The target audience of the brochure was Design Professionals. No Design Professional would have assumed from those images that the Alucobond products were suitable for use in any manner on any building, in any quantity or configuration. Statements that the Alucobond panels were popular products that had varied and diverse uses would not have conveyed to a Design Professional a representation that Alucobond PE or Alucobond Plus are suitable for use on any building, in any manner, in any quantity or configuration.

1526 The Applicants refer specifically to an image of a the “EXO” building in Melbourne in the version two ([HVG.001.001.0106]), which is a 13-storey apartment building located on top of a carpark. The building was wrapped in 10,000 m 2 of Alucobond PE with large cuts-outs, which the Applicants say exposed the core around balconies. The ACP cladding on this building has since been replaced with solid aluminium cladding. The image is on the last page of the brochure, placed next to four other images, without any accompanying description, including as to which Alucobond product has been used. I have not been addressed as to whether the use of Alucobond PE on this building was BCA compliant or otherwise.

1527 I do not accept that this image conveyed the Suitability Representation. A Design Professional would have been aware that the suitability of the Alucobond products would have depended on the specific building, including characteristics that are not ascertainable from a photo – such as the specific product used.

1528 In relation to the CodeMark Certificate text, and the technical data set out on page 12, of version two of the brochure, considering these together, I do not accept they conveyed the Suitability Representation. As explained earlier in these reasons, the CodeMark Certificates certify a particular use of a product will comply with the identified provisions of the BCA, subject to conditions and limitations identified within the certificate.

1529 The CodeMark Certificate referred to in the brochure for Alucobond PE is Cert. No. “CMA-CM40022”. The brochure notes, on page 12, it is limited to Type C construction and mechanical and adhesive fixing techniques are permitted. CodeMark Certificate CMA-CM40022 says under “Product Purpose or Use”: “[d]ecorative and protective attachment system for internal and external use.” It has three conditions and limitations, and notes that the certificate holder (Alucobond Architectural – a division of HVG) should be contacted for specific installation details.

1530 The CodeMark Certificate referred to in the brochure for Alucobond Plus is Cert. No. “CMA-CM40032”. The brochure notes on page 12 that for Type A and B construction only mechanical and fixing is permitted and for Type C construction mechanical and adhesive techniques are permitted. CodeMark Certificate CMA-CM40032 says under “Product Purpose or Use”: “[d]ecorative and protective attachment system for internal and external use.” It has five conditions and limitations and notes that the certificate holder (Alucobond Architectural – a division of HVG) should be contacted for specific installation details.

1531 A Design Professional would have understood that it would be necessary to interrogate the specific CodeMark Certificate, and that any proposed use would require an individual assessment, by a Design Professional, and the relevant Qualified Professional, as to whether the proposed use came within the use covered by the CodeMark Certificate.

1532 The inclusion of the phrase “Now CodeMark Certified for complete compliance with fire requirements of the BCA 2013” and the technical data, including the CodeMark certification information, and the AS 1530.3 and ISO 9705 test results, in the context of the whole brochure, would not have led a Design Professional reading the brochure to assume the Alucobond products were suitable for use in any manner or on any building.

9.4.3.2 Fire Performance Representations and Compliance Representation

1533 The Applicants submit in addition to the above-mentioned images and content, the images in the brochure and the following text conveyed the Fire Performance Representations and Compliance Representation:

(a) Alucobond “normal flammability”;

(b) Alucobond Plus “hardly inflammable according to EN13501-1”;

(d) “when properly designed and installed, Alucobond panels will keep their shape and remain flat for life, even when exposed to extreme temperatures”.

1534 The Applicants also rely upon the brochure reproducing fire test results including Australia AS 1530 and the International Fire Classifications, which again stated that Alucobond PE and Plus had achieved “D” and “B” classifications under EN13501-1 without disclosing that these results were based on a riveted system, and that the recommended flat stick method achieved worse results.

1535 I reject that submission. The above statements relied upon by the Applicants would not have conveyed to a Qualified Professional that Alucobond PE and Alucobond Plus could be used in any way, on any building, in any quantity, in any configuration without materially increasing the risks associated with a fire in a particular building.

1536 The Applicants rely upon the statement that Alucobond PE is of “normal inflammability”, and that Alucobond Plus is “hardly inflammable”. I repeat my comments at [1503 ]-[1505 ] which apply equally to this phrase as it is used in this brochure.

1537 I also refer to my comments at [1483 ]-[1484 ] in relation to the phrase “[t]he non-combustible aluminium cover sheets protect the PE core”, together with the visual images depicted.

1538 The Applicants have failed to establish that the brochure conveys the alleged Fire Performance Representations and Compliance Representation.

9.4.3.3 Fabrication and Affixation Representation

1539 The Applicants submit the text “the components can be easily fabricated and fitted onsite”, and “Alucobond can be bent, curved or shaped or to any required angle” and the Fabrication and Affixation Methods described in the brochures, and the images demonstrating the fabrication and affixing methods, conveyed the alleged Fabrication and Affixation Representation.

1540 I reject that submission. The statements relied upon by the Applicants to the effect that Alucobond products could be processed in certain ways do not amount to an unqualified representation that those processing methods would not impact on the performance of the Alucobond products in the event of a building fire.

1541 It would have been obvious to a Design Professional that the core of Alucobond PE and Alucobond Plus was combustible, so that any processing method which exposed the PE core could impact on the fire performance of the Alucobond product. I am fortified in my view by the experts’ agreement that compliance with the BCA, and the fire properties of complex façade systems, such as ones incorporating ACPs, is dependent on the particular building, which self-evidently includes the method of fabrication and affixation.

1542 It would have been obvious to a Design Professional that the processing methods used and the affixation methods used would impact on the fire risk of the Alucobond product such that a Design Professional, and relevant Qualified Professionals, would need to exercise their own professional skill and judgment in relation to the building in question and the need to consider compliance with the relevant BCA requirements.

1543 Further, HVG emphasised the following text:

(a) “[f]or every project, the proven strategy to achieve a smooth completion lies in an early coordination between vision, architectural plans and the many possibilities which our unique panels give to fabricators and installers”;

(b) “[y]our nearest fabricator will provide a tailor-made solution that will stand the test of time”; and

(c) “[d]uring the past 40 years, qualified, independent fabricators and installers have become firmly established, offering professional service to the building industry. They have acquired deep knowledge in the processing of ALUCOBOND® and their skilled personnel and specialised processing equipment ensure that your project is completed on time and within budget”.

1544 I find that these statements, conveyed that first, not all fabrication and affixation methods would be appropriate for all uses of Alucobond PE or Alucobond Plus and second, that the expertise of the relevant Qualified Professional, including a fabricator, would be required to determine the appropriate method for a particular building.

1545 The Applicants have not established that the images in the brochure nor the text conveyed the Fabrication and Affixation Representation.

1546 The Applicants also submit this brochure conveyed the Plus Composition Representation. As I have indicated earlier in these reasons, I have not considered this as I am satisfied that the representation was true.

9.4.4 Generation 4: Beyond Facades (2017-2018)

1547 The “Beyond Facades” brochure spans the end of the relevant period; it is admitted that it was published between 2017-2018, and it is an Australian brochure distributed by HVG: [APP.001.005.0945].

9.4.4.1 Suitability Representation

1548 The Applicants submit the images in the brochure of buildings with Alucobond cladding visibly affixed and the following text conveyed the alleged Suitability Representation:

(a) “…architects and designers soon discovered the host of advantages of Alucobond for use in exterior architectural applications and corporate identity programs, particularly in façades, wall cladding and roof edging”;

(c) “our product and application expertise is the fastest and safest way to success, whether it be for buildings, renovation projects or interior and exterior applications”;

(d) “your nearest fabricator will provide a tailor-made solution that will stand the test of time”; and

(e) “Alucobond is ideal to fit into any curtain wall system” and “high-rise, low-rise and public buildings”. The Applicants rely upon the residential applications referred to in the brochure and the text “modern refurbishment” and “protecting asset value”.

1549 I reject that submission. The Applicants submissions characterise the contents of this brochure, that is relevant to the Suitability Representation, PE Fire Performance Representation, Plus Performance Representation, Compliance Representation and Fabrication and Affixation Representation as “largely identical” to earlier brochures. As with the three previous generations of brochures discussed, the images relied upon by the Applicants as conveying the alleged Suitability Representation depict a wide variety of buildings and structures which could only have been designed, constructed, and certified as compliant with the BCA by Qualified Professionals. No Design Professional would have assumed from the images and text in the brochure that Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration.

1550 Nor would a Design Professional have drawn any such conclusions from the broad and general statements in the brochure to the effect that the products were popular, or that they had varied and diverse uses. Statements of that kind do not amount to a representation that Alucobond PE or Alucobond Plus are suitable for any use, on any building, in any manner, in any quantity or in any configuration. A Design Professional would have known that whether an Alucobond product is suitable for a particular use on a particular building was a matter which required the exercise of the Design Professional, and the relevant Qualified Professionals, of professional skill and judgment to ensure that the particular building complied with the requirements of the BCA.

1551 A statement that Alucobond PE or Alucobond Plus could be used in curtain wall systems would not have been construed by a Design Professional that the Alucobond product could be used on any wall in any quantity but, rather, that they may possibly be used to form part of a curtain wall system to a greater or lesser extent depending upon compliance with the BCA.

1552 The brochure states explicitly that the fabricators would be the individuals to process the Alucobond sheets to manufacture a tailor-made solution. That statement would have conveyed to a Design Professional that the extent to which Alucobond PE or Alucobond Plus could be used would depend upon the specific building in contemplation. The images in the brochure and the text relied upon by the Applicants do not convey the Suitability Representation.

9.4.4.2 Fire Performance Representations and Compliance Representation

1553 The Applicants submit in addition to the content said to have conveyed the Suitability Representation, the images in the brochure and the following text conveyed the alleged Fire Performance Representations and Compliance Representation.

(a) “internationally proven and recognised fire performance”;

(b) “CodeMark Certified for complete compliance with the fire requirements of the BCA”;

(d) Alucobond Plus has “70% mineral filling”; and

(e) “reinforcing fire safety in Australia…globally, suppliers, architects and building owners have a ‘duty of care’ and are required to meet the stringent regulations aimed at protecting the building structure, surrounding environments and, more importantly, the inhabitants or visitors to a building…As a trusted supplier, Alucobond Architectural have, and continue to, provide the knowledge, technology and compliance required to assist you in your selection process. Safety is paramount and we aim to ensure you are kept up to date with correct information and are offered products that are best suited to your project needs”.

1554 The Applicants also rely upon the brochure referring to the “International Fire Classifications” on page 18, including references to CodeMark Certificates. The Applicants submit that this is the main difference between this brochure and the previous generations. The Applicants submit the table has been amended so that the results of the ISO 9705, EN 1350.1, NFPA 285 and BS 8414 tests all sit in the “ Australia ” row for Alucobond Plus, despite only one of those tests (ISO 9705) having any relevance to the Australian regulatory regime. The equivalent section for Alucobond PE is now blank, and the AS 1530.3 test results have been removed from the table for all three products.

1555 I reject that submission. The statements relied on by the Applicants as establishing the alleged Suitability Representations, similarly, would not have conveyed to a Design Professional that Alucobond PE and Alucobond Plus could be used in any way, on any building, in any quantity and in any configuration without materially increasing the risks associated with fire in a particular building. A Design Professional would have known that the fire performance of Alucobond panels depended upon their particular use on a particular building, and that the Design Professional, and the relevant Qualified Professionals, would need to exercise professional skill and judgment in determining whether the fire performance of the Alucobond products would comply with the BCA.

1556 The Applicants rely upon the statement that Alucobond PE is of “normal inflammability”, and that Alucobond Plus is “hardly inflammable”. I repeat my comments at [1503 ]-[1505 ] which apply equally to this phase as it is used in this brochure. The difference between the Alucobond products also would have been obvious to a Design Professional from the International Fire Classifications table, which showed clearly that the three Alucobond products are classified differently under most fire classifications and that Alucobond A2 was the only product described as “non-combustible”. I am not persuaded that the differences in the presentation of the fire results in the brochure would have altered the impression given to a Design Professional. A Design Professional would not have relied on the technical information and would have deferred to the relevant Qualified Professionals, including FSEs.

1557 As to the references by the Applicants to the CodeMark Certificates, any reasonable Design Professional would understand that if Alucobond PE or Alucobond Plus was fitted to a building in a way which met all of the conditions described in the applicable CodeMark Certificate, then the products would permit a building to comply with the BCA to that extent. No Design Professional would have understood the references to the CodeMark Certificate as an unlimited representation that Alucobond PE and Alucobond Plus could be fitted compliantly with the BCA to any building, in any manner, in any configuration, or in any quantity.

1558 As to the text in (e) above, which is set out on page 18 under the table headed “International Fire Classifications”, the Applicants have omitted the following which appears where the ellipses are in (e):

When making your product and system selection, it’s imperative that you fully understand the product that you are looking to choose and ensuring that it is actually safe.

1559 The Applicants submit that the text in (e) “recognises the role of the ‘ trusted supplier ’ to provide the knowledge, technology and compliance required to assist in the selection process by providing correct information and offering products that are suited to your project needs” and “is an express acknowledgement of the role suppliers play in providing necessary information to allow architects to choose appropriate and compliant products.” Read as a whole, I find that the statement is making clear to the target audiences, Design Professionals, that Design (and Qualified) Professionals must exercise due care, skill and diligence in selecting Alucobond products, and ensure the specific use contemplated is safe and compliant. The brochure does hold out the supplier as being ‘trusted’ and acknowledges the importance of correct and up to date information, including offering assistance in the selection process. This does not, in my view, amount to a representation that Alucobond PE and Alucobond Plus could be fitted compliantly with the BCA to any building, in any manner, in any configuration, or in any quantity, without that effecting the reaction-to-fire properties of the Alucobond Products.

1560 The Applicants have not established that the images in the brochure and the text relied upon conveyed the Fire Performance Representations or the Compliance Representation.

9.4.4.3 Fabrication and Affixation Representations

1561 The Applicants submit the images and the following text conveyed the Fabrication and Affixation Representations:

(a) “the components can easily be fabricated and fitted onsite”; and

(b) “Alucobond can be bent, curved or shaped to any required angle.”

1562 The Applicants also rely upon the fabrication and affixation methods described in the accompanying diagrams.

1563 I reject that submission. The statements relied upon by the Applicants to the effect that Alucobond products could be processed in certain ways do not amount to an unqualified representation that those processing methods would not impact on the fire performance of the products in the event of a fire in a particular building. I am fortified in my view by the experts’ agreement that compliance with the BCA, and the fire properties of complex façade systems, such as ones incorporating ACPs, is dependent on the particular building, which self-evidently includes the method of fabrication and affixation.

1564 It would have been obvious to a Design Professional from the text of the brochure that the core of Alucobond PE and Alucobond Plus was combustible, so that any processing method which exposed the core could impact upon the fire performance of the Alucobond products.

1565 Further, HVG emphasised the following text:

(a) “[t]he plastic core of ALUCOBOND® can be hot air welded using conventional hot-air welding equipment and plastic filler rod. Hot-air welding provides a water-tight joint for decorative purpose only. It is not suitable for joints where structural strength is required”;

(b) “[t]he components can easily be fabricated and fitted on site”;

(c) “[f]or every project, the proven strategy to achieve a smooth completion lies in an early coordination between vision, architectural plans and the many possibilities which our unique panels give to fabricators and installers”; and

(d) [y]our nearest fabricator will provide a tailor-made solution that will stand the test of time.”

1566 It would have been obvious to a Design Professional that the manner of fabrication and the manner of affixation of the Alucobond products to a particular building would require the exercise of professional skill and judgment by the Design Professional, and the relevant Qualified Professionals, so as to ensure compliance with the BCA.

1567 The Applicants have not established that the images in the brochure and the text relied upon conveyed the Fabrication and Affixation Representations.

9.4.5 Alucobond Plus brochures

1568 The Applicants rely upon an Alucobond Plus brochure entitled “Alucobond Plus: For Greater Protection Against Fire” [HVG.006.025.1306]. The evidence does not establish that this brochure was distributed in Australia. At best, the evidence establishes that the brochure was an attachment to emails sent from HVG to potential customers, first, in 2012 and then on a second occasion, in 2015.

9.4.5.1 Suitability Representation

1569 The Applicants submit that this brochure contains similar content to the previous brochures, which along with the following additional text conveyed the Suitability Representation:

(a) “[t]he superb qualities of this material boost one’s inspiration and offer architecture a whole new range of solutions – whether your project is a private home, a public building, a corporate headquarter and offices, or a trading or industrial complex”;

(b) “[u]nlimited applications – For interiors and exteriors: industrial buildings, public buildings, hotels, hospitals, shopping centres, sports-stadiums, event halls, railway and underground stations”;

(c) “ ALUCOBOND plus has been developed exclusively for the higher requirements of the fire regulations in architecture. Due to its mineral-filled core ALUCOBOND plus meets the higher requirements of the fire classifications. It is hardly inflammable and offers all the proven product properties of the ALUCOBOND family ”; and

(d) “[f]ire classification according to EN 13501-1, class B, s1, d0… Generates no harmful gases in case of fire”, without disclosing the “B” classification is based on a riveted system or that Alucobond Plus has achieved worse results with other systems.

1570 I reject that submission. The images relied upon as conveying the alleged Suitability Representation depict different buildings and structures which could only have been designed, constructed and certified as compliant by Qualified Professionals. It would have been obvious to a Design Professional reading the brochure, and no Design Professional would have assumed from the images and the text in the brochure that Alucobond Plus was suitable for any use, on any building, in any manner, in any quantity and in any configuration. Nor would a Design Professional have drawn any such conclusions from the generalised statements in the brochure to the effect that the products were of broad application. Statements of that kind do not amount to representations that Alucobond Plus was suitable for any use, on any building, in any manner, in any quantity and in any configuration and circumstance. A Design Professional would have known that whether Alucobond Plus is suitable for a particular use on a particular building was a matter which required the exercise of professional skill and judgment by the Design Professional, and the relevant Qualified Professionals, to ensure that the particular building complied with the requirements of the BCA.

1571 In relation to the assertion that Alucobond Plus is “hardly inflammable”, that phrase comes after a reference to fire classifications. It would have been obvious to a Design Professional reading the brochure that flammability is a technical term, and would need to be understood in the context of the test being referred to. The brochure contains a table of the test results of Alucobond Plus for various countries (Australia is not included). I find, reading the brochure as a whole, the phrase “hardly inflammable” would be read in the context of these tests. A Design Professional would understand that the test results would need to be evaluated according to the BCA requirements, noting again that there is no Australian standard referred to in the brochure, and in the context of the particular use contemplated.

1572 The images in the brochure and the text relied upon by the Applicants do not convey the Suitability Representation.

9.4.5.2 Fire Performance Representations and Compliance Representation

1573 The Applicants submit the images in the brochure and the following text conveyed the alleged Fire Performance Representations and Compliance Representation:

(a) “…whether your project is a private home, public building, a corporate headquarter and offices, or a trading or industrial complex”;

(b) “[f]ire Behaviour – Alucobond Plus has been developed exclusively for the higher requirements of the fire regulations in architecture. Due to its mineral-filled core, Alucobond Plus meets the higher requirements of the fire classifications. It is hardly inflammable and offers all the proven product properties of the Alucobond family”;

(d) “[u]nlimited applications – For interiors and exteriors: industrial buildings, public buildings, hotels, hospitals, sports-stadiums, event halls, railway and underground stations”; and

(e) “Fire behaviour of Alucobond Plus panels”, listing international tests.

1574 I reject that submission. A Design Professional would have known that the fire performance of Alucobond Plus depended upon its particular use on a particular building, and that a Design Professional, and the relevant Qualified Professionals, would need to exercise professional skill and judgment in determining whether the fire performance of Alucobond Plus would comply with the BCA. The images and statements in the brochure would not have conveyed to a Design Professional that Alucobond Plus could be used on any building, in any manner, in any quantity and in any configuration without increasing the risks associated with a fire in the particular building.

1575 On page 3 of the brochure Alucobond Plus is described as having been designed to meet the “higher requirements” of the fire regulations in architecture. That statement must be read with the International Fire Classifications table at page 5 of the brochure, which describes the classifications of Alucobond Plus under various European standards. A Design Professional would have understood that the general reference to “higher requirements” was to be qualified by the information contained in the table and which could have been obtained by requesting reports for the tests referred to in the table.

1576 The images in the brochure and the text relied upon by the Applicants did not convey the Fire Performance Representations and Compliance Representation.

9.4.5.3 Fabrication and Affixation Representation

1577 The Applicants submit the text, “can easily be folded and bent using common tools” conveyed the Fabrication and Affixation Representation. I reject that submission. The statement relied upon by the Applicants could not amount to a representation that Alucobond Plus could be processed and subsequently affixed to any building and in any manner without impacting its fire performance in the event of a building fire.

1578 For the same reasons as with the earlier brochures discussed, the Applicants have not established that the text in the brochure conveyed the Fabrication and Affixation Representation.

9.4.6 Fire Protection Guide (2017-2018)

1579 The Applicants rely upon a specific “Fire Protection Information Guide” dated October 2017, being after the Grenfell Fire: [HVG.001.001.0048]. This was an Australian information guide which appears to be based on 3A’s own brochure, “Fire Redundancy and Alucobond”, as some of the imagery and text are nearly identical: [HVG.001.001.0048]

9.4.6.1 Suitability Representation

1580 The Applicants submit the images in the information guide and the following text conveyed the Suitability Representation:

The finish and flatness of Alucobond Plus, its dynamic range of colours, formability and weather resistance allow designers complete freedom of creativity in projects ranging from apartment buildings, high-rises and commercial and industrial buildings to the prestigious landmarks of modern urban construction.

1581 I reject that submission. The single statement that the Applicants rely on as the basis for the alleged Suitability Representation is one sentence on a page that identifies more detailed information about the fire behaviour of Alucobond Plus, including that it has been tested under AS 5113, and which is to be compared with the following one page which explains that Alucobond A2 meets the standard under EN13501-1, a standard which Alucobond Plus does not meet. This would have been obvious to any Qualified Professional reading the information guide. The information guide also states on page 3 of the guide that the latest CodeMark Certificate for Alucobond Plus addresses the vertical fire separation for easy compliance and safety of the building. In the context of the text of the information guide as a whole, rather than one sentence from the guide (relied upon by the Applicants), a Qualified Professional would not have assumed that Alucobond Plus was suitable for any use on any building, in any manner, in any quantity and in any configuration. The images in the information guide and the text relied upon by the Applicants did not convey the Suitability Representation.

9.4.6.2 Fire Performance Representations and Compliance Representation

1582 The Applicants submit the images in the information guide and the following text conveyed the alleged Fire Performance Representations and Compliance Representation:

(a) “…suppliers, architects and building owners have a ‘duty of care’ and they are required to meet the stringent regulations…”;

(b) “[a]s a trusted supplier, Alucobond Architectural have, and continue to provide, the knowledge and technology and compliance required to assist you in your selection process. Safety is paramount and we aim to ensure you are kept up to date with correct information and are offered products that are best suited to your project needs”;

(d) “[i]n addition to bench scale fire tests, results from large scale BS8414 façade fire tests (as prescribed in AS5113) have been considered and addressed in justification of the Alucobond Plus CodeMark certificate of conformity”;

(e) “…all Alucobond products must be tested under EN13501.1 ‘reaction to fire’ test. This test addresses the performance and safety of the complete product being supplied as it would be installed”;

(f) the heading “Fire behaviour in a building’ – accompanied by a diagram of fire spread from use of “regular ACP without vertical fire separation” versus “fire resistant Alucobond Composite Panel (ACP) … min 70% mineral content”;

(g) “Alucobond Architectural have chosen the Performance Solution [under the NCC] pathway for their Alucobond products … utilising this compliance pathway ensures the Alucobond products are tested as they would be installed in a full-wall make-up, including vertical fire separation”;

(h) “[t]he latest CodeMark Certificate of conformity reinforces the safe and compliant use of Alucobond Plus for type A and type B construction”;

(i) “[t]he Alucobond Plus CodeMark Certificate of conformity addresses the vertical fire separation for easy compliance and safety of the building”;

(j) “projects ranging from apartment buildings, high-rises and commercial and industrial buildings to the prestigious landmarks of modern urban construction”; and

(k) “[i]mportant: When evaluating comparable products, architects and designers should ensure that manufacturers provide independent fire rest results from MATA accredited testing laboratories. To avoid confusion and reduce risk, the product should be tested as a complete panel, as it would be installed on the building.

1583 The Applicants also rely upon the Alucobond technical data sheet and fire behaviour table in the guide, including CodeMark Certifications for Alucobond Plus mechanical fixing and the International Fire Classifications table reproduced in the guide.

1584 The information guide represents that Alucobond Plus could be used safely and compliantly in conformity with the applicable CodeMark Certificate. A CodeMark Certificate certifies a particular use of a product will comply with the identified provisions of the BCA, subject to conditions and limitations identified within the certificate. As the information guide states on page 3, the CodeMark Certificate only applies for Type A and Type B construction. The certificate, being “CM 30070 Rev 2” has six limitations and conditions and a three-page annexure detailing the relevant technical data. It cannot be said that a representation that Alucobond Plus could be used in compliance with a CodeMark Certificate amounts to a representation that Alucobond Plus could be used safely and compliantly on any building, in any manner, in any quantity and in any configuration, without effecting the reaction-to-fire properties of Alucobond Plus so as to render the use unsafe or uncompliant. A Design Professional would not have assumed upon reading the information guide that Alucobond Plus could be used in any way, on any building, in any quantity and in any configuration without materially increasing the risks associated with fire in a particular building. A Design Professional would have known that the fire performance of Alucobond Plus depended upon their particular use on a particular building, and that a Design Professional, and the relevant Qualified Professionals, would need to exercise professional skill and judgment in determining whether the fire performance of Alucobond Plus would comply with the BCA. In my view, many of the above statements emphasise the need for Design Professionals, and Qualified Professionals, to ensure a specific contemplated use is safe and compliant.

9.4.6.3 Fabrication and Affixation Representation

1585 The Applicants rely upon the mechanical fixing description in the information guide as conveying the Fabrication and Affixation Representation. I reject that submission. There is nothing in the text of the information guide that would convey a representation to the effect that Alucobond Plus could be processed and subsequently affixed to a building in any manner, on any building, in any quantity and in any configuration without impacting the risks associated with fire in a particular building. Qualified Professionals would have known that the fire performance of Alucobond Plus depended upon their particular use on a particular building, and that a Qualified Professional would need to exercise professional skill and judgment in determining whether the fire performance of the Alucobond Plus panels would comply with the BCA.

9.4.7 Websites

1586 The Applicants rely upon the summaries of content of the 3A and HVG websites throughout the relevant period and referred to in Annexure D to their written closing submissions. The Applicants submit that they display materially the same content as in the brochures.

1587 There is no evidence that 3A was responsible for the content of any of the websites referred to in Annexure D, save for the website at “www.alucobond.com”. The other websites identified were websites of different entities, including HVG. To the extent that the websites are foreign websites, there is no evidence that any Representations on those websites were made in Australia. In circumstances where the publications or statements on the websites were made to the world at large, and did not occur in the context of any pre-existing relationship between 3A and Australian consumers, and were not otherwise directed towards Australian consumers, there is no proper basis for me to conclude that the Representations were made in Australia, absent evidence that the websites had been downloaded in Australia. The Applicants tendered no such evidence.

1588 As Edelman J in Valve (No 3) observed at [18], approved by the Full Court in Valve FCAFC at[127]-[134], they were:

[G]eneral representations to the world at large. They are not representations to any person or to any Australian consumer. Until the representations were accessed, the representations were meaningless and could not be the subject of any alleged contravening conduct.

1589 There is also no evidence that HVG’s web pages were accessed by persons in Australia. The only evidence is admissions by HVG as to whether the website was published in Australia and questions as to the period of publication.

1590 In respect of the Applicants, there is no evidence that any of the Qualified Professionals involved in the design, construction and certification under the BCA of the Shore Building or Five Dock Building accessed any of the websites relied upon by the Applicants and referred to in Annexure D. Whilst some of the documents comprising the screengrabs of the webpages include statistics related to engagement with the website, there is no admissible evidence as to where those people were based and I have not been addressed, in oral or written submissions as to evidence of Australian consumers accessing the websites relied on.

1591 Notwithstanding that finding, I will go on to consider whether the website pages identified in Annexure D convey the Representations, in case a Full Court may decide that issue differently.

1592 The Applicants, in their written and oral submissions, have not sought to identify any particular examples of the websites which they allege convey the Representations. I have considered each of the website pages in Annexure D identified at pages 259 to 279 of the Applicants’ closing written submissions and make the following findings in relation to whether the Representations have been conveyed by the content relied upon by the Applicants in the website pages referred to in Annexure D.

1593 It is apparent from the content of the website pages that there is substantial repetition of the text used in the numerous website pages relied upon by the Applicants. Indeed, the Applicants submit that the websites in Annexure D display materially the same content as the brochures. It would serve no point and not be meaningful to consider each of the website pages relied upon by the Applicants, so in the absence of the Applicants identifying examples of websites to make good their claim in relation to the Representations conveyed I have selected as representative the following websites.

9.4.7.1 Architectural Product News/Architecture Australia Newsletter (2015)

1594 The Applicants rely upon the website page, Architectural Product News/Architecture Australia Newsletter, which is alleged to have been published in 2015: [3AC.402.001.3969-0003]. The Respondents do not admit to either the alleged publication period nor that the website was published in Australia.

9.4.7.2 Suitability Representation

1595 The Applicants submit the images on the website page and the following text conveyed the alleged Suitability Representation:

(a) “Alucobond is a leader in ACM”; and

(b) “[u]nrivalled qualities of Alucobond”.

1596 I reject that submission. The images relied upon by the Applicants as conveying the alleged Suitability Representation depict a wide variety of buildings and structures which could only have been designed, constructed and certified as compliant with the BCA by Qualified Professionals. The target audience of the website was Qualified Professionals such as architects, designers, and façade fabricators. It would have been obvious to any Qualified Professional reading the website, and no Qualified Professional would have assumed from the images and the text of the website that Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration.

1597 The images and the text on the website do not convey the Suitability Representation.

9.4.7.3 Fire Performance Representations and Compliance Representation

1598 The Applicants submit the images on the website and the following text conveyed the alleged Fire Performance Representations and Compliance Representation:

(a) “Alucobond Plus undergoes stringent European and Australian quality testing”;

(b) “[m]anufactured in Germany, Alucobond achieves international fire compliance and sets itself apart through excellent UV stability, high formability, and rigidity”;

(c) “[t]his remarkable aluminium composite material is not only sophisticated, it offers unbeatable rigidity, excellent formability, outstanding weather, UV and fire resistance”; and

(d) “Alucobond has local fire compliance and proven long-term performance.”

1599 I reject that submission. The images and the above statements relied upon by the Applicants would not have conveyed to a Qualified Professional that Alucobond PE and Alucobond Plus could be used in any way, on any building, in any quantity, in any configuration, without materially increasing the risks associated with a fire in a particular building. A Qualified Professional reading the architectural product news website would have known that the fire performance of Alucobond panels depended upon their particular use on a particular building, and that a Qualified Professional would need to exercise professional skill and judgment in determining whether the fire performance of the Alucobond panels would comply with the BCA.

1600 The Applicants also submit in MFI-11 that this website conveyed the Compliance Representation, but without reference to any content displayed on the website. Having regard to the Applicants’ submissions that the website displayed materially the same content as the brochures, and given I have not found that any of the brochures conveyed the Suitability Representation, I similarly find the “Architectural Product News/Architecture Australia Newsletter” did not convey the Suitability Representation.

9.4.8 Architecture Review (2015)

1601 The Applicants submit the “Architecture Review (2015)” website conveyed the Suitability Representation and the Fire Performance Representations and Compliance Representation: [3AC.402.001.3969/0004]. It is alleged to have been published in 2015. The Respondents do not admit to either the alleged publication period nor that the website was published in Australia.

9.4.8.1 Suitability Representation

1602 The Applicants submit the text, “Alucobond provides the solution for creating truly unique façades”, conveyed the Suitability Representation.

1603 I reject that submission. The images on the website page and the text do not convey the alleged Suitability Representation. The target audience of the “Architecture Review (2015)” website was Design Professionals. No Design Professional would have assumed from the images and text on the website that Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration.

1604 A Design Professional would have known that whether an Alucobond product is suitable for a particular use on a particular building was a matter which required the exercise of the Qualified Professionals’ own professional skill and judgment to ensure that the particular building complied with the requirements of the BCA.

9.4.8.2 Fire Performance Representations and Compliance Representation

1605 The Applicants submit the text, “Alucobond provides approved fire performance, local stock and a full manufacturer’s warranty, ensuring your concept becomes a reality” and the images on the website displaying buildings with Alucobond cladding affixed, conveyed the alleged Fire Performance Representations and Compliance Representation.

1606 I reject that submission. The above statement would not have conveyed to a Design Professional that Alucobond products could be used in any way, on any building, in any quantity and in any configuration without materially increasing the risks associated with a fire in a particular building. A Design Professional would have known that whether an Alucobond product is suitable for a particular use on a particular building was a matter which required the exercise of the Design Professional’s, and the relevant Qualified Professionals’, professional skill and judgment to ensure that the building complied with the requirements of the BCA.

1607 The Applicants have not established that the images on the Architecture Review website and the text relied upon conveyed the Fire Performance Representations and the Compliance Representation.

9.4.9 N A TSPEC Product Partners Booklet (2015)

1608 The Applicants submit the website NATSPEC Product Partners Booklet (2015) conveyed the Suitability Representation, the PE and Plus Fire Performance Representations and the Compliance Representation: [3AC.402.001.3969/004]. The Respondents admit the publication period (2015), but not that the website was published in Australia.

9.4.9.1 Suitability Representation

1609 The Applicants submit the images at the website page NATSPEC Product Partners Booklet (2015) and the following text conveyed the alleged Suitability Representation: “With excellent product qualities such as exceptional flatness and rigidity, low weight, excellent formability, weather resistance and ease of cleaning, Alucobond met all expectations”.

1610 I reject that submission. The images in the screengrab of the website are of the Switch high-rise building in Sydney with large-scale Alucobond cladding. The website says the building was “designed by DEM Architects” and that the building’s exterior is “clad with Alucobond Plus natural Brushes Silver Metallic and Dark Grey Metallic”. Beyond this statement, there is nothing on the webpage as to manner of or who was involved in the design and construction of the building. Further, whilst the webpage refers generically to ‘Alucobond’ given the article specifies that the pictured building is clad with Alucobond Plus it cannot be said that the article and the images give rise to any representations regarding Alucobond PE.

1611 No Design Professional would have assumed from the images and the text on the website that Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration. Further they would not have assumed that the use of Alucobond on the building was achieved other than through design, construction, and certification by Qualified Professionals to ensure BCA compliance.

1612 A Design Professional would have known that whether an Alucobond product is suitable for a particular use on a particular building was a matter which required the exercise of the Qualified Professional’s own professional skill and judgment to ensure that the particular building complied with the requirements of the BCA.

1613 The images and the text at the NATSPEC Product Partners Booklet website do not convey the Suitability Representation.

9.4.9.2 Fire Performance Representations and Compliance Representation

1614 The Applicants submit the images described above and the text “Alucobond, with its 5005 marine-grade alloy and superior fire performance, was ideal for this project”, in the NATSPEC Product Partners Booklet website that Partners Booklet website conveyed the PE and Plus Fire Performance Representations and Compliance Representation. I reject that submission.

1615 A Design Professional would have known that the fire performance of Alucobond products depended upon its particular use on a particular building, and that a Design Professional, and the relevant Qualified Professionals, would need to exercise professional skill and judgment in determining whether the fire performance of the Alucobond panels would comply with the BCA. The statement that Alucobond has superior fire performance does not speak in any meaningful way to the reaction-to-fire properties of the Alucobond products or the impact on the safety and BCA compliance of the products. The statement that Alucobond products are ideal for that particular project, does not convey that the use of Alucobond products will be ideal for any project in any quantity, configuration, no matter the manner of application. The images and statements on the website would not have conveyed to a Design Professional that Alucobond panels could be used on any building, in any manner, in any quantity, and in any configuration, without increasing the risks associated with a fire in the particular building.

1616 The Applicants also submit this webpage conveyed the Compliance Representation but have not made any specific submissions going to how this webpage conveyed the Compliance Representation. I find that the webpage did not convey the Compliance Representation. My reasons for so finding reflect my reasoning regarding the Suitability Representation. The picture of the Switch high-rise building in Sydney and the article did not convey that the Alucobond products were compliant with all relevant building codes and standards for use, or would be so compliant once affixed, when used for the Purposes.

9.4.10 Architectural Product News

1617 The Applicants submit the website page “Architectural Product News – Urban Design range from Alucobond” (2014) [HVG.006.017.0076], and the text “[w]hile providing all the benefits that have made Alucobond a long-term industry leader, the Urban Design range also offers design flexibility …”, conveyed the Suitability Representation. The Respondents accept the publication period of 2014 but do not admit the website was published in Australia.

1618 I reject that submission. It would have been obvious to a Design Professional reading the text at the website and observing the images of the buildings that no Design Professional would have assumed from the images and the text that Alucobond panels were suitable for any use on any building, in any manner, in any quantity and in any configuration. Nor would a Design Professional have drawn any such conclusions from the broad and generalised statements on the website to the effect that Alucobond products were industry leaders and offered design flexibility. A Design Professional would have known that whether Alucobond panels were suitable for a particular use on a particular building was a matter which required the exercise of professional skill and judgment by a Qualified Professional to ensure that the particular building complied with the requirements of the BCA.

9.4.11 Alucobond.com.au website – Home page (2009)

1619 The Applicants submit the Alucobond.com.au website – Home page (2009) [TEN.001.001.0102/0002] conveyed the Suitability Representation. The alleged publication period (2009) and publication in Australia are admitted to the extent references are to the Australian website. The Applicants rely upon the text:

(a) “Alucobond and Alucore are not only applicable to the building and construction industry but also for corporate image programs and for vehicle and marine manufacturing industries”; and

(b) “[f]or every project, early co-ordination of the designer’s planning with our product know-how is a sure way to success whether for new constructions, refurbishments, interiors or exteriors”.

1620 I reject that submission. The images relied upon depict different buildings and structures which could only have been designed, constructed and certified as compliant by Qualified Professionals. It would have been obvious to a Design Professional reading the Alucobond website and no Design Professional would have assumed from the images and text relied upon that Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration. Nor would a Design Professional have drawn any such conclusions from the broad and generalised statements on the website to the effect that Alucobond products were of broad application.

1621 Further, HVG emphasised the following text:

A national business, Alucobond Architectural aims to support architects and designers’ aspirations from initial concept to project completion, providing individual consultancy, detailed technical support, colour charts and sampling.

1622 I find that this text conveyed that the use of Alucobond products was likely to require detailed technical support, which mitigates against any representation that the Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration.

1623 The Applicants make the same submissions as to the Suitability Representation in respect of the Alucobond.com.au Website – Homepage (2011) and the Alucobond.com.au Website – Homepage (2014): [TEN.001.001.0103/0002] and [TEN.001.001.01014/0002]. For the reasons given in respect to the 2009 Alucobond.com.au Website – Homepage, I reject that these two further websites convey the Suitability Representation.

9.4.12 Alucobond AU website - Homepage (2015)

1624 The Applicants submit the Alucobond AU website - Homepage (2015) [TEN.001.001.0135/002] conveyed the Suitability Representation by the images of buildings with Alucobond products affixed and the text, “Alucobond brings homes to life” and “Explore our inspirational projects”. I reject that submission. The images would not convey to a Design Professional that the Alucobond products were suitable for any use, on any building, in any manner, in any quantity and in any configuration. Nor would a Design Professional have drawn any such conclusions from the broad and generalised statements on the website to the effect that the products were of broad application.

9.4.13 Alucobond AU website - Homepage (2016)

1625 The Applicants submit the Alucobond AU website Homepage (2016) [TEN.001.001.0143/002] conveyed the Suitability Representation by the images of the buildings and the following text:

(a) “[s]pecify Alucobond for your next project”;

(b) “Alucobond Architectural, a division of HVG, distributes a range of superior and innovative façade products throughout Australia”; and

1626 I reject that submission. The images and the text relied upon make no representation as to the suitability of Alucobond products for a particular building or a particular application. A Design Professional observing the images and reading the text on the website would not have assumed that Alucobond products were suitable for any use, on any building, in any manner, in any quantity, and in any configuration.

9.4.14 Alucobond AU website - Homepage (August 2017)

1627 The Applicants also rely upon the August 2017 Alucobond AU website homepage [TEN.001.001.0150/0002], which is in identical terms to the 2016 website. For the reasons given in relation to the 2016 website, I reject the Applicants’ submission that the images and text of the Alucobond AU website, August 2017, convey the Suitability Representation. The only difference is the Applicants submit the phrase “ALUCOBOND – CODEMARK CERTIFIED” also conveyed the PE and Plus Fire Representations. For the reasons I have already given in respect of references to the Alucobond products being CodeMark Certified in the brochures discussed earlier in these reasons, I do not find that this statement conveyed the PE or Plus Fire Representations.

9.4.15 Alucobond AU website - Homepage (November 2017)

1628 The Applicants submit the Alucobond AU website homepage, November 2017 conveyed, by images and text, the Suitability Representation: [TEN.001.0156/0002]. The November 2017 Alucobond AU website homepage is in identical terms to that of the August 2016 and 2017 website. For the reasons given, in relation to those websites, I reject that the Alucobond AU website homepage, November 2017, conveyed the Suitability Representation.

9.4.16 Alucobond.com – Products – Alucobond (PE) – Processing

1629 The Applicants also rely on the Alucobond website on the webpage Alucobond (PE) – Processing (http://www.alucobond.com/alucobond-processing.html), which the Respondents admit was published between 2008 – 2017 but do not admit was an Australian publication: [TEN.001.001.0233/0002]; [TEN.001.001.0048/0002]; [TEN.001.001.0020/0002], [TEN.001.001.0021/0002], [TEN.001.001.0025/0002], [TEN.001.001.0033/0002], [TEN.001.001.0046/0002], [TEN.001.001.0049/0002-0003], [TEN.001.001.0051/0002], [TEN.001.001.0057/0002], [TEN.001.001.0058/0002-0003], [TEN.001.001.0060/0002], [TEN.001.001.0062/0002-0003], [TEN.001.001.0063/0002]; [TEN.001.001.0026/0002-0003], [TEN.001.001.0030/0002], [TEN.001.001.0032/0002], [TEN.001.001.0037/0002-0003], [TEN.001.001.0272/0002], [TEN.001.001.0284/0002], [TEN.001.001.0043/0002], [TEN.001.001.0047/0002], [TEN.001.001.0018/0002], [TEN.001.001.0036/0002-0003]; [TEN.001.001.0038/0002]. The Applicants submit the webpage conveyed the Fabrication and Affixation Representation through instructions including images describing various methods of processing and affixing the Alucobond panels for outdoor use, including:

(a) cutting;

(b) punching;

(d) bending;

(e) routing & folding;

(f) riveting; and

(g) screwing.

1630 I reject that submission. The above text and instructions accompanied by images of certain fabrication and fixing methods on the webpage would not have conveyed to a Design Professional a representation that none of those methods would make any difference to the fire performance of Alucobond PE. The statements relied upon by the Applicants to the effect that Alucobond products could be processed in certain ways do not amount to an unqualified representation that those processing methods would not impact on the fire performance of the products in the event of a building fire. The webpage displayed a range of fabrication and affixation options, with explanations regarding those methods. The webpage did not convey that any particular fabrication or affixation method would be suitable for a particular building.

1631 A Design Professional would not have understood the statements relied upon by the Applicants as a representation that the products could be safely and compliantly used in any way in any building. A Design Professional who accessed the webpage would reasonably have concluded that the particular use to which Alucobond PE could be put depended on the fire characteristics of the particular building and on the Design Professional using their own professional skill and judgment to comply with the relevant provisions of the BCA.

9.4.17 Alucobond.com – Products – Alucobond (P lus) – Processing

1632 The applicants also rely on the Alucobond website on the webpage Alucobond (Plus) – Processing, which the Respondents admit was published between 2008 – 2017 but do not admit was an Australian publication: [TEN.001.001.0044], [TEN.001.001.0055], [TEN.001.001.0061], [TEN.001.001.0228], [TEN.001.001.0039], [TEN.001.001.0041], [TEN.001.001.0042], [TEN.001.001.0050], [TEN.001.001.0052], [TEN.001.001.0053], [TEN.001.001.0054], [TEN.001.001.0059], (2009) [TEN.001.001.0064]; [TEN.001.001.0274], (2015) [TEN.001.001.0279], [TEN.001.001.0018], [TEN.001.001.0023]; [TEN.001.001.0024]; [TEN.001.001.0027]; [TEN.001.001.0031]; [TEN.001.001.0034]; [TEN.001.001.0035], [TEN.001.001.0040]; [TEN.001.001.0045], [TEN.001.001.0056]. The Applicants submit the webpage conveyed the Fabrication and Affixation Representation through instructions including images describing various methods of processing and affixing the Alucobond panels for outdoor use, including:

(a) screwing;

(b) contour cutting;

(d) shearing;

(e) routing & folding; and

(f) cutting.

1633 I reject this submission for the same reasons as in respect of the Alucobond PE version of this webpage. The webpage displayed a range of fabrication and affixation options, with explanations regarding those methods. The webpage did not convey that any particular fabrication or affixation method would be suitable for a particular building. A Design Professional would not have understood the statements relied upon by the Applicants as a representation that the products could be safely and compliantly used in any way in any building. A Design Professional who accessed the webpage would reasonably have concluded that the particular use to which Alucobond Plus could be put depended on the fire characteristics of the particular building and on the Design Professional using their own professional skill and judgment to comply with the relevant provisions of the BCA.

9.4.18 Other website pages

1634 The Applicants in Annexure D to their written closing submissions rely upon numerous other website pages as conveying the Representations. I do not propose to deal with each of those other website pages as they are similar in their terms to the sample websites which I have considered above, and the repetition of analysis would serve no purpose and would be wasteful of the Court’s resources and would not be consistent with the overarching purpose prescribed by s 37M of the FCA Act.

1635 Notwithstanding that I have found, aside from the Plus Composition Representation, that the brochures and websites relied upon by the Applicants and referred to in the Consolidated Schedule do not convey the Representations, I will go on to consider whether the Representations were false and misleading in case a Full Court should determine the issue differently. That is, I will assume that the brochures and websites did convey each of the Positive Representations.

9.5 Issue 11 – Were the representations misleading?

9.5.1 Legal principles

1636 The legal principles in respect of the misleading conduct claim did not appear to be substantively in dispute between the parties. The following principles were outlined by White J in A ustralian Competition and C onsumer C ommission v HJ Heinz Co Australia Ltd (2018) 363 ALR 136; [2018] FCA 360 at [37]-[47]:

[37] The principles which the Court applies when considering alleged contraventions of ss 29(1) and 33 of the ACL are settled… It was also common ground that, despite the slight differences in language between the terms “misleading or deceptive” and “mislead or deceive” used in s 18 of the ACL and the term “false or misleading” used in s 29(1), the terms have the same meaning: Australian Competition and Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682 at [14], cited with approval by Allsop CJ in Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2014] FCA 634; (2015) 317 ALR 73 at [40]. It has, however, been held that conduct which is “liable to mislead” (being the term used in s 33) applies to a narrower range of conduct than does conduct which is “likely to mislead or deceive” (being the term used in s 18): Coles Supermarkets at [44] and the cases cited therein. Under s 33, what is required is that there be an actual probability that the public would be misled: Trade Practices Commission v J&R Enterprises Pty Ltd (1991) 99 ALR 325 at 339.

[38] Provisions such as ss 18, 29 and 33 of the ACL are remedial in character and so should be construed so as to give the fullest relief which the fair meaning of their language would allow: Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470 at 503; New South Wales Lotteries Corporation Pty Ltd v Kuzmanovski [2011] FCAFC 106; (2011) 195 FCR 234 at [105].

[39] A representation will be false if it is contrary to the relevant fact and misleading if it has a tendency to lead into error. The causing of confusion or questioning is insufficient; it is necessary to establish that the ordinary or reasonable consumer is likely to be led into error: Coles Supermarkets at [39].

[40] The question of whether conduct, including conduct by way of representations, contravenes s 29 or s 33 of the ACL is one of fact to be determined by an objective consideration in the light of all the relevant surrounding circumstances: Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 at 198–9; Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592 at [109].

[41] The application of ss 29 and 33 requires the Court to identify the conduct said to be false or misleading or liable to mislead and then to consider separately whether the conduct was false or misleading or liable to mislead: Google Inc v Australian Competition and Consumer Commission (2013) 249 CLR 435; 294 ALR 404; 99 IPR 197; [2013] HCA 1 at [89].

[42] Consideration of the conduct as a whole in its proper context may require consideration of the type of market, the manner in which the goods or services are sold, the habits and characteristics of purchasers in that market as well as of any relevant disclaimers or explanations: Coles Supermarkets at [41]. It also includes any relevant disclaimers, qualifications or explanations: Butcher v Lachlan Elder Realty at [49]. When the impugned conduct involves representations to the public at large or to a section of the public, such as prospective retail purchasers of a product or service, regard must be had to the effect of the representations on “ordinary” or “reasonable” members of the class of prospective purchasers. The range of persons in such a class may be quite broad and may include the intelligent as well as the less intelligent, and those who are well educated as well as those who are less literate.

[43] In many cases, the words and images used in advertising or promotional material are capable of conveying different meanings. In such cases, the question is whether the meaning said to be false or misleading is reasonably open and may be drawn by a significant number of persons to whom the representation was addressed. Thus, in CPA Australia Ltd v Dunn (2007) 74 IPR 495; [2007] FCA 1966 at [28], Weinberg J said:

Statements that are capable of more than one meaning may be misleading or deceptive provided that the meaning for which the applicant contends is one that would be reasonably open, and might be drawn by a significant number of those to whom the representation is made. In the same way, a statement may contain a representation that is implied, rather than express. That is why a statement that is literally true can be misleading or deceptive.

(Citation omitted)

[44] In Coles Supermarkets at [46], Allsop CJ quoted with approval the following statement by Hill J in Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (1992) 38 FCR 1 at 50:

Where, as in the present case, the advertisement is capable of more than one meaning, the question of whether the conduct of placing the advertisement in a newspaper is misleading or deceptive conduct must be tested against each meaning which is reasonably open. This is perhaps but another way of saying that the advertisement will be misleading or likely to mislead or deceive if any reasonable interpretation of it would lead a member of the class, who can be expected to read it, into error …

Allsop CJ went on to say at [47], that “if any one or more of the reasonably available different meanings is misleading, the conduct may well be misleading or deceptive, or false and misleading”.

[45] Generally speaking, however, the class will not include those who fail to take reasonable care for their own interests: Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45; 169 ALR 677; 46 IPR 481; [2000] HCA 12 at [101]–[103]; Coles Supermarkets at [43].

[46] In cases in which the conduct and representations are to the public generally and concern simple advertising, the absence of individuals saying that they were misled will usually be of little significance. In such circumstances, the Court can carry out an objective assessment of the advertising and promotional material itself without evidence from individual witnesses: Coles Supermarkets at [45].

[47] In assessing advertising material, the “dominant message” of the material will be of crucial importance: Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; 304 ALR 186; 96 ACSR 475; [2014] HCA 54 (ACCC v TPG) at [45]; Coles Supermarkets at [47].

1637 In respect of the “dominant message” of material, the High Court in A ustralian C ompe t ition and C onsumer C ommission v TPG Internet Pty Ltd (2013) 250 CLR 640; [2014] HCA 53 at 55 went on to say:

It has long been recognised that, where a representation is made in terms apt to create a particular mental impression in the representee, and is intended to do so, it may properly be inferred that it has had that effect. Such an inference may be drawn more readily where the business of the representor is to make such representations and where the representor’s business benefits from creating such an impression.

(Citations omitted.)

1638 As Katzmann J said in Ethicon at [3556]:

Conduct can be misleading or deceptive regardless of the intention of the alleged wrongdoer; the section is concerned with the effects or consequences (actual or likely) of the conduct. Nor does it matter whether the wrongdoer took reasonable care. No question of fault is involved. That said, where an intention to deceive is established, a court may more readily infer that the intention will probably be effective.

(Citations omitted).

1639 Further, as White J said in HJ Heinz Co Australia at [88]:

The manner by which a representation may be proved to be false does not control the content or meaning of the representation. There is no reason in logic or principle why the ACCC cannot prove the falsity of a representation concerning the quality of a product by resort to expert evidence concerning features of the product about which the consumer may be unaware or have overlooked. It is commonly the case that the features of a product which make representations about it misleading are revealed only by expert investigation or analysis.

1640 It is relevant to note the distinction between, on the one hand, the task of characterising whether the Respondents’ conduct was misleading, and on the other hand, whether any person suffered loss or damage by reason of that conduct. “[T]he question of characterisation as to whether conduct is misleading is ‘logically anterior to the question whether a person has suffered loss or damage thereby’…characterisation of conduct ‘generally requires consideration of whether the impugned conduct viewed as a whole has a tendency to lead a person into error’”: TPG at [49], discussing C ampbell v Backoffice I nvestments at 318 [24]. As Gleeson CJ, Heydon and Hayne JJ said in Butcher at [112], “[t]he words ‘or is likely to mislead or deceive’…make it clear that it is unnecessary to prove that the conduct in question actually deceived or misled anyone”.

1641 The Full Court in Ethicon (Full Court) stated the following in relation to a submission by the appellant that no evidence had been adduced from any treating doctor or individual patient that they made the inferences or assumptions suggested by the primary judge:

[796 ] … it is useful initially to deal with the submission that no evidence was adduced from any treating doctor or individual patient, thus preventing a finding that contravening conduct had been established.

[797] In explaining why this complaint is misconceived, it is necessary to emphasise some bedrock notions which inform the assessment as to whether contravening conduct is established. Whether particular conduct is misleading or deceptive is a question of fact to be determined in the context of the evidence about the alleged conduct and all relevant surrounding facts and circumstances. The relevant inquiry is whether, in the circumstances, the impugned conduct induces or is capable of inducing error.

[798 ] It is correct, as Gibbs CJ observed in Parkdale [Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191] at 198, that this means that consideration must be given to the class of persons likely to be affected by the conduct. But in this regard, the characterisation exercise involves consideration of a notional cause and effect relationship between the conduct and the state of mind of the relevant person or class of persons. The test is necessarily objective.

[799 ] In considering the appellants’ submissions it is important to be alive to the distinction between the characterisation task (whether conduct is misleading or deceptive or likely to mislead or deceive) and the causation inquiry (whether any person has suffered loss or damage by reason of that conduct). The first task is logically anterior to the second. In a case such as the present, as the primary judge accepted (at [4357]), the issue of causation could not be a common issue. The common questions answered by her Honour were directed to the first of these inquiries and while similar contextual factors relevant to characterisation may play a role in determining causation for any individual group member, no issue as to causation has been determined for any claimant beyond Mrs Sanders.

[800] An answer to a common question directed to whether contravening conduct took place is possible because determining whether any particular conduct is misleading or deceptive is a question of fact to be determined objectively. In Campbell [v Backoffice Investments Pty Ltd (2009) 238 CLR 304] at [102], Gummow, Hayne, Heydon and Kiefel JJ approved the following statements of McHugh J in Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592 at [109]:

The question whether conduct is misleading or deceptive or is likely to mislead or deceive is a question of fact. In determining whether a contravention of s 52 has occurred, the task of the court is to examine the relevant course of conduct as a whole. It is determined by reference to the alleged conduct in the light of the relevant surrounding facts and circumstances. It is an objective question that the court must determine for itself. It invites error to look at isolated parts of the [alleged contravener’s] conduct...

(Citation omitted).

…

[802 ] Contrary to the appellants’ submissions, in resolving the objective characterisation task, it was not necessary for any doctors to be called to state that they had read, received and relied on Ethicon’s marketing materials. The characterisation issue was whether the appellants’ conduct, in marketing the products and continuing to market them without proper disclosure or warning as to their complications and the gravity of them, in the light of all relevant surrounding facts and circumstances including the class of persons to which the conduct was directed and the applicable regulatory regime, was conduct capable of inducing error. Given the primary judge’s findings about the deficiencies in the conduct of the appellants as it related (as senior counsel for the appellants described it below) to “the failure to warn about…the mesh and tape complications, including the removal complications”…the result of the characterisation exercise was obvious.

(Original emphas i s, citations omitted.)

1642 Whether the Positive Representations were false or misleading is a question of fact to be determined having regard to the context in which the Representations were made and the surrounding facts and circumstances. That necessitated the Applicants adducing evidence from the Qualified Professionals involved with the representative Shore Building and Five Dock Building. This is not to be taken as adopting the view of the Respondents that the misleading and deceptive conduct claim should be approached as an individual case, as opposed to by reference to a class of persons. Rather, such evidence was necessitated because the “relevant surrounding circumstances” in this case involved the negligent misuse of Alucobond products by Qualified Professionals. The misleading conduct claim necessitates that this Court consider, by reference to a reasonable, hypothetical Design Professional, whether Design Professionals, in the relevant period, would have been led into error by 3A and HVG’s marketing of Alucobond ACPs in the brochures and on the websites. This issue cannot be determined simply by comparing different combinations of select parts of text in brochures and on websites with the experts’ opinions about the inappropriate use of ACPs on the Applicants’ respective buildings. This lacuna in the evidence is particularly heightened because the Group 7 Joint Report is to be read as referring to the personal knowledge of the experts during the relevant period, rather than as evidence of any generalised industry knowledge or practice. This is the relevant context in which the Positive Representations are to be assessed as to whether they are false or misleading. Notwithstanding the view I have expressed above, I now turn to consider whether the Representations in the brochures and on the websites were false or misleading, in case a Full Court should express a different view.

1643 I will first consider the generation one to four brochures, which I discussed above in the context of whether the Positive Representations were conveyed.

9.5.2 Generation 1: The Face of Tomorrow, Today (2004 - 2013)

1644 This brochure has been discussed above – it only covers Alucobond PE. The Respondents do not admit the publication period, but HVG does accept it was an Australian brochure.

9.5.2.1 Suitability and Compliance Representations

1645 Noting the overlap between the Suitability and Compliance Representations, it is appropriate to address these representations collectively rather than individually.

1646 In respect of the Suitability Representation, the Applicants submit that the evidence establishes that neither Alucobond PE nor Alucobond Plus were suitable for use for all of the purposes for which they were commonly supplied (that is, the Purposes). The Applicants submit that the Material Fire Risk Properties and Prohibition Risk Properties meant that the only way the goods could be used safely, if at all, was in very limited applications with the assistance of a careful and competent FSE. The Applicants submit that this is contrary to the impression that was conveyed by the marketing material.

1647 In respect of the Compliance Representation, the Applicants similarly submit that the representation was false and misleading on the basis that the only way Alucobond PE could theoretically be used was via a Performance Solution designed by a careful and competent FSE. The Applicants submit that, even then, there was no assurance that the FSE would be able to design a solution that allowed for the intended use and which would ultimately be approved by the certification body.

1648 Accepting that the Applicants say that the textual representations are to be viewed in combination with the images of various buildings, I do not consider that those representations take the Applicants’ case much further. Statements such as “anything is possible” would be properly understood by Design Professionals as puffery and not a representation that could be taken literally and relied upon in terms of the suitability or compliance of the product.

1649 As the evidence of the Expert Groups has illustrated, Alucobond PE was capable of being used, for the Purposes. Further, Professor Bisby and Professor Torero both accepted that it was not possible to opine on the use of Alucobond PE on specific buildings by reference only to photos, such as those contained in the Respondents’ brochures. Similarly, Mr Moore said that whether the use of Alucobond PE on a particular building could be demonstrated as being BCA compliant depended on the particular details of its use and the design of the building, including fire safety systems within the building.

1650 It may be accepted that use on a particular building in the manner in which the panels were depicted within the brochure may not have been safe or BCA compliant. It may also be accepted that a particular building may have required use in more limited ways than the manner of affixation depicted in the brochure. This reflects the building specific nature of BCA compliance assessments. If the Suitability Representation was conveyed by the brochure, then I find it was not misleading. This is because (a) I have found that Alucobond PE was capable of being used in a safe and BCA compliant manner for the Purposes, and (b) because in the circumstances, noting my comments regarding the lack of contextual evidence, a Design Professional would not have been led into error to think that Alucobond PE would be suitable and compliant for, in effect, any application – including applying Alucobond PE to a building in a similar manner as that depicted in the brochure.

1651 It is worth making a number of additional comments regarding the representations alleged.

1652 In respect of the Compliance Representation particularly, it is difficult to properly understand how the representation is alleged to have been made. As part of having a working understanding of the BCA and the different fire resistance requirements imposed in respect of the different types of construction and the available BCA compliance pathways, a Design Professional would presumably know that the DtS Provisions require external walls of Type A and Type B to be non-combustible.

1653 It would appear to follow that the only manner in which Alucobond PE could be represented to be compliant with the DtS Provisions (again, focusing particularly on the fire resistance requirements of the BCA) in respect of all relevant building codes and standards for use on all buildings as part of an external wall, or that it would be so compliant once affixed, would be if Alucobond PE was represented to be non-combustible. A similar comment may be made in relation to the Suitability Representation. That is to say that a representation that Alucobond PE would be suitable (in the sense of being safe and compliant) for all of the uses for which it is commonly acquired, and would be suitable for such uses once affixed, if used under a DtS pathway, would presumably only be possible where Alucobond PE was represented as being non-combustible. As has been noted in these reasons above, on the evidence before me, I am unable to make the finding sought by the Applicants that Design Professionals as a whole in Australia, during the relevant period, considered Alucobond PE to be non-combustible.

1654 As to suitability and BCA-compliance of Alucobond PE through a Performance Solution, a Design Professional would have known a Performance Solution is specific to the particular building. The images and statements in the brochure would not be understood as representing that any particular use (eg as depicted) would be BCA-compliance or suitable for a particular building and a particular desired use.

9.5.2.2 Fire Performance Representation

1655 The only express representations made regarding the fire performance of Alucobond PE in the brochure is the image of a flame impinging upon an aluminium cover sheet of Alucobond PE accompanied with the text “[t]he non-combustible aluminium cover sheets protect the plastic core”, and the results of a number of fire tests, most relevantly AS 1530.3 “indicative” results showing an index of 0 for each of ignitability, heat evolved, Spread-of-Flame, and Smoke-Developed.

1656 The Applicants submit that that the PE Fire Performance Representation was false and misleading for a number of reasons. Firstly, the Applicants submit that, in contrast to the express representation made, the aluminium cover sheets did not protect the PE core from fire. Rather, the cover sheets might, at most, delay, by a matter of minutes, the ignition of the core in the event of a building fire and would certainly not resist flame in the way depicted in the image in the brochures. The Applicants submit that this misrepresentation is significant because it was apparent that it was this fundamental misunderstanding that led Design Professionals to conclude, incorrectly, that a building product with a combustible element inside the aluminium cover sheets would not present a material risk of fire when used on the façade of a building.

1657 The Applicants also submit that the use of Alucobond PE (and Alucobond Plus) did materially increase the risk to life or safety of occupants, and damage to property, in the event of a building fire, because they each had the Material Fire Risk Properties.

1658 The Applicants also submit that Alucobond PE (and Alucobond Plus) had not passed all of the fire tests represented, and that those fire tests did not provide a reasonable basis for the Respondents to represent that either product was suitable or safe. The Applicants refer primarily to the number of issues they identified in respect of how the fire tests were performed, including around how the tests were conducted in a manner that was unrepresentative of the recommended use of Alucobond PE and Alucobond Plus.

1659 As noted above, “The Face of Tomorrow Today” brochure is in a somewhat unique position as the only HVG brochure which dealt exclusively with Alucobond PE. Many of the submissions on the issue of the Fire Performance Representations were directed to brochures where representations regarding the fire behaviour of Alucobond PE were made alongside representations regarding the fire behaviour of Alucobond Plus and A2.

1660 Again, there is an evidentiary issue which arises in respect of the Fire Performance Representations, which is namely, the difficulty in properly construing how the representations would be understood by an ordinary and reasonable Design Professional in the absence of clear evidence regarding the particular level of knowledge that should be properly attributable to them.

1661 The brochure makes no express representation that Alucobond PE is non-combustible (for the purposes of the BCA). To the extent that any submission is made that non-combustibility was implied by reproducing the AS 1530.3 test results, there is little evidence to support such a finding. Mr Moore provided evidence that architects and/or building certifiers may have been misled by AS 1530.3 test results as indicating that the use of Alucobond PE and/or Alucobond Plus would not constitute an undue risk of fire spread. However, this evidence was directed towards building surveyors’ consideration of Alucobond products compliance with the attachment exception under the BCA. This required a product to not constitute an undue fire spread and have attained AS 1530.3 test results within specific parameters. Where a Design Professional was considering AS 1530 test results of a product, they would have already been operating on the understanding that they were assessing the use of a product that is combustible for the purposes of the BCA (as that test is only relevant to combustible materials). It is unclear to what extent a Design Professional could be expected to appreciate the difference between the results for an AS 1530.1 test and an AS 1530.3 test with the former being the relevant test to determine whether a product is non-combustible.

1662 Noting the above, I accept HVG’s submission that the clear implication of the representation, “[t]he non-combustible aluminium cover sheets protect the plastic core”, is the fact that, in contrast to the non-combustible aluminium cover sheets, the PE core is combustible. The representations regarding the fire test results, including in respect of AS 1530.3, would have been understood by a Design Professional, in the context of the protection afforded by the cover sheets to the combustible core.

1663 I therefore do not accept, to the extent it is submitted, that the brochure represented that Alucobond PE was non-combustible. This is a matter of significance, particularly in respect of the Suitability and Compliance Representations, for the reasons outlined above.

1664 Noting the above, there is a distinction to be drawn between a representation that Alucobond PE is non-combustible, and what appears to be the more general representation alleged by the Applicants that Alucobond PE was safe and suitable, and would present no material increase in risk to life or safety of occupants, or damage to property, in the event of a building fire.

1665 In respect of the express representations made regarding the cover sheets, 3A submits that the statement is not misleading on the basis that the cover sheets do, in fact, protect the core, even if such protection is not absolute. 3A submits that whether the extent to which the cover sheets protected the core on any particular application was a matter that was application specific, and that this would have been obvious to a Design Professional. Additionally, 3A submits that, in respect of the various fire test results published in the brochure, a Design Professional would understand the references as a notification of the test reports that could be obtained if required, and that no Design Professional would seek to draw conclusions about the suitable application of Alucobond PE on the basis of the test results so described within the brochure.

1666 It is not disputed that the cover sheets provide some protection to the core. The general evidence of Expert Group 3 in this respect was that whether the degree of protection afforded by the cover sheet was sufficient for a particular application would depend on a range of factors specific to that application. In this sense, it is unclear from the evidence what particular degree of reliance could be placed on the protection afforded by the cover sheets in the context of a building’s overall fire safety strategy. Associate Professor Lange gave evidence to a similar effect, stating that the actual protection afforded by the aluminium cover sheets in a particular application would be difficult to determine in practice.

1667 I do not accept that the “The Face of Tomorrow Today” brochure was misleading in respect of the fire behaviour of Alucobond PE by expressly and impliedly representing that the aluminium cover sheets protected the core of the panels. The expert evidence established that a degree of protection was afforded by the cover sheets but whether that action was sufficient for a particular application is application specific. I do not accept that the Applicants have established on the evidence that the Suitability, Compliance and Fire Performance Representations were false or misleading. That is particularly the case in circumstances where the Applicants have failed to lead any evidence from the Qualified Professionals who were responsible for designing, constructing and certifying the Shore Building and Five Dock Building.

9.5.2.3 Fabrication and A ffixation R epresentation

1668 The Fabrication and Affixation Representation is an allegation that the Respondents positively represented that Alucobond PE could be fabricated and affixed in accordance with the methodologies set out in the brochure without compromising its fire performance or safety. The Applicants allege that this was misleading because the method of fabrication and affixation could have a material effect on the fire performance of Alucobond PE.

1669 The Applicants submit 3A regularly set up its fire tests with unusual fixing methods which were apt to produce the best test results. The Applicants submit it was misleading for the Respondents to represent that Alucobond PE (and Alucobond Plus) had “ passed ” those tests or had particular fire performance qualities without disclosing the method of affixation used in the relevant test, in circumstances where the same brochure contained a number of other ‘approved’ affixation methods without any suggestion those methods impacted upon the fire performance.

1670 It is not in dispute that the method of fabrication and affixation of Alucobond PE and Alucobond Plus can have an impact on the overall reaction to fire behaviour of the panels. However, properly understood, the methods of fabrication and affixation outlined within the brochure were intended to provide Design Professionals with information about how the panels could be manipulated and installed on a building. The Alucobond panels were marketed as being lightweight and therefore, easy to fabricate and install. Given the stated benefits of the panels, the brochure naturally sought to provide information about the various ways in which the panels could be fabricated and affixed. These would not be properly understood by Design Professionals as any positive representation that any form of fabrication or affixation of an Alucobond panel would not materially affect its fire performance or safety.

1671 It may be that whether a particular use of Alucobond PE (that is relevantly, the method of fabrication and affixation) represented an undue fire risk cannot be answered in the abstract. It may also be that in the context of a particular building, including its fire strategy, a particular method of fabrication and affixation would be inappropriate and would materially affect the fire performance and safety of the Alucobond PE. But that conclusion would not be a result solely of the fabrication and affixation method chosen but of the whole of the relevant attributes of the building.

1672 However, the pleaded representation is that applying any fabrication and/or affixation method would not materially affect the fire performance and safety of the Alucobond products. I am satisfied that if such a representation was conveyed (contrary to my finding), this was a misleading representation.

1673 In the Group 3 Joint Report, the experts agreed that:

The above reaction-to-fire behaviours will be influenced, for better or for worse, by the methods of forming, fixing, and mounting of the Alucobond PE panels. This includes the manner of cutting, routing, folding, and forming Alucobond PE into cladding panels, as well as the mounting and affixation methods used to fix the panels to the outside of a building, as described in detail by Professor Bisby in his expert report.

The above reaction-to-fire behaviours will also be influenced by the configuration, materiality, and geometry of any cladding system that Alucobond PE panels are used within; the effects of internal cavities, thermal feedback, and interactions with other materials and products within the cladding system may all play important roles that need to be considered by specifiers, designers, and approvers.

1674 The experts noted that the method of forming, mounting, and fixing of Alucobond Plus panels could also affect its reaction-to-fire properties.

1675 A further significant point is that it was also accepted that when the Alucobond panels were fabricated and affixed, the core could become exposed, thereby affecting the fire behaviour of the products. Professor Bisby’s first expert report detailed various different fabrication and affixation methods (including those portrayed in the marketing material). Professor Bisby opined as to (a) the potential for those techniques to result in the exposure of the core and (b) as a result of (a) and/or for other reasons (eg the creation of reservoirs within the cladding system leading to the pooling of molten) the adverse affect on the reaction-to-fire properties of ACPs.

1676 Professor Bisby said:

I consider that the particular method of affixation is unlikely to entirely avoid the fire behaviours I have identified above. However, the manner of shaping of the cladding panels, and the manner of fixing them to a building, may affect the way in which any fire spreads on and in the cladding system and the resulting external fire spread hazards associated with their use.

However, as I explain below, in [sic] ways in which this could occur are unlikely to be well characterised or easily quantified.

1677 The above evidence does not explicitly address the question of whether the method of fabrication and/or affixation could materially affect the reaction-to-fire properties of the Alucobond products. I accept that the experts could not, with any degree of precision, extrapolate from the results of small-scale experiments of particular affixation methods to a quantified affect of affixation methods on a large-scale experiment or in relation to any particular building – noting again the importance of other building specific factors.

1678 Nonetheless, I am satisfied that the method of fabrication or affixation could (in the sense of being able to) materially affect the reaction-to-fire properties of the Alucobond products, such that if (contrary to my finding) the Fabrication and Affixation Representation was conveyed, then it was misleading, as it cannot be said that applying any fabrication and/or affixation method would not materially affect the fire performance and safety of the Alucobond products.

9.5.3 Generation 2: Vision Materi a li z ed (2009 - 2013)

1679 The “Vision Materialized” brochure [HVG.001.001.0052] is what the Applicants refer to as the second generation of HVG brochures. The nature of the Suitability Representations alleged to be contained therein are broadly similar to those identified in respect of “The Face of Tomorrow Today”. In particular, there are a range of photos of buildings clad with Alucobond panels, including high-rise and low-rise public, commercial and residential buildings. The brochure makes specific reference to the use of panels in the context of residential applications, as well as in refurbishments.

1680 I note, for the sake of completeness, that while the brochure identified Alucobond PE as ALUCOBOND® (and that it was not until version two of the third generation of HVG brochures that Alucobond PE was specifically identified by that name rather than by ALUCOBOND®), and that ALUCOBOND® is referred to generically throughout the brochure, I do not consider that a Design Professional would understand the brochure to be referring specifically to Alucobond PE (other than in limited circumstances where this is clear). It appears plain that the brochure is referring the ALUCOBOND® as the registered trademark for the product range, and therefore, references to ALUCOBOND® within the brochure are not to be generally understood as a reference specifically to Alucobond PE.

1681 A number of the comments made below in respect of the Fire Performance Representation are also relevant to the Suitability and Compliance Representations.

1682 As noted above, the “Vision Materialized” brochure is in substantially similar terms to the earlier “The Face of Tomorrow Today” brochure. The reasons for finding that the Suitability, Compliance and Fire Performance Representations were not false or misleading apply equally to the Vision Materialized brochure. It follows that the Applicants have failed to establish, if, contrary to my finding the Vision Materialized brochure conveyed the Suitability, Compliance and Fire Performance Representations, those representations were false or misleading.

1683 In respect of the alleged Fabrication and Affixation Representation, the comments made above are repeated – the introduction of Alucobond Plus does not alter that analysis which applies equally to this brochure. I find that if, contrary to my finding, the brochure did convey the Fabrication and Affixation Representation, it was misleading.

9.5.4 Generation 3: At a G lance (2013 - 2015)

1684 The Applicants rely upon the next generation of brochures which was branded, “At a Glance”: [HVG.001.001.01106] and [HVG.006.015.5554]. This generation of brochures contains a range of photos of buildings clad with Alucobond panels, including high and low-rise public, commercial and residential buildings. The brochure makes specific reference to the broad range of uses to which Alucobond panels can be used in the context of public, commercial and residential buildings. The images and the text relied upon as identified in Annexure D to the Applicants’ closing submissions are substantially identical to those relied upon in the “The Face of Tomorrow Today” brochure and the “Vision Materialized” brochure which I have considered above.

1685 The nature of the Positive Representations alleged are broadly similar and I am not satisfied that the additional number or styles of photographs, or the additional textual representations accompanying them in any way change the substance of the matters I have already addressed in my analysis of the Positive Representations in respect of “The Face of Tomorrow Today” and the “Vision Materialized” brochure above. The same reasoning and analysis apply in respect of the Positive Representations to the brochure, “At a Glance” (2013 to 2015). The repetition of analysis would serve no purpose and would be wasteful of the Court’s resources and would not be consistent with the overarching purpose proscribed by s 37M of the FCA Act. It is sufficient to state that for the reasons previously given in relation to those other brochures, the Applicants have not established in respect to the “At a Glance” (2013 to 2015) brochure that the Representations were false or misleading.

9.5.5 Other brochures

1686 The Applicants, in the sample brochures dealt with in their written closing submissions, refer to and rely upon the Generation 4: “Beyond Facades” (2017-2018) brochure [APP.001.005.0945]; the “Alucobond Plus” brochures [HVG.006.025.1306-0006], and the “Fire Protection Guide” (2017-2018) [HVG.001.001.0048]. I have reviewed Annexure D to the Applicants’ written closing submissions and the images and text relied upon by them for the purpose of determining whether the Positive Representations relied upon were false or misleading. These additional sample brochures relied upon by the Applicants are in substantially identical form to the brochures which I have considered above, being “The Face of Tomorrow Today”, “Vision Materialized” and “At a Glance”. Save for one matter which I address below, the analysis which I have undertaken in relation to those three brochures applies equally to the other sample brochures relied upon by the Applicants. It would be repetitive and serve no purpose for me to repeat that analysis in relation to each of the other brochures. To do so would be a waste of judicial resources and be contrary to the overarching purpose of s 37M of the FCA Act. It is sufficient to say that I have concluded that, for the same reasoning I have identified above, the Compliance, Suitability and Fire Performance Representations in the other brochures are not false and misleading.

1687 The main difference in the generation four brochure compared to the previous generations, is, as discussed earlier in these reasons, the introduction of references to the CodeMark Certificates and the amendments to the table displaying the fire test results. The Applicants submit that the falsity of the Fabrication and Affixation Representation is demonstrated by the inferior results for Euroclass for Alucobond Plus when tested with the tapefix, and BS 8414 and AS 5113 when tested with the cassette fix method. And that it was also demonstrated by the fact that 3A regularly set up its fire tests (eg the ISO 9705 test, ASTM E108 test, NFPA 285 test and BS 8414 test which are displayed in this brochure under the ‘ Australia ’ row) with unusual fixing methods which were apt to produce the best test results. As with the other brochures, the Applicants submit it was misleading for the Respondents to represent that Alucobond PE and Alucobond Plus had “passed” those tests or had particular fire performance qualities without disclosing the method of affixation used in the relevant test, in circumstances where the same brochure contained a number of other ‘approved’ affixation methods without any suggestion those methods impacted upon the fire performance.

1688 I find, for the above reasons and the reasons discussed in respect of the previous brochures, if, contrary to my finding, these brochures did convey the Fabrication and Affixation Representation, that it was misleading.

9.5.6 Plus C o mposition Representation

1689 As I have discussed earlier in these reasons, the Applicants allege that three brochures conveyed a representation throughout the relevant period that the core of Alucobond Plus was comprised of no more than 30% plastic binders and/or not less than 70% non-combustible mineral filler (the Plus Composition Representation).

1690 The Applicants submit that the above statements are false and misleading. I reject the Applicants’ submission. The Applicants have not established, on the evidence, that any such representation was false or misleading. As I have discussed earlier in these reasons, I find, on the basis of Dr Werner’s evidence (section 4.2), and the evidence of Expert Group 1 (Chemists) (section 5.1), and my reasons in section 8.5.1, the Plus Composition Representation has not been proved by the Applicants.

9.5.7 Websites

1691 The Applicants, in their oral and written closing submissions, have not made any express submissions in respect of whether the content displayed on each of the websites was false and misleading. The Applicants rely upon their submissions at paragraphs [712]-[730] of the Applicants’ closing written submissions. The images and texts on the websites are substantially similar to the images and text in the brochures which I have considered above. There is no material difference in what is conveyed or not conveyed by the images and texts on the websites and those in the brochures. The same analysis which I have undertaken in relation to the brochures applies equally to the websites for the same reasons I have given. I do not propose to repeat that analysis in relation to each of the websites again as that would be repetitive and serve no purpose. It would also be a waste of judicial resources and contrary to the overarching purpose in s 37M of the FCA Act.

1692 Apart from the Fabrication and Affixation, and the Plus Composition Representation, if, contrary to my findings, the Positive Representations were conveyed by the images and text relied upon by the Applicants as identified in Annexure D, the Applicants have not established that those Positive Representations on the websites were false and misleading. In relation to the Fabrication and Affixation Representation if, contrary to my findings, it was conveyed by the images and text displayed on the website relied upon by the Applicants as identified in Annexure D, the Applicants have established that such representations were false and misleading.

1693 In respect of the Plus Composition Representation, the Applicants allege this was conveyed by two websites:

(a) Alucobond AU – “Specify Now” – Alucobond PLUS (Feb 2015) (http://alucobond.com.au/specify-now/alucobond-plus); and

(b) Alucobond AU – “Specify Now” – Alucobond PLUS (February 2016 and December 2017) (http://alucobond.com.au/specify-now/alucobond-plus).

1694 As I have discussed above (see sections 4.2, 5.1 and 8.5.1), the Plus Composition Representation has not been proved by the Applicants. Therefore, the Applicants have not proved the Plus Composition Representation was misleading.

1695 I find in relation to issue 11 that the Applicants have failed to prove that the Positive Representations were false or misleading, as apart from the Plus Composition Representation, the Positive Representations were not conveyed by each of the brochures and websites relied upon. The Plus Composition Representation has not been established to be false. If I am wrong and the Suitability, Compliance, Fire Performance and Fabrication and Affixation Representation were conveyed by some or all of the brochures and websites relied upon, then the Applicants have only established that the Fabrication and Affixation Representation was misleading.

9.6 Representations as to future matters

1696 The Applicants submit that the Suitability Representation, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation were all representations that were, in whole or in part, in respect of “future matters”.

1697 The Applicants submit that they conveyed that the products would be suitable, safe and compliant once affixed to buildings. The Applicants submit that the Respondents have not identified in their pleadings or adduced any evidence of the grounds upon which they made those Representations. The Applicants submit that, accordingly, the Respondents have failed to discharge their evidentiary onus with the result that the Representations are deemed to be misleading pursuant to s 51A of the TPA and s 4 of the ACL.

1698 The Applicants submit that this is an independent reason why the Representations should be found to be misleading.

1699 I reject the Applicants’ submissions for the following reasons:

1700 In A ustralian C ompetition and C onsumer C ommission v Woolworths Group Ltd (2020) 281 FCR 108; [2020] FCAFC 162, the Full Court (Foster, Wigney and Jackson JJ) observed:

120 As submitted by Woolworths, we think that s 4 of the ACL does not operate on truthful statements about presently measurable and provable scientific characteristics or properties such as flammable, recyclable and biodegradable.

121 Rather, s 4 is concerned with predictions, promises, forecasts and other like statements which are directed to circumstances or events which may or may not happen in the future but which cannot be proven to be true or false at the time when they are made...

…

125 The term “future matter” is not defined in the ACL. Whether a statement relates to a future matter depends upon the words used and the context in which they were used (Digi-Tech (Australia) Ltd v Brand (2004) 62 IPR 184 at [99]-102).

126 Section 4 is in substantially the same terms as its predecessor — s 51A of the Trade Practices Act 1974 (Cth) (TPA). When that provision was introduced into the TPA, there was a line of authority in this Court exemplified by Bill Acceptance Corporation Ltd v GWA Ltd (1983) 78 FLR 171 at 175-178; 50 ALR 242 at 246-249 (per Lockhart J) and Global Sportsman at 88 (per Bowen CJ, Lockhart and Fitzgerald JJ) in which the Court sought to address the perceived difficulty that a prediction, forecast or promise as to what would occur in the future was not misleading or deceptive merely because the event did not come to pass. The principle developed was that a statement as to what would occur in the future could be misleading if the statement could properly be viewed as an implied representation as to the representor’s state of mind and if it could be established that the representor either did not intend to carry out the promise or did not have proper grounds for making the statement (because he did not believe the prediction or was indifferent as to its truth) and therefore did not have the state of mind which he had represented he had.

…

129. At [23]-[25] of its Written Submissions dated 6 February 2020, Woolworths made the following submissions:

There is therefore an unusually clear indication of the mischief which s 51A was designed to address — the difficulty of establishing the state of mind of a representor in relation to a prediction, promise or similar statement about the future. What s 51A was not designed to do was to reverse the onus in relation to conventional representations of fact already actionable under the existing provisions. Such representations did not, and do not, give rise to difficulties of proving a state of mind. They were, and are, either true or false — and capable of being demonstrated to be so — at the time that they are made, and irrespective of the state of mind of the person making them. As the trial judge observed (at [103]), that construction is also consistent with the concept of “reasonable grounds”, the purpose of which “is to require an appropriate basis for the state of mind (being the opinion or prediction) disclosed by the representation”.

Section 4(1) is in near identical terms to s 51A(1). There is nothing in either the language or context of s 4 to suggest that it was intended to depart in any relevant sense from its predecessor (as to which, see the Explanatory Memorandum to the Trade Practices Amendment (Australian Consumer Law) Bill (No 2) 2010 at [2.22]-[2.27]). The mischief to which the provision was addressed remained that of proving that statements not presently capable of being true or false were nevertheless misleading.

That history also accords with the natural meaning of the term “future matter” — as something occurring in the future, the accuracy of which is thus not presently ascertainable. It is also consistent with a stated object of the CCA— the protection of consumers. In line with that object, s 4 does not apply to representations which are true when made because, in such circumstances, no consumer will be misled, nor in need of protection.

(Emphasis in original.)

130. Those submissions are correct. We accept them.

…

132. We do not think that, generally speaking, a representation about the nature, quality, character or capability of a product based upon its inherent characteristics is a representation with respect to a future matter. A representation will only be with respect to a future matter if it is in the nature of a promise, forecast, prediction or other like statement about something that will only transpire in the future — that is, a representation which is not capable of being proven to be true or false when made. This interpretation of “… a representation with respect to a future matter” in s 4(1) is the interpretation propounded by Nicholas J in [Samsung Electronics Australia Pty Ltd v LG Electronics Australia Pty Ltd (2015) 113 IPR 11] at [83]-[86], by Rares J in Ackers v Austcorp International Ltd [2009] FCA 432 at [359] and by Gleeson J in Kimberly-Clark at [276]-[286] esp at [285]. At [285] in [Australian Competition and Consumer Commissioner v Kimberly-Clark Australia Pty Ltd [2019] FCA 992], Gleeson J said:

I am not satisfied that the “flushability” representation (or either of the alleged characteristics and disintegration representations) is a representation with respect to any future matter, for reasons identified by KCA which are as follows:

(1) The “flushability” representation is expressed as a representation about the characteristics of the KCFC wipes as manufactured, that is, that the wipes are suitable for flushing. The representation is not couched in conditional terms, nor as a prediction. It does not depend upon whether or not some uncertain event occurred.

(2) The fact that a consumer needs to actually use the product is hardly grounds to give the representations a futuristic quality. If that was the effect of s 4 of the ACL, then any representation made about the characteristics of goods sold in Australia, in respect of their intended use after sale, would be taken to be with respect to a future matter and the maker of the representation would be taken to have contravened the ACL absent evidence of reasonable grounds. It would substantially mischaracterise claims that something is “soluble”, “edible”, “dishwasher safe”, “water-proof” or “scratch resistant”, to describe them as predictions, forecasts or, in any substantial sense, representations as to future matters. Rather, in substance and effect, each is a statement of present fact as to the performance characteristics of the product as it has been manufactured. In the forms ending “-ble” the expression means “able to be” (dissolved or eaten or flushed as the case may be). As a matter of grammar and as a matter of substance that is an assertion in the present tense. And each such assertion is true or false whether or not the item is ever used as described. It is edible whether or not it is ever eaten. It is flushable whether or not it is ever flushed. The assertion is about the present quality of the thing.

(3) The ACCC’s submission does not reflect the intention behind s 4, or its predecessor in s 51A of the Trade Practices Act 1974 (Cth) (TPA). Allsop J traced the enactment history of this section in detail in McGrath v Australian Naturalcare Products Pty Ltd [2008] FCAFC 2; (2008) 165 FCR 230 (McGrath) at [165]-[195]. The particular mischief to which the section was directed was in overcoming the difficulty in obtaining “conclusive proof of dishonesty or recklessness from the surrounding circumstances without an admission of guilt from the defendant” in relation to statements, representations or predictions about future matters: Explanatory Memorandum, Trade Practices Amendment Bill 1986 (Cth) at [72], quoted in McGrath at [167]. Relevantly, the Explanatory Memorandum and the Senate Standing Committee for the Scrutiny of Bills both referred in this respect to the concepts of “promises”, “predictions” or “forecasts” when considering the proposed application of the section: see extracts quoted in McGrath at [167] and [169]-[170].

In our judgment., the above three authorities correctly state the law on this point.

1701 The Suitability Representation, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation were not in respect of “future matters” as they were not in the nature of a promise, forecast, prediction or other like statement about something that will only transpire in the future. They were Representations which were capable of being proven true or false when made. Moreover, statements regarding the nature, quality, character or capability of Alucobond products based upon their inherent characteristics is not a representation with respect to a future matter. The Applicants’ claim in relation to the Positive Representations as to future matters must be rejected.

9.7 Issue 12 – Failure to warn case

1702 The Applicants allege that neither of the Respondents gave appropriate warnings about Alucobond PE and Alucobond Plus. Specifically, the Applicants allege that 3A did not publicly disclose that:

(a) the products were not safe and suitable for use on all buildings for all of the Purposes (Suitability Warning) or some of the Purposes, or were only safe for some Purposes when combined with particular materials designed to resist the spread of fire (Limitation of Use Warning);

(b) the behaviour of Alucobond PE and Alucobond Plus in a fire was affected in a material way by the method of fabrication or affixation chosen (Fabrication and Affixation Warning);

(c) the aluminium coversheets did not protect the PE core from igniting in a fire, and that the products had the Material Fire Risk Properties (Fire Risk Warning);

(d) the core of Alucobond Plus could, and did at times, contain less than 70% mineral filler (Plus Composition Warning);

(e) the products had not passed fire safety test AS 1530.1 and there was a material risk that the products were not compliant with the BCA (Non-compliance Warning);

(f) alternatively, that the products were only compliant with the BCA when used on some buildings, or for some Purposes or when combined with other materials and/or technology to resist the spread of fire (Non-compliance Limitation Warning); and

(g) the products could not be used safely or in a manner compliant with the BCA without advice from a competent fire safety engineer (Fire Advice Limitation Warning).

1703 The Applicants allege that by making the Positive Representations and failing to give the alleged warnings, the Respondents engaged in conduct that was liable to mislead the public as to the nature, characteristics and suitability for purpose of Alucobond PE and Alucobond Plus in contravention of s 55 of the TPA and s 33 of the ACL.

1704 It was not in dispute between the parties that the warnings were not given.

1705 Section 55 of the TPA and s 33 of the ACL require the identification of conduct that is “liable to mislead” the public. The term “liable to mislead” is narrower than “likely to mislead”. Section 55 of the TPA and s 33 of the ACL, therefore, apply to a narrower range of conduct by requiring the Applicants to establish an “actual probability” of the audience being misled: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73 (Allsop CJ); A ustralia n C ompe t ition and C onsumer C ommis sion v Meriton Property Services Pty Ltd (2017) 350 ALR 494; [2017] FCA 1305 (Moshinsky J). In A ustrali an Competition and C onsumer C om mission v Birubi Art Pty Ltd [2018] FCA 1595 (Perry J), “liable” was regarded as meaning “more probable than not”, requiring a probability of 50% or greater.

1706 Insofar as the claim under s 55 of the TPA or s 33 of the ACL is based on the alleged failures to warn, the Applicants are required to establish that a representative member of the class to whom the conduct is directed would hold a reasonable expectation that the circumstance would be disclosed if the circumstance exists: Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; [2010] HCA 31 at [18]-[21]; H Lundbeck A/S v Sandoz Pty Ltd (2022) 276 CLR 170; [2022] HCA 4, [69].

1707 The Applicants rely upon the expert evidence in Mr Quigley’s report dated 30 April 2022 at [118]-[120]. In those paragraphs, Mr Quigley’s evidence was that he would have expected the manufacturer or suppliers of Alucobond PE to disclose a long list of matters that he had been asked to assume which essentially amount to the alleged Material Fire Risk Properties and the alleged BCA Compliance Risk Properties. Mr Quigley stated in his report at [119] that those matters relate to “critical building fire safety issues and compliance issues” which were “essential for [him] to know in the selection and specification of the material”. That evidence was, however, undermined during the course of Mr Quigley’s cross-examination where he agreed that:

(a) a prudent architect would have understood that the question of whether a material complies with the performance requirements of the BCA including as to fire risk was a question that is answered having regard to the particular use of the material and the particular building [T656.26-31], and it might, therefore, be the case that a combustible material could not be used compliantly on one type of building, but may be able to be used compliantly on another [T655.39-47 – T656.1-6];

(b) it was plain from the International Fire Classifications table in the “Vision Materialized” brochure referred to in Mr Quigley’s report, as well as the “Product Range” page that Alucobond PE, Alucobond Plus and Alucobond A2 were not identical in terms of the combustibility of their cores, contrary to what Mr Quigley had said at [67] of his report ([T657.35-47, T660.31-37];

(c) in selecting panels, he relied on the expertise of a building certifier to determine whether, in that person’s opinion, the product was non-combustible and, therefore, satisfied the DtS Provisions under the BCA [T660.41-47 – T661.1-3];

(d) Mr Quigley’s practice when specifying ACPs was to describe the product in a way that afforded flexibility: “[s]o in describing the façade in a set of DA drawings, I would talk about painted metal panels rather than an ACP, painted ACP. And that would mean that there could be some flexibility when you got down the track …” [T664.5-9]. He continued (at [T664.10-25]):

Because if you said ACP and that was included on the planning permit drawings and you subsequently wanted to change to a solid aluminium panel, you would have to go back and get an amendment to the planning approval and that is annoying and time-consuming. Now, in terms of the involvement of the building certifier, my approach has always been to get them involved as early as possible…

So things, for example, like the number and location of stairs, the size of the building, the materials we were proposing in a general sense. And as that – as our design developed and became more detailed, the building certifier would look in more detail at each of the proposals. So that by the time we got to preparing the construction drawings, I would be reasonably confident that the certifier wouldn’t have any objections to what we were proposing to do…

1708 Weighing the totality of Mr Quigley’s evidence and, in particular, his answers in cross-examination, I do not conclude that the alleged Material Fire Risk Properties and the BCA Compliance Risk Properties were matters “essential for [Mr Quigley] to know on the selection and specification of material”. The evidence discloses that Mr Quigley specified cladding at a general level and left decisions as to the fire performance to BCA certifiers and FSEs. It was to those Qualified Professionals, not Design Professionals, that disclosures as to fire performance in the brochures were relevant.

1709 I find that the Relevant Warnings (as defined in the 2FASOC) constituted matters that would have been known and understood by any competent Design Professional (and Qualified Professional). I find no reasonable Design Professional would expect the Relevant Warnings to have been made. I further find, to the extent that the materials were provided to other Qualified Professionals, including FSEs (who would be in the position of assessing the fire performance of materials for a particular building), those Qualified Professionals would not have expected the Relevant Warnings to have been made. I so find for the following reasons.

1710 Each of the Suitability, Limitation of Use and Fabrication and Affixation Warnings pleaded at 2FASOC [56], are premised on the notion that the Respondents ought to have warned Qualified Professionals that Alucobond PE and Alucobond Plus could not be used on any buildings in any manner. The expert evidence demonstrates that competent Qualified Professionals were aware that the use of ACPs was constrained by provisions of the BCA. In relation to Fire Safety Performance, the expert evidence was that:

(a) competent architects would not take it upon themselves to assess that aspect of a proposed façade system using Alucobond PE or Alucobond Plus, but would rather defer to a BCA certifier or FSE; and

(b) competent BCA certifiers and FSEs would be expected to have an awareness of BCA clause A 1.1, the fact that Alucobond PE and Alucobond Plus were combustible, and the necessity to assess the proposed use of those products as external cladding on a building having regard to its features, not because of some general “reliance” on marketing material in brochures.

1711 The Fire Risk Warning pleaded at 2FASOC [57], and [34] of the 2FAPOC, contends that neither of the Respondents disclosed adequately or at all that the aluminium cover sheets did not protect the core of the Alucobond PE or Alucobond Plus from igniting in a building fire and that the Alucobond cladding had the Material Fire Risk Properties. The expert evidence demonstrated that a competent Qualified Professional, including any reasonable BCA certifier or FSE would have obtained and analysed copies of the actual fire tests that were advertised in the brochures and made an assessment as to whether the Alucobond Products were suitable and BCA compliant for a particular building.

1712 I find on the evidence that a competent BCA certifier or FSE would not have approved the use of Alucobond PE or Alucobond Plus as a façade cladding material simply by relying on an advertising statement in the brochures that aluminium cover sheets protect the PE core without obtaining additional information about the nature and degree of protection that the aluminium cover sheets provided. The relevant experts on all sides agreed that the information that would have been relied on by FSEs when assessing the suitability or combustibility of ACPs were fire tests “properly contextualised and understood”, and that a competent FSE could be expected to obtain the test reports so as to understand the test conditions rather than rely upon marketing material contained in brochures. By way of example:

(a) in the Group 4-5 Joint Report, answer (d), the expert practising FSEs agreed that the information relied upon by FSEs when assessing the suitability or compliance of combustible ACPs for use on a building were fire tests carried out by NATA accredited bodies and, if such tests were not available, overseas fire tests “properly understood and contextualised”, as well as any available and relevant scientific papers and fire safety engineering principles generally. At answer 5(a), they said that:

…Some of the tests could support the use of a performance-based solution depending upon the circumstances. A reasonable and competent FSE would not rely upon any test results stated in the marketing material but should ask to be provided with the relevant test report and results, including certificates.

(b) Mr Kip said at [T545.11-20] that:

A reasonable and competent fire safety engineer would not usually rely upon any test results stated in the marketing material, but would interrogate publicly available information … [and then] ask [for] the relevant fire test reports.

My view of the test results and tests referred to in the marketing material is that they are just reflecting that the products have been tested to the standards that have been called up by the various building codes and not that they would necessarily support or unsupport [sic] the use of a performance solution. So if it was not Alucobond PE or Plus, but another panel, and I saw that it had been tested in the marketing material to 5113, I would jump on that and get that report in a lot of detail.

(d) And then at [T547.22-30]:

So those fire tests, as I said, I see them as reflecting what the building codes from those various countries have called up and that is all they – if I know the test or one of them, say, BS467, if I thought that was relevant, I would get the test result and start looking at how it applied to my situation and then take the data. I wouldn’t take the “Yes, it complied with that, hence I can say it complies with mine.” I would take the exposure, the amount of fire spread that it had, and then relate that to my situation and the exposures that I have in my building. So it can support performance solutions. I’m not saying that the performance solution is always going to come out positive.

When the Applicants’ counsel, Mr Roberts SC suggested to Mr Moore that he would not have used certain tests for Performance Solutions in respect of “a substantial use on a building”, Mr Moore said at [T547.32-47] that he agreed, subject to the qualification that it would, “depend upon the application, what the deviation is, how far it is …”;

(e) Mr Davis said that he did not regard marketing material from suppliers and manufacturers as “technical data”, and that he would seek the test reports and the test data [T508.24-29];

(f) during the Group 3 concurrent evidence, Professor Torero said that “anything that could affect the outcome of the test should be part of the test report” (at [T438.25-26]) and that, in developing a fire safety engineering solution for a particular building, he would ask for the test data and the videos of the fire tests referred to, so that he could extrapolate from the test properly (at [T442.29-33]; [T443.38-40]). Professor Torero was asked whether, if it were the case that a different classification was attributed to Alucobond Plus when affixed in a certain manner, he would expect to see that qualification in the marketing material. Professor Torero said, in implicit disagreement, that that was a question he would ask the manufacturer, and he would be expected to be told the answer (at [T444.5-6]).

1713 The Plus Composition Warning pleaded at 2FASOC [57A] – warning that the Alucobond Plus core could, and at times did, contain less than 70% mineral filler – cannot be maintained in circumstances where the Applicants have not proven, on the evidence, the extent and variance of mineral filler in the Alucobond Plus core during the relevant period.

1714 The Non-compliance and Non-compliance Limitation Warnings pleaded at 2FASOC [58(a)] and [58(b)] are permutations of the Suitability Warning, which amount to an asserted obligation on HVG and 3A to state what was obvious to Qualified Professionals: that Alucobond PE and Alucobond Plus could not be used on any buildings, and in any manner. The expert evidence was that Qualified Professionals such as BCA certifiers or FSEs were aware that the use of ACPs was constrained by the requirements of the BCA and was not suitable and/or safe for use on all buildings for all purposes. For this reason, there is no obligation on the Respondents to give the pleaded Non-compliance and Non-compliance Limitation Warnings.

1715 The Fire Advice Limitation Warning pleaded at 2FASOC [58(c)] is an asserted failure by the Respondents to state the obvious common-sense proposition that Qualified Professionals who propose to use Alucobond PE or Alucobond Plus in complex façade cladding systems who did not possess the knowledge or qualifications necessary to assess fire hazards needed to seek expert advice from other Qualified Professionals who did have that specialist knowledge. This allegation is premised on the notion that competent builders, architects, and building certifiers laboured under a state of ignorance about the fundamental requirements of the BCA concerning fire safety. The evidence of the expert witnesses directly contradicts that proposition.

1716 I am not satisfied that the Applicants have established that there was any obligation on the Respondents to give the relevant warnings about the use and application of Alucobond PE and Alucobond Plus. For this reason, the Applicants’ failure to warn case must be rejected.

9.8 Conclusion on misleading conduct claim

1717 The Applicants have not established on the evidence that the Respondents have contravened ss 53 and 55 of the TPA and ss 29 and 33 of the ACL. These claims must, accordingly, be dismissed.

10. CAUSATION AND LOSS

1718 I will now turn to consider the issues of causation and loss in respect of each of the consumer guarantee claim, and the misleading conduct claim, in the event my findings as to each of those claims are found to be wrong. That is, in considering these issues I am assuming the Alucobond products have been found to be not of acceptable quality and the Respondents have been found to have engaged in misleading conduct contrary to ss 29 and/or 33 of the ACL. I will refer to this as the alternate scenario. It is in that alternate scenario that I make the below findings as to what loss each of the Applicants is entitled. The below reasoning should, therefore, not be read as suggesting there is a basis to conclude the Applicants have established their claims.

1719 Causation and loss are individual issues that fall to be established by each of the Shore OC, the Five Dock OC and by each group member. They will need to each establish the loss suffered was by reason of contravention of the consumer guarantee provisions or misleading conduct.

10.1 Issues 13 and 14 – Loss and causation (consumer guarantee claim)

1720 To recover damages under s 272 of the ACL, each applicant must be an “affected person” within the meaning of that term in s 2 of the ACL. An “affected person” means “a consumer who acquires the goods” or “a person who acquires the goods from the consumer (other than for the purpose of re-supply)” or “a person who derives title to the goods through or under the consumer”.

1721 I have found that the developers were the consumers of the Alucobond products, but that the Applicants derived title through or under the developers by operation of the statutory deeming provision in the relevant strata legislation. Therefore, I have found that the Applicants are each an “affected person”.

1722 I have found that the Applicants have not established either the consumer guarantee claim nor the misleading conduct claim. However, I turn now to consider, if I am wrong in relation to either or both of those claims, whether any loss is recoverable in respect of each of the Shore OC’s and the Five Dock OC’s individual claims.

1723 It is necessary for each applicant to prove that the loss it claims was suffered “because of” the failure to comply with the consumer guarantee and that it was reasonably foreseeable that the applicant would suffer such loss as a result of such failure. As Edelman J said in Williams at 104 this means the loss-based remedy in s 272(1)(b) “thus [contains] at least two important limits: a causal limit (the failure to comply with the guarantee must cause the loss) and a remoteness limit (the loss or damage must be reasonably foreseeable)”.

1724 Section 272(1)(b) of the ACL provides:

an affected person in relation to goods is entitled to recover damages for … any loss or damage suffered by the affected person because of a failure to comply with the guarantee to which the action relates if it was reasonably foreseeable that the affected person would suffer such loss or damage as a result of such a failure.

(Emphasis added).

1725 Section 272(1)(a) relates to reduction in value damages which the Applicants are not seeking.

10.1.1 Loss or damage and reasonable foreseeability

1726 In Capic (First Instance), Perram J held that s 272(1)(b) resembles the second component of compensatory damages available at common law for breach of contract (s 272(1)(a) resembling the first): at [891]. Perram J referred to Edelman J’s analysis in Moore v Scenic Tours Pty Ltd (2020) 268 CLR 326; [2020] HCA 17 at [63]-[67] in respect of the similarly worded s 267(3) and (4) of the ACL, where Edelman J said that the two components of compensatory damage for breach of contract (being compensation (1) directly for performance interest and (2) for consequential loss) are necessary to restore the injured party to the position they would have been in if the breach had not occurred: at [63]. Edelman J said at [63] and [67] that ss 267(3) and (4) provide separately for each component and, by reference to Hadley v Baxendale, that the consequential loss contained in s 267(4):

[A]llows for recovery of further loss or damage for a relevant failure to comply with a guarantee as provided in s 267(1) “if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure”. The assumption of all the parties to this litigation has been that the damages recoverable under s 267(4) for non-economic loss are governed by the same principles as common law damages for breach of contract.

1727 Applying this reasoning, Perram J held that s 272(1)(b) is referable to the second component of common law damages for breach of contract, being consequential loss, which is “bounded in the same manner as at common law by the second limb of the rule in Hadley v Baxendale ”: see also Williams v Toyota Motor Corp Australia Ltd (Initial Trial) [2022] FCA 344 at 466. Edelman J also said in Williams, at [110] that, “the remedies against manufacturers under Div 2 of Pt 5-4 of the Australian Consumer Law, for breach of the guarantee in s 54, follow the same broad pattern as the remedies against suppliers in Div 1”.

1728 The second limb of the rule in Hadley v Baxendale, is of course, that consequential loss is recoverable for breach of contract, so far as the loss may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach. 3A submits, and I accept, that adapting this test to the statutory cause of action in s 272(1)(b), the relevant question is whether the loss may reasonably be supposed to have been in the contemplation of both parties at the time of supply as the probable result of the goods failing to comply with the statutory guarantee.

1729 It should be noted that, as the Full Court observed in Toyota, “ the authorities on statutory remedy provisions establish that it is wrong to approach such provisions by beginning with general law analogies (such as damages for breach of contract)”, and referred specifically to the High Court’s unanimous decision in Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388; [2004] HCA 3 at [44] in the context of remedies under Pt VI of the TPA (Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ). However, as Edelman J said in Williams:

[94] Although the remedies in Pt 5-4 of the Australian Consumer Law do not precisely replicate the common law model of damages for breach of contract, the basic architecture concerning breach and remedies is the same, as was intended.

…

[104] [L]oss-based remedies to rectify the consequences of the breach (“consequential loss”) are necessarily assessed by reference to facts that are proved to exist at any time from the failure to comply with the guarantee until the time of judgment. It has been held in this Court that the damages award in such cases follows the “universal” rule “that a plaintiff cannot recover more than he or she has lost”. A loss involves any “adverse effect experienced by the plaintiff either on their mind, on the way they conduct their business or live their life, or on their financial position”.

(Citations omitted).

1730 I consider below the submissions of 3A in detail, which HVG generally joins with. However, I note that HVG’s primary position in its written submissions is that the Applicants have failed to establish that Alucobond products were not of acceptable/merchantable quality (because HVG contends the issue is really one of the improper use of the Alucobond products, not any inherent properties of the goods), and therefore the Applicants have failed to establish any loss because of the non-compliance with the statutory guarantee.

10.1.2 Shore Building – Causation and reasonable foreseeability

1731 In respect of the Shore Building, the Applicants’ claim is for the cost of work done to the building to replace the cladding and other costs such as increases in insurance premiums. The total claimed by the Shore OC is $591,644.78, consisting of:

(a) $9,328 in respect of building safety assessments and reports

(b) $451,979 in respect of the removal and disposal of Alucobond PE, and the purchase and installation of replacement cladding;

(d) $113,704.92 in respect of pre-judgment interest.

1732 The evidence as to the costs incurred by the Shore OC in undertaking the cladding replacement work is as follows:

(a) invoice issued by Core Project Consulting: $528 (incl GST);

(b) invoice issued by Defire: $8,800 (incl GST); and

1733 If (contrary to my findings above) a failure to comply with the acceptable quality guarantee is established, 3A does not object to the quantum of the Core Project Consulting invoice. 3A also accepts that the costs of the Defire report were incurred because of a failure to comply with the guarantee and were reasonably foreseeable.

1734 In respect of the Restorial invoice, I have discussed Mr Abbott’s evidence as to the reasonableness of that invoice at [672 ]-[675 ] of these reasons. Mr Abbott found the quantum of the Restorial invoice, $451,979 (incl GST) to be reasonable. No challenge was made to this evidence, and I have accepted that evidence.

1735 However, 3A does not accept that the invoices from Restorial were suffered ‘because of’ any failure to comply with the acceptable quality guarantee. Alternatively, 3A submits the loss was not reasonably foreseeable. This submission is based on a contention by 3A that the removal work undertaken by Restorial was due to the building rectification order issued by Bayside Council, requiring the replacement of the Alucobond PE, and that this building notice was not a result of any failure to comply with the statutory guarantee or alternatively was not a reasonably foreseeable consequence of any such failure.

1736 The Shore OC submits that the banning of ACPs with a core of more than 30% PE by mass in certain situations under the BPS Act, along with the related legislative history and explanatory materials make perfectly clear that the product ban was introduced, and the compulsory rectification notice was issued by Bayside Council, because Alucobond PE was hazardous – which the Shore OC submits is why those ACPs did not comply with the statutory guarantee. The Shore OC submits that such an outcome was reasonably foreseeable in the context of dangerous building products.

1737 Section 9 of the BPS Act empowers the Commissioner for Fair Trading to impose a Building Product Use Ban that prohibits the use of a specified building product in a building only “if satisfied on reasonable grounds that the use is unsafe”. From 15 August 2018, the Commissioner for Fair Trading issued a notice under s 9(1) of the BPS Act, banning the use of ACPs with a core comprised of greater than 30% PE by mass, in certain situations. It is useful to set out the terms of the ban, which are as follows:

I, Rosemary Ann Webb, Commissioner for Fair Trading, Department of Finance, Services and Innovation:

PROHIBIT the use of aluminium composite panels (ACP) with a core comprised of greater than 30 per cent polyethylene (PE) by mass ('the building product') in any external cladding, external wall, external insulation, façade or rendered finish in:

• Class 2, 3 and 9 buildings with a rise in storeys of three or more and Class 5, 6, 7 and 8 buildings with a rise in storeys of four or more (Type A construction as defined in the Building Code of Australia); and

• Class 2, 3 and 9 buildings with a rise in storeys of two or more and Class 5, 6, 7 and 8 buildings with a rise in storeys of three or more (Type B construction as defined in the Building Code of Australia),

subject to the following exceptions:

a) the building product is not deemed combustible by successfully passing a test in accordance with Australian Standard 1530.1-1994 'Methods for fire tests on building materials, components and structures' (AS 1530.1);

b) the building product and proposed external wall assembly has successfully passed a test for both the EW (external wall fire spread) and BB (building-to-building fire spread) classifications in accordance with Australian Standard 5113 'Fire Propagation testing and classification of external walls of buildings' (AS 5113) and the proponent of the use of the building product tested to AS 5113 documents by statutory declaration that the building product will be installed in a manner identical to the tested prototype wall assembly or façade,

c) the AS 1530.1 or AS 5113 test results to be relied upon to except a building product from the ban are produced by an Accredited Testing Laboratory, and describe the methods and conditions of the test and the form of construction of the tested building product or prototype wall assembly or façade, and are dated on or after 1 July 2017.

1738 The Shore Building is a Type A building and, therefore, clearly comes within the terms of the ban, unless one of the relevant exceptions apply. The expert evidence was clear that Alucobond PE is combustible, and therefore, would not pass AS 1530.1. Alucobond PE was never tested under AS 5113. So, on the face of the ban, no exception applies to the Shore Building.

1739 The notice set out the Commissioner’s reasons for determining that the use of ACPs in the banned manner was unsafe. In her reasons, the Commissioner noted:

Cladding, including ACP [sic] with a PE core of some proportion, is often used for the purposes of aesthetics to act as a cover for part or all of external walls of a building. In the event of a fire, the use of ACP with a PE core on a multi storey building can significantly increase the amount of energy that is released by the cladding and contribute to the rapid spread of fire.

…

A ban directed only to ACP with a core comprised of greater than 30 per cent PE targets the impact of the product ban and focuses regulatory intervention on the types of ACP panels that are most likely to pose a safety risk. This threshold aligns with the FR European standard which is considered the benchmark for an ACP product to be of low flammability.

…

At present, the NCC is not sufficient to regulate building products and cannot be relied on in isolation to address the safety risks associated with the use of ACP with a core comprised of greater than 30 per cent PE by mass.

(Emphasis added).

1740 The Shore OC submits that this description corresponds precisely to at least one of the Shore OC’s contended reasons why Alucobond PE panels fail the test for acceptable quality under s 54 of the ACL.

1741 The Shore OC submits that as a direct result of this ban, it was issued with a building rectification order by Bayside Council requiring the replacement of the Alucobond PE. This, the Shore OC submits, was a consequence directly caused by the unacceptability of the Alucobond PE product at the time it was installed on the Shore Building. As a consequence, the Shore OC seeks by way of damages, an amount to compensate it for the cost of removing the cladding, remediating the building, and purchasing and affixing a non-combustible alternative.

1742 The Shore OC submits that the loss and damage suffered by it was reasonably foreseeable. It submits that upon the supply of non-compliant building materials that carried the Material Fire Risks, such as Alucobond PE, to consumers, the natural and foreseeable loss they will suffer is that, once the qualities are discovered, after being used in a building, the consumer will be required to remediate their building by removing and replacing those products. The Shore OC submits that this is so whether the immediate impetus is a regulatory requirement to take such action, or a self-help measure to remove the risky product that endangers the buildings and its occupants. It submits that the risk that insurance premiums will be increased by the presence of the hazardous cladding is equally foreseeable.

1743 The Shore OC submits that 3A’s contention that it was the building notice and not the statutory guarantee non-compliance which caused this head of loss sets up a false dichotomy. Rather, the Shore OC says that removal and replacement of combustible cladding with a non-combustible alternative is the natural and obviously foreseeable consequence of supplying goods that are unsafe. The introduction of the product ban and the product ban itself was a reflection of the need to take action because goods had been supplied, and used, which were unsafe, rather than some extraneous and independent cause of the cladding needing to be removed.

1744 The Respondents submit that it was the inappropriate use of combustible cladding such as Alucobond PE, rather than its inherent characteristics, that precipitated the introduction of the BPS Act and, in turn, the ban. The Respondents submit that it was the inappropriate use of Alucobond PE on the Shore Building and not the alleged Material Fire Risk Properties that brought about the circumstance whereby Bayside Council was granted the power to order the Shore OC to remove the cladding and was prompted to exercise that power.

1745 I am satisfied on the evidence that the proximate cause of the loss constituted by the cost to remove and replace the cladding on the Shore Building was the action by Bayside Council in issuing the direction. To succeed the Shore OC must, in respect of this head of loss, prove that Bayside Council issued the direction because the Alucobond PE was not of acceptable quality and that it was reasonably foreseeable that the council would do so: s 272(1)(b) ACL.

1746 There was no evidence that Bayside Council issued that direction because the Alucobond PE was not of acceptable quality as pleaded. No one from Bayside Council was called to give evidence, notwithstanding that on 17 September 2018, the Bayside Council undertook an inspection of the ACPs installed on the Shore Building. There is limited documentary evidence relating to the Bayside Council direction.

1747 On 18 September 2018, the Bayside Council sent an email to members of the Shore OC strata committee advising that: (a) Alucobond PE, and not Alucobond Plus, had been installed; and (b) that Alucobond PE cladding “has the potential to facilitate the spread of fire between floors and between units, therefore replacement of the installed cladding with a non-combustible material will be required”.

1748 On 7 March 2019, the Bayside Council sent a notice of proposed fire order and building product rectification order, which included the following:

Bayside Council is in receipt of correspondence that indicates that the Aluminium Composite Panelling (ACP) installed on the subject premises is a product that contains a core material that is greater than 30% Polyethylene (PE) and is therefore a Banned Product pursuant to the Building Products Safety Act 2017. Such products cause an unreasonable risk to the spread of fire around a building.

Accordingly, Bayside Council intends to give you the attached Fire Order, in accordance with Section 9.34 & Schedule 5 of the Environmental Planning & Assessment Act, 1979 (the " Act ") and Section 20 of the Building Products Safety Act 2017, which will require you to do the things specified in the proposed Order, within the period specified in the proposed Order.

…

(Emphasis in the original).

1749 On 29 May 2019, the Bayside Council sent the Rectification Order, which included the reasons which are set out in paragraph [73 ] of these reasons and are, for convenience, repeated below:

2. Such products cause an unreasonable risk to the spread of fire around a building and therefore give rise to a risk of loss of life or damage to property from fire.

3. The subject building is an 'affected building' under the Building Products Act (a building is an 'affected building' if a building product the subject of a building product use ban has been used in the building for a use that is prohibited by the building product use ban.

4. Provisions for fire safety or fire safety awareness are not adequate to prevent the spread of fire or ensure or promote the safety of persons in the event of fire.

5. To improve the current level of fire safety at the premises.

1750 I am satisfied that the notice was issued because the Alucobond PE on the Shore Building was a banned product within the meaning of BPS Act. However, I am not satisfied that the notice under the BPS Act was issued because ACPS, including Alucobond PE, were and are not of acceptable quality, in the manner pleaded by the Applicants, for the reasons that follow – even assuming, contrary to my findings, that Alucobond PE is of unacceptable quality.

1751 The explanatory note to the BPS Act explained that it was introduced “to prevent the unsafe use of building products”, “to identify buildings in which building products have been used in a way that is prohibited” and to enable councils and other enforcement authorities to “require the use …to be rectified” (emphasis added, Explanatory Note, BPS Act). The Commissioner was empowered under s 9 of the BPS Act to impose a building product use ban only if “satisfied on reasonable grounds that the use is unsafe” (emphasis added).

1752 Consistent with the grant of power, the reasons stated by the Commissioner for issuing the product ban included that combustible cladding was “often used for the purposes of aesthetics to act as a cover for…external walls of a building” and that “misapplication of or non-compliance with the performance requirements of the [BCA] raises a significant risk and concern for the safety of buildings and the community” and that “a genuine concern exists that the [BCA] cannot be relied on in isolation to address the safety risks associated with the use of ACP with a core comprised of greater than 30%”.

1753 Significantly, the product ban was expressed to only apply in respect of particular uses of the product and was subject to various exceptions relating to the particular circumstances of use, such as use in accordance with a configuration tested under AS 5113. I accept the Respondents’ submission that these matters make it plain that it was the inappropriate use of combustible cladding rather than its inherent characteristics that precipitated the introduction of the BPS Act and, in turn, the ban. It follows that, in my view, it was the inappropriate use of ACPs and not the alleged Material Fire Risk Properties of the Alucobond products that brought about the circumstance whereby the council was granted the power to order the Shore OC to remove the cladding and was prompted to exercise that power.

1754 Therefore, the Shore OC has not proved that Bayside Council issued the direction because the Alucobond PE was not of acceptable quality.

1755 The Shore OC has also not proved that the making of the order was reasonably foreseeable at the time the Alucobond PE products were supplied. Such an order cannot reasonably be supposed to have been in the contemplation of the parties at the time of supply as a probable result of the Alucobond PE panels failing to comply with the statutory guarantee.

1756 The Shore OC also seeks to recover the cost of increased insurance premiums during the period that the cladding needed to be replaced. The Shore OC points to the evidence of Mr Sheils that it was the insurer’s concern about the Material Fire Risk Properties of the Alucobond PE that led to the increase in insurance premiums. Those premiums only decreased to normal levels once the cladding was removed. The Shore OC submits this was a foreseeable consequence of the non-acceptability of the Alucobond PE.

1757 The amount claimed is $16,632.86 for excess insurance premiums paid from 31 August 2018 to 31 August 2019 and 31 August 2019 to 31 August 2020.

1758 3A submits that this amount is calculated by comparing the amount paid by way of premiums for the period 1 August 2018 to 31 August 2019 to the previous year, with the increase being entirely attributed to the presence of cladding. The same process is repeated in respect of the period 31 August 2019 to 31 August 2020. 3A submits this logic is flawed because there is no basis to infer that the increase in either or both 2019 and 2020 is entirely attributable to the insurer becoming aware of the presence of cladding.

1759 3A refers to the range of quotes received by the Shore OC from various insurers as a further basis on which to discount the simplistic calculation method used by the Shore OC. 3A submits that the evidence does not establish on the balance of probabilities the true quantum of any increase attributable to the presence of the cladding.

1760 3A submits that in the absence of comprehensive evidence as to the premiums being offered by the market at the relevant times with and without cladding, the court cannot make any findings of fact as to the impact of the presence of cladding on premiums paid for the Shore Building, and the Shore OC have not proved that the $16,632.86 claimed was attributable to the presence of the cladding (or that any amount was so attributable).

1761 The Shore OC framed the parties’ differing position with respect to the recoverability of insurance premiums as one of insufficiency of proof as to the precise correlation between the increased premiums and the cladding. The Shore OC, in oral closings, accepted the evidence did not sufficiently differentiate between the general market increase in insurance premiums and the increase attributable to the cladding. The Shore OC submitted the solution is for the Court to apply a modest discount to the amount claimed.

1762 The key evidence referred to by the parties was an email from the Shore OC strata manager dated 17 August 2018, which said:

[I]n light of the recent cladding update onsite, the current insurer … has declined renewing the schemes policy[.]

Having obtained the attached report from Core Project, we raised the concern of cladding being present onsite to the existing insurer early this year, and their reply to not renew has only just been received now when renewal is due.

The broker accordingly tendered the policy and has received the attached tow [sic] option from CHU & SCI insurance for the committee’s review…

…

CHU will cover the building in full however please note page 3 . comments [sic] on a $5000.00 excess applicable for damage caused by fire in a resultant claim associated to external cladding.

SCI - have not provided a cover in the case damage caused by fire in a resultant claim associated to external cladding.

Explaining the above CHU have quoted $17,743.26 for the annual premium.

The current premium with CSI was $9,288.66 however, they will not renew.

Explaining the above – insurance premiums were expected to rise over the coming year – some cases by 20 to 25%[.]

With the added risk of cladding being identified on site, the increase has way exceeded the anticipated rise.

We strongly recommend the committee to renew with CHU and ensure the scheme is covered in full.

Moving forward, a risk assessment will be proposed. Either to confirm the cladding is or is not combustible or any alternative solutions in order to help reduce any risk [sic] increase in premium [sic].

1763 The Shore OC, referring to the above email, submitted that the Court could discount the amount claimed ($16,632.86) by 20-25%. 3A submits this amount refers only to a general expectation that insurance premiums would rise in some cases by 20-25%. 3A submits that that figure is not specific to the Shore Building and is a belief on the part of the strata manager (who was not called to give evidence) that with the added risk of the cladding, the increases in the quotes exceeded, by some way, the anticipated rise. 3A further submits that the amount of the Shore Building premium absent the cladding is not known and cannot be reliably estimated based on the “thin veneer of evidence”: [T1068.29]. 3A submits that as the Shore OC could properly have proved any loss it suffered in respect of insurance premiums, that aspect of its claim should be rejected.

1764 By way of response to 3A’s submission that the Shore OC ought to have called an expert, the Shore OC submits that this disregards the issue of proportionality. The Shore OC submits the difference between what was sought to be demonstrated by the evidence (that is mainly, the above email) and what might have been demonstrated by the expert evidence, is small. Bearing in mind that loss is an individual issue, the Shore OC submits this would have been a disproportionately expensive exercise. The Shore OC further submits that any expert evidence on this topic, while better than the inferential propositions advanced, would itself have been an exercise of retrospective approximation; the Shore OC are not in a position of being able to prove the true precise counterfactual. The Shore OC referred to Commonwealth v Amann (1991) 174 CLR 64; [1991] HCA 54 and submitted the Court should do the best it can to estimate the loss, the sort of loss having been identified and there being a rational basis from the available evidence, to discern an increase in insurance premiums which correlates to the cladding.

1765 I am satisfied, in the alternate scenario of the Alucobond PE being not of acceptable quality, that the increases in the insurance premiums are recoverable by the Shore OC from the Respondents. I am satisfied that the increases in the insurance premiums were caused, to some degree, by the Alucobond PE affixed to the Shore Building and the associated fire risk. I am satisfied that in the alternate scenario, that would have been caused by the unacceptable quality of the Alucobond PE and that such a result would have been reasonably foreseeable at the time of supply – that is it would have been in the contemplation of the parties that if the Alucobond PE did not comply with the statutory guarantee, due to the Material Fire Risk Properties, the Shore OC would be subject to an increase in insurance premiums.

1766 I accept the Respondents contention, as conceded by the Applicants, that the Shore OC has not established to what degree the increase was due to the cladding, as opposed to some other extraneous cause, namely the general rise in insurance premiums. However, I am not persuaded that is a sufficient reason to disregard the claim.

1767 In Bed Bath ‘N’ Table Pty Ltd v Global Retail Brands Australia Pty Ltd (No 3) [2024] FCA 226 at [75], Rofe J said:

Section 37M(2)(e) [of the F ederal C ourt of Australia Act 1976 (Cth)] provides that one of the objectives of s 37M is “the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute”. In my view, that objective requires that the costs of establishing a certain fact or point of law in a proceeding is proportionate to the importance of that point in ultimately obtaining the relief sought in the proceeding.

1768 Respectfully, I agree with her Honour. The total claimed by the Shore OC in respect of insurance premium increases is $16,632.86. I accept that the cost of establishing, by expert evidence, the percentage of the insurance premium increases which is referable to the fire risk associated with the Alucobond PE cladding would not have been proportionate to the amount claimed. Particularly in circumstances where, as the Shore OC submits, any such evidence would not have been precise, and would have amounted to a retrospective approximation. I am satisfied, applying the principles from Ama n n that the sort of loss has been identified (insurance premium increases) and there is a rational basis from the available evidence, to discern a correlation between the insurance premium increase and the existence of the Alucobond PE cladding.

1769 Therefore, if the Applicants are found, contrary to my findings, to have established the consumer guarantee claim, I would find that the insurance premium increases are recoverable, with a discount applied of 20%, which I note is not an insignificant amount, to account for the other factors which have led to the increases in the insurance premiums.

10.1.3 Five Dock Building – Causation and reasonable foreseeability

1770 The Five Dock Building was fitted with Alucobond Plus cladding. At the time of the trial, that cladding remained on the building. The Five Dock OC claims in total $391,804.31. This consists of:

(a) $339,705.70 in respect of the cost of replacing all the Alucobond Plus panels with a non-combustible alternative;

(b) $49,036.85 in respect of excess insurance premiums; and

1771 Mr Filippopoulos, the chairperson of the Five Dock OC gave evidence that as at May 2021, he understood that the cladding installed on the Five Dock Building had a core containing less than 30% PE and at a meeting with the lot owners of the Five Dock Building, it was agreed, even though the ACPs were not the subject of the product ban, that as the cladding wrapped into windows, balconies and was affixed in a continuous fashion, it presented a danger and no certifier would certify the building with the cladding affixed. Mr Filippopoulos deposed that as a result, it was decided that the Five Dock OC would obtain three quotes with a view to removing the cladding given the danger, impact on possible sales, and price of insurance. The Five Dock OC submits that it follows from Mr Filippopoulos’ evidence that the cost of reinstatement of the building is a cost that directly follows from the owners’ discovery of the unacceptability of the Alucobond Plus product.

1772 The issue in relation to causation for the Five Dock Building is: what is the appropriate remediation to address the failure (notwithstanding and contrary to my findings above) to comply with the consumer guarantee?

1773 “In cases where a claimant is entitled to have a building erected on its land in accordance with the contract and the plans and specifications which formed part of it, the prima facie measure of damages is the cost of reinstatement, not the diminution in value of the defective building”: Owners SP 92450 v JKN Para 1 Pty Ltd [2023] NSWCA 114 at 68, relying on Bellgrove v Eldridge (1954) 90 CLR 613 at 617 (Dixon CJ, Webb and Taylor JJ). In this context, damages for “reinstatement” means: “the amount required to rectify the defects complained of and so give [her] the equivalent of a building on [her] land which is substantially in accordance with the contract”: Bel l grove at 617. The rule is subject to a qualification namely that “not only must the work being undertaken be necessary to produce conformity, but that also it must be a reasonable course to adopt”: at 618.

1774 In its written submissions, 3A put the question as: what is the “reasonable” scope for rectification to address the failure of the Alucobond Plus cladding on the Five Dock Building to comply with the consumer guarantee? That is not the correct question to ask. If, contrary to my findings, the Applicants are found to have established the consumer guarantee claim, then as the Respondents seem to accept, the Five Dock OC would prima facie be entitled to reinstatement damages. In that case, it is only if the Respondents prove that reinstatement is unreasonable, by reference to an alternative solution, that the Five Dock OC would instead only be entitled to damages in respect of that alternative solution. It is not that the Court considers which of the alternatives is more reasonable. That is plain from the following principles which can be drawn from JKN Para 1 at [71]-[81], which can be summarised as follows:

(a) the burden of proof for establishing loss lies on the claimant (the Five Dock OC): at [71];

(b) by contrast, the party in breach (the Respondents) have the onus of displacing the prima facie rule for assessing damages as the cost of reinstatement: at [71];

(c) the onus is at least an evidentiary onus in the sense referred to by Barwick CJ, Kitto and Taylor JJ in Purkess v Crittenden (1965) 114 CLR 164 at 168; [1965] HCA 34 when speaking of the “burden of proof in the secondary sense” of introducing evidence: at [72].

(d) such evidence could include adducing evidence of functional equivalence of an alternative solution, such that reinstatement is unnecessary: at [73];

(e) the High Court has expressed reluctance to confine a plaintiff to a “a doubtful remedy”, in contrast to a case where it is clear that the “expenditure imposed on the defendant is disproportionate to any benefit to the plaintiff in terms of the vindication of the plaintiff’s right to recover its actual loss from the defendant”: at [75], discussing Kirby v Coote [2006] QCA 61 at 52, referring to Bellgrove;

(f) an assessment of what is reasonable in a particular case is not to be measured in purely economic terms. Personal preferences of a subjective nature are not irrelevant when choosing the appropriate measure of damage: This is especially so if the plaintiff’s “predelictions” [sic]…are not excessive or extravagant (citations omitted): at [78], quoting Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (2008) 166 FCR 494; [2008] FCAFC 38 (Finkelstein and Gordon JJ), decision affirmed on appeal in Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272; [2009] HCA 8; and

(g) the qualification in Bellgrove indicates that “unreasonableness” is only to be satisfied by “fairly exceptional circumstances”: at [79], discussing Tabcorp Holdings at 17.

1775 Keane JA, in Kirby v Coote at [58]-[59] said the following, which is a helpful illustration of the above principles:

[T]he respondent’s house is a house which is affected by a degree of instability which would not have been present had the first appellant properly discharged his duty … because the respondents’ damages are assessed ‘once and for all’ the law must be astute to ensure that the measure of damages accurately reflects the restoration of the respondents to the position they would have been in had the appellants not failed in their duty. The respondents should recover the amount of damages necessary to enable them to own a house free of risk so far as its stability was concerned. As McLure JA, with whom Steytler P and Wheeler JA agreed, said in J-Corp Pty Ltd v Gilmour [[2005] WASCA 136 at [47]]: "Reasonableness does not require the respondent to carry those risks."

1776 Reinstatement in this case would consist of removing and replacing all of the Alucobond Plus panels and replacing them with a non-combustible alternative. The Five Dock OC’s claim is based on this alternative. It relies on the tendered expert reports of Mr Abbott estimating the likely cost to remove the entirety of the Alucobond Plus from the Five Dock Building and replace it, which I have discussed in section 5.7 of these reasons, in particular at [676 ]-[682 ]. Mr Abbott’s updated assessment of the costs that would be incurred to replace the Alucobond Plus cladding at the Five Dock Building with a non-combustible cladding in 2024 was $339,705.70 (incl GST). Mr Abbott also assessed the reasonableness of the three quotes the Five Dock OC had received from Restorial, Everest Contracting, and IClad. Mr Abbott disregarded the Restorial quote, on the basis it included obvious errors, and found that when the Everest Cladding and IClad quotes were limited to the same scope of work as that contained in Mr Abbott’s assessment, the prices were in a similar range to his estimation. The slight variation can be accounted for the quotes not including additional items which Mr Abbott had determined were necessary. There was no substantive challenge made to these conclusions, and I accept Mr Abbott’s evidence as to the quantum of replacing the Alucobond Plus on the Five Dock Building.

1777 The alternative solution is one of the Performance Solutions prepared by Mr Davis, being the removal of specific Alucobond Plus panels, which I discuss at [519 ]-[535 ] of these reasons (the Davis’ Solution). Mr Abbott assessed the likely cost of the Davis’ Solution, which I discuss at [683 ]-[697 ] of these reasons. I have found that Mr Abbott’s estimation of the Davis’ Solution, $245,588.83 (incl GST) should be discounted by $34,846.54 due to the mathematical error which Mr Abbott conceded he had made in his calculations, being $210,742.29. Mr Abbott also included estimates of $36,520 (incl GST) for “project management of fire engineering activities” – with the actual cost of an FSE performing the work being an additional cost in the range of $10,000 for final inspection and report, to $100,000 for a full-time service and reporting during the works. Apart from the mathematical error which I have dealt with, there was no substantive challenge to Mr Abbott’s assessment.

1778 The Five Dock OC submits the Davis’ Solution does not rise to the level of establishing it is entirely unreasonable for the Five Dock OC to proceed with the plan it actually wants to proceed with, for the following reasons:

(a) the retrospective performance solutions designed by Mr Davis do not adequately assess the fire hazards presented by Alucobond Plus or provide any comfort that the relevant authorities would accept the cladding as compliant (particularly given that ACPs with a core of more than 30% PE have now been banned). Mr Davis accepted that there is no guarantee that a performance solution such as the ones that he prepared would be accepted and approved. Reasonableness does not require the Five Dock OC to carry those risks: JK N Par a 1 at [76], quoting Keane JA in Kirby v Coote. It is, therefore, reasonable for the Five Dock OC to prefer to replace the entire façade and remove the risk entirely;

(b) Mr Abbott has quantified the cost of implementing those measures for the Five Dock Building and the difference between Mr Abbott’s assessment of the cost of replacing all the panels and the Davis’ Solution is around $129,000, before accounting for the additional costs of $36,520 (incl GST) for “project management of fire engineering activities” and the costs of an FSE undertaking the work which could be in the range of $10,000 to $100,000;

(c) the Respondents have not demonstrated that it was unreasonable for the Five Dock OC not to have incurred the cost of retaining an FSE to investigate the possibility of such a bespoke solution, in circumstances where the outcome of that exercise would have been unpredictable and may have involved wasted time and money; and

(d) the Davis’ Solution has aesthetic disadvantages because it would have the effect of changing the design and visual façade of the building, by interspersing Alucobond panels with other non-identical panels; effectively removing a patchwork of panels from various sections and having to replace them, presumably, with something else which may or may not be of the same appearance and may or may not be of the same aesthetic standard.

1779 The Five Dock OC submits that none of the following issues have been properly addressed, and, therefore, the Respondents have established, at best, that there is a fledgling plan that might be considered suitable by the fire authorities, that might end up costing less, and may or may not be a suitably attractive solution as the one the Five Dock OC wants.

1780 3A submits that the Davis’ Solution reflects the loss that the Five Dock OC has suffered “because of” the failure to comply with the statutory guarantee, on the basis that the use of “because of” in that section plainly seeks to put the affected person in the position he or she would have occupied had the guarantee been complied with. 3A submits the “reasonable reinstatement” test from cases such as JKN Para 1 and Bellgrove are aimed at the same objective. 3A submits that had the guarantee been complied with, the Five Dock OC would have had cladding on its building that was fit for purpose, which it says the expert evidence establishes by reference to BCA requirements, means only that the fire risk be an acceptable level, as opposed to complete eradication of fire risk.

1781 In response to the Five Dock OC’s submission as to the lack of assurance as to approval of Mr Davis’ solution, 3A submits that that fails to appreciate the special circumstances of the proceeding which precluded Mr Davis from consulting with, for example, the fire brigade.

1782 3A says the Davis’ Solution is materially cheaper, on Mr Abbott’s evidence, than the wholesale replacement of the cladding ($210,742 versus $339,705). 3A submits that replacing the entirety of the cladding when this alternative is available and has been approved by a qualified FSE, being Mr Davis, would not be a step taken “because of” the failure to comply with the guarantee. Rather, 3A submits such a decision would amount to a decision to take unnecessary steps which breaks the causal nexus.

1783 3A submits the only loss that was reasonably foreseeable was the cost of addressing the consequences of the Alucobond Plus panels not being fit for purpose, and otherwise complying with the guarantee, and that Mr Davis’ evidence establishes that only some of the Alucobond Plus panels need to be removed to satisfactorily address those consequences. Therefore, further and alternatively to its contention that the loss was not suffered “because of” the failure to comply with the guarantee, 3A submits it was not reasonably foreseeable (for the purposes of s 272(1)(b)) that the Five Dock OC would incur the “unnecessary expense” in addressing the consequences of non-compliance with the consumer guarantee.

1784 I accept the characterisation by counsel for the Applicants of the Davis Solution as suggesting the Five Dock OC undertake a significant amount of remediation work at less cost, but not a radically lower cost.

1785 In relation to the aesthetic difference, I do not accept 3A’s submission that there is no evidence about what that aesthetic differences there might be and that colours between the different types of panelling can presumably be matched. That submission misses the point. As JKN Para 1 makes clear, the evidentiary onus is on the Respondents to establish that reinstatement damages are unreasonable.

1786 I accept that the Respondents have not established that removal of all of the Alucobond Plus panels would be unreasonable in the alternate scenario where the Alucobond Plus panels are found to be of unacceptable quality. If it is accepted that the Alucobond Plus has the Material Fire Risk Properties, and/or the other pleaded risks giving rise to the Alucobond Plus being of unacceptable quality, the Court would be slow to make the Five Dock OC accept an alternative to reinstatement which still leaves the Five Dock OC with a level of risk arising from the Alucobond Plus still on the building. This finding should not be read as undermining my acceptance of Mr Davis’ evidence as to the ability of Alucobond Plus (and indeed Alucobond PE) to be affixed to a building, including the Five Dock OC, in a compliant and safe manner. This finding is solely concerned with, in the alternate scenario where Alucobond Plus is found to be of unacceptable quality, what is the loss and damage which the Five Dock OC is entitled to recover.

1787 The Five Dock OC also seeks to recover the cost of increases in insurance premiums. Mr Filippopoulos gave evidence of the amounts the Five Dock OC has incurred by way of increases in insurance premiums. Mr Filippopoulos deposed that the Five Dock OC has held residential strata insurance through CHU Underwriting Agencies Pty Ltd, on behalf of QBE Insurance (Australia) Limited since January 2019. The table below sets out the insurance premiums paid between 2019 and 2025:

23 January 2020 | $7,000,000 | $8,662.55 |
| 23 January2020 –

23 January 2021 | $7,000,000 | $9,795.41 |
| 23 January 2021 –

23 January 2022 | $7,000,000

(increased to $10,000,000 from 23 July 2021) | $14,097.72

(being $12,239.57 December from the invoice dated 23 July 252 2021) |
| 23 January 2022 –

23 January 2023 | $10,000,000 | $18,904.68 |
| 23 January 2023 –

22 July 2023 | $10,000,000 | $11,875.86 |
| 22 July 2023 –

23 January 2024 | $10,000,000 | 12,853.60 |
| 23 January 2024 –

23 July 2024 | $10,000,000 | $13,593.81 |
| 23 July 2024 –

23 January 2025 | $10,500,000 | $16,892.82 |
1788 The total amount claimed in respect of excess insurance premiums is $49,036.85.

1789 On 29 October 2020, Dalton Strata, on behalf of the Five Dock OC, provided the Core Five Dock Report to the Five Dock OC’s insurance brokers, B AC Insurance Brokers Pty Ltd as part of a 2020 pre-renewal declaration. The Core Five Dock Report was produced by Core Project Consulting for the Five Dock OC dated 30 September 2020 which: (a) identified two samples of the cladding as containing a core of 29% PE; and (b) recommended an FSE and a certifier be engaged to assess the entire wall assembly to ascertain any risks associated with the areas clad in ACP considering the fire protection systems at the property.

1790 On 23 January 2021, BAC provided an insurance report to the Five Dock OC, which stated that: “due to the type of cladding identified on the building and the hardening insurance market, all alternate insurers approached have declined to issue terms for this year’s renewal”. The report also explained the Five Dock OC’s current insurer had applied additional policy conditions and imposed a higher excess due to the type of cladding present on the building.

1791 On 4 August 2021, BAC sent a further email saying, "If the composite cladding is removed, it may be an annual reduction in premium of around $1,500 - $2,000 and the imposed fire excesses will be removed."

1792 On 23 January 2022 BAC sent an insurance report for 2022 which noted the combustible cladding identified on the Five Dock Building, and said "due to the nature of its combustibility insurers have increased the premium rate". The report also said the premium had been impacted by the hardening of the insurance market due to “recent global catastrophes” which resulted in increases “on every policy” and “more specifically, the outstanding Waterproofing Works and Fire Certification relating to your property.” 3A submits details of the “waterproofing” issues, were not disclosed in the Five Dock OC’s evidence.

1793 The schedules of insurance cover for the periods 23 January 2021 to 23 January 2022, and 23 January 2022 to 23 January 2023 respectively stated the following:

*Fire Excess

All Damage arising directly or indirectly caused by fire resulting in any claim to the internal or external cladding materials, generally known as 'Aluminium Composite Panels' (ACP), affixed to buildings as defined under 'Policy 1 - Insured Policy a. Buildings' is subject to Fire Excess shown in the Schedule any one Event.

1794 The Fire Excess in the schedule of insurance cover for the period 23 January 2021 to 23 January 2022 is stated to be $5,000 for each and every Fire claim relating to ACP, while the Fire Excess in the schedule of insurance cover for the period 23 January 2022 to 23 January 2023 is $10,000 for each and every Fire claim.

1795 On 23 July 2024, BAC informed the Five Dock OC that the key factors causing the Five Dock Building’s heightened insurance premiums are (a) the presence of ACPs on the building, which creates an increase property and liability risk factor, and (b) the presence of a fire non-compliance issue which impacts the willingness of insurers to provide quotations.

1796 The Five Dock OC submits the above evidence makes clear that the increases in insurance premiums were a direct result of the Alucobond Plus present on the building.

1797 3A makes the same argument in respect of the insurance premiums as it did in respect of the Shore OC’s claim for insurance premiums. That is, that the Five Dock OC has not led any sufficient evidence as to the precise correlation between the increased premiums and the cladding. 3A says the claim ought to be rejected entirely.

1798 3A also refers to a further issue, which is that the Five Dock Building was also affected by numerous defects unrelated to the Alucobond Plus panels. 3A refers to an email dated 8 October 2020 from Dalton Strata (the Strata Managing Agent) to Canada Bay Council which discloses defects relating to the “mechanical air” systems, which are described as “not compliant, never installed correctly and not functioning” and “fire doors”, which are said never to have been “certified by installer”. A subsequent email from Dalton Strata on 18 December 2020 refers to “further fire service-related issues to be rectified”. 3A also refers to an email from Mr Filippopoulos dated 22 July 2024, from which it submits it is apparent from that the issues referred to in the 2020 emails have not been resolved. That email states:

The owners corporation received a fire inspection report in 2021, and have made considerable progress resolving items in the report over the last few years working with the builder, developer and private contractors. The remaining work is to do with the mechanical air balancing in the basement. We received a quotation recently from Ventrite for $75,000, and are looking into options.

1799 3A urges the Court to find that these unrelated defects contributed, to an unknown extent, to the increases in insurance premiums in 2022 to 2024.

1800 Finally, 3A submits that, in circumstances where the Five Dock OC has known about the Alucobond Plus panels on the Five Dock Building since at least 30 September 2020, any increased insurance premiums which are occasioned by the delay in attending to any necessary rectification work are not recoverable. Whilst the Five Dock OC did not make any express submissions in response to this assertion, Mr Filippoloulos’ evidence, as discussed in section 2.5.2, is that the Five Dock OC started looking into removing the cladding in mid-2021, with the primary reason for delay being difficulty in securing funding.

1801 For the same reasons that I found the Shore OC would be entitled to recover the loss caused by the increases in insurance premiums, I find that in the alternate scenario where the Applicants have established the consumer guarantee claim, the Five Dock OC would likewise be entitled to recover the loss caused by the increases in insurance premiums. However, given the additional extraneous causes of those increases which apply to the Five Dock Building, I would discount the amount claimed by 25%.

10.2 Issues 15 to 17 – Loss and causation (misleading conduct claim)

1802 Loss or damage suffered because of conduct in contravention of ss 29 or 33 of the ACL, is recoverable under s 236 of the ACL, which is as follows:

(1) If:

(a) a person (the claimant) suffers loss or damage because of the conduct of another person; and

(b) the conduct contravened a provision of Chapter 2 or 3;

the claimant may recover the amount of the loss or damage by action against that other person, or against any person involved in the contravention.

1803 The Applicants submit that to establish causation in respect of the misleading conduct claim it is unnecessary to show that the misleading conduct (notwithstanding and contrary to my findings above) was the sole cause of the loss: Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 at 14, at [60]-61. It is sufficient, in the Applicants’ submission, that the misleading conduct made some non-trivial contribution or material contribution to the decision to acquire the products, resulting in the claimant’s loss: E zy F it Engineering Group Pty L imited v Microm Nominees Pty L imited [2024] FCA 441 at 751.

1804 The Applicants submit that this is a text-book case where the Court can readily draw an inference that misleading advertising was a cause of the loss arising from the acquisition of the Alucobond products. The Applicants submit that for the following two reasons these principles support the findings of causation in the present case. The Applicants submit that if a material representation is made which is calculated to induce the representee to enter into a contract (here, to purchase Alucobond products) and that person in fact enters into the contract, there is a fair inference that the representee was induced to do so by the representation: Gould v Vaggelas (1985) 157 CLR 215 at 236, 239 (Wilson J).

1805 First, the promotion of Alucobond PE and Alucobond Plus by the making of the alleged Representations and failure to give appropriate warnings led to the widespread use of those goods throughout Australia. Had the Representations not been made, the Qualified Professionals responsible for designing, building and certifying buildings would not have used either of these goods in the way that they were in fact used. The most likely result is that a non-combustible alternative would have been specified:

1806 In the Applicants’ submission, it is unnecessary to go further and show that the particular professionals involved in the design or construction of the Shore Building or Five Dock Building specifically relied on the marketing material. The Applicants further submit that if the Respondents had been transparent about the risks associated with their products, then those products would not have been used in the way that they were used during the relevant period, including on the Shore Building or the Five Dock Building.

1807 Second, there is direct evidence that the professionals involved in the design or construction of the Shore Building and Five Dock Building specifically relied on the marketing material. The Applicants point to Mr Hatziandreou, the representative of the Shore Developers and Prestige Apartments, having met with a representative of HVG and being given the one page “Vision Materialized” brochure together with relevant fixing details by HVG and copies of AS 1350.3 Certificates. The Applicants submit that this was clear evidence of HVG conveying at least the Suitability Representation and Compliance Representation using materials approved by 3A and without providing any appropriate warnings. The Applicants submit the Court can readily infer from the email evidence that this marketing had its intended effect, as they submit Mr Hatziandreou chose to use the Alucobond PE on HVG’s recommendation.

1808 The Applicants, at [772] of their written closing submissions, submit that the cladding installer for the Five Dock Building, ACP Solutions, had HVG marketing literature setting out the results of the international fire tests conducted by 3A as well as a copy of the one-page ISO 9705 results which were provided to owner/developer, Mr Abdul-Rahman, when seeking to win the job. This appears to be an error, and should refer instead to Mr Zeitoun, a representative of the builder, Buildrite. Mr Zeitoun responded by querying whether the Alucobond Plus was non-combustible. The Applicants submit that the Court can readily infer that he was satisfied that it was, based on the Plus Fire Performance Representations conveyed by the material provided. The building was then ultimately certified as compliant based on the CodeMark Certificate that HVG had procured.

1809 The Respondents contend that to recover any damages, each of the Applicants, and, if their individual cases are reached, the group members will need to establish that the Qualified Professionals responsible for placing Alucobond PE and Alucobond Plus on their Relevant Buildings or Relevant Building Parts were in fact misled. The Respondents submit that evidence is needed sufficient to satisfy the Court on the balance of probabilities that Alucobond PE or Alucobond Plus, as the case may be, would not have been supplied but for the particular misleading conduct alleged. The Applicants’ failure to call evidence from any of the Qualified Professionals involved in either the Shore Building or the Five Dock Building precludes any finding of causation, as it is not open to decide the misleading conduct claim by looking at a brochure on the one hand, and a group member’s building on which Alucobond PE or Alucobond Plus has been inappropriately used on the other hand, and assuming that a causal link is established through visual comparison.

1810 HVG submits that the Court is required to look at the evidence “as a whole and in context” to determine whether a relevant nexus exists between the conduct complained of and the damage suffered: Reiffel v ACN 075 839 226 Ltd (2003) 132 FCR 437 at [67].

1811 HVG submits that this case is somewhat different to Gould, which involved misleading conduct in the context of a sale of business, as unlike in Gould, the causal analysis in this case involves examination of supply chains of several stages, where independent professional judgment was called for at various points in the process of design and construction of the Shore Building and the Five Dock Building. HVG submits that the Applicants ‘inferential case’ does not answer the evidence, particularly from Professor Torero, that the practice of Qualified Professionals in Australia did not reflect the requirements of the BCA. HVG contends that the Applicant’s causation theory ignores the regulatory gaps and inconsistencies, and varying degrees of professionalism (and shortcomings) displayed by Qualified Professionals during the Relevant Period, which Professor Torero identifies as factors leading to the inappropriate use of Alucobond PE/Plus. HVG submits these circumstances cannot be ignored in assessing whether the Applicant has established a sufficient causal link between the alleged misleading conduct and the non-compliant use of Alucobond PE and, therefore, the inferential case advanced by the Applicants is not sufficient to find causation in respect of the misleading conduct claim.

1812 Further, HVG submits that the Applicants’ inferential causation case elides the question of why the relevant Qualified Professionals decided to acquire Alucobond PE or Alucobond Plus, with the question of why the relevant Qualified Professionals decided to use the products in a particular way on a particular building. Therefore, the authorities relied upon by the Applicants which deal with circumstances where persons made contracts under inducement of misleading or deceptive conduct are inapposite to this case, which concerns the various uses that Qualified Professionals made of goods, not merely their purchase.

10.2.1 Shore Building - causation

1813 The Applicants have failed to call evidence from any of the Qualified Professionals involved in the design and construction of the Shore Building, namely Mr Hatziandreou (or anyone else from the Shore Developers or Prestige Apartments) V ictor R obert Bryce Lake and Associates Pty Ltd (the architect), Modernise Installations (the façade installer), or AR Building Certifiers (the certifier).

1814 As I have outlined earlier in these reasons, on 27 June 2011, Mr Hatziandreou emailed a copy of the completed architectural drawings to Mr Ben Di Giorgi (of HVG) and specified that “[e]verything referred to as prefinished metal cladding” was to be Alpolic (a different brand of ACP) or Alucobond. HVG refer to this email as substantiating that the architects, VR Lake, were responsible for the proposal of using Alucobond PE on the Shore Building.

1815 VR Lake was not called as a witness, so the particular circumstances as to if or why the architect specified Alucobond PE remain unknown.

1816 Further, as HVG submitted, the inquiry does not end with the decision to use Alucobond PE, but the specific use to which it was put on the Shore Building. As I have also discussed earlier in these reasons, on 21 July 2011, after a site meeting, HVG provided Mr Hatziandreou with a list of recommended installers, including Modernise Installations, alongside various documents and marketing material, including “Fixed Cassette” fixing methods, which was described as the “Recommended Option”. Then between 27 September 2011 and 25 May 2012, HVG supplied 130 sheets of Alucobond PE panels to Modernise Installations and Modernise Installations affixed the cladding to the Shore Building using the “cassette method”.

1817 The Court has no evidence from Mr Hatziandreou to enable an assessment of whether there was any causal link between his email correspondence with HVG and the installation of Alucobond PE on the Shore Building by Modernise Installations, in accordance with VR Lake’s design, including the decision to utilise the cassette method. There was also no evidence from AR Building Certifiers about the process it undertook to certify that the Shore Building was suitable for occupation in accordance with its classification under the BCA when it issued an Occupation Certificate on 16 August 2012.

1818 As a consequence, there is no evidence that the alleged misleading conduct was relied upon by any of the Qualified Professionals involved in the design and construction of the Shore Building. It is not sufficient for the Applicants to point to evidence establishing that certain marketing materials were provided to the Qualified Professionals involved in the design and construction of the Shore Building.

1819 The whole of the evidence does not allow for the drawing of inferences in the manner contended for by the Applicants. This is not a similar context to that in Ethicon where Katzmann J found that direct evidence was not required from the physicians that they would have passed on warnings to their patients, as “in the absence of evidence to the contrary, the Court may infer that, if the respondents had included warnings about the pleaded complications and the other relevant matters, the treating doctors would have passed the information onto their patients. After all, that would be consistent with the doctors’ professional obligations”: at [4412]-[4426]. I am not satisfied that the evidence allows the Court to draw the inference that the misleading conduct was a cause of the decision to use (including in the sense both of the decision to acquire and to use in a specific manner) the Alucobond PE on the Shore Building.

1820 The Applicants have failed to show that any conduct of the Respondents caused any of the Qualified Professionals to misuse Alucobond PE in the façade of the Shore Building in the non-compliant manner which they did.

1821 I find that the Applicants have failed to establish causation in respect of the Shore Building and that the misleading conduct claim must be rejected.

10.2.2 Five Dock Building - causation

1822 The Applicants have also failed to call any evidence from the Qualified Professionals who were involved in the design and construction of the Five Dock Building. The Applicants have failed to address the roles of Mr Tatian, the FSE (of BCA Innovations), and Mr Spyrou, the building certifier, involved with the Five Dock Building. The Five Dock Building includes a façade system incorporating Alucobond Plus on its eastern external wall and certain parts of its western external wall. On 27 August 2018, Mr Tatian, prior to the issue of an Occupation Certificate for the Five Dock Building, issued a report described as an “interim report” which stated, amongst other things:

Please note: external cladding is out of the scope of this Fire Engineering Report. External cladding has been identified onsite by our office, however after requests to the builder to provide information confirming compliance to the P CA [sic] for assessment, to our knowledge no such information has been provided. Neither myself or our office take any responsibility for the type of cladding used if it deemed to be not in accordance with the BCA as this is out of the scope of our engagement and was mentioned numerous times during the design and construction phases of the project.

(Emphasis added.)

1823 Mr Tatian, in the interim FER, emphasised that despite requests to the builder of the Five Dock Building, information about its external cladding for assessment had not been forthcoming. This was cited as the reason why Mr Tatian was not prepared to take any responsibility for the type of external cladding if it was “not in accordance with the BCA”. Mr Tatian continued that this matter had been “mentioned numerous times during the design and construction” of the Five Dock Building. Mr Tatian’s disclaimer in the interim report was far from a certification that Alucobond Plus on the Five Dock Building was compliant with the BCA.

1824 Indeed, Mr Tatian was saying that he was not prepared to be responsible for the external cladding because the builder had failed to answer his requests for information. The plain implication was that it could not be presumed that the external cladding of the Five Dock Building was compliant. Mr Tatian’s interim FER placed the builder on notice that he considered it necessary to assess the external cladding for compliance with the BCA. However, the builder, Mr Zeitoun of Buildrite, did not answer Mr Tatian’s repeated requests for information about the external cladding. The builder, instead, provided Mr Tatian’s interim FER to the developer, Mr Abdul-Rahman, who used it as a supporting document to apply for an Interim Occupation Certificate, which was issued by the building certifier, Mr Spyrou on 29 November 2018.

1825 HVG submits that the Applicants’ submissions that the building was certified as compliant based on a CodeMark Certificate implies that the non-compliant use of Alucobond Plus was not detected owing to HVG’s conduct. However, HVG points to Mr Tatian refusing to vouch for the compliance of the Alucobond Plus on the Five Dock Building. Despite the terms and effect of Mr Tatian’s interim FER, Mr Spyrou read and considered Mr Tatian’s disclaimer and still proceeded to issue an interim Occupation Certificate, certifying that the Five Dock Building, affixed with the Alucobond Plus cladding, was suitable for occupation in accordance with the BCA. The significance of Mr Spyrou’s role is that the interim Occupation Certificate was a pre-condition of the Strata Scheme of the Five Dock Building by reason of s 6.3 of the EPA Act and s 54(1)(b)(iv) of the SSDA 2015.

1826 HVG submits it must have been apparent to Mr Spyrou that the building as constructed did not satisfy the conditions for use of Alucobond Plus stated on the Codemark Certificate he purportedly relied on – which he was also looking at after both the Lacrosse fire and the Grenfell Tower fire.

1827 HVG contends, and I accept, that if Mr Spyrou had not issued the interim Occupation Certificate, or, alternatively, had he required the builder to procure Mr Tatian to assess the Alucobond Plus cladding as Mr Tatian had recommended, the Five Dock OC would not have been registered in circumstances where the Five Dock Building featured an inappropriate use of Alucobond Plus and thus the Five Dock OC would have avoided the loss claimed. I accept HVG’s submission that the effect of these circumstances is that, any causal link between the alleged misleading conduct claim by the Respondents and the use of Alucobond Plus on the Five Dock Building was severed by the actions of the builder, developer and building certifier, each of whom I find must have read Mr Tatian’s disclaimer in his interim FER and decided not to answer his requests for information about the BCA compliance of Alucobond Plus for the Five Dock Building. The Applicants have not established the inferential causation case.

1828 I find that even if I am wrong and the Applicants have established that the Respondents’ conduct was misleading, nonetheless the Applicants have failed to establish causation in respect of the Five Dock Building and that the misleading conduct claim must be rejected.

11. LIMITATION DEFENCES

1829 Only issue 18, the date on which amendments made to the pleadings in March 2020 take effect, is common to the group members. Each of the other limitation issues addressed in this section are individual to each group member. No limitation point is taken by the Respondents in relation to the claims brought by the Five Dock OC.

1830 In addition to the limitation provisions discussed below, 3A relies on the 10-year limitation period imposed by s 74J(3) of the TPA. Section 74J(3) bars actions not commenced within 10 years after the time of the first supply to a consumer of the goods to which the action relates. Section 74J(3) has no application to the claims brought by the Applicants, but it may apply to bar the claims of other group members. This will need to be determined individually on a case-by-case basis (as will the issue of limitations more generally).

11.1 Issue 18 – The date the amendments take effect

1831 These proceedings commenced on 14 February 2019. On 3 March 2020, the Shore OC filed its F urther A mended O riginating A pplication and A mended S tatement of C laim, together the Amended Documents. The amendments to the Amended Documents can be divided into the following categories:

(a) amendments to the description of the group members;

(b) an expansion on the factual and legal allegations that supported the consumer guarantee claim; and

1832 In short, the Applicants contend that the amendments should take effect from the commencement of the proceeding, being 14 February 2019, whereas the Respondents contend that the amendments should take effect from the date the Amended Documents were accepted for filing, being 3 March 2020. 3A submits that this question is important because of the consequential effect it will have on limitation defences which the Respondents may have not only against the Shore OC, but also, potentially, other group members. The Applicants submit that it is immaterial whether the amendments take effect from 14 February 2019 or 3 March 2020, as the Applicants’ case is that both dates are within the relevant limitation periods for each of their claims against the Respondents.

1833 It is first necessary to say something about the procedural history surrounding the Amended Documents. There was no formal application made for leave to file the Amended Documents. Rather, at a case management hearing before Wigney J on 13 December 2019, the Shore OC alerted his Honour to its intention to seek leave to file the Amended Documents, and it was decided the grant of leave would be determined at a hearing on 27 February 2020. In the intervening period, the Shore OC provided the proposed Amended Documents to the Respondents, who agreed to consent to the filing of the Amended Documents, on the condition that the date the amendments are deemed to take effect was reserved for the trial.

1834 The hearing on 27 February 2020 was, therefore, primarily concerned with the costs associated with the Amended Documents, rather than a contested hearing as to whether leave should be granted for the filing of the Amended Documents. Wigney J granted the Shore OC leave to amend, but made the following additional order:

5. The date on which the amendments in the Amended Statement of Claim and the proposed Further Amended Originating Application (including any amendment to the group definition) will be deemed to have taken effect (for the purposes of determining limitation periods amongst other things) will be reserved for the initial trial.

1835 This order was understandable, as “if there is a reasonable argument [a] claim is not statute-barred, there is no reason in principle that an amendment should not be permitted, particularly if all rights are preserved by the date on which the amendment takes effect being determined as part of the final judgment rather than on an interlocutory basis”: McGraw-Hill Financial, Inc v Clurname Pty Ltd (2017) 123 ACSR 467; [2017] FCAFC 211 at 25.

1836 It should also be noted that further amendments were made to the Amended Documents, such that by November 2023 and December 2022 respectively, the Shore OC had filed a Second Further Amended Originating Application and the 2FASOC. However, it is only the date upon which the amendments in the Amended Documents take effect which is in issue.

11.1.1 Submissions

1837 The Applicants submit that the amendments to the description of the group members did not change the group definition. I take this submission to mean that the amendments sought to clarify the group definition, rather than to expand it. The Respondents did not, in either their written or oral submissions, engage separately with the amendments to the group definition from the amendments to the Amended Documents generally.

1838 In relation to the other amendments to the ASOC, the Applicants characterised the amendments as being in response to criticisms made by 3A regarding the common questions and the framing of the case, and as merely expanding on the factual and legal allegations supporting the consumer guarantee claim. The Applicants conceded the amendments also added the misleading conduct claim. The Applicants’ position is that the amendments were made pursuant to r 16.53 of the F ederal C ourt Rules 2011 (Cth), which unlike r 16.51 contains no express provision as to the date that amendments are to take effect, and that the better position is that the amendments relate back to the date of commencement: Gibson v Malaysian Airline System Berhad [2016] FCA 1476 at [34]-35; Australian Securities and Investments Commission v Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed) (No 2) [2013] FCA 409; (2013) 213 FCR 289 at [8]-19.

1839 3A submits that the amendments had the effect of ‘re-casting’ the proceedings and effectively resulted in an almost entirely new case that did not arise from the facts already pleaded. Whilst 3A accepts that ‘relation back’ is the general rule, 3A says that that rule is qualified by the existence of the power to order an amendment be deemed to take effect from some later date, relying on Air Link Pty Ltd v Paterson (No 2) (2003) 58 NSWLR 388; [2003] NSWCA 251 at [51] and Agtrack (NT) Pty Ltd t/as Spring Air v Hatfield (2003) 7 VR 63; [2003] VSCA 6 at [39]-[40]. In essence, 3A says that these two cases stand for the proposition that where an amendment is so extensive that it changes the character of the original pleading, such that it is better understood as the creation of a new substituted document, it is appropriate, in such a circumstance, to order that the substituted document take effect not on the date on which the document was originally filed, but the date on which it was substituted. HVG pleaded in its defence that the amendments to the consumer guarantee claim did not arise out of the same or alternatively substantially the same facts as pleaded in the Applicants’ Statement of Claim filed on 14 February 2019. HVG did not put forward separate submissions on this point, but it joined generally with the submissions advanced orally by 3A.

11.1.2 Consideration

1840 The orders granting leave to file the Amended Documents do not refer to the specific powers pursuant to which each of the amendments was made, and contrary to what the Applicants submit, it is not clear to me that the relevant rule is r 16.53. The importance of this is that the considerations and principles relevant to determining the question of when the amendments are to take effect, depends on the specific power pursuant to which leave was granted.

1841 I will deal first with the amendments other than to the description of the group members, that is the amendments both to the existing consumer guarantee claim and the additional misleading conduct claim.

1842 First, the decisions referred to by 3A, Agtrack and Air Link, were both appealed to the High Court, which heard the appeals together. It should be noted that both proceedings dealt with complex questions relating to the interaction of limitation provisions in Victorian state legislation and a limitation provision in the Civil Aviation (Carriers’ Liability) Act 1959 (Cth), which do not arise in this proceeding. The High Court “held that the relation-back doctrine could not validate an amendment pursuant to Victorian State rules of court adding a cause of action which had been extinguished by a limitation provision contained in a Commonwealth statute”: Street v Luna Park Sydney Pty Ltd [2006] NSWSC 230 at 50.

1843 Second, there is Full Court authority on the principles that relate to the date on which amendments ordered pursuant to the FCA Act and FC Rules take effect: Impiombato v BHP Group Ltd (2025) 308 FCR 250; [2025] FCAFC 9 at 176; Ethicon S à rl v Gill (2018) 264 FCR 394; [2018] FCAFC 137 at 17 (Ethicon (F ull Court Amendments Decision)). Impiombato was decided after I heard the trial in this proceeding, but it affirmed and built on the principles expressed in Ethicon (Full Court Amendments Decision).

1844 In Ethicon (Full Court Amendments Decision) the Full Court, approved, with one caveat, of Brereton J’s characterisation in Street at [46] that “[i]t is true that ordinarily ‘an amendment, duly made, takes effect, not from the date the amendment is made, but from the date of the original document which it amends’ [Baldry v Jackson [1976] 2 NSWLR 415, 419 (Samuels JA)]”. The Full Court’s caveat to that description was that it is “somewhat an overgeneralisation to say that the ‘usual position’ is that an amendment of a statement of claim takes effect from the commencement of the proceeding”: at [47]. The Full Court went on to say at [47]:

Although it is undoubtedly the case in ordinary inter partes litigation, that amendments often take effect from the commencement of the proceeding, this is in circumstances where the amendment is to add a claim between existing parties that arises out of the same or substantially the same facts. This flexibility operates as an amelioration of the rule of practice established by Weldon v Neal (1887) 19 QBD 394.

1845 Brereton J also said in Street at [52]:

[T]he relation-back doctrine is a manifestation of the general principle that, except insofar as the nature of the proceedings or the relief claimed requires attention to be given to the actual position of the parties at the time of judgment (such as, for example, the assessment of damages, and discretionary equitable remedies including injunctions), the rights and liabilities of parties are determined as at the date of the commencement of the proceedings, unless a statute changing the law expresses a clear contrary intention [Hutchinson v Jauncey [1950] 1 KB 574; Wilson v Dagnall [1972] 1 QB 509; Application Des Gaz SA v Falks Veritas Ltd [1974] Ch 381 at 392 and 399]. Relation-back recognises that a pleading speaks from the date it bears, and that an amendment speaks from the date of the original pleading that it amends, so as to state a claim for relief to which the party is entitled as at the date at which the rights and liabilities of the parties will be judged.

1846 It seems to me that the critical question is whether the amendments, both to the existing consumer guarantee claim and the additional misleading conduct claim, can be said to have arisen from the same or substantially the same facts as those which had already been pleaded in the Applicants’ Statement of Claim filed on 14 February 2019.

1847 Wigney J, in hearing the application for leave to amend, in The Owners-Strata Plan No 87231 v 3A Composites GmbH (No 2) [2020] FCA 333 at [23]-[25] said:

[23] It would perhaps be an understatement to say that the amendments to the statement of claim are extensive and substantial. Virtually every paragraph of the existing pleading has been the subject of some amendment. The vast majority of the amended pleading is entirely new. The original statement of claim was 19 pages in length (without annexures) and contained 25 paragraphs. The amended statement of claim is 49 pages in length (without annexures) and contains 89 paragraphs. More significantly, the new pleading contains entirely new causes of action and, while the original causes of action are retained, for the most part they are now supported by substantially new or reformulated allegations and particulars.

[24] Owners contended that, while the amendments to the statement of claim are extensive and substantial, the “core” of the case nevertheless remained the same. The core of the case was said to be the “risk of fire associated with this product” and the “TPA [Trade Practices Act ] merchantable acceptable quality cause of action, which fixes upon the risks that are associated with this product”. Owners sought to characterise the amendments to the existing causes of action as simply “restructur[ing] the existing pleading to more clearly identify the different elements of the cause of action” and suggested that the amendments did not introduce “any significant new factual matters”. As for the new causes of action, Owners contended that they arose substantially from facts “already pleaded”.

[25] While at an entirely superficial level it might be said that the core of Owners’ case may remain the same, the suggestion that the new pleading simply provides a clearer explanation of the existing causes of action and does not introduce substantially new factual allegations is nonsense. So too is the claim that the new causes of action arise from facts already pleaded. It would be more accurate to characterise the new pleading as an almost entirely new case.

1848 The amendments to the originating application were also substantial. “The common questions as originally framed in paragraph two of the application were completely replaced by an annexure which sets out, over 11 pages, 45 detailed common questions, and a further four ‘questions of commonality’; being questions applicable to some, but not all, group members”: The Owners-Strata Plan No 87231 (No 2) at [30].

1849 Wigney J ordered the Applicants to pay the Respondents’ costs thrown away by reason of the amendments, such costs to be payable forthwith: at [45]. Wigney J described those costs as the costs “…incurred to date in responding to a pleading and common questions that have now effectively been abandoned in favour of a far more complex and detailed pleading and questions”: at [45].

1850 I accept 3A’s submission that it is hard to imagine “amendments” more extensive than those made on 3 March 2020. A marked-up version of the ASOC bears out Wigney J’s characterisation that the 3 March 2020 amendments introduced “an almost entirely new case” that did not arise out of facts already pleaded. For example, the ASOC involved:

(a) the expansion of the “Material Fire Risk Properties” at [10] to [12];

(b) a new allegation of the existence of “Prohibition Risk Properties” at [17];

(c) the introduction of existence of the “BCA Non-compliance Properties” and the “BCA Non-compliance Risk Properties” at [28] to [34];

(d) the insertion of an extensive pleading of non-compliance with the fire resistance requirements in BCA in new [18] to 36; and

(e) the insertion of an entirely new cause of action founded new facts in respect of the making of misleading or deceptive representations and misleading or deceptive conduct at [75]-[82] and [86]-[89].

1851 Properly understood, the “amendments” made on 3 March 2020 were in the nature of a substitution rather than an amendment. The character of the pleading and the proceeding itself changed to such a degree that, as Wigney J said, the proceeding was “almost back at square one”. I am satisfied that the amendments do not arise out of the same, or substantially the same, facts as those already pleaded.

1852 I also agree with Colvin J’s reasoning in Sy d ney Subdivision Pty Ltd (in l iq) v Chow [2023] FCA 8 at [35] that:

[A]n amendment to introduce a claim that may be barred by the period of limitation at the time the amendment is made is not an ordinary amendment. If it were to be allowed to relate back then it would prejudice the opposing party’s ability to raise a limitation point even though the claim was out of time. Such amendments are only treated as taking effect from the date of the original document where the amendment introduces a claim that ‘arises out of the same or substantially the same facts’ as the claims that have been brought within time: Ethicon Sàrl v Gill [2018] FCAFC 137; (2018) 264 FCR 394 at [47] (Allsop CJ, Murphy and Lee JJ).

1853 Therefore, I am satisfied that the amendments, other than to the group description which I deal with below, should take effect from 3 March 2020, including for the purposes of determining all limitation periods.

1854 For completeness, I note that my finding that the amendments do not arise out of the same or substantially the same facts as those already pleaded, does not effect the validity of the orders granting leave for the Amended Documents to be filed. As I have said, the orders did not refer to a specific rule pursuant to which leave was granted. The Applicants have proceeded on the basis that it was pursuant to r 16.53 of the FC Rules. A few points need to be made in relation to that assumption. First, r 16.53 is only in relation to pleadings, and in relation to the FAOA, the relevant rule is r 8.21 of the FC Rules.

1855 Second, dealing with r 8.21 first, the Court is not limited to the specified grounds in r 8.21 of the FC Rules, which includes, relevantly, where the proposed new claim for relief arises out of the same facts or substantially the same facts as those already pleaded to support an existing claim for relief by the applicant. This is because r 8.21 expressly says that an applicant may apply to the Court for leave to amend an originating application for any reason, including any of the reasons in r 8.21(a)-(g). The sub-rules in “(a) to (g) are examples of amendments that may be the subject of application. They are not a code. Thus, the interaction of r 8.21(1)(g) and (2) does not mean that the Court’s power to permit an amendment asserted to involve a statute-barred claim is confined to the circumstances in r 8.21(1)(g)(i)”, and this is reinforced by construing the FC Rules as a whole, specifically rr 1.32-1.35 and r 16.51: McGraw-Hill Financial at 23.

1856 Third, turning to the power to amend pleadings, r 16.53 is as follows:

(1) Unless rule 16.51 applies, a party must apply for the leave of the Court to amend a pleading.

(2) A party may apply for leave to amend a pleading to add or substitute a new claim for relief, or a new foundation in law for a claim for relief that arises out of the same facts or substantially the same facts as those already pleaded to support an existing claim for relief by the party, even if the application is made after the end of any relevant period of limitation applying at the date the proceeding was started.

….

1857 However, consistent with what the Full Court said in McGraw-Hill Financial, it is my view that r 16.53 does not limit the Court’s discretion to grant leave for amendments in other circumstances, including where the amendments do not arise out of the same facts as those already pleaded. This interpretation fits with the existence of rr 1.32-35 of the FC Rules and also, in respect of representative proceedings, s 33ZF of the FCA Act (the “gap filler” provision). Further, this interpretation accords with the practice, as occurred here, of granting leave for amendments at the interlocutory stage where it is arguable that the additional claims may be statute-barred, but deferring the determination of the question of when the amendments take effect to the final judgment.

1858 In relation to an amendment to the description of group members, the Court may, pursuant to s 33K of the FCA Act, upon application made by a representative party, give leave to amend the application commencing the representative proceeding so as to alter the description of the group. There is no equivalent express order in relation to amending the description of the group in a pleading, an unfortunate situation which has been described as an infelicity in drafting: Impiombato at 176; Ethicon (Full Court Amendments Decision) at [17]. The Full Court held in Ethicon (Full Court Amendments Decision) at [17] that there are, however, a number of rules within the FC Rules which support an order for amendment to the class definition in a pleading, but most relevantly, the gap filler, s 33ZF of the FCA Act, which allows the Court to make any order the Court thinks appropriate or necessary to ensure that justice is done in the proceeding. The Full Court in Impiombato was clear that the bespoke and detailed regime in Part IVA, which has the “evident purpose…to displace generally understood procedures”, means that amendments to the description of group members are governed by s 33K, with a supplementary source of power in s 33ZF if the description is contained in a pleading, and not by rules which relate to originating applications and pleadings generally (ie, r 8.21 or rr 16.51 and 16.53). This is so whether or not the amendment has the effect of broadening (or narrowing) the description of the group members, or merely seeks to clarify the description.

1859 The amendments made to the description of the group members in the ASOC (which is the same in the FAOA apart from the chapeau) are set out below. The differences are indicated with strikethrough and underline:

This proceeding is commenced as a representative proceeding pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth) by the Applicant on its own behalf and on behalf of all person (Group Members) who, as at the date of this Amended Statement of Claim:

(a) either:

(i) own or have previously owned a building situated in Australia (Relevant Building), or have or have previously had an ownership interest in a part of a building situated in Australia (Relevant Building Part); or

(ii) have or have previously had a leasehold interest in a Relevant Building and/or a Relevant Building Part which includes an obligation to rectify defects of a kind associated with Alucobond PE Core Cladding in the Relevant Building or the Relevant Building Part; and

(b) where the Relevant Building and/or the Relevant Building Part is or was fitted with Alucobond PE Core Cladding; and

(c) have suffered loss or damage as a result of the failure of Alucobond PE Core Cladding to meet the applicable requirements for which statutory damages or compensation is claimed, as pleaded in in this the Amended Statement of Claim; and

(d) where the Alucobond PE Core Cladding was first supplied to a Consumer in the period that commences on the day that is 10 years before the date of this Statement of Claim 14 February 2009 and ends on 14 February 2019 the date of this Statement of Claim (Relevant Period); and

(e) were not during the Relevant Period, and are not, any of the following:

(i) a related party (as defined by s. 228 of the Corporations Act 2001 (Cth) (Corporations Act)) of 3A Composites or HVG;

(ii) a related body corporate (as defined by s. 50 of the Corporations Act) of 3A Composites or HVG;

(iii) an associated entity (as defined by s 50AAA of the Corporations Act) of 3A Composites or HVG;

(iv) a director, an officer, or a close associate (as defined by s. 9 of the Corporations Act) of 3A Composites or HVG; or

(v) a judge or the Chief Justice of the Federal Court of Australia or a Justice or the Chief Justice of the High Court of Australia.

1860 The Full Court in Ethicon (Full Court Amendments Decision) further said the bespoke nature of Pt IVA of the FCA Act makes it inapt to draw analogies between aspects of ordinary inter partes litigation and Pt IVA procedures: at [52]. The Full Court held that the default position is that a s 33K order (or an equivalent order under s 33ZF) has effect from the time the definition is changed, consistent with the requirements of class certainty. The Full Court’s reasoning was as follows:

[51] It is consistent with the scheme introduced by Part IVA and, in particular, the need for there to be certainty as to the persons who comprise the class at all times, that the Group Definition Amendment should have been ordered to take effect from the date of amendment, being the date of filing of the 5FASOC…Apart from anything else, this prevents the topsy turvy notion that someone retrospectively becomes a group member on commencement, when the Court has thus far proceeded on the basis that they are not group members. As a matter of principle, such an approach would avoid the vice of potentially resuscitating causes of action by persons who have never sought to agitate them. It would be odd that by becoming a group member through the augmentation of a class, substantive rights were conferred on a claimant that had been either extinguished or barred by operation of statute and could not otherwise be advanced by that claimant.

[52] Before leaving this topic, it is worth making a further point. Given the suspension of limitations caused by the operation of s 33ZE, the question of inclusion (or, as occurred here, unusually, exclusion) of group members has potentially important consequences on substantive rights. As does the date when any such order is to take effect. Whatever might be the nature of other amendments to a statement of claim, or to relief claimed in an application, attention must be given by parties to the legal consequences of class composition changes. Irrespective as to when other amendments might take effect, the consequences of amendments to group definition can affect the rights of third parties, being the absent group members or proposed group members. Although it would be inappropriate to lay down inflexible rules, the default position is that a s 33K order (or an equivalent order under s 33ZF) has effect from the time the definition is changed, consistent with the requirements of class certainty. It is a sound practice for applicants, in seeking such orders, to deal separately with amendments concerning class composition to assist in avoiding any confusion.

1861 This approach was affirmed in Impiombato, where the Full Court agreed with the position in Ethicon (Full Court Amendments Decision), that the default position is that amendments to the description of group members takes effect from the date of the amendment, although they emphasised that it is not an inflexible rule: at 52. The Full Court ultimately was not persuaded in that case that the interests of justice required the grant of leave to amend the group definition with effect from the commencement of the proceeding. The majority went further to say that to do so would “be contrary to the interests of justice to effect a material augmentation to the group membership on a retrospective basis, imposing upon [the respondents] a potentially very substantial increase in liability for claims that have otherwise been extinguished by the effluxion of time”: Impiombato at 305.

1862 In contrast, in Murphy Operator & Ors v Gladstone Ports Corporation (No 9) [2023] QSC 035 at [127]-[128], Crow J found that the amendments in that case to the description of the group members did not expand the class, but more carefully defined the class and, therefore, found it was appropriate for the amendments to take effect from the commencement of the proceeding.

1863 I was not addressed on whether the amendments to the description of the group members merely clarified the description or whether they effected a change to the class composition, beyond an assertion from the Applicants in their written closing submissions that “the amendments did not change the group definition”. I accept the amendments are relatively minor, but, given (a) my findings in relation to the other amendments, and (b) that it was not argued before me that these amendments should be dealt with any differently from the other amendments, I am not persuaded that it is in the interests of justice to depart from the default position that amendments to the description of group members take effect from the date of the amendment.

1864 For these reasons, I will order that all the amendments to the Amended Documents should take effect from 3 March 2020, including for the purposes of determining all limitation periods.

11.2 Issue 19 – The consumer guarantee claim: s 273

1865 Section 273 of the ACL provides:

An affected person may commence an action for damages under this Division at any time within 3 years after the day on which the affected person first became aware, or ought reasonably to have become aware, that the guarantee to which the action relates has not been complied with.

1866 Section 271 is in the same division as s 273 (Division 2 of Part 5-4 of the ACL).

1867 I have determined in answer to issue 18 that the date from which time should be reckoned for the purposes of all limitation periods should be 3 March 2020. Three years before that date is 3 March 2017. The Shore OC (noting no limitation point is taken in respect of Five Dock OC), and any applicable group members’ claims will be barred if the Shore OC, or any applicable group member, first became aware or ought reasonably to have become aware, that Alucobond PE or Alucobond Plus (as the case may be) was not of acceptable quality, by 3 March 2017.

11.2.1 Submissions

1868 The first question is what is meant by the phrase “ought to have become aware”. 3A submits that the phrase “ought to have become aware” has been considered in the context of limitation periods, and held to import an obligation to conduct reasonable inquiries, “reasonableness” to be assessed having regard to the particular qualities and circumstances of the applicant: Commonwealth of Australia v Shaw (2006) 66 NSWLR 325; [2006] NSWCA 209 (Basten JA, Handley and Ipp JJA agreeing). It should be noted that 3A made a similar submission in Strata Plan 88695 v Metlege [2025] NSWSC 535 – a case which also arises out of the installing of alleged defective ACPs. In that case, the plaintiff has brought an action against Casumo Constructions Pty Ltd for breaching its duties under the Design and Building Practitioners Act 2020 (NSW) and the Home Building Act 1989 (NSW). Casumo filed a cross-claim list statement which alleges that 3A, who supplied the ACPs to Casumo through a distributor, breached the guarantees as to acceptable quality in s 54 of the ACL, and sought damages, to the extent Casumo is found liable, pursuant to s 272(1)(b) of the ACL. Metlege concerned an application by 3A for Casumo’s cross-claim cross-summons to be set aside. Peden J said in respect of this submission:

[20] I was taken to authorities that have considered the issue of a plaintiff’s awareness in the context of seeking from a Court an extension of time after particular limitation periods in relation to personal injury negligence claims had expired: AME Hospitals Pty Ltd v Dixon (2015) 48 WAR 139; Commonwealth v Shaw (2006) 66 NSWLR 325. Both of these authorities indicate that the inquiry as to the proper construction of the particular sections in question there were multifaceted and fact-heavy as to the timing of the awareness of the plaintiff of matters relevant to their injury.

[21] There are no authorities on the proper construction of s 273 ACL. However, intermediate appellate courts have considered in detail the proper construction of what the parties considered were arguably similar provisions. These factors tell against it being appropriate to determine the issue of the proper construction of s 273 ACL on a strike out application. This is further so in circumstances where the evidence is not obviously one way. That is a sufficient reason to reject 3A Composite’s submissions.

1869 3A submits that the Shore OC and any applicable group members, ought reasonably to have been aware that the goods were not of merchantable quality, or that the acceptable quality guarantee had not been complied with by no later than 3 March 2017, or alternatively 14 February 2016. The basis of this submission is that by that time there was information in the public domain about the Lacrosse Fire, which occurred on 25 November 2014, and additionally there had been public hearings in the Senate inquiry into non-conforming building products in November 2015, which leads to the following propositions:

(a) the Shore OC should have been put on notice that aluminium cladding potentially possessed the properties that the Applicants rely upon in these proceedings as establishing that Alucobond PE and Alucobond Plus do not comply with the consumer guarantee,

(b) acting reasonably, a representative of the strata committee would have made enquiries about whether the cladding posed a risk. That is what ultimately occurred after the Grenfell Fire; and

(c) there is no meaningful explanation for why the Lacrosse Fire did not put a member of the strata committee for the Shore Building on notice that the guarantee to which the action relates has not been complied with.

1870 The Applicants submit that there is no reason to conclude that the Lacrosse Fire could or should have put the Shore OC on notice of the non-compliance with the acceptable quality guarantee. This submission was based on the evidence given by Mr Sheils and the further submission that, as supported by the expert evidence, the result of enquiries by the strata committee would clearly have been very different in late 2014 as compared to after the Grenfell Fire in June 2017. In part this is said to be because after the Lacrosse Fire, HVG promoted that the fire was the result of an “inferior Chinese product”, and because Qualified Professionals did not appreciate the safety risks associated with the use of Alucobond PE until after Grenfell Fire. The Applicants submit that the Shore OC was not, and ought not to have reasonably been aware, that the acceptable quality guarantee had not been complied with until both (a) the cladding on their building had been identified as Alucobond PE and (b) the material fire risks and non-compliance qualities of PE-cored cladding of this type became generally available. The Applicants submit that (a) and (b) did not occur until, at the earliest, late 2018.

11.2.2 Mr Sheils ’ evidence and findings

1871 Mr Sheils has been a resident of the Shore Building since November 2012. He has been a member of the strata committee of the Shore OC since October 2013. He knew from when he moved into the Shore Building that it had aluminium cladding on the outside of its upper levels.

1872 The Lacrosse Fire occurred on 25 November 2014. Mr Sheils read and heard about the Lacrosse Fire in the news at around the time it occurred. He was aware from the reports that aluminium cladding on the Lacrosse Building was cladding of the kind Mr Sheils knew to be on the outside of the Shore Building and was believed to have contributed to the fire.

1873 The Grenfell Fire occurred on 14 June 2017. Mr Sheils read and heard about the Grenfell Fire in the news at around the time it occurred. He was also aware that aluminium cladding had contributed to that fire.

1874 When he heard about the Grenfell Fire, Mr Sheils along with the other members of the Shore Building strata committee decided to instruct their strata manager to investigate the fire safety of the aluminium cladding on the Shore Building. They gave that instruction in early September 2017. About a month later, in October 2017, the members resolved at an AGM to obtain a fire safety inspection report from Core Project Consulting. In early 2018, the strata committee received the Core Shore Report indicating that the cladding was most likely to have a PE core and was not recommended for high-rise construction.

1875 Mr Sheils accepted that he “could have” raised the Lacrosse Fire with the members of the strata committee when he heard about it. He also accepted that the members of the strata committee “could have” after the Lacrosse Fire, taken the steps that the strata committee took after the Grenfell Fire. Mr Sheils’ explanation for not raising the Lacrosse Fire at the time it occurred in 2014 was that:

[T189.32]: [M]oving into the Shore building, I considered it to be a pristine building. I didn’t think there was anything wrong with it. I thought it was – it – it was compliant in all respects because I suppose, being a bit selfish, there was no cladding on the floor where I live; it was on the upper floors. Although I knew it was there – it was shiny, bright aluminium cladding – I didn’t – I – I just took it for granted that everything in the building was compliant.

1876 Mr Sheils, when pressed about that understanding, accepted that nothing had happened to cause him to have any doubt about the quality of the cladding on the Shore Building other than the Lacrosse Fire and the Grenfell Fire.

11.2.3 Consideration

1877 I accept that it is not necessary for time to start running under s 273 that the Applicants, or applicable group member, became or ought reasonably to have been aware that the specific cladding on its building did not comply with the statutory guarantee, as all that is required is that the relevant group member was aware or ought reasonably to have been aware that the guarantee to which the action relates was not complied with: Capic (Full Court) at [280], overturned by the High Court in Capic (High Court) but not in relation to the principles or application of s 273. The matters the Applicants plead as establishing non-compliance with the guarantee are said to have been inherent in the cladding type (Alucobond PE or Alucobond Plus, as the case may be), rather than arising from its specific use on a particular building, aside perhaps from the requirement that they be used on Class 2 to 9 buildings. It follows that once the inherent characteristics are known or ought to be known by the particular group member, time starts to run.

1878 The Respondents contend that a reasonable person would have gone on inquiry after the Lacrosse Fire in November 2014 and, therefore, the Shore OC ought reasonably to have become aware that Alucobond PE used in the façade was non-compliant with the acceptable quality guarantee by 13 February 2016, or at the latest, 3 March 2017. I reject that contention. That is not made out on the evidence. I do not consider it necessary to determine whether the phrase “ought to have become aware”, imports a requirement to undertake reasonable enquiries. That is because I do not accept that Mr Sheils, as a member of the strata committee, or the Shore OC ought, acting reasonably, to have made enquiries about the use of Alucobond PE panels in the façade of the Shore Building shortly after hearing about the Lacrosse Fire in Melbourne in November 2014. Further, I do not accept the Respondents’ contention that had Mr Sheils or the Shore OC made those enquiries that they would have discovered, first that the product on the building was Alucobond PE and second, that it had the qualities that made it unsafe and unfit for purpose. In reaching that conclusion, I have adopted an objective test of what is reasonable, with regard being had “to the background and situation of the applicant”: Castlemaine Perkins Ltd v McPhee [1979] Qd R 469 at 473.

1879 The Respondents’ contention overlooks that, by late November 2014, the result of those enquiries would have been very different as compared to after the Grenfell Fire in June 2017. The evidence of Expert Group 7 (the architects and building professionals) demonstrated that Qualified Professionals in late 2014 did not appreciate the safety risks associated with the use of Alucobond PE until after the Grenfell Fire on 14 June 2017. The Group 7 Joint Report said:

(a) there was a view held by some building professionals that the Lacrosse Fire may have been caused by substitution of an inferior product;

(b) this view changed after the Grenfell Fire;

(c) for the period before 2017/2018, ACPs were not considered to be combustible, nor non-compliant with the DtS Provisions of the BCA, nor to have the fire risk properties pleaded by the Applicants;

(d) however, from 2017/2018 to 2019, this view began to slowly change as architects and building specialists became aware of the combustibility and non-compliance with the DtS Provisions of the BCA of ACPs, although views did not change regarding the fire risk properties of ACPs; and

(e) there was ‘a clear realisation’ in respect of these issues after the NSW regulation banning the use of ACPs with a core of more than 30% PE (which came into effect in August 2018).

1880 Further, the contemporary news reports which the Respondents relied on promulgated the view after the Lacrosse Fire that it was a problem with the particular sub-standard cladding used on that building rather than an inherent problem with ACPs. I also find that there is force in the Applicants’ submission that given the Respondents have consistently denied that their goods were not of acceptable quality and have adduced extensive evidence in support of that defence, it is hard to see how the Shore OC ought reasonably to have worked this out unassisted.

1881 In relation to when the Shore OC became, or ought to have become, aware that the cladding on the Shore Building was Alucobond PE, I refer to section 2.4.2 of these reasons. I refer in particular to [63 ], which states that on 27 August 2018 a representative from HVG emailed Mr O’Reilly and confirmed the cladding on the Shore Building was Alucobond PE with a full PE core. First, I have found that the Shore OC could not reasonably be expected to have become aware of the Material Fire Risk Properties and the non-compliance qualities of PE core cladding until after the Grenfell Fire, being 14 June 2017. Second, the Shore OC did undertake enquiries as to the type of cladding on the Shore Building shortly after the Grenfell Fire. Third, I find the steps which the Shore OC took in the course of those enquiries were reasonable. Therefore, I find that not only was the Shore OC in fact not aware that the cladding on the Shore Building was Alucobond PE, but also that it cannot be said that it ought reasonably to have been aware that the cladding on the Shore Building was Alucobond PE until at least 27 August 2018.

1882 I find on the evidence that the time the Shore OC ought reasonably to have become aware that the acceptable quality guarantee had not been complied with was after the cladding on their building had been identified as Alucobond PE and knowledge of the reaction-to-fire properties and BCA non-compliance qualities of PE core cladding of this type became generally available. I find that this did not occur until, at the earliest, 27 August 2018.

1883 The consequence of this finding is that the Shore OC’s consumer guarantee claim, brought pursuant to s 271, was commenced within the three-year time period mandated by s 273, because 3 March 2020 is within three years of 27 August 2018.

11.3 Issue 20 – Whether 14 February 2019 or 3 March 2020 (whichever is applicable) is within 6 years after the day on which the Applicants’ causes of action under s 236(1) accrued: ACL s 236(2)

1884 The limitation period for the misleading conduct claim is found in s 236(2) of the ACL and its predecessor, s 82(2) of the TPA, which provides that an action may be commenced at any time within six years after the day on which the cause of action that relates to the conduct accrued.

1885 The Applicants contend that the loss claimed in this case is analogous to cases involving negligence causing latent defects in buildings. Whilst the structure of the building was physically diminished by the installation of defective Alucobond PE panels making the Shore Building more combustible and susceptible to fire, the Applicants submit that time did not begin to run until that defect became manifest in the sense of becoming discoverable by reasonable diligence: Cyril Smith & Associates Pty Ltd v The Owners-Strata Plan No. 64 97 0 [2011] NSWCA 181 at [15]-26 and Hawkins v Clayton (1988) 164 CLR 539 at [587]-[588]. The Applicants submit that loss did not occur, and they did not have a cause of action in respect of the misleading conduct claim until the Applicants actually became aware of it. The Applicants submit that the defects only became discoverable by reasonable diligence after the Grenfell Fire when information about the true properties of ACPs such as Alucobond Plus became publicly available.

1886 The Respondents’ contention is that the Shore OC suffered any loss as a result of their misleading conduct by no later than the date the strata plan was registered and they were deemed to have become the owner of the Alucobond PE. This occurred on 24 August 2012. This is because the Respondents contend that the misleading conduct claim is in substance a claim for economic loss that is consequent upon or in conjunction with physical damage to the property, which occurred on the affixation of the panels to the building. When the Shore OC came into existence on the registration of the strata plan on 24 August 2012, it inherited a building with physical damage and at that point first suffered loss and damage by reason of the alleged misleading or deceptive conduct.

1887 The relevant principles for determining when an action for damages “accrues” were stated by the High Court in Wardley Australia Ltd v Western Australia (1992) 175 CLR 514, where Mason CJ, Dawson, Gaudron and McHugh JJ held as follows at 527:

Economic loss may take a variety of forms and, as Gaudron J. noted in Hawkins v Clayton, the answer to the question when a cause of action for negligence causing economic loss accrues may require consideration of the precise interest infringed by the negligent act or omission. The kind of economic loss which is sustained and the time when it is first sustained depend upon the nature of the interest infringed and, perhaps, the nature of the interference to which it is subjected. With economic loss, as with other forms of damage, there has to be some actual damage…

[footnotes omitted]

1888 Wardley concerned a claim for loss and damage said to arise upon the fulfilment of a contingency, being the calling upon an indemnity the claimant allegedly gave under the inducement of misleading or deceptive conduct. Regarding the point at which loss and damage was sustained, the High Court held at 532-533:

The conclusion which we have reached with respect to the time when the plaintiff first suffers loss in respect of contingent loss or liability accords with the comment of Gaudron J. in Hawkins v Clayton:

“[I]f the interest infringed is an interest in recouping moneys advanced it may be appropriate to fix the time of accrual of the cause of action when recoupment becomes impossible rather than at the time when the antecedent right to recoup should have come into existence, for the actual loss is sustained only when recoupment becomes impossible. (Emphasis added.)”

The conclusion which we have reached is reinforced by the general considerations to which we referred earlier. It is unjust and unreasonable to expect the plaintiff to commence proceedings before the contingency is fulfilled…

[footnotes omitted; underlining added]

1889 The point of Wardley is that an action for damages for economic loss accrues – and time starts to run – when “actual loss” first occurs. As the High Court held, where the occurrence of actual loss is dependent on the fulfilment of a contingency, it follows that “actual loss” occurs, and the action for damages accrues, at that time, as this is the point when the loss is “ascertainable”.

1890 A court may use hindsight to determine when a cause of action accrued. In Alcan Gove Pty Ltd v Zabic (2015) 257 CLR 1, a negligence case, the High Court held as follows at [20]:

Determining whether a cause of action has arisen involves an assessment of objective fact, rather than an assessment of the subjective capacity of a plaintiff to muster proof.

It follows that hindsight is permitted in determining when a cause of action accrues. The aim is to ascertain when relevant facts, namely the presence of compensable damage, objectively came into existence. A Court should not be limited to ascertaining whether relevant facts were provable or discoverable at a particular time.

1891 In Ethicon, this Court held that there was “no reason” to approach limitation periods for the purposes of s 82 of the TPA any differently to the manner stated in Zabic: see Ethicon at [4767], decision affirmed on appeal to the Full Court: Ethicon (Full Court).

1892 The cases cited above show that the concept of whether a loss was “ascertainable” denotes the question of when the loss (ie, the compensable damage) actually occurred. It does not denote some subjective notion of the claimant’s knowledge or awareness of the fact of loss.

1893 There is no general principle that time will run only from the point when damage was reasonably discoverable: Magman International Pty Ltd v Westpac Banking Corporation (1991) 32 FCR 1. In Magman, Hill J held as follows at 26:

In the state of the present law, which can fairly be criticised as working hardship in difficult cases, it must be accepted, at least in this Court, that there is no general rule that time will only run from the point when damage was reasonably discoverable.

1894 There are some instances where the accrual of a cause of action is linked with the “discoverability” of loss. However, the concept of “discoverability” is used by the authorities to describe the point at which loss occurs, not the subjective knowledge of a claimant.

1895 In relation to claims in negligence for economic loss arising from latent building defects – ie, cases involving physical damage to a building as a result of latent defects – there is authority for the proposition that the cause of action does not accrue until the “physical consequence” of the latent defect “becomes manifest in the sense of becoming discoverable by reasonable diligence”: Cyril Smith at [24]-[26], applying Sutherland Shire Council v Heyman (1985) 157 CLR 424. In Cyril Smith, which is relied upon by the Applicants, Basten JA who delivered the judgment on behalf of the NSW Court of Appeal, said at [25] that Hawkins is “authority, at most, for the proposition that it is the physical defect which must be known or manifest, not that the cause of the defect must be identifiable.”

1896 Heyman has been described as stating the “orthodox doctrine” that an action for negligent construction accrues “when the defects become manifest or are otherwise discovered”: Scarcella v Lettice (2000) 51 NSWLR 302 at [16], cited in Cyril Smith at [8].

1897 A proper analysis of Heyman also reveals that notions about “manifestation” or “discoverability” of latent building defects marking the point at which an action in negligence accrues are tied to the occurrence of physical damage, not the plaintiff’s subjective knowledge. Even if the Applicants’ characterisation of a latent defect analogy is to be accepted, it does not follow that the defects only became discoverable by reasonable diligence after the Grenfell Fire when information about the true properties of ACPs such as Alucobond Plus became publicly available. That submission misunderstands the doctrine by focusing on when the cause of the defect, rather than the defect itself, became discoverable.

1898 The Applicants’ pleaded case on causation and loss is that, absent the misleading conduct and representations, Alucobond PE would not have been specified for use on the Shore Building and thus it would have avoided the “loss and damage”.

1899 The plurality in Wardley, at 532, held that if the suffering of loss or damage is predicated on the occurrence of some contingency, then loss or damage is first suffered when the contingency is fulfilled and the loss becomes actual. The general position regarding accrual of an action under s 236 of the ACL and s 82 of the TPA is as stated in Wardley: time starts to run when actual loss occurs.

1900 In the present case there is no contingency. Either the Alucobond PE had the characteristics that the Applicants alleged the Respondents represented them having, or they did not. If the Applicants are right and the Positive Representations or some of them were false, then it follows that loss occurred at the moment of acquisition because the Applicants acquired a product that did not have the characteristics that it was represented as having. In the case of the Shore OC, loss or damage in the form of economic loss was suffered upon vesting of the common property on registration of the Strata Plan 87231 on 24 August 2012.

1901 Furthermore, the Shore OC suffered loss and damage in the form of physical damage to the building upon registration of the Strata Plan 87231 for the reasons that follow.

1902 In Hawkins, Deane J said at 587-588:

Commonly in [cases where economic loss is sustained as a consequence of the development of a latent defect in a building] the building never existed and was never owned without the defect and (in the absence of consequential collapse or physical damage or injury) the only loss which could have been sustained by the owner was the economic loss which would be involved if and when the defect was actually discovered or became manifest, in the sense of being discoverable by reasonable diligence, with the consequence that the damage was then sustained by the then owner: cf. Sutherland Shire Council v. Heyman. The position is different in cases where all or some of the damage, be it in the form of physical injury to person or property or present economic loss, is directly sustained in the sense that it does not merely reflect diminution in value or other consequential damage which occurs or is sustained only when a latent defect which has existed at all relevant times becomes manifest. In those cases, damage is sustained when it is inflicted or first suffered and the cause of action accrues at that time.

[Emphasis added.]

1903 To similar effect is the following passage in Hawkins from Gaudron J at [601]:

If the interest infringed is the value of property, it may be appropriate to speak of a cause of action in negligence for economic loss sustained by reason of latent defect as accruing when the resultant physical damage is known or manifest, for as was explained by Deane J. in Heyman it is only then the actual diminution in market value occurs. If, on the other hand, the interest infringed is the physical integrity of property then there is a certain logic in looking at the time when physical damage occurs, as was done in Pirelli.

1904 In The Owners – Strata Plan No 91086 v Fairview Architectural Pty Ltd (No 3) [2023] FCA 814, a claim was brought against the manufacturer, Fairview, for loss and damage suffered by reason of the affixation of ACPs on buildings which were not of merchantable or acceptable quality. The plaintiff claimed that Fairview engaged in misleading conduct by representing that the cladding was suitable and had certain fire performance and compliance qualities and by failing to provide adequate warnings as to the risks associated with use of the products. As in this case, the loss and damage alleged to have been suffered, was the cost of removing and replacing the ACPs. In Fairview, Wigney J concluded that Fairview’s liability to pay compensation for economic loss suffered by the plaintiff was “in respect of Property Damage”. The essential reasoning underlying that conclusion was that the affixation of the defective panels caused physical loss or damage to the tangible property of the plaintiff (at [150]). Moreover, Wigney J held that physical damage to the building occurred at the time of affixation (at [161]). The relevant damage to the building was making “the buildings less suitable, in a substantial and material way, for the purpose for which the buildings were intended, being for use as residential housing” (at [152]) and that the process of installation and removal of the panels itself causes damage and would cause damage to the building (at [153]-[157]).

1905 I am of the view that the misleading conduct claim in these proceedings is in substance a claim for economic loss that is consequent upon or in conjunction with physical damage to the property. The physical damage to the property occurred on the affixation of the panels to the building. When the Shore OC came into existence on the registration of the strata plan on 24 August 2012, it inherited a building that had physical damage and at that point first suffered loss and damage by reason of the alleged misleading or deceptive conduct.

1906 For the reasons given, the Shore OC’s cause of action accrued when it was vested with the common property of Strata Plan 87231 on 24 August 2012. Upon this basis, the six-year limitation period for the Shore OC’s misleading conduct claim expired on 24 August 2018. I have determined that, the amendments, including those which introduced the misleading conduct claim, take effect from 3 March 2020, which is more than six years after the day on which its cause of action accrued. It follows that the Shore OC’s misleading conduct claim is time barred by reason of s 236(2) of the ACL and cannot be maintained. If I am wrong in respect of when the amendments introducing the misleading conduct claim takes effect, the Shore OC’s misleading conduct claim would still be time barred by reason of s 236(2) of the ACL because the Shore OC commenced this proceeding on 14 February 2019, which is also more than six years after the cause of action accrued.

12. DISPOSITION

1907 The parties are directed to confer and to propose a form of orders to give effect to these reasons and to answer the common questions and questions of commonality in Annexure A to these reasons. To the extent there is disagreement between the parties as to the orders to be made, each party is to file their proposed orders together with a written submission as to why their proposed form of orders should be made by the Court. I will list a date for a further hearing if required.

| I certify that the preceding nil (1907) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Anderson. |
Associate:

Dated: 27 March 2026

ANNEXURE A – COMMON QUESTIONS AND QUESTIONS OF COMMONALITY

A. THE PARTIES

A.1 The Respondents

3A Composites

CQ1: Was 3A Composites a company incorporated under the laws of Germany and capable of being sued in its corporate name?

CQ2: Did 3A Composites, during the Relevant Period, own the Trademark?

CQ3:

(a) Was 3A Composites a “manufacturer” of Alucobond PE Core Cladding (within the meaning of that term in s. 7 of the ACL) and a corporation that “manufactured” Alucobond PE Core Cladding (within the meaning of s. 74A(1) and (3) of the TPA) supplied during the Relevant Period?

(b) If so, were there any periods that 3A Composites ceased to be a “manufacturer” or to have “manufactured” Alucobond PE Core Cladding?

CQ4: Did 3A Composites have a place of business in Australia for the purposes of s. 7(1)(e)(ii) of the ACL and s. 74A(4) of the TPA at the time that the Alucobond PE Core Cladding supplied during the Relevant Period was imported?

CQ5:

(a) Did 3A Composites during the Relevant Period engage in conduct within Australia in respect of the Alucobond PE Core Cladding supplied?

(b) Did 3A Composites, during the Relevant Period, carry on business within Australia for the purposes of s. 5(1) of the TPA and s. 5(1) of the CCA? If so, were there periods that 3A Composites did not carry on business in Australia?

HVG

CQ6: Is HVG a company incorporated in Australia and capable of being sued in its corporate name?

CQ7: Was HVG the sole and exclusive importer and distributor of Alucobond PE Core Cladding in Australia on and from about 8 or 17 August 2007?

CQ8:

(a) Was HVG a “manufacturer” of Alucobond PE Core Cladding (within the meaning of that term in s. 7(1)(e) and 7(3) of the ACL) and a corporation that “manufactured” Alucobond PE Core Cladding (within the meaning of s. 74A(1) and (3) of the TPA) supplied during the Relevant Period?

(b) If so, were there any periods that HVG was not a “manufacturer” or not a corporation which “manufactured” Alucobond PE Core Cladding?

B. THE GOODS

B.1 ACP s AND Alucobond

CQ9: Was Alucobond PE Core Cladding a good of the kind commonly known as an “Aluminium Composite Panel” (“ACP”) which consisted of three bonded laminates, being two aluminium cover sheets and a core throughout the Relevant Period?

CQ10: Throughout the Relevant Period:

(a) were there goods commonly known as ‘combustible ACPs’?

(b) were there goods commonly known as ‘non-combustible ACPs’?

(c) if the answer to (a) and/or (b) is “yes”, was it commonly known that each of Alucobond PE and Alucobond Plus were ‘combustible ACPs’ and not ‘noncombustible ACPs’?

CQ11: Throughout the Relevant Period, were ACPs (including Alucobond PE Core Cladding) commonly used in Australia for the Relevant Uses (as pleaded in the 2FASOC at paragraph 7)?

CQ12: Throughout the Relevant Period, were ACPs (including Alucobond PE Core Cladding), Third Party Products and products transformed, manipulated or fabricated from ACPs:

(a) only supplied to Qualified Professionals (as pleaded in the 3A Defence at paragraph 7(b) and pleaded in the HVG Defence at paragraphs 7(f) and (g));

(b) used in Australia in accordance with designs, plans and specifications prepared, reviewed, approved or certified and/or used by Qualified Professionals in accordance with the BCA and Relevant Building Legislation; and/or

(c) only able to be used for their intended purposes including the Relevant Uses (as defined in paragraph 7(i) of the HVG Defence), with specialised knowledge and/or training and/or specialised equipment, which at all material times was not sold or available to the general public.

CQ13: Throughout the Relevant Period, did Alucobond PE Core Cladding have:

(a) the features; and

(b) was it the subject of technical support in Australia from 3A and/or HVG, as pleaded at paragraph 8 of the 2FASOC?

B.2 ACP s with PE cores

CQ14: Throughout the Relevant Period, did Alucobond PE Cladding have a PE Core as pleaded at paragraph 9 of the 2FASOC?

CQ15: Throughout the Relevant Period, what was the percentage of PE or Plastic Binders, by weight, in the core of each of Alucobond PE; and Alucobond Plus?

CQ16: Did the percentage, by weight, of PE or Plastic Binders in the core of Alucobond Plus supplied by 3A Composites and/or HVG in Australia vary during the Relevant Period ?

CQ17: Throughout the Relevant Period, did 3A Composites and/or HVG know the precise composition of the core of Alucobond Plus supplied in Australia?

C. STATE AND CONDITION OF THE GOOD (ALL BUILDINGS)

C.1 Combustibility and Fire Risk

CQ18: Throughout the Relevant period, did PE and Plastic Binders have the characteristics pleaded at paragraphs 11 and 11A of the 2FASOC? And if so, which characteristics?

CQ19: Throughout the Relevant Period, did the aluminium cover sheets of Alucobond PE Core Cladding fail to protect the PE Core from ignition in the event of a building fire for the reasons pleaded at paragraph 12 of the 2FASOC?

CQ20: By reason of the answers to questions CQ18 and/or CQ19, throughout the Relevant Period, was Alucobond PE Core Cladding combustible due to its PE core within the natural and ordinary meaning of the word?

C.2 Risks associated with use of Alucobond PE Core Cladding

CQ21: By reason of the answers to questions CQ14 to CQ20 above, when used as cladding fitted as part of or as an attachment to an external wall or other building element, did and does Alucobond PE Core Cladding pose a material risk that it will:

(a) cause or contribute to the rapid spread and severity of fire, including the rapid vertical spread and/or horizontal spread of a fire in the building?

(b) cause or contribute to debris falling from the building?

(c) cause or contribute to fire and smoke from fire overwhelming or compromising any fire safety, suppression and/or smoke control systems in the building?

(d) cause or contribute to the release of toxic products of combustion?

(e) if the answer to any or all of CQ21(a) to (d) is “yes” did and does Alucobond PE Core Cladding:

(i) increase the risk of loss of life in the event of a building fire;

(ii) increase the risk of damage to the building and/or building contents in the event of a building fire;

(iii) in the event of a building fire, adversely impact the ability of occupants of the building to evacuate;

(iv) in the event of a building fire, adversely impact the ability of the firefighting authorities to minimise the damage to the building and building contents, and to mitigate against the loss of life or injury to persons in the building?

CQ22: By reason of the answers to CQ14 to CQ21, did Alucobond PE Core Cladding have the Material Fire Risk Properties throughout the Relevant Period? And if so, which ones?

CQ23: Throughout the Relevant Period, was the suitable use of Alucobond PE or Alucobond Plus on a building (as defined in the BCA) required to be determined by those Qualified Professionals with responsibility for the design, construction and/or certification of that building having regard to the matters pleaded in paragraph 14(a) of the HVG Defence?

CQ24: Throughout the Relevant Period was it reasonable for a consumer to expect that, prior to using or installing Alucobond PE or Alucobond Plus on a building (as defined in the BCA), each of those Qualified Professional involved in the design and/or construction of that building would consider or cause to be considered the matters pleaded in paragraph 14(b) of the HVG Defence?

CQ25: Throughout the Relevant Period was it reasonable for a consumer to expect that, prior to issuing any certification for a building (as defined in the BCA), the relevant Qualified Professional involved in the certification of that building or causing the certification of the building would consider the matters pleaded in paragraph 14(c) of the HVG defence?

C.3 Prohibition Risk Properties

CQ26: Were the Relevant Regulations introduced because Alucobond PE Core Cladding had the Material Fire Risk Properties?

CQ27: By reason of the answers to CQ14 to CQ21, did Alucobond PE Core Cladding have the Prohibition Risk properties throughout the Relevant Period?

D. STATE AND CONDITION OF THE GOODS (CLASS 2 TO 9 BUILDINGS)

CQ28: Was Alucobond PE Core Cladding, at all material times, including throughout the Relevant Period, “combustible” as that term is used in the BCA (i.e. did it fail the combustibility test pursuant to AS 1530.1)?

CQ29: If the answer to question CQ28 is yes, could Alucobond PE Core Cladding be used wherever a non-combustible material was required by the BCA, having regard to the matters pleaded at paragraphs 27(a) to (c) of the 2FASOC?

CQ30: Throughout the Relevant Period, could Alucobond PE Core Cladding when used as part of or as an attachment to an external wall or other building element of a Class 2 to 9 Building comply with the Deemed-to-Satisfy Provisions of:

(a) BCA 2008 to BCA 2016;

(b) BCA 2016 (Amendment 1),

in each case as applied in each State and Territory of Australia, having regard to the matters pleaded in paragraphs 28 and 30 of the 2FASOC?

CQ31: Throughout the Relevant Period, could Alucobond PE Core Cladding when used as part of or as an attachment to an external wall or other building element of a Class 2 to 9 Building meet the Fire Resistance Performance Requirements for all Class 2 to 9 Buildings by means of an Alternative Solution, in accordance with the:

(a) BCA 2008 to BCA 2016;

(b) BCA 2016 (Amendment 1),

in each case as applied in each State and Territory of Australia, having regard to the matters pleaded in paragraph 32 of the 2FASOC?

CQ32: Throughout the Relevant Period, was it reasonably practicable to design or certify an Alternative Solution that would allow the use of Alucobond Plus in accordance with the Fire Resistance Performance Requirements (other than where used in insubstantial quantities), in accordance with the:

(a) BCA 2008 to BCA 2016;

(b) BCA 2016 (Amendment 1),

in each case as applied in each State and Territory of Australia, having regard to the matters pleaded in paragraph 32A of the 2FASOC?

CQ33: By reason of the answers to questions CQ28 to CQ31,

(a) did Alucobond PE Core Cladding, throughout the Relevant Period, have:

(i) the BCA Non-compliance Properties; and/or

(ii) the BCA Non-compliance Risk Properties;

(b) if the answer to CQ33(a) is “yes”, did Alucobond PE Core Cladding, throughout the Relevant Period have the BCA-Related Prohibition Risk Properties?

E. SUPPLY OF THE GOODS

E.1 Supply to consumer otherwise than by sale by auction

CQ34: Is the price of Alucobond PE Core Cladding for the purposes of the definition of “Consumer” in s. 4B of the TPA, s. 3 of the ACL, and to the extent that it applies (noting s. 4KA of the CCA) s. 4B of the CCA, to be determined by the price per panel, the price per quantity ordered per delivery, or the price per quantity ordered per Relevant Building or Relevant Building Part?

CQ35: Was Alucobond PE Core Cladding a good of a kind ordinarily acquired for personal, domestic or household use or consumption within the meaning of s. 3(1)(b) of the ACL and s. 74A(2) of the TPA throughout the Relevant Period?

CQ36: Was Alucobond PE Core Cladding only supplied by HVG to persons in the Construction Industry Market during the Relevant Period?

E.2 Supply of “Third Party Products”

CQ37: To the extent that Alucobond PE Core Cladding was incorporated into any building product or system manufactured by a person other than 3A or HVG (in the manner pleaded at paragraphs 1(d) of the 3A Defence and 7(h) of the HVG Defence) (the “Third Party Products”), were such Third Party Products different goods to Alucobond PE Core Cladding for the purpose of the TPA and ACL, having regard to:

(a) the ordinary or common means of using or affixing Alucobond PE Core Cladding to a building; and/or

(b) the Fabrication and Affixation Representations made by 3A and HVG (to the extent those representations are found to have been made)?

CQ38: Did the supply of Third Party Products (as defined in the 3A Defence and HVG Defence) during the Relevant Period constitute:

(a) the supply of Alucobond PE Core Cladding together with other goods or services; and/or

(b) the supply of Alucobond PE Core Cladding in an altered form or condition or incorporated into other goods,

for the purposes of s 4C of the TPA and s 11 of the ACL, such that the supply of Third Party Products was also supply or resupply of Alucobond PE Core Cladding?

CQ39: To the extent that the Third Party Products were different goods to Alucobond PE Core Cladding or did not constitute a relevant supply of Alucobond PE Core Cladding, throughout the Relevant Period, were 3A and/or HVG the manufacturer of those goods within the meaning of the TPA and ACL, having regard to:

(a) the ordinary or common means of using or affixing Alucobond PE Core Cladding to a building;

(b) the Fabrication and Affixation Representations made by 3A and HVG (to the extent those representations are found to have been made);

(c) 3A holding itself out (or causing or permitting HVG to hold it out) to the public as the manufacturer of the Third Party Products (in the manner pleaded and particularised in the Applicant’s Reply at paragraph 2(d))?

F. REASONABLE EXPECTATIONS AS TO THE QUALITY OF GOODS

F.1 Purposes for which goods commonly supplied

CQ40: Was Alucobond PE Core Cladding commonly bought or supplied in Australia for the Purposes throughout the Relevant Period?

CQ41: Throughout the Relevant Period, was Alucobond PE Core Cladding commonly bought or supplied in Australia for use in accordance with designs, plans and specifications prepared, reviewed approved, certified and/or used by one or more Qualified Professionals in accordance with the BCA and Relevant Building Legislation.

F.2 Representations about the goods

CQ42: Did 3A Composites and/or HVG make the Suitability Representation? If so, in what period and in respect of which product(s)?

CQ43: Did 3A Composites and/or HVG make the Plus Composition Representations? If so, in what period?

CQ44: Did 3A Composites and/or HVG make the Fabrication and Affixation Representation? If so, in what period and in respect of which product(s)?

CQ45: Did 3A Composites and/or HVG make the PE Fire Performance Representations? If so, in what period?

CQ46: Did 3A Composites and/or HVG make the Plus Fire Performance Representations? If so, in what period?

CQ47: Did 3A Composites and/or HVG make the Compliance Representation? If so, in what period and in respect of which product(s)?

CQ48: If any of the answers to any of questions CQ42 to CQ47 is “yes”, did either of 3A Composites or HVG qualify those representations (and if so, which representations) during the Relevant Period by:

(a) representing in that Alucobond PE and/or Alucobond Plus (or any Third Party Products derived therefrom) were capable of being used in accordance with designs, plans and specifications prepared, reviewed, certified and/or used by one or more Qualified Professionals in compliance with the requirements of the BCA and the Relevant Building Legislation;

(b) representing that Alucobond PE and Alucobond Plus were capable of being used on or fitted to buildings by Qualified Professionals for the purposes identified in paragraph 7 of the HVG Defence in accordance with the obligations imposed on those professionals by Relevant Codes and Standards, including without limitation the BCA and/or the NCC, as in force at the relevant time; and/or

(c) using any one or more of the terms or phrases “PE”, “polyethylene”; “flammability”; and/or “normal flammability” in connection with Alucobond PE, so as to expressly or by implication or otherwise represent that Alucobond PE was flammable, or and/or “combustible” for purposes of the BCA?

CQ49: If any of the Representations were conveyed by 3A or HVG in the Relevant Period, were they only conveyed to the Construction Industry Market?

CQ50: If the answer to CQ49 is “yes”, was it common knowledge within the Construction Industry Market during the Relevant Period that ACPs had the Known Fire Properties as that term is defined in the 3A Defence and/or the HVG Defence?

F.3 No warning as to risks

CQ51: Did 3A Composites or HVG, at any time during the Relevant Period, provide any of the:

(a) Suitability Warning?

(b) Limitation of Use Warning?

(d) Fire Risk Warning?

(e) Plus Composition Warning?

(f) Non-compliance Warning?

(g) Non-Compliance Limitation Warning?

(h) Fire Advice Limitation Warning?

CQ52: If any of the Relevant Warnings or Relevant Limitation Warnings were given at some point during the Relevant Period, given by either of 3A Composites or HVG, or were made in respect of certain types of Alucobond PE Core Cladding, when were the warnings given and in relation to which types of cladding?

F. 4 Reasonable expectation as to fitness of goods

CQ53: Having regard to the answers to questions at paragraphs CQ9 to CQ15 and CQ40 above, any combination of the answers to the questions at paragraphs CQ42 to CQ49 above, and/or any combination of the answers to the questions at paragraphs CQ51to CQ52, was it reasonable to expect Alucobond PE Core Cladding to be fit for all of the Purposes, only if:

(a) Alucobond PE Core Cladding did not have the Material Fire Risk Properties;

(b) Alucobond PE Core Cladding did not have the Prohibition Risk Properties;

(i) was safe;

(ii) did not pose a material risk to the health or safety of occupants of the building to which the cladding was fitted; and

(iii) did not pose a material risk of damage to the building or to property in the building; and/or

(d) Alucobond PE Core Cladding could be fabricated by applying any of the Fabrication or Affixation Methods without compromising its fire performance and or giving rise to any of the material risks found in response to question CQ21 above?

CQ54: Having regard to the answers to questions at paragraphs CQ9 to CQ15 and CQ40 above, any combination of the answers to the questions at paragraphs CQ42 to CQ49 above, and/or any combination of the answers to the questions at paragraphs CQ51 to CQ52, would a reasonable consumer fully acquainted with the state and condition of Alucobond PE Core Cladding (including any hidden defects) only regard the goods as acceptable for the Purposes and safe if:

(a) Alucobond PE Core Cladding did not have the Material Fire Risk Properties;

(b) Alucobond PE Core Cladding did not have the Prohibition Risk Properties;

(i) was safe;

(ii) did not pose a material risk to the health or safety of occupants of the building to which the cladding was fitted; and

(iii) did not pose a material risk of damage to the building or to property in the building; and/or

(d) Alucobond PE Core Cladding could be fabricated by applying any of the Fabrication or Affixation Methods without compromising its fire performance and/or giving rise to any of the material risks found in response to question CQ21 above?

CQ55: Having regard to the answers to questions at paragraphs CQ9 to CQ15 and CQ40 above, any combination of the answers to the questions at paragraphs CQ42 to CQ49 above, and/or any combination of the answers to the questions at paragraphs CQ51 to CQ52, was it reasonable to expect Alucobond PE Core Cladding to be fit for all of the Purposes, only if:

(a) Alucobond PE Core Cladding was compliant with the BCA when fitted as part of or as an attachment to an external wall of all Class 2 to Class 9 Buildings;

(b) the use of Alucobond PE Core Cladding for any of Purposes would not cause any Class 2 to Class 9 Building to be or to become non-compliant with the BCA;

(d) Alucobond PE Core Cladding did not have the BCA-Related Prohibition Risk Properties?

CQ56: Having regard to the answers to questions at paragraphs CQ9 to CQ15 and CQ40 above, any combination of the answers to the questions at paragraphs CQ42 to CQ49 above, and/or any combination of the answers to the questions at paragraphs CQ51 to CQ52, would a reasonable consumer fully acquainted with the state and condition of Alucobond PE Core Cladding (including any hidden defects) only regard the goods as acceptable for the Purposes and safe if:

(a) Alucobond PE Core Cladding was compliant with the BCA when fitted as part of or as an attachment to an external wall of all Class 2 to Class 9 Buildings;

(b) the use of Alucobond PE Core Cladding for any of Purposes would not cause any Class 2 to Class 9 Building to be or to become non-compliant with the BCA;

(d) Alucobond PE Core Cladding did not have the BCA-Related Prohibition Risk Properties?

G. GOODS NOT OF MERCHANTABLE OR ACCEPTABLE QUALITY

CQ57: Having regard to the answers to the above questions, was Alucobond PE of:

(a) merchantable quality within the meaning of s 74D(3) of the TPA; and/or

(b) acceptable quality within the meaning of s 54(2)-(3) of the ACL,

subject to the application of s 74D(2) of the TPA or ss 54(4), (7) and/or 271(2) of the ACL in respect of any individual group member’s claim.

CQ58: Having regard to the answers to the above questions, was Alucobond Plus of:

(a) merchantable quality within the meaning of s 74D(3) of the TPA;

(b) acceptable quality within the meaning of s 54(2)-(3) of the ACL,

subject to the application of s 74D(2) of the TPA or SS 54(4), (7) and/or 271(2) of the ACL in respect of any individual group member’s claims.

CQ59: If the answer to CQ57 or CQ58 is “yes”:

(a) was any failure of the goods to be of merchantable quality and/or to comply with the acceptable quality guarantee by reason of the act or default of a person or persons other than 3A or HVG or a cause independent of human control within the meaning of s 74D(2)(a) of the TPA or s 271(2) of the ACL?

(b) would an examination of the goods reasonably have revealed that they were defective or not of acceptable quality within the meaning of ss 74D(2)(c) or 54(7) of the ACL?

H. MISLEADING OR DECEPTIVE REPRESENTATIONS

H.1 False or misleading representations about goods

CQ60: If 3A Composites and/or HVG made any of the Suitability Representation, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation, and Compliance Representation (the “Representations”) during the Relevant Period, were those representations made in trade or commerce in connexion with the supply or possible supply of Alucobond PE Core Cladding or in connexion with the promotion of the supply of Alucobond PE Core Cladding?

CQ61: Was the Suitability Representation:

(a) a representation that Alucobond PE Core Cladding had specified performance characteristics, uses and benefits?

(b) false or misleading because Alucobond PE Core Cladding was not suitable for all of the Purposes by reason of the answers to the questions at paragraphs CQ21, CQ22, and/or CQ27 above?

CQ62: Was the Fabrication and Affixation Representation:

(a) a representation that Alucobond PE Core Cladding had specified performance characteristics, uses and benefits?

(b) false or misleading because all or some of the Fabrication Methods caused Alucobond PE Core Cladding to have the Material Fire Risk Properties or the Prohibition Risk Properties addressed in questions CQ22 and CQ27 above?

CQ63: Were each of the PE Fire Performance Representation and Plus Fire Performance Representation:

(a) a representation that Alucobond PE Core Cladding:

(i) was of a particular standard or quality; or

(ii) had specified performance characteristics, uses and benefits?

(b) false or misleading because of the answers to the questions at paragraphs CQ19 and CQ21 above?

(c) false or misleading because Alucobond PE Core Cladding had not passed or satisfied all of the local and international fire tests referred to in the promotional material?

(d) false or misleading because the fire tests did not provide a reasonable basis for 3A Composites and/or HVG to represent that Alucobond PE Core Cladding was suitable or safe for use on a building for the Purposes and/or did not present any material increase in risk in the event of a building fire?

CQ64: Was the Compliance Representation:

(a) a representation that Alucobond PE Core Cladding:

(i) was of a particular standard or quality; or

(ii) had specified performance characteristics, uses and benefits?

(b) false or misleading:

(i) because Alucobond PE Core Cladding had not passed all of the fire safety tests required by relevant building codes and standards, including AS1530.1; and/or

(ii) by reason of the answers to the question at paragraph CQ33(a) and (b)above?

CQ65: Were any or all of the Suitability Representations, Fabrication and Affixation Representation, PE Fire Performance Representation, Plus Fire Performance Representation and/or Compliance Representations (“Future Representations”) representations with respect to a future matter?

CQ66: Did 3A Composites and/or HVG have reasonable grounds for making the Future Representations?

CQ67: Did each of 3A Composites and HVG contravene s. 53 of the TPA and s. 29 of the ACL by making the Representations?

H.2 Misleading conduct as to the nature of goods

CQ68: To the extent it is found that 3A Composites and/or HVG:

(a) made the Representations;

(b) failed to give the Relevant Warnings; and/or

during the Relevant Period, was this conduct, in trade or commerce, that was liable to mislead the public as to the:

(d) nature;

(e) characteristics; and

(f) suitability for purpose,

of Alucobond PE Core Cladding?

CQ69: Did each of 3A Composites and HVG contravene s. 55 of the TPA and s. 33 of the ACL, and if so, in what period?

I. OTHER MATTERS

I.1 Transitional provisions

CQ70: Do the transitional provisions in item 6 of Schedule 7 of the Trade Practices Amendment (Australian Consumer Law) Act (No. 2) 2010 (Cth) have the effect that:

(a) the TPA applies to any claim by a Group Member where the relevant Alucobond PE Core Cladding was supplied to a consumer prior to 1 January 2011; and

(b) the ACL applies to any claim by a Group Member where the relevant Alucobond PE Core Cladding was supplied to a consumer on or after 1 January 2011?

CQ71 For the purposes of any of the limitation defences raised in the 3A Defence or HVG Defence, is 2 March 2020 (being the date the Amended Statement of Claim was filed) the relevant date that the proceedings were commenced (and the date on which the suspension of limitation periods with respect to Group Members pursuant to s 33ZE takes effect) in respect of any of the claims advanced in the 2FASOC? If so, in relation to which aspects of the claim? Group members who have TPA claims but not ACL claims (see CQ70 above)

I.2 Group members who have TPA claims but not ACL claims (see CQ70 above)

CQ72: Subject to CQ37, CQ38 and CQ39, and depending on the answer to CQ70 above, if Group Members only have claims under the TPA, and not the ACL, then, in respect of those group members:

(a) Did 3A Composites supply all Alucobond PE Core Cladding in Australia to its exclusive distributor (at all material times, HVG)?

(b) Were the supplies referred to in (a) above in trade or commerce?

(c) Did 3A Composites’ exclusive distributor (at all material times, HVG) acquire the Alucobond PE Core Cladding for the purpose of re-supplying it?

(d) By reason of the answers to paragraphs (a) to (c), did 3A Composites supply all of the Alucobond PE Core Cladding fitted on the Relevant Buildings and/or Relevant Building Parts of those Group Members to another person who acquired those goods for the purposes of re-supply, within the meaning of s 74D(1)(a) of the TPA?

I.3 Group members who are owners’ corporations or derived title through owners’ corporations

CQ73: With respect to:

(a) the Applicant;

(b) any Group Member who acquired the Alucobond PE Core Cladding affixed to their Relevant Building or Relevant Building Part by operation of the legislation specified in Note 1 of this Annexure A; and

(c) any Group Member who acquired or derived title to the Alucobond PE Core Cladding from or through an Original Consumer Owner who acquired their interest in the Alucobond PE Core Cladding in the manner described in the preceding paragraph,

does the transfer of title by operation of the relevant legislation constitute a “supply” of Alucobond PE Core Cladding to the Applicant, Group Member or Original Consumer Owner (as applicable), within the meaning of the TPA and ACL?

I.4 Group members who are subject to a legally-binding direction to remove and replace Alucobond PE Core Cladding

CQ74: With respect to the Applicant and any Group Members who are the subject of a legally-binding direction to remove and replace their Alucobond PE Core Cladding at their own cost, is the cost of removing and replacing the Alucobond PE Core Cladding, or of implementing other measures to rectify the impact of the cladding on their building, loss or damage suffered by the Applicant or Group Member:

(a) by reason of Alucobond PE Core Cladding not being of merchantable quality; or

(b) because of the failure of Alucobond PE Core Cladding to comply with the Acceptable Quality Guarantee?

I.5 Commonality of questions

CQ75: Are any of the above questions and their answers not common to all group members? If so, which questions and answers?

CQ76: If the answer to question CQ75 is “yes”, are the questions and their answers sufficiently common to some of the group members so as to be the subject of an order under s 33ZB of the Federal Court of Australia Act 1976 (Cth) that binds those group members and the defendant in relation to those answers? If so, which questions and answers and in relation to which group members?

NOTE 1

The version of the legislation referred to below is the version in force in the period from February 2009 to February 2019.

New South Wales

Strata Schemes Development Act 2015 (NSW)
Strata Schemes (Freehold Development) Act 1973 (NSW)
Strata Schemes (Leasehold Development) Act 1986 (NSW)

Victoria

Subdivision Act 1988 (Vic)

South Australia

Strata Titles Act 1988 (SA)
Strata Community Titles Act 1996 (SA)

Queensland

Land Titles Act 1994 (Qld)

Western Australia

Strata Titles Act 1985 (WA)

Tasmania

Strata Titles Act 1998 (Tas)

Australian Capital Territory

Unit Titles Act 2001 (ACT)
Unit Titles (Management) Act 2011 (ACT)
Land Titles (Unit Titles) Act 1970 (ACT)

Northern Territory

Unit Title Schemes Act 2009 (NT)

ANNEXURE B – GLOSSARY OF TERMS

| Term | Definition |
| 2FAPOC | Second Further Amended Points of Claim |
| 2FASOC | Second Further Amended Statement of Claim |
| 3A | 3A Composites GmbH |
| ABCB | Australian Building Codes Board |
| Abdul-Rahman | Developer of the Five Dock Building |
| ACL | Sch 2 to the C ompetition and Consumer A ct 2010 (Cth) (the Australian Consumer Law) |
| ACP | aluminium composite panel |
| ACP Solutions | ACP Cladding Solutions Pty Ltd – installers of the Alucobond Plus affixed to the Five Dock Building. |
| AFAC | Australasian Fire and Emergency Service Authorities Council. |
| Ahmed Zeitoun | A representative of Buildrite, the builders of the Five Dock Building. |
| Alucobond products | Alucobond PE and Alucobond Plus |
| Amended Documents | The Further Amended Originating Application and the Amended Statement of Claim |
| Applicants | Shore OC and Five Dock OC collectively |
| AR Building Certifiers | Certifiers of the Shore Building |
| AS 1530 | An Australian Standard relating to the fire testing of building materials, components and structures. The standard is comprised of four parts. |
| AS 1530.1-1994 | A simple, small-scale test to determine whether a material is considered non-combustible for the purposes of the BCA. The test involves a small-scale cylindrical sample of the material being lowered into a small furnace held at a constant temperature of 750°C, with a pilot flame located above the furnace. The test measures whether the relevant product burns under such circumstances. Where a material is not deemed combustible as determined by AS 1530.1, it is classified as non-combustible for the purposes of the BCA. |
| AS 1530.3 1999 | A test designed to assess the fire hazard properties of materials, namely: ignitability, flame propagation, heat release, and smoke release. The test involves a 600 x 450 mm sample which is held onto a supporting frame in a vertical orientation and exposed to heating from a radiant panel source. The sample is progressively moved closer to the radiant heater over a period of 20 minutes or until ignition occurs. A pilot flame is maintained above the sample. The response of the sample is then measured with the results reported as indices for time to ignition, intensity of radiation, spread of flame, and smoke detection. AS 1530.3 allows a cascading level of fire safety for materials which are combustible. |
| AS 1530.4-2005 | A test which relates to the fire resistance level of a material, whether or not it is combustible. |
| AS 5113-2016 | The first Australian Standard testing method specifically for the external fire performance of cladding systems. In contrast to the other tests discussed above, AS 5113 is a large-scale test. Based on the earlier UK test BS 8414, the product is applied over the front face of a testing rig which is around eight to nine metres high. The testing rig also includes a “wing wall” at right angles to the main face. A combustion chamber sits at the bottom of the testing rig, into which a wooden crib is placed and ignited, developing into a severe fire source which vents from the combustion chamber and impinges on the cladding above the opening. |
| ASC | Amended Statement of Claim |
| ATH | aluminium(tri)hydroxide |
| ATR-FTIR | Attenuated Total Reflectance Fourier Transform Infrared Spectroscopy. One of the methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. |
| BAC | BAC Insurance Brokers Pty Ltd – Five Dock OC’s insurance brokers. |
| Bayside Council | Local council for the Shore Building |
| BCA | Building Code of Australia |
| BCA Innovations | BCA Innovations Pty Ltd – fire safety engineers engaged by Buildrite in relation to the Five Dock Building. |
| BCA Non-compliance properties | The Applicants pleaded claim that the Alucobond products do not and did not comply with the BCA. This is pleaded on the basis that the panels could not be used as part of a design that was compliant with the DtS Provisions of the BCA, and could not reasonably practicably form part of an alternative solution, other than where used in insubstantial quantities. |
| BCA Non-compliance Risk Properties | The Applicant’s pleaded claim that there was a material risk that the Alucobond products did not comply with the BCA for the same reasons as pleaded in respect of the BCA Non-compliance properties. |
| BCA-related Prohibition Risk Properties | The Applicants’ pleaded claim that by reason of the BCA Non-compliance Risk Properties of the panels, there was at all material times a risk that the Alucobond products could be the subject of a legally binding direction to be removed and/or replaced at the cost of the owner or leaseholder. |
| Ben Di Giorgi | The “Sales & Technical Manager – NSW” of HVG |
| Bill Filippopoulos | The chairman of the Five Dock OC strata committee. Has been a lot owner since January 2019, a member of the strata committee of the Five Dock OC since 25 May 2020 and chairperson since 30 March 2021. Mr Filippopoulos gave evidence on behalf of the Five Dock OC. |
| BPS Act | Building Products (Safety) Act 2017 (NSW) |
| Buildrite | Buildrite Australia Pty Ltd – builders of the Five Dock Building |
| Cassette method (also referred to as tray method) | ACP cladding panels being routed and folded to create shallow box shapes that can then (typically) be hung from cladding rails on the outside of a building. |
| CCA | C ompetition and Consumer A ct 2010 (Cth) |
| CGA (NZ) | C onsumer G uarantees A ct 1993 (NZ) a |
| Chopping technique | One of the sample preparation methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. |
| CIP | Carriage and Insurance Paid To |
| City of Canada Bay | The local council for the Five Dock Building |
| Commissioner | Commissioner for Fair Trading |
| Compliance Representation | Alucobond PE and Alucobond Plus were compliant with all relevant building codes and standards for use on all buildings in Australia as part of or as an attachment to an external wall or other building element for its common uses, or would be so compliant once affixed. |
| Concurrent flame spread | Occurs where the flame propagates in the same direction as the flow of hot combustion products. The most common case of concurrent flame spread is upwards flame spread. |
| cone calorimeter | A piece of specialist fire science equipment which is used to apply a controlled level of radiant heat to a test sample. An electrical spark is generally used to provide an ignition source immediately above the sample. It enables the calculation of various factors which can be used to describe the flammability of a material, including the heat release rate, smoke production, and the critical heat flux for ignition. |
| Core Five Dock Report | Core Project Consulting produced a report dated 30 September 2020 in which they identified that both samples had a core containing 29% PE. |
| Core Project Consulting | Authors of the Core Shore Report and the Core Five Dock Report. |
| Core Shore Report | Report dated 19 January 2018 by Core Project Consulting which identified that the cladding applied to the Shore Building was most likely to have a PE core. |
| Critical heat flux for ignition | Refers to the minimum heat flux at which a material will ignite when exposed to heating for a specified time period (generally, 15 minutes) |
| Cryomilling | One of the sample preparation methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus, which creates free-flowing powder, with the intent to homogenise, as far as is possible, the sample. |
| Davis’ Solution | The second proposed Performance Solution prepared by Mr Davis in respect of the Five Dock Building – being a Performance Solution prepared from the perspective of offering remediation measures to achieve BCA compliance with the performance requirements under BCA 2019 Amendment 1. Specifically, the first remedial measure proposed, being: removal of Alucobond Plus panels that connect vertically between apartment windows on the building’s eastern elevation (ie, the back of the building), replacing them with a non-combustible cladding option if necessary and installing mineral wool batting with a minimum density of 60 kg/m3 behind panels around all windows on the eastern elevation. |
| Defire | Defire (NSW) Pty Ltd – fire safety engineers engaged by the Shore OC to produce a report on the compliance or otherwise of the cladding affixed on the Shore Building. |
| Design fire scenario | A narrative structure of a fire event that accounts explicitly for the features of a particular building and the reaction-to-fire behaviours of its various components. A design fire scenario can be used subsequently as the basis for the development of models of fire scenarios for the performance assessment of the building. |
| Design Professionals | Qualified Professionals who were responsible for designing, constructing and certifying buildings that complied with the BCA including architects and designers who specified ACPs, façade fabricators, who constructed facades using ACPs and building certifiers who certified compliance with the BCA. |
| Developers | The developers of the Shore Building (Ronnstar Pty Ltd and Lawtow Pty Ltd) and of the Five Dock Building (Abdul-Rahman) |
| Distributor Agreements | The distributor agreements between 3A and HVG dated 1 July 2007, 1 September 2010, 1 September 2015 and 1 January 2018. |
| Dr Joachim Werner | Managing Director of 3A since 2003 with responsibility for the Singen plant that manufactured the Alucobond products including oversight of the production and operation of the plant. Dr Werner gave evidence on behalf of 3A. |
| dry ash analysis | One of the sample preparation methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. It involves pre-drying a sample and then placing the sample into a muffle furnace for a period of time, to ensure the ashing of the sample. The relative weight loss between the pre-dried sample and the ash is calculated to enable the quantification of the inorganic content of the samples. |
| DtS | Deemed-to-Satisfy Solution |
| EPA Act | Environmental Planning and Assessment Act 1979 (NSW) |
| EVA | ethylene vinyl acetate |
| Everest Contracting | Everest Contracting Pty Ltd |
| Fabrication and Affixation Representation | Alucobond PE and Alucobond Plus could be fabricated and affixed to buildings by third parties prior to (or as part of) being fitted to buildings, in accordance with the methodologies set out in the technical manuals and marketing materials, without materially affecting their fire performance and safety. |
| Fabrication and Affixation Warning | the behaviour of Alucobond PE and Alucobond Plus in a fire was affected in a material way by the method of fabrication or affixation chosen. |
| FAOA | Further Amended Originating Application |
| FC Rules | Federal Court Rules 2011 (Cth) |
| FCA Act | Federal Court of Australia Act 1976 (Cth) |
| FEB | Fire Engineering Brief |
| FER | Fire Engineering Report |
| Filing technique | One of the sample preparation methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. |
| Fire Advice Limitation Warning | the products could not be used safely or in a manner compliant with the BCA without advice from a competent fire safety engineer. |
| Fire Risk Warning | the aluminium coversheets did not protect the PE core from igniting in a fire, and that the products had the Material Fire Risk Properties. |
| Five Dock Building | A residential building located in Five Dock, NSW, The owners corporation is the Five Dock OC. |
| Five Dock OC | The Owners – Strata Plan 98297 (sub-group representative) |
| flame spread | Occurs when heat is transferred from a burning region to adjacent unburnt material. It can be thought of as a series of ignitions, where sufficient energy is applied to the fuel ahead of the flame such that pyrolysis can occur. As the rate of flame spread is governed by the rate at which the material ahead of the burning region can be heated to its pyrolysis temperature, the rate of flame spread is dependent on the heat transferred to the material and the material’s thermal inertia. |
| Flammability | The ease with which the material ignites and the manner in which it burns. |
| FPA | Fire Propagation Apparatus which consists of two main components, being the fire model and the gas analyser system. The fire model is fitted with a sample holder, infrared lamp heaters to irradiate heat above the sample, and a piloted flame that sits above the sample to induce ignition. |
| FRL | Fire-Resistance Level |
| FSE | fire safety engineer |
| Grenfell Fire | Grenfell” building fire in London in June 2017 |
| Heat capacity | The amount of energy required to increase the temperature of a unit mass of the material by one degree Celsius. |
| Heat Flux | The magnitude of applied energy |
| Heat of combustion (or calorific value) | The total amount of energy that is available to be released from a material. It is a measure of the maximum energy that a material can be expected to release via combustion, or in other words, the amount of “fuel” that a material may provide for a fire. It is reported in units of megajoules per kilogram (MJ/kg) and provides an upper limit on the amount of energy that can be released by burning a material, but does not give any information regarding the rate at which energy is released. |
| Heat release rate | Describes the rate of energy release, per unit of time, as a material burns. The heat release rate of a material is dictated by the pyrolysis mechanism of the material, the physical geometry of the sample, the boundary conditions of the materials, and the presence of an external heat source. Heat release rate is commonly expressed in terms of the area of burning, being the heat release rate per unit area. |
| HVG | Halifax Vogel Group Pty Ltd |
| IClad | IClad Solutions Pty Ltd |
| ICP-MS | Inductively Coupled Plasma Mass Spectroscopy. One of the methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus |
| Ignition | The initiation of sustained flaming combustion of pyrolysis gases. Ignition only occurs after a period of heating of the solid material, such that the surface temperature of the material reaches pyrolysis temperature. |
| ISO 9705 | A test used to determine materials to be used in internal applications such as floor materials, floor coverings, and wall and ceiling lining materials. The test determines a “group number” for materials. Involves a set up that replicates the corner of a room with a gas burner situated on the floor in the corner. The gas burner is ignited, and the growth rate of the fire resulting from involvement of the lining products, as well as the total heat released and amount of smoke generated, is measured. For the first 10 minutes, the heat output of the burner is set to 100 kW, after which the heat output of the burner is increased to 300 kW for another 10 minutes. |
| Lacrosse Fire | Lacrosse building fire in Melbourne in November 2014 |
| LIFT | Lateral Ignition and Flame spread Test – a method of testing the flame spread of a material. |
| Limitation of Use Warning | The products were not safe and suitable for use on all buildings for some of the Purposes, or were only safe for some Purposes when combined with particular materials designed to resist the spread of fire. |
| Margaret Hall | Member of the Shore OC strata committee |
| Margaret Lynette Hall | A lot owner in the Shore Building and member of the strata committee since 1 October 2023. Ms Hall gave evidence on behalf of the Shore OC. |
| Material Fire Risk Properties | The Applicant’s pleaded claim that when the Alucobond products were fitted as part of or as an attachment to the external wall or other building element, there was, and is, a material risk that the cladding will, in the event of a fire: cause or contribute to the spread and severity of the fire, cause or contribute to debris falling from the building, cause or contribute to fire and smoke overwhelming or compromising any fire safety measures in the building, and cause or contribute to the release of toxic products of combustion. As a result of all, any, or a combination of the above matters, that the Alucobond products increase the risk of loss of life and damage to property, adversely impact the ability of occupants to evacuate, and/or adversely impact the ability of firefighting authorities to fight the fire. |
| MBM | Mount Bruce Mining Pty Ltd |
| Michael Sheils | A lot owner in the Shore Building and member of the strata committee of the Shore OC since 1 October 2013. As a member of the strata committee, Mr Sheils gave evidence on behalf of the Shore OC. |
| Modernise Installations | Installers of the Alucobond PE cladding on the Shore Building |
| Mr Hatziandreou | A representative of the Shore Developers and Prestige Apartments |
| Mr Spyrou | The building certifier of the Five Dock Building |
| Mr Tatian | A fire safety engineer from BCA Innovations – the fire safety engineer firm engaged by the Five Dock OC in respect of the Five Dock Building. |
| Mr Zeitoun | A representative of the builder of the Five Dock Building: Buildrite |
| National Construction Code | National Construction Code |
| NCC | National Construction Code |
| NFPA 285-1999 | One of the most widely used large-scale cladding fire tests and was developed in the United States of America. Involves a testing rig that is 7.32 m high. The candidate cladding is installed over the exterior wall of the testing rig and a combustion chamber is placed near the base of the wall, with the fire allowed to vent to the exterior wall, resulting in direct impingement of a fire plume on the exterior cladding system being assessed. |
| Non-compliance Limitation Warning | Alternatively, that the products were only compliant with the BCA when used on some buildings, or for some Purposes or when combined with other materials and/or technology to resist the spread of fire. |
| Non-compliance Warning | The products had not passed fire safety test AS 1530.1 and were not compliant and there was a risk they were not compliant with the BCA. |
| Opposed-flow flame | Occurs when the flame spread is in the opposite direction to the flow of hot gases. This is most commonly observed where a flame is spreading downwards or horizontally. Concurrent flame spread is generally faster than opposed-flow flame spread given that the hot combustion products rise due to buoyancy, resulting in higher rates of heat transfer to the surface of the material. |
| PE | Polyethylene |
| PE Fire Performance Representations | Alucobond PE was safe and suitable, and would present no material increase in risk to the life or safety of occupants, or damage to property in the event of a building fire, because the aluminium cover sheets protected the core and/or it had passed or satisfied various local and international fire performance tests. |
| Peter O’Reilly | Chairperson of the Shore OC strata committee in August 2018 |
| Plus Composition Representation | The core of Alucobond Plus contained no more than 30% plastic binders and/or not less than 70% non-combustible mineral filler. |
| Plus Composition Warning | The core of Alucobond Plus could, and did at times, contain less than 70% mineral filler. |
| Plus Fire Performance Representation | Alucobond Plus was safe and suitable, and would present no material increase in risk to the life or safety of occupants, or damage to property in the event of a building fire, because the aluminium cover sheets protected the core and/or it had passed or satisfied various local and international fire performance tests, and it was fire resistant, hardly inflammable and/or had low flammability. |
| Positive Representations | Each of the Suitability Representation, the Fabrication and Affixation Representation, the PE Fire Performance Representation, the Plus Fire Performance Representation, the Compliance Representation and the Plus Composition Representation. |
| Prestige Apartments | The builders of the Shore Building. |
| Prohibition Risk Properties | The Applicants’ pleaded claim that by reason of the BCA Non-compliance Properties, there was at all material times a risk that the Alucobond products could be the subject of a legally binding direction to be removed and/or replaced at the cost of the owner or leaseholder. |
| Purposes | The purposes which the Applicants plead the Alucobond products were commonly bought and supplied in Australia for, being: use as part of an external wall (or as an attachment thereto or other building element) on high-rise or low-rise buildings, where such buildings were for residential purposes, commercial purposes or public or government administration purposes. |
| Pyrolysis | The process of thermal decomposition of a solid material and results in the production of flammable vapours which fuel the flaming combustion of a solid. Materials with higher pyrolysis temperatures are more difficult to ignite. |
| Qualified Professionals | Professionals involved in the design, construction and approval of buildings, including being architects, builders, surveyors, certifiers, developers, project managers, FSEs, as well as consent authorities, façade engineers, façade contractors and sub-contractors. |
| Rectification Order | Fire Order & Building Product Rectification Order issued by Bayside Council to the Shore OC on 29 May 2019. |
| Relevant Period | 14 February 2009 to 14 February 2019 |
| Respondents | 3A and HVG |
| Restorial | Restorial Remedial Building Services – engaged by the Shore OC to carry out rectification works for the removal Alucobond PE on the Shore Building. |
| SEM-EDS | Scanning Electron Microscopy Energy Dispersive Spectroscopy. One of the methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus |
| Shore Building | A residential building in Dolls Point, NSW. The owners corporation is the Shore OC. |
| Shore Developers | The developers of the Shore Building - Ronnstar Pty Ltd and Lawtow Pty Ltd |
| Shore OC | The Owners – Strata Plan No 87231 |
| Singen Plant | 3A’s large-scale industrial manufacturing plant in Singen, Germany. |
| SSDA 2015 | Strata Schemes Development Act 2015 (NSW) |
| SSFDA 1973 | Strata Schemes (Freehold Development) Act 1973 (NSW) |
| SSMA 1996 | Strata Schemes Management Act 1996 (NSW) |
| SSMA 2015 | Strata Schemes Management Act 2015 (NSW) |
| Suitability Representation | Alucobond PE and Alucobond Plus were suitable for all of the uses for which they were commonly acquired (which included use as external cladding on high or low rise buildings used for residential, commercial or public purposes), and would be suitable for such uses once affixed to a building. |
| Suitability Warning | The products were not safe and suitable for use on all buildings for all of the Purposes. |
| Susan Haas | Senior sales manager from 3A in Germany. Appears to have been largely responsible for the Australian market during the relevant period, and made numerous marketing trips to Australia. |
| Swanson Report | Report of the Trade Practices Act Review Committee dated August 1976. |
| TGA | Thermogravimetric Analysis – used to measure weight loss as a function of temperature, to monitor any decomposition/dehydration processes. One of the methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. |
| The “time to ignition”. | Refers generally to the time required to heat the relevant solid to pyrolysis temperature, where pyrolysis occurs at a rate sufficient to form a flammable mixture. A material’s time to ignition depends on the heat flux and the material’s thermal inertia. Where the applied heat flux is increased, and/or a material has a lower thermal inertia, the time to ignition decreases |
| The product ban | On 10 Aug 2018, a “ban notice” was issued under s 9(1) of the Building Products (Safety) Act 2017 (NSW). |
| Thermal conductivity | The ability of the material to transfer thermal energy internally |
| Thermal inertia | represents the ease with which the surface temperature of a material will change, where materials with high thermal inertia are slow to react to changes in temperature. The thermal inertia of a material is a product of its thermal conductivity, the density of the material, and the material’s specific heat capacity. Materials with a low thermal inertia will initially experience more rapid pyrolysis than materials with high thermal inertia. |
| Tony Hatziandreou | Representative of the Shore Developers and Prestige Apartments. |
| Torero and Lange September 2021 Paper | M.S. McLaggan et al, “Towards a better understanding of fire performance assessment of façade systems: Current situation and proposed new assessment framework” (2021) 300 Construction and Building Materials.

Professor Torero and Associate Professor Lange were two of the co-authors of this article. |
| TPA | Trade Practices Act 1974 (Cth) |
| VR Lake | Victor Robert Bryce Lake and Associates Pty Ltd - architects of the Shore Building. |
| VRL | The architects of the Shore Building - Victor Robert Bryce Lake & Associates Pty Ltd. |
| XRPD | X-ray Powder Diffraction – a method routinely used in the characterisation of solid compounds. One of the methods used by Expert Group 1 (Chemists) in testing the chemical composition of Alucobond Plus. |
Top