The Owners - Strata Plan No 87231 v 3A Composites GmbH

2.1 The products: Alucobond PE and Alucobond Plus

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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 21st 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] (Beach, Osborne JJA and Stynes AJA).
13. 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.
14. 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.
15. 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.

1. Construction in Australia is regulated through the BCA. The BCA is maintained and published by the Australian Building Codes Board and forms part of the broader National Construction Code. 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).
2. The BCA is adopted in each of the States and Territories through State and Territory legislation.
3. 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.
4. 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.
5. 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.
6. A building, or part of a building, may be designed, constructed or adapted for multiple purposes and have more than one classification.
7. 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.
8. 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.
9. 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.

1. 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 "Deemed-to-Satisfy 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.
2. 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.
3. 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.
4. The specifics of these regulations differ across the States and Territories. They are summarised in the table below:

On 10 Aug 2018, a "ban notice" was issued under s 9(1) of the Building Products (Safety) 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.

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.

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

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.

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.

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.

1. 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.
2. 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.
3. 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.
4. 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 m2. 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.
5. 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.
6. 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).
7. 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).
8. 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.
9. 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.

1. The Shore Building is a four-storey residential apartment building consisting of 17 residential units and a basement car parking level.
2. The building was designed by architects Victor Robert 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.
3. 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.
4. 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.
5. 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".
6. 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.
7. 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)

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

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. On 11 October 2018, the Shore OC decided to engage fire safety engineers (FSEs), Defire (NSW) Pty Ltd, to provide a report on the compliance or otherwise of the cladding affixed on the Shore Building.
8. 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).
9. Defire reached the following conclusions regarding the risk of Alucobond PE on the Shore Building:

1. The report recommended that in respect of the "high" cladding risk, it was essential that a risk treatment strategy be developed and implemented as a high priority. It suggested that this could include management solutions, installation of additional fire safety measures, and façade system remediation/removal. The report also noted that a more detailed fire engineering assessment may be necessary to evaluate the risk treatment options. A number of interim measures were also recommended until a treatment plan could be developed and implemented.
2. 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.

1. On 7 March 2019, Bayside Council sent a proposed Fire Order & Building Product Rectification Order in relation to the Shore Building.
2. 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.
3. 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.

1. 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.
2. The Shore OC also separately resolved to raise a special levy to fund the rectification works.
3. 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.

1. 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:

Inspection of Shore Building and combustible cladding risk assessment

Removal of old cladding and installation of new cladding

1. 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).

1. 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.
2. 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.
3. 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)

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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_._
7. 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.
8. 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.

1. 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

1. On 8 June 2018, Mr Zeitoun forwarded the attachments to BCA Innovations stating: "Please see attached product used at Fivedock".
2. 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.

1. 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.

1. 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.
2. 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%.
3. 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.

1. 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.
2. 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.
3. 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.

1. 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:

1. The Five Dock OC rejected the above tenders on the basis that they were too expensive.
2. The Five Dock OC made further enquiries with private contractors regarding the replacement works, receiving the following quotations:

$476,622.30, offering an additional home owners warranty fee of $32,400.00.

1. 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.
2. 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.

1. 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.
2. 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/m2).
3. 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.
4. 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.
5. 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.
6. 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).
7. Once a material has ignited, a key variable is the rate at which energy is released.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.
13. 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.

1. As referred to earlier, the Applicants rely on two separate causes of action.
2. 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".

1. 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.
2. 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.
3. 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.
4. 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.
5. Setting aside these threshold issues for the moment, the Respondents make a number of arguments as to why the underlying claims should fail.
6. 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 Qualified Professionals - 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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'.
12. 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.
13. 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:

Part 1 - Whether the TPA and ACL apply to 3A's conduct

Whether 3A engaged in the impugned conduct in Australia.

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

Whether 3A supplied Alucobond PE or Alucobond Plus to HVG in "trade or commerce": TPA, s 74D(1)(a) [TPA only].

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].

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 4B(1); ACL, s 3(2).

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).

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

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).

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).

[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.

Whether the alleged representations were misleading for the reasons alleged in SOC [77]-[80].

[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)

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).

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)

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.

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.

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.

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.

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.

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).

1. 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.

1. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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).

1. A singular affidavit affirmed by Dr Werner on 14 March 2023 was read into evidence.
2. 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.
3. 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.
4. 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.
5. 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.

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

1. 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.

1. 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.
2. 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.
3. 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.
4. 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)

1. 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.
2. 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.
3. 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.
4. Again, Mr Filippopoulos' evidence was largely uncontroversial and was not subject to challenge by the Respondents.

1. 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.
2. 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.
3. 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.

Joint report of Dr Kirk and Mr Carrascal dated 3 March 2024 ("Group 1 Joint Report")

Joint Report of Professor Bisby, Mr Carrascal and Associate Professor Lange dated 28 March 2024 ("Group 2 Joint Report")

Joint Report of Professor Bisby, Professor Torero and Associate Professor Lange dated 3 April 2024 ("Group 3 Joint Report")

Joint Report of Mr Kip, Mr Davis and Mr Moore dated 3 April 2024 ("Group 4-5 Joint Report")

Joint Report of Mr Kip and Mr Halstead dated 13 Mar 2024 ("Group 6 Joint Report")

Joint Report of Mr Quigley, Mr Incoll and Mr Smithson dated 26 February 2024 ("Group 7 Joint Report")

1. Despite the extensive expert evidence that was filed, as it turns out, there was actually limited disagreement between the experts.

1. The summary of Expert Group 1 is extracted below:

Joint report of Dr Kirk and Mr Carrascal dated 3 March 2024 ("Group 1 Joint Report")

1. 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.
2. 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.
3. 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.
4. 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.
5. 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).
6. 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.

1. Dr Kirk conducted the following tests in relation to the Alucobond Plus samples: (XRPD), 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).
2. 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.
3. 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 %.
4. 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.
5. 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.
6. 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.
7. 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.
8. More significantly, Mr Carrascal also conducted various tests to quantify the percentages by weight of EVA and aluminium hydroxide in the samples.
9. 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.
10. 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%.
11. 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%.
12. 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.
13. 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%.
14. The following table summarises Mr Carrascal's findings on inorganic content:

1. 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.
2. 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.
3. 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.
4. 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).
5. 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.
6. 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.
7. 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.

1. 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.
2. 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.
3. 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 m2.
4. 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.
5. 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.
6. 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.
7. 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.

1. 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%.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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%.
7. The following table summarises the average weight % of aluminium hydroxide in the Alucobond Plus samples calculated by the various tests conducted by the experts:

1. 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?

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

1. 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).
2. 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.
3. 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.
4. 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.
5. 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.
6. 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

1. The summary of Expert Group 2 is extracted below:

Joint Report of Professor Bisby, Mr Carrascal and Associate Professor Lange dated 28 March 2024 ("Group 2 Joint Report")

1. There was a degree of cross-over between Expert Groups 2 and 3.
2. Mr Carrascal and Associate Professor Lange's professional backgrounds have been discussed above under Expert Group 1.
3. 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.
4. 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.
5. 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 Fire Propagation Apparatus, also sought to determine the ignition temperature of Alucobond Plus and the apparent thermal inertia of the samples.
6. 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.
7. 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.
8. 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.
9. Mr Carrascal conducted the tests on four samples. His results are summarised in the table below:

1. 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.
2. 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.
3. 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/m2 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/m2 at the bottom to 8 kW/m2 at the top.
4. The following image extracted from Mr Carrascal's report shows a sample marked every 25 mm and a preheating test phase.

1. 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.
2. 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.
3. Mr Carrascal determined that the average value of critical heat flux for flame spread across the samples tested was 10 kW/m2. Mr Carrascal also calculated the average minimum flame spread velocity and the flame spread parameter of the samples tested.
4. 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.
5. Nevertheless, Mr Carrascal concluded that the values suggest that the material may have a limited flame spread under exposure equivalent to the testing conditions.
6. 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.
7. 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.
8. 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.

1. 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.
2. The criticisms raised by Professor Bisby in relation to Mr Carrascal's experiments were discussed in the Group 2 Joint Report.
3. 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.
4. 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.
5. 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.
6. 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?"
7. 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.

1. 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.
2. 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/m2 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/m2 (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.
3. 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.
4. 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.
5. As Associate Professor Lange stated during the course of the expert conclave, Mr Carrascal's experiment is not intended to represent reality.
6. 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.
7. 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)

1. The summary of Expert Group 3 is extracted below:

Joint Report of Professor Bisby, Professor Torero and Associate Professor Lange dated 3 April 2024 ("Group 3 Joint Report")

1. Expert Group 3 was constituted by Professor Bisby, Associate Professor Lange, and Professor Torero.
2. 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.
3. 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.
4. 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.
5. 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

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

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

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?

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?

Alucobond Plus

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

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

3. 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?

4. 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

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?
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?

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

1. 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.
2. 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.
3. 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 Fire Engineering Brief and an FER, which is discussed further below.
4. A particularly important part of a building's fire safety strategy, in the context of the Alucobond products, is compartmentation.
5. 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.
6. 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.
7. "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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.
13. 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.
14. 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.
15. 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.
16. 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.
17. 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.
18. 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.
19. 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.
20. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.

1. 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".

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

1. 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.
2. 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.
3. 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/m2, and a surface temperature at ignition of about 377°C.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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;

(c) the melted, burning PE can collect and pool on horizontal surfaces which may promote horizontal 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.)

1. 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.
2. 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.
3. 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.
4. 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.
5. 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?

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. A radiant heat panel was used to investigate the burning behaviour of the samples at heat flux values of 25, 50 and 75 kW/m2. 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:

1. Professor Bisby noted some visual observations from PE_02 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.
2. 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/m2, the ignition of the PE core occurred in under six minutes. Increasing the incident heat flux also increased the peak heat release rate.
3. 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/m2. While Professor Bisby did not experiment with heat fluxes below 25 kW/m2, 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/m2.
4. The Group 3 Joint Report noted that increasing the incident heat flux to the sample from 25 kW/m2 to 75 kW/m2 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/m2 resulted in ignition of the PE core in less than six minutes.
5. 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.
6. The joint report noted that increasing the incident heat flux from 25 kW/m2 to 75 kW/m2 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.
7. 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/m2 (being the maximum heat flux tested by Professor Bisby) even when non-combustible cladding materials and products are used.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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?

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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?

1. 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.
2. 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.
3. 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.
4. 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).
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.

5.3.3.1 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?

1. 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.
2. 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.
3. 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.

1. 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.
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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?

1. 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.
2. 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.
3. 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.
4. 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/m2. 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.

1. Again, in his first report, Professor Bisby noted his visual observations of the rear fixing radiant heating experiment at 50 kW/m2 (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.
2. 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.
3. 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 Plus_04 (front-fixed) and Plus_07 (through-fixed) did not result in any ignition when exposed to the lowest heat flux condition of 25 kW/m2.
4. 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/m2, 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.
5. The fire performance tests conducted by Professor Bisby and Mr Carrascal were also the subject of detailed discussion within the Group 3 Joint Report.
6. 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.
7. 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/m2, while ignition will also occur within a matter of minutes at heat fluxes of 25 kW/m2 in cases where the cover sheets become compromised and the core is directly exposed to heating.
8. Professor Bisby, noting the observations made during his experiments when increasing the incident heat flux from 25 kW/m2 to 75 kW/m2, 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.
9. 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.
10. 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.
11. 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.
12. 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/m2. 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.
13. 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.
14. 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/m2. 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.
15. 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.
16. 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.
17. 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.
18. 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.
19. 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/m2, and well beyond the 40 kW/m2 used in Mr Carrascal's experiments.
20. 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/m2, as that enabled the experiment to observe the cessation of flame spread, being the relevant behaviour of interest.
21. 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/m2) 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.
22. 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.

1. 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.
2. 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 response to question 8 be mitigated by the design of the building as a whole?

1. 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.
2. 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.

5.3.4.1 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?

1. 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.
2. 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".
3. 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.

1. 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.
2. 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.
3. 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.
4. 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.)

1. 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.
2. 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.
3. 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?

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.)

1. 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

1. 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.
2. 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.
3. 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)

1. 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:

Joint Report of Mr Kip, Mr Davis, Mr Moore, Professor Bisby and Professor Torero dated 3 April 2024 ("Group 4-5 Joint Report')

1. 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.
2. 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.

1. 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.
2. 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.
3. 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?

1. 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.

1. 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:

(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.

1. 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;

(c) CP8 could apply to an ACP where openings, construction joints, and the like occur; and

(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.

1. 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.
2. 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.
3. 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 FSEs in designing, constructing and certifying buildings in respect of combustible ACPs in Australia during the relevant period?

1. 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.
2. 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.
3. 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.
4. 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.
5. 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 FSEs 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)?

1. 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_._
2. The experts also outlined, in practice, what the process for considering, analysing, and preparing a Performance Solution would look like.
3. 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.
4. 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.
5. If all stakeholders agree, the FSE prepares an FER, which, in effect, forms the relevant Performance Solution.
6. 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.

1. 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.
2. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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 CodemarkTM 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.)

1. 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.
2. 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.
3. 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.
4. 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.

1. 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".
2. 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.)

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.

1. 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.
2. 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.
3. 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.

1. The report was prepared in the context of an appeal by the owners corporation of the building to the Building Appeals Board.
2. In July 2017, shortly after the Grenfell Fire, the Victorian Government established the Victorian Cladding Taskforce 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.
3. A preliminary RAT analysis was conducted of the 544-550 High Street building by the Victorian Building Authority which classified the building as extreme risk.
4. 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.
5. 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.
6. 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.

1. 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.
2. 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.
3. 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.
4. 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 FSEs 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?

1. 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 [Fire Resistance Level] (BCA DtS clause 2.4 of Specification C1.1),

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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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".
11. 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.

1. 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.
2. 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.

1. 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.

1. 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.
2. 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.

1. 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.
2. 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.
3. 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.

1. Alucobond PE was never tested under AS 5113.
2. 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.
3. 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).

1. The report identified the results from the test, in relation to a number of classification criteria in AS 5113, as follows:

1. 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".
2. 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.
3. 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:

1. 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.
2. 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.
3. 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.

1. 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.

1. 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.
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.

1. 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.
2. 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.

1. 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.

1. 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.

1. 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 9th Minute, however, you think about what you are selling...

1. 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.
2. 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...

1. 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.

1. 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.
2. 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.

1. 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.

1. 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.

1. 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?

1. 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.

1. 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.
2. 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 Solutions

1. In his second report, Mr Davis was requested to prepare Performance Solutions in relation to both the Shore Building and the Five Dock Building.
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.

1. 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).
2. 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.
3. 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.

1. The location of the relevant Alucobond Plus panels is illustrated in the following image extracted from Mr Davis' report:

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.

1. 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.
2. 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.

1. 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.
2. 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.
3. 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.
4. 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.

1. The summary of Expert Group 6 is extracted below:

Joint Report of Mr Kip and Mr Halstead dated 13 Mar 2024 ("Group 6 Joint Report")

1. 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.
2. 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.
3. 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?

1. 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)? 2. Could Alucobond PE or Alucobond Plus have been used on a low-rise building of type C construction during the relevant period?
2. 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?

1. 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.

1. 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.

1. 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.
2. 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.
3. 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.
4. 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.

1. 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.
2. The Applicants also note that the application of the exception was put in issue in both the Respondents' defences.

1. 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.

1. 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).
2. 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)).
3. 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).
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. It is also worth considering that note 3 in relation to "other materials" in Specification C1.10 states the following:

1. 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.

12. 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.
13. 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.

1. 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.
2. 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.
3. 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.
4. 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 Fire-Resistance Level. 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.

1. 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.

1. 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;

1. 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.
2. 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.

1. 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.

1. 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.
2. 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.

1. 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".
2. 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.

1. 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.
2. 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

(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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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)?

1. 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.
2. The CodeMark Certification Scheme is a voluntary third party building product certification scheme, administered by the ABCB. The scheme was first developed in 2009.
3. The scheme sets a nationally accepted process to demonstrate compliance with the BCA.
4. 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.
5. 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:

(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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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;

(c) did not provide an AS 1530.3 test that was conducted in a manner compliant with the BCA;

(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.

1. 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.
2. 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.

1. 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.
2. Although Professor Torero did not participate in Expert Group 6, the following comments made in his expert report are also relevant:

"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.)

1. 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.

1. 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".
2. 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.
3. 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.
4. 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.
5. The following images extracted from the report provide an indication as to the extent to which Alucobond Plus was used on the building.

1. 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.

1. 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?

1. 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.
2. 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.
3. 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.

1. 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.
2. 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.
3. 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.
4. 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

1. The summary of Expert Group 7 is extracted below:

Joint Report of Mr Quigley, Mr Incoll, and Mr Smithson dated 26 February 2024 (Group 7 Joint Report)

1. Expert Group 7, referred to as the "Architects and building professionals", was constituted by Mr Peter Quigley, Mr Greg Incoll and Mr Peter Smithson.
2. 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.
3. 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.
4. 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.
5. 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

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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?

1. 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?
2. 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)?
3. 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;

1. were not capable of being used in a manner that met the deemed-to-satisfy provisions of the BCA; and

2. had the fire-risk properties identified in paragraph 14 of the Second Further Amended Statement of Claim?

3. 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?

1. 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

1. 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.
2. 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?

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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)?

1. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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:

1. 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)".
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.

1. 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?

1. 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.

1. 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.
2. 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.
3. 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 Solutions proposed by Mr Davis for the Shore Building and Five Dock Building?

1. 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...

1. The experts provided the same answer in respect of the Performance Solutions designed by Mr Davis for the Five Dock Building.
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.
3. 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.
4. 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;

(c) Abbott Report 3 - 19 Jan 2024; and

(d) Abbott Report 4 - 6 Aug 2024.

1. 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.
2. 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.
3. 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?

1. 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...

1. 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.
2. 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.
3. 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.
4. 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?

1. 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.
2. 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).
3. In his fourth report, this amount was increased to $308,823.36 (excl GST) to reflect 2024 prices ($339,705.70 incl GST).
4. 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:

$476,622.50, offering an additional home owners warranty fee of $32,400.00.

1. In relation to the quote from Restorial, Mr Abbott disregarded the quote on the basis that it appeared to include some obvious errors. Mr Abbott also noted that when IClad's quote was limited to the same scope Mr Abbott had assessed, the quote was for $283,000 (excl GST).
2. 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.
3. 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 assessment of Mr Davis' remedial Performance Solutions

1. 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.
2. 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/m3 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.

1. Mr Davis did not specify any remediation measures in relation to the west elevation of the building (ie, the front of the building).
2. 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.

1. 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.
2. 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.

1. 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

1. In his report, Mr Abbott estimated that this remedial work proposed by Mr Davis would cost $245,588.83 (incl. GST).
2. In reaching the above figure, Mr Abbott calculated that 46 m2 of Alucobond Plus panels would need to be removed and replaced with solid aluminium, and that 111 m2 of Alucobond Plus panels would need to be removed and refixed with mineral wool batting inserted behind them (157 m2 in total).
3. Mr Abbott's cross-examination was largely confined to the above calculation.
4. 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 m2 of Alucobond Plus affixed to the eastern elevation of the building. This is clearly lower than the 157 m2 of Alucobond Plus that Mr Abbott referred to in calculating the cost of the remedial Performance Solution.
5. 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.
6. 3A suggests that Mr Abbott incorrectly included 24 panels that did not require removal under Mr Davis' Performance Solution, representing 46.08 m2. 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).
7. 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.
8. 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.

1. 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.
2. Mr Youssef, as a member of the Australasian Fire and Emergency Service Authorities Council, Urban Operations Group, was directly involved in determining operational firefighting (including high-rise) doctrine and training at the national level.
3. 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.
4. 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.
5. For the purposes of the report, Mr Youssef assumed that ACPs referred to ACPs consisting of a core entirely made out of PE.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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

1. 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.
2. 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.
3. 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?

1. 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.
2. 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

an affected person in relation to the goods may, by action against the manufacturer of the goods, recover damages from the manufacturer.

...

1. 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.
2. 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.
3. 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] FCA 243; (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] FCAFC 70; (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] FCAFC 224; (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.

1. The Applicants also refer to the New Zealand Court of Appeal decision in Body Corporate Number 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 Consumer Guarantees Act 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.
2. 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.

1. 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.
2. 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.
3. 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.
4. 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:

(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] HCA 11; (1966) 115 CLR 10 at 23; [1966] HCA 11; [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

(a) Part IV;

(b) Part XI;

(c) the Australian Consumer Law (other than Part 5-3);

...

(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.

1. 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.
2. 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.
3. 3A also seeks to distinguish the present case from both authorities the Applicants rely on.
4. 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.
5. 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.
6. 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.

1. 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.
2. 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] (Gageler CJ, Gordon, Edelman, Gleeson and Jagot JJ). 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.
3. 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] HCA 61; (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] (Kirby J). 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.
4. 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.
5. 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.
6. 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).
7. 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.
8. 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).
9. 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.
10. 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.

1. 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.
2. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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?

1. 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.
2. 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.
3. 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.
4. 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".

1. "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.
2. At least some of 3A's supplies to HVG were shipped on a "Carriage and Insurance Paid 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.
3. 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.
4. 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.
5. 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).
6. 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. ...

1. 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.
2. 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.
3. 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:

6. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.

1. 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.
2. 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] FCAFC 224; (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.

1. 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...

1. 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.
2. 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.
3. 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.
4. 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 m2 for 2015, and 475.000 m2 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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 Australian Competition and Consumer Commission v Valve Corporation (No 3) (2016) 337 ALR 647; [2016] FCA 196 at [181] (Edelman J); 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] HCA 55; (1990) 171 CLR 538 at 568 (Mason CJ, Deane, Dawson and Gaudron JJ).
11. 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.

1. 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.
2. 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.

1. 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?

1. 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.
2. Section 5(1) of the CCA relevantly provides:

5 Extended application of this Act to conduct outside Australia

(1) Each of the following provisions:

...

(c) the Australian Consumer Law (other than Part 5-3);

...

extends to the engaging in conduct outside Australia by:

(g) bodies corporate incorporated or carrying on business within Australia; or

1. Section 5(1) of the TPA was in substantively the same terms.
2. 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.

1. 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] (Nicholas, Yates and Beach JJ), citing Luckins (Receiver and Manager of Australian Trailways Pty Ltd) v Highway Motel (Carnarvon) Pty Ltd [1975] HCA 50; (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] NSWSC 544; (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 plc [1990] Ch 433 at 530 and Bray v F Hoffman-La Roche Ltd [2002] FCA 243; (2002) 118 FCR 1 at [60]- [63].

1. 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] FCA 243; (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] HCA 50; (1975) 133 CLR 164 at 178; [1975] HCA 50; 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] HCA 37; (1990) 171 CLR 338 at 350; [1990] HCA 37; 94 ALR 647 at 654 (Dawson J); Pioneer Concrete Services Ltd v Galli [1985] VicRp 68; [1985] VR 675 at 705; [1985] VicRp 68; (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).

1. Barrett J referred to the following principles in Campbell v Gebo Investments (Labuan) 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] HCA 48; (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] HCA 51; (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 ...".

1. 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.
2. 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] (Perram J, with Allsop CJ generally agreeing at [1] and elaborating at [10], and Yates J agreeing at [166]).
3. 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 1988 (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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. Secondly, 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.
8. 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.

1. 3A also contributed to HVG's marketing budget as contemplated by the Distributor Agreements.
2. 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.
3. 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.
4. Thirdly, and more significantly, 3A's representatives travelled to Australia to provide direct support in relation to HVG's promotion and sales of Alucobond products.
5. 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.
6. 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.

1. 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.

1. 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.

1. 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.
2. 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.
3. 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.
4. 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".
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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 m2 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".
13. 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.
14. 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.
15. 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

1. 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.
2. 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).

1. 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.
2. 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.
3. 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.

1. 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.
2. In Chief Executive Officer 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] FCA 59; (1990) 21 FCR 241 at 244). As Pearce and Geddes observe in Statutory Interpretation in Australia (5th 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.

1. 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.
2. 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)

1. 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.
2. Section 74D(1) of the TPA relevantly provides:

74D 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;

(c) the goods are not of merchantable quality; and

(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.

1. "Trade or commerce" is defined in s 4 of the TPA as follows:

trade or commerce means trade or commerce within Australia or between Australia and places outside of Australia.

1. 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.
2. In particular, 3A refers to the High Court decision of Concrete Constructions (NSW) Pty Ltd v Nelson [1990] HCA 17; (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.)

1. 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] HCA 77; (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.)

1. 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.
2. 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.
3. 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)

1. 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;

1. 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).

1. 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".
2. 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] (Rothman J), citing with approval Metropolitan Water Board v London, Brighton & South Coast Railway Co [1910] 1 KB 804 at 810 (Phillimore J).
3. 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.
4. 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.
5. 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].

1. 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.)

1. 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.

1. 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 (Aust) 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).
2. 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].

1. 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.
2. 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).
3. 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).
4. 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:

(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.

1. 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.
2. 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.

1. 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.

1. 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] (Glazebrook, Ellen France and Kós JJ).
2. 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.

1. 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.
2. 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.
3. 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.
4. 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).

1. 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.
2. 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.

1. 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 Authority (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) [1955] HCA 27; 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] HCA 7; (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] HCA 17; (1990) 169 CLR 594 at 601.

In Webb Distributors (Aust) Pty Ltd v Victoria [1993] HCA 61; (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] HCA 7; (1991) 172 CLR 32 at 44.

[75] In Zaravinos v Dairy Farmers Co-Operative Ltd and Pure-Pak Australia [1985] FCA 77; (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.

1. 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.
2. 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.
3. 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 Trade 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; ...

1. 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.
2. 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.
3. Noting the distinction in each party's approach, it is worth considering the authorities the Applicants rely on in further detail.
4. 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.
5. 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].
6. 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].
7. 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.
8. 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...

1. 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.
2. 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.
3. 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.
4. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.

1. 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.
2. 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.
3. 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 m2 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.
4. 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.)

1. 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.
2. 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.
3. 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.
4. 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).
5. Under s 2 of the CGA (NZ), the term "goods" is defined as follows:

(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

1. 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.
2. 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

(c) minerals, trees and crops, whether on, under or attached to land or not; and

(d) gas and electricity; and

(e) computer software; and

(f) second‑hand goods; and

(g) any component part of, or accessory to, goods.

1. Similarly, "goods" were defined under s 4 of the TPA as:

goods includes:

(a) ships, aircraft and other vehicles;

(b) animals, including fish;

(c) minerals, trees and crops, whether on, under or attached to land or not; and

(d) gas and electricity.

1. 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.

1. "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

(c) a vehicle, vessel or aircraft; or

(d) a part of any such premises.

1. 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.
2. 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.

1. 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].
2. 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] (which reflects the nature of the submission made by the Applicants in the present proceeding).
3. 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.
4. 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.)

1. 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.
2. This, as it turns out, is quite central to the conflict between the parties but was the subject of limited submissions.
3. 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).
4. 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.

1. 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].
2. 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.
3. 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.

1. 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.
2. 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.
3. 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.)

1. 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.
2. 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.
3. 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.
4. 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:

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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".
7. 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.
8. 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].
9. 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.
10. 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.
11. 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)

1. 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".
2. 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.

1. 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) first, 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) second, 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) third, 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).

1. 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.
2. The following supply chain relates to the Shore Building and forms part of MFI-2.

1. 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.
2. 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.
3. In relation to the Five Dock Building, the following supply chain has also been extracted from MFI-2.

1. 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.
2. 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)

1. 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)).
2. 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.
3. 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.

1. 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.
2. 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)

1. 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.
2. 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.

1. "Acquire" and "supply" are defined inclusively under the ACL, in s 2:

(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.

...

supply, 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.

1. The concepts of "acquire" and "supply" are further elaborated in s 11 of the ACL:

(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.

1. 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 Strata Schemes (Freehold Development) Act 1973 (NSW) and the Strata Schemes Management Act 1996 (NSW) in respect of the Shore Building; and

(b) the Strata Schemes Development Act 2015 (NSW) and the Strata Schemes Management Act 2015 (NSW) in respect of the Five Dock Building.

1. 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.

1. 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.

1. 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 Australia Pty Ltd v Chief Commissioner of State Revenue (2004) 213 ALR 795; [2004] NSWSC 1029 at [16]- [53] (Gzell J).
2. 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.
3. 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).

1. "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".
2. 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.

1. 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.
2. 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'".
3. It is also worth considering each of the authorities the parties relied on in further detail.
4. 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.

1. 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].
2. 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.

1. 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".
2. 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.

1. 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.

1. 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.
2. 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.
3. 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.

1. 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.
2. 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.

1. 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].
2. 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.
3. 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".
4. 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.
5. 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".
6. 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.
7. 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)

1. 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".
2. "Consumer" is defined under s 3 of the ACL as follows:

(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

(c) the goods consisted of a vehicle or trailer acquired for use principally in the transport of goods on public roads.

(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.

1. 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.

1. 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 - Issue 5(b)(iii)(A)

1. 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.
2. 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.
3. I do not accept the Respondents' submissions.
4. 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.
5. 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".
6. 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.
7. 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.
8. 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 - Issue 5(b)(iii)(B)

1. 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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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".
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.
13. 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).
14. 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.
15. 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.
16. 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.
17. 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.
18. 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.

1. 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.
2. 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".
3. 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.
4. 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".
5. 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 - Issue 5(a)(ii)(A) and 5(b)(i)

1. 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.

1. 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.
2. 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).
3. In respect of the Shore Building, the amount paid for the Alucobond PE fitted to that building was $41,158.68 (incl GST).
4. 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 New 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).
5. 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.
6. 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:

...

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

(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.

(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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. I do not accept the Respondents' submissions.
7. 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.
8. 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.
9. 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.
10. 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.
11. 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.
12. 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.
13. 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).
14. 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)

1. 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).
2. 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.
3. 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.
4. 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?

1. 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.
2. 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:

affected 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

(c) a person who derives title to the goods through or under the consumer.

1. 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.
2. 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.
3. 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".
4. 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.
5. 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".
6. 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.
7. 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.
8. 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.
9. 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, Mount Bruce Mining 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.
10. 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: