Federal Court of Australia

Pirmax Pty Ltd v Kingspan Insulation Pty Ltd [2022] FCA 1340

ORDERS

THE COURT ORDERS THAT:

1.    On the originating application dated 17 May 2019, there be judgment for the respondent.

2.    The originating application dated 17 May 2019 be dismissed.

3.    On the notice of cross-claim dated 7 June 2019, there be judgment for the cross-claimant.

4.    Within 14 days of the date of these orders, the parties must confer and, if possible, agree upon and submit to the chambers of Justice Snaden a minute of orders for final relief (including costs) that reflect the court’s reasons for judgment herein.

5.    In the event that no such agreement is possible, the parties each prepare and submit, within 21 days of these orders, a minute of orders for final relief (including costs) that they propose in reflection of the court’s reasons for judgment herein, together with brief written submissions (of no more than three pages) in support thereof.

6.    Further orders for final relief (including costs, as appropriate) be made on the papers.

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

REASONS FOR JUDGMENT

SNADEN J:

Part 1: Overview

1    In early 2016, the applicant and cross-respondent (“Pirmax”) entered the market for the manufacture and supply of rigid foam insulation products. Since that time, it relevantly manufactured two modified polyisocyanurate rigid thermal insulation products, to which I shall refer as the “HR Panel Product” (which it began manufacturing in or around 2016) and the “ISO3 Product” (which it began manufacturing in or around 2019).

2    The respondent and cross-claimant (“Kingspan”) is the Australian subsidiary of Kingspan Group PLC, a large manufacturer of building products headquartered in Ireland. Kingspan has been manufacturing polyisocyanurate rigid thermal insulation products for over 40 years. It competes with Pirmax in the market for the supply of such products in Australia.

3    Pirmax brings the present proceeding alleging that Kingspan engaged in an unlawful campaign aimed at damaging Pirmax’s business by means of untrue, public representations about the HR Panel Product. In particular, it alleges that Kingspan made untrue representations to the effect that the HR Panel Product failed to comply with certain requirements contained in the National Construction Code (the “NCC”) concerning fire hazard properties and was, for that reason, unsafe (amongst other things). By certain elements of that campaign, Pirmax alleges that Kingspan (1) engaged in misleading or deceptive conduct in contravention of s 18 of the Australian Consumer Law (comprising Schedule 2 to the Competition and Consumer Act 2010 (Cth); the “ACL”) and (2) committed the tort of injurious falsehood.

4    By its cross-claim, Kingspan alleges that the marketing and technical materials that Pirmax produced and publicly disseminated contained untrue representations that overstated the extent to which the HR Panel Product and the ISO3 Product, respectively, complied with those same requirements in the NCC concerning fire hazard properties. The making of those representations, Kingspan alleges, similarly amounted to Pirmax engaging in misleading or deceptive conduct in contravention of the ACL.

5    Pirmax moves the court for declarations, injunctions, damages, interest and costs. On the first day of the trial, Kingspan informed the court that it would no longer pursue any claim for damages. It seeks only declarations, injunctions, and costs by way of relief in respect of its cross-claim.

6    For the reasons that follow, Pirmax’s application must be dismissed and Kingspan’s cross-claim must succeed. Orders will be made accordingly.

Part 2: Building industry regulations

2.1 The National Construction Code

7    The proceeding turns largely on certain requirements of the NCC relating to the fire hazard properties of wall and ceiling linings. It is necessary to trace the regulatory origins of the NCC and its relevant provisions in some detail.

8    The introduction to the current iteration of the NCC, the NCC 2019, provides a helpful overview of the NCC and its scope. It states as follows:

The NCC is Australia’s primary set of technical design and construction provisions for buildings. As a performance-based code, it sets the minimum required level for the safety, health, amenity, accessibility and sustainability of certain buildings. It primarily applies to the design and construction of new buildings, and plumbing and drainage systems in new and existing buildings. In some cases it may also apply to structures associated with buildings and new building work or new plumbing and drainage work in existing buildings.

The Australian Building Codes Board (ABCB), on behalf of the Australian Government and each State and Territory government, produces and maintains the NCC. When determining the content of the NCC, the ABCB seeks to—

•    ensure requirements have a rigorously tested rationale; and

•    effectively and proportionally address applicable issues; and

•    create benefits to society that outweigh costs; and

•    consider non-regulatory alternatives; and

•    consider the competitive effects of regulation; and

•    not be unnecessarily restrictive.

The primary users of the NCC include architects, builders, plumbers, building surveyors, hydraulic consultants, engineers and other building and plumbing related professions and trades.

9    The NCC is published in three volumes: volumes 1 and 2 contain the Building Code of Australia (the “BCA”), while volume 3 contains the Plumbing Code of Australia. The BCA assumes statutory force in each state and territory, albeit in different ways. In Victoria, reg 10 of the Building Regulations 2018 (Vic) (which is made under the Building Act 1993 (Vic)), provides that “[t]he BCA is adopted by and forms part of these Regulations as modified by these Regulations”.

10    The BCA is, then, to be construed according to ordinary principles; albeit with recognition that it is a technical document used by building practitioners on a day-to-day basis and, as such, is not drafted in the same way as an act of parliament: Tanah Merah Vic Pty Ltd v Owners Corporation No 1 of PS631436T [2021] VSCA 72, [208] (Beach, Osborn JJA and Stynes AJA).

11    The NCC is typically revised every three years following a process of industry consultation and review (although, as will shortly become apparent, that process sometimes occurs more frequently). Principally, the dispute around which this proceeding revolves arises out of changes to the provisions concerning the testing of fire hazard properties from the 2015 version of the NCC (which took effect from 1 May 2015) to the 2016 version of the NCC (which took effect from 1 May 2016). Certain provisions of the NCC 2019 (which took effect from 1 May 2019) concerning fire hazard properties are also relevant to a claim made by Kingspan in respect of the ISO3 Product.

12    The fire resistance provisions are contained in volume 1 of the NCC, which is also volume 1 of the BCA. As volumes 1 and 2 of the NCC are also volumes 1 and 2 of the BCA, the parties in their written submissions and during the trial referred variously to “the NCC”, “the BCA”, “the NCC/BCA”, or simply “the Code”. In this judgment I shall refer to the “NCC” (or to “NCC 2015”, “NCC 2016”, and “NCC 2019”, as applicable), although it is upon only a small number of provisions in volume one of each instrument that the matter turns. Capitalised terms not otherwise defined in this part adopt the meaning as defined in the relevant NCC.

2.2 NCC 2015

13    Section A of volume 1 of NCC 2015 was entitled “general provisions”. It provided an overview of the NCC and its application, as well as the rules and instructions for interpreting and complying with it. Of present importance, it mapped out the various methods by which compliance with its requirements might be demonstrated. Those compliance pathways were introduced by Part A0 of NCC 2015, which provided, relevantly:

A0.4 Compliance with the BCA

A Building Solution will comply with the BCA if it satisfies the Performance Requirements.

A0.5 Meeting the Performance Requirements

Compliance with the Performance Requirements can only be achieved by—

(a)    complying with the Deemed-to-Satisfy Provisions; or

(b)    formulating an Alternative Solution which—

   (i)    complies with the Performance Requirements; or

(ii)    is shown to be at least equivalent to the Deemed-to-Satisfy Provisions; or

(c)    a combination of (a) and (b).

...

A0.7 Deemed-to-Satisfy Provisions

A Building Solution which complies with the Deemed-to-Satisfy Provisions is deemed to comply with the Performance Requirements.

…

A0.9 Assessment Methods

The following Assessment Methods, or any combination of them, can be used to determine that a Building Solution complies with the Performance Requirements:

(a)    Evidence to support that the use of a material, form of construction or design meets a Performance Requirement or a Deemed-to-Satisfy Provision as described in A2.2.

(b)    Verification Methods such as—

(i)    the Verifications Methods in the BCA; or

(ii)    such other Verification Methods as the appropriate authority accepts for determining compliance with the Performance Requirements.

(c)    Comparison with the Deemed-to-Satisfy Provisions.

(d)    Expert Judgement.

14    The present matter concerns only the Deemed-to-Satisfy Provisions of the NCC (which is to say that it does not concern the formulation of an “Alternative Solution”).

15    Part A2 of NCC 2015 relevantly provided as follows:

A2.2 Evidence of suitability

(a)    Subject to A2.3 and A2.4, evidence to support that the use of a material, form of construction or design meets a Performance Requirement or a Deemed-to-Satisfy Provision may be in the form of one or a combination of the following:

(i)    A report issued by a Registered Testing Authority, showing that the material or form of construction has been submitted to the tests listed in the report, and setting out the results of those tests and any other relevant information that demonstrates its suitability for use in the building.

(ii)    A current Certificate of Conformity or a current Certificate of Accreditation.

(iii)    A certificate from a professional engineer or other appropriately qualified person which—

(A)    certifies that a material, design, or form of construction complies with the requirements of the BCA; and

(B)    sets out the basis on which it is given and the extent to which relevant specifications, rules, codes of practice or other publications have been relied upon.

(iv)    A current certificate issued by a product certification body that has been accredited by the Joint Accreditation System of Australia and New Zealand (JAS-ANZ).

  (v)    * * * * *

(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.

…

(b)    Any copy of documentary evidence submitted, must be a complete copy of the original report or document.

16    Against the background of those “general provisions”, the remaining sections of the NCC 2015 contained the particular standards, assessment methods and specifications against which products were required to be tested, and the “Performance Requirements” that products had to satisfy, in order to achieve compliance with the NCC.

17    Section C of NCC 2015 was entitled “fire resistance”. Unsurprisingly, it contained provisions concerning the required fire resistance qualities of various building applications. Relevantly, cl C1.0 of NCC 2015 (within Part C1, which was entitled “Fire Resistance and Stability”) provided, in part, that:

(a)    Where a Building Solution is proposed to comply with the Deemed-to-Satisfy Provisions, Performance Requirements CP1 to CP9 are satisfied by complying with—

(i)    C1.1 to C1.12…

…

18    In turn, cl C1.10 was entitled “Fire hazard properties” and provided, relevantly, as follows:

(a)    The fire hazard properties of the following linings, materials and assemblies in a Class 2 to 9 building must comply with Specification C1.10:

…

(ii)    Wall linings and ceiling linings.

…

19    Specification C1.10 set out some requirements concerning the fire hazard properties of linings, materials and assemblies. The requirements for wall linings and ceiling linings (which includes insulation products when used as a lining), in particular, were contained in cl. 4 of Specification C1.10, which relevantly provided as follows:

4.    Wall and ceiling linings

(a)    For the purpose of this Clause, the group number of a material is determined by either—

(i)    physical testing in accordance with AS ISO 9705; or

…

(b)    The group number of a material is as follows when tested or predicted in accordance with sub-clause (a):

(i)    A Group 1 material is one that does not reach flashover when exposed to 100 kW for 600 seconds followed by exposure to 300 kW for 600 seconds.

(ii)    A Group 2 material is one that reaches flashover following exposure to 300 kW within 600 seconds after not reaching flashover when exposed to 100 kW for 600 seconds.

(iii)    A Group 3 material is one that reaches flashover in more than 120 seconds but within 600 seconds when exposed to 100 kW.

(iv)    A Group 4 material is one that reaches flashover within 120 seconds when exposed to 100 kW.

(b)    A material used as a finish, surface, lining or attachment to a wall or ceiling must be a Group 1, Group 2 or Group 3 material used in accordance with Table 3…

(Emphasis added)

20    “Flashover” is (and was) defined in the NCC as the point at which the total heat release rate in the test room reaches 1000 kW. As can be seen, a group number of “1” applies to linings that achieve the highest degree of fire resistance (flashover is not reached during 20 minutes of testing), while a group number of 4 designates the lowest degree of fire resistance (flashover is reached within two minutes of testing).

21    Table 3, referred to in clause 4(c) of Specification C1.10, then set out the permitted uses for wall and ceiling linings based on their group numbers. Linings that achieved a group number of “1” could be used in all applications listed in the table, while linings with a group number of “3” could be used in a more limited range of applications. Wall and ceiling linings with a group number of “4” were not permitted to be used at all. Quite clearly, then, the group number that wall and ceiling linings were able to achieve was a matter of some commercial significance.

22    As can be seen, demonstrating compliance with the NCC is not straightforward. It involves several different potential pathways, numerous defined terms and various modes of providing evidence of compliance. Nonetheless—and at the risk of oversimplification—what emerges from the above survey is that wall and ceiling linings were required, in order that they might comply with the Deemed-to-Satisfy Provisions of NCC 2015 relating to fire resistance (and, thereby, with the Performance Requirements and the NCC more broadly), to attain a group number of “1”, “2” or “3” when tested in accordance with AS ISO 9705.

2.3 AS ISO 9705

23    AS ISO 9705 or AS ISO 9705-2003 is an instrument produced or endorsed by Standards Australia, a non-government body that produces and endorses such instruments. It is entitled “Fire tests—Full-scale room test for surface products”. Clause 1 of AS ISO 9705 states that it “specifies a test method that simulates a fire that under well ventilated conditions starts in a corner of a small room with a single open doorway”, and that a test performed in accordance with that method “provides data for the early stages of a fire from ignition up to flashover”.

24    According to cl 5.1 of ASO ISO 9705, a “test room” within which a test under that standard is conducted must consist of four walls at right angles, a floor and a ceiling (the dimensions of which are specified). Many of the remaining sections of the standard traverse highly technical matters, including (amongst other things) the ignition source to be used for the test, the heat flux instrumentation in the fire test room, and the means of conducting a gas analysis. Of relevance, cl 11.1 of AS ISO 9705 provides that:

11.1    The product to be tested shall, as far as possible, be mounted [in the fire test room] in the same way as in practical use.

NOTE 7    In the standard specimen configuration, three walls and the ceiling are covered with the product. Alternative specimen configurations are given in annex G.

25    Annex G, in turn, provides as follows:

NOTE 22    Different specimen configurations are possible depending on the practical use of the product under test and the specific situation that is to be studied.

G.1 Standard specimen configuration

In order to achieve comparable test data between laboratories, it is recommended that the walls (excluding the wall containing the doorway) and the ceiling are covered with the product. This is designated as the standard specimen configuration.

G.2 Alternative specimen configuration

Other possibilities are to test the product covering only the walls and having standard ceiling materials, or to test the product covering only the ceiling and having standard wall materials.

The standard materials should then be chosen in accordance with 11.4.

It is also possible to test combinations of different wall and ceiling products in order to evaluate specific scenarios.

26    In short, although the “standard specimen configuration” for testing in accordance AS ISO 9705 involves the application of a test product to three walls and the ceiling of the test room, AS ISO 9705 also contemplates tests that involve the application of a test product only to the ceiling or only to the walls of the test room. That flexibility assumes some significance presently.

2.4 NCC 2016

27    Although Section A of NCC 2016 contained some minor structural and terminological changes from NCC 2015, the compliance pathways there set out remained, in substance, unchanged. For present purposes, the compliance pathways set out in NCC 2016 were the same as those for which NCC 2015 provided: compliance was achieved by satisfying the Performance Requirements, which could, in turn, be satisfied by a Performance Solution (called an “Alternative Solution” in NCC 2015) or a Deemed-to-Satisfy Solution (being a solution that complied with the Deemed-to-Satisfy Provisions). As with NCC 2015, if a product complied with those provisions, it was deemed to comply with the Performance Requirements (and, therefore, the NCC).

28    Like NCC 2015, Section C of NCC 2016 contained the Deemed-to-Satisfy Provisions that related to fire resistance. Clause C1.0 provided, relevantly, that:

(a)    Where a Deemed-to-Satisfy Solution is proposed, Performance Requirements CP1 to CP9 are satisfied by complying with—

(i)    C1.1 to C1.13…

29    Clause C1.10 was in the same terms as in NCC 2015. Like its predecessor, it provided that the wall and ceiling linings in a Class 2 to 9 building must comply with Specification C1.10. Specification C1.10 in NCC 2016, however, required different testing to that mandated by its predecessor. It provided, relevantly:

(a)    A wall or ceiling lining system must comply with the group number specified in Table 3…

(b)    A group number of a wall or ceiling lining and the smoke growth rate index or average specific extinction area must be determined in accordance with AS 5637.1.

(Emphasis added)

30    Table 3 in Specification C1.10 of NCC 2016 was identical to its counterpart in NCC 2015. Accordingly, in order to comply with the Deemed-to-Satisfy Provisions of NCC 2016 relating to fire resistance, a wall or ceiling lining was still required to have a group number of 1, 2 or 3; but that group number must have been determined by testing undertaken in accordance with AS 5637.1.

2.5 AS 5637.1

31    AS 5637.1 is an Australian Standard (also produced or endorsed by Standards Australia) entitled “Determination of fire hazard properties—Part 1: Wall and ceiling linings”. It sets out the procedure for the assessment of various properties of internal wall and ceiling linings and, relevantly, allows for the determination of a lining’s group number. It incorporates AS ISO 9705-2003 as a test method that may be used to determine a product’s group number; but it imposes some additional requirements.

32    Under the heading “Determining group numbers”, cl 4.3 of AS 5637.1 reads:

The group number of a material shall be determined by either-

(a)    physical testing in accordance with AS ISO 9705-2003; or

(b)    if the material has a confirmed correlation, prediction in accordance with Clause 4.4 using data obtained by testing the material at 50 kW/m2 irradiance in the horizontal orientation with edge frame in accordance with ISO 5660-1 or AS/NZS 3837, as appropriate to the test conducted.

33    The following section is entitled “testing for the purpose of determining group number, smogra_rc and ASEA”. It provides as follows:

5.1 General

The AS ISO 9705—2003 room test shall be used for determining a group number and calculating SMOGRA_RC unless the material is listed in Clause 5.3.2 as having a correlation.

…

5.2 Testing to AS ISO 9705—2003

5.2.1 Specimens

When testing for the purposes of determining group numbers and SMOGRA_RC, the specimen shall be affixed to three walls and the ceiling, described in AS ISO 9705-2003 as the standard specimen configuration. Tests of walls or ceilings alone shall not be used for determining group number or SMOGRA_RC.

(Emphasis added)

34    AS 5637.1, then, mandates testing in accordance with AS ISO 9705 for the purpose of determining a product’s group number; but it removes the flexibility previously afforded by Annex G of AS ISO 9705, such that a product cannot be tested in accordance with AS 5637.1 if it covers only the ceiling or only the walls of the room in which it is tested. Instead, the product must cover three walls and the ceiling of the test room.

35    Appendix C to AS 5637.1 is also of some significance. It provides, relevantly, as follows:

Where a material or system has been tested in either the room test or the cone calorimeter, the range of applicability will depend on many factors. The factors that need to be considered will not necessarily be the same for both tests.

Factors that should be considered are the following:

…

(b)    Colour.

…

2.6 The NCC 2016 “Transitional Provision”

36    Specification A1.3 of NCC 2016 was entitled “documents adopted by reference”. It contained a “schedule of referenced documents”—that is, of various documents referred to in the operative provisions of the NCC (the majority of which are Australian Standards). Alongside the entry for AS 5637.1 in the schedule, there was a “note” that assumes central significance in this matter. That entry appeared as follows:

37    During the trial and in the parties’ written submissions, this note was referred to as the “transition(al) provision” or the “grandfathering provision” (hereafter, the “Transitional Provision”). Its effect is apparent enough: group numbers that were determined by testing that was undertaken under versions of the BCA that applied prior to 1 May 2016 (including NCC 2015) remained validly determined until 1 May 2019, notwithstanding the more stringent testing requirements to which NCC 2016 gave effect.

2.7 NCC 2019

38    The requirements for determining a group number under NCC 2019 are the same as those that were contained in NCC 2016 (save that there is no equivalent of the Transitional Provision).

39    As will be explained later in these reasons, the resolution of Kingspan’s cross-claim in respect of the ISO3 Product turns on the construction of C1.10 of NCC 2019. That being so, it is prudent to set out its relevant parts. C1.10 of NCC 2019 reads as follows:

(a)    The fire hazard properties of the following linings, materials and assemblies in a Class 2 to 9 building must comply with Specification C1.10:

…

…

…

(c)    The requirements of (a) do not apply to a material or assembly if it is—

…

Part 3: Background and evidence

40    The proceeding was commenced by originating application dated 17 May 2019, by which Pirmax also claimed interlocutory relief. In particular, Pirmax sought various forms of injunctive relief in respect of certain materials published or conveyed by Kingspan (which materials will be described in detail later in these reasons).

41    Given the urgent nature of the interlocutory relief sought by Pirmax, the proceeding first came before Davies J in her capacity as duty judge and, subsequently, Middleton J in that same capacity. Each judge made standard procedural orders, including orders for the exchange of concise statements, affidavits, and expert reports. The proceeding was then allocated to my docket. Kingspan’s cross-claim was commenced by notice dated 7 June 2019.

42    The trial of the proceeding commenced on 28 June 2021 and ran across six days. The parties filed comprehensive written submissions, upon which they elaborated orally at a later hearing.

43    The court received written and/or oral testimony from 11 witnesses. Pirmax led evidence from:

(1)    Mr Benjamin Robert Alan Hughes-Brown, a fire safety engineer and director of Ignis Solutions Pty Ltd, a fire safety consultancy firm, and Ignis Labs Pty Ltd, a fire safety test facility;

(2)    Mr Jeffrey Stephen Lewinsohn, Pirmax’s managing director and majority shareholder;

(3)    Mr Dale Ronald Alan Bradley, the director of Greenspec Solutions Pty Ltd, a supplier and installer of thermal and acoustic insulation products, including those manufactured by Pirmax;

(4)    Dr Patrick Anthony Enright, a fire safety engineer and registered building practitioner, and the director of Enright Consulting Pty Ltd;

(5)    Mr Travis Scott McCallum, the commercial director for Greater Asia for Huntsman Polyurethanes;

(6)    Mr Steven John Ashton, a web design and computer repair technician who performed work as a contractor for Pirmax;

(7)    Mr Stephen Alan Kip, a fire safety engineer and building surveyor, and the managing director of SKIP Consulting Pty Ltd; and

(8)    Mr Owain Stone, a partner in forensic accounting at Korda Mentha.

44    Kingspan led evidence from:

(1)    Mr Scott Ian Edgeworth Gibson, the managing director of Kingspan;

(2)    Dr Jonathan Ross Barnett, a fire safety engineer and the managing director of Basic Expert Pty Ltd;

(3)    Mr Keith Robert Anderson, the “Technical R&D and Accreditations Manager” of Kingspan;

(4)    Mr Shane Andrew Leonard, a registered building surveyor and a director of Philp Chun & Associates Pty Ltd; and

(5)    Ms Dawna Kathleen Wright, a senior managing director in forensic accounting at FTI Consulting.

45    Mr Hughes-Brown and Mr McCallum were called to give evidence in answer to subpoenas issued to each of them at Pirmax’s request. The remaining lay witnesses gave evidence by affidavit (or, in Mr Lewinsohn’s case, three affidavits; and, in Mr Gibson’s, two) and, with the exception of Mr Ashton, all were cross-examined.

46    Each of the expert witnesses provided their evidence by way of expert report (Dr Barnett produced four reports and made two affidavits; Dr Enright produced two reports, and the other expert witnesses each produced one report). Some of the expert witnesses gave evidence in conclaves: Mr Kip gave evidence concurrently with Mr Leonard, and Mr Stone gave evidence concurrently with Ms Wright. To facilitate that process, Mr Kip and Mr Leonard also produced a joint report, as did Mr Stone and Ms Wright. Dr Barnett and Dr Enright were cross examined on their evidence in the conventional manner.

47    In advance of the trial, each party filed a document setting out in tabular form its objections to the various affidavits and expert reports relied upon by the other party. In turn, each party provided a response to the objections that were raised, including, where appropriate, concessions that certain aspects of the evidence were no longer relied upon. Rather than ruling on each objection contained in the parties’ respective tables, those objections (and any responses to them) were instead treated as submissions as to the weight to be given to those parts of the evidence to which objection was taken.

48    The day before the trial commenced, Pirmax also filed a document entitled “pirmax’s outline of objection to admissibility of dr barnett’s evidence”. In summary, Pirmax objects to the whole of Dr Barnett’s evidence on several bases, each of which revolves around Dr Barnett’s alleged lack of independence—in particular, Pirmax asserts that Dr Barnett was an advocate or “hired gun” for Kingspan; and, relatedly, that any conformity of Dr Barnett’s opinion with Kingspan’s interests was the product of his lack of independence. That being so, Pirmax submits that Dr Barnett’s evidence was inadmissible under s 79 of the Evidence Act 1995 (Cth) (the “Evidence Act”); or, alternatively, that it ought to be excluded pursuant to s 135 of that act.

49    In its amended concise statement, Pirmax alleges that Kingspan made misleading or deceptive representations concerning Dr Barnett’s independence. Accordingly, the issue of Dr Barnett’s independence (or lack thereof) will be addressed as a preliminary matter. For reasons to which I shall shortly return, it suffices to record that I do not consider Dr Barnett’s evidence to be inadmissible under s 79 of the Evidence Act (or, more accurately, under s 76); nor do I consider that it ought to be excluded under s 135 of the Evidence Act.

50    Before the last day of the trial, the parties undertook the process of “filleting” the court book that had previously been provided to the court (and upon which the parties had relied up until that point). That process was apparently undertaken in order to remove documents that the parties had deemed unnecessary, such as those that were irrelevant or appeared in duplicate. That filleted court book was referred to as the “consolidated tender bundle”, and was tendered on the last day of the trial.

Part 4: Dr Barnett’s evidence

51    Pirmax objects to the whole of Dr Barnett’s evidence on the basis that he lacked independence, and was instead an advocate or “hired gun” for Kingspan. Pirmax urges the court to find that Dr Barnett’s evidence was inadmissible under s 79 of the Evidence Act; or, alternatively, that it ought to be excluded pursuant to s 135 of that act.

52    Section 76(1) of the Evidence Act provides as follows:

Evidence of an opinion is not admissible to prove the existence of a fact about the existence of which the opinion was expressed.

53    Section 79(1) contains an exception to that rule. It reads:

If a person has specialised knowledge based on the person’s training, study or experience, the opinion rule does not apply to evidence of an opinion of that person that is wholly or substantially based on that knowledge.

54    Section 135 of the Evidence Act is entitled “[g]eneral discretion to exclude evidence”. It provides as follows:

The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might:

(a)    be unfairly prejudicial to a party; or

(b)    be misleading or confusing; or

(c)    cause or result in undue waste of time.

55    Pirmax submits that aspects of Dr Barnett’s conduct throughout his engagement by Kingspan’s solicitors was inconsistent with the Expert Evidence Practice Note (GPN-EXPT) (the “Practice Note”) and the Harmonised Expert Witness Code of Conduct (the “Code of Conduct”), by each of which he was required to abide. In turn, that was said to amount to conduct inconsistent with pt 23 of the Federal Court Rules 2011 (Cth) (the “Rules”). Pirmax submits that “[n]on-compliance with the [Rules] may make it more likely that s 79 is not satisfied, or that s 135 ought to be engaged”.

56    I do not consider that Dr Barnett’s evidence should be excluded for want of compliance with the Practice Note or the Code of Conduct. I accept that his evidence was at least substantially based upon his extensive knowledge and experience in the field of fire safety. I do not accept that, when he gave his evidence, he did so as an advocate or “hired gun”. His evidence was given consistently with the requirements of pt 23 of the Rules; and, even if it wasn’t, its admissibility is governed in any event by the Evidence Act, which does not require untrammelled independence or impartiality (however preferable those qualities plainly are): Ananda Marga Pracaraka Samgha Ltd v Tomar (No 4) (2012) 202 FCR 564, 570-571 [35]-[46] (“Ananda Marga”; Dodds-Streeton J); Rush v Nationwide News Pty Ltd (No 5) [2018] FCA 1622, [29]-[36] (Wigney J).

57    Pirmax did not attempt to establish that Dr Barnett’s evidence failed to meet the requirements of s 79 of the Evidence Act. Rather, it asserts that the present circumstances warranted the approach that Mortimer J took in Guy v Crown Melbourne Ltd [2017] FCA 1104 (“Crown”). There, having reviewed the relevant provisions of pt 23 of the Rules, the Practice Note, and the Code of Conduct, Mortimer J made the following observation (at [50]):

…at a minimum…there must be substantial, at least purportedly substantial, compliance with Part 23, or a capacity substantially to comply with Part 23, by both a party and that party’s proposed witness, including a preparedness and capacity to acknowledge the necessity for an expert witness to be independent in the sense set out in the authorities, the Practice Note and the Harmonised Code.

58    Her Honour found (at [51]-[55]) that there had been “no attempt to comply with Part 23 in the first place” and, (after distinguishing the facts that were before her Honour from those faced by Dodds-Stretton J in Ananda Marga) it followed, “no compliance at all” with that part by the expert witnesses. More importantly, her Honour found (at [56]):

In the present situation, quite unlike the Ananda Marga case, and given what he has already deposed, I fail to see how Dr Livingstone could promise to comply with and recognise the matters required by…Part 23, the Practice Note and the Harmonised Code. He is plainly well aware, and prepared to state, that he is an advocate for the cause of the applicant. I add I have no reason to believe Dr Livingstone would even consider attempting to proffer the declarations of independence required, or the acknowledgments of the need for independence. His candidness in his affidavit suggests he would not. I should also make it clear that there is no inherent criticism to be made of Dr Livingstone in the position he has taken in support of the applicant’s cause. The legal question is how that position affects his capacity to comply with Part 23 and the underlying core requirements for expert evidence.

59    In light of the conclusions that I have reached regarding Dr Barnett’s independence, and Dr Barnett’s statements that he had read and understood the Practice Note and the Code of Conduct, the circumstances confronting Mortimer J in Crown are distinguishable from those that arise here.

60    As to s 135 of the Evidence Act, Dr Barnett’s evidence plainly holds at least some probative value (even if the resolution of this matter does not turn solely upon it). The question then, is whether that value is substantially outweighed by any unfair prejudice that the receipt of that evidence would visit upon Pirmax. It is not. The prejudice to Pirmax, though obvious, is not unfair: Dr Barnett was not a partial expert, nor one whose independence from Kingspan was improperly or impermissibly compromised. But, even if he was, his evidence remained of some significance. I do not consider that any unfair prejudice attending its receipt substantially outweighs that probative value.

Part 5: The HR panel product

5.1 Pirmax enters the market for the supply of rigid foam insulation products

61    Pirmax was established by Mr Lewinsohn in 2015. As has already been mentioned, it entered the market for the manufacture and supply of rigid foam insulation products in early 2016. Since then, it has competed with Kingspan in that market.

62    Pirmax manufactures all of its products from facilities in Braeside, in Melbourne’s south-east. For the most part, Pirmax sells its products through distributors, which then supply its products to customers (typically builders and other participants in the building industry). Pirmax also has several “direct accounts” with customers that it supplies directly. Pirmax’s products are used in commercial, industrial, and domestic building projects.

63    The HR Panel Product is a polyisocyanurate rigid thermal panel product. It comprises a polyisocyanurate core—made from Daltofoam MR 40788, a polyol blend, and Suprasec 5005, a diisocyante-diphenylmethane-based composition—with a layer of aluminium foil bonded to the two largest external faces of that core (in other words, the core is “sandwiched between two layers of foil autohesively bonded to the insulation core during manufacture”).

64    Mr Lewinsohn gave evidence that, sometime in 2015, he approached Huntsman Polyurethanes (Australia) Pty Ltd (“Huntsman”), a supplier of polyurethane chemicals, in order that Pirmax might secure Huntsman’s assistance in developing its products. Since then, Pirmax has sourced all of its polyol and isocyanate from Huntsman.

65    The HR Panel Product is produced in different colour finishes (silver, white or black, although Mr Lewinsohn gave evidence that “99 per cent of Pirmax’s orders were for silver”). It is available in various thicknesses.

5.2 The HR Panel Product reports

66    Mr Lewinsohn gave evidence that, in order to ensure that Pirmax complied with applicable regulations (including the fire resistance requirements contained in the NCC), it arranged to have its products “tested by appropriately qualified and accredited testing facilities”, and that it “engaged independent fire engineers and other consultants” to provide all necessary compliance assessments and reports.

67    Several of those reports and related materials relied upon by Pirmax in respect of the HR Panel Product were in evidence and bear noting. They include:

(a)    a test report by Exova Warringtonfire Aus Pty Ltd (“Exova”) entitled “Fire test of a ceiling lined with PIR Insulation panels, tested in general accordance with AS ISO 9705-2003” first issued on 9 May 2016 (and subsequently revised on 26 May 2016, 16 June 2016, and 31 January 2017) (the “Pirmax Exova Report”);

(b)    a report by Acronem Consulting Australia Pty Ltd (“Acronem”) entitled “Pirmax, PIR Insulation Panel – NCC 2016 Fire Hazard Properties Assessment for Ceiling Only Applications” dated 30 May 2016 and revised on 2 February 2017 (the “Acronem Report”);

(c)    a report by Ignis Solutions Pty Ltd (“Ignis”) entitled “PIR MAX Insulation – Product Evaluation and Compliance” first issued for comment on 4 November 2018, finalised on 25 November 2018, and revised on 8 January 2019, 21 January 2019, 18 April 2019, 26 April 2019, 28 April 2019 and 17 May 2019 (the “Ignis Report”);

(d)    a test report by CSIRO entitled “Thermal transmission properties of Pirmax PIR foam panel insulation” dated 22 March 2017;

(e)    test reports by the Australian Wool Testing Authority Ltd (the “AWTA”) issued on 13 November 2015, 11 February 2016, 9 March 2017, 29 March 2018, 26 June 2018, 18 June 2019, 17 March 2020 and 18 March 2020;

(f)    a series of “Engineering Evaluation Certificates” issued by Ignis dated 11 November 2016, 14 April 2017, 1 May 2018, 21 November 2018, 25 November 2018, 8 January 2019, 21 January 2019, 18 April 2019, 26 April 2019, 7 May 2019 and 17 June 2019 (the “Ignis Certificates”); and

(g)    a report by Ignis entitled “Pirmax HR Insulation Panel Product Compliance Review” dated 22 May 2019.

68    It is unnecessary to describe in detail all of the various reports that were in evidence. There were many of them—several of which appeared in the consolidated tender bundle in numerous versions (each incorporating amendments or revisions to the one that preceded it). Some of those reports assume significance. In particular, in support of its claims that the HR Panel Product achieved a group 1 rating in silver and white finish, and that it achieved a group 3 rating in black finish, Pirmax relied upon the Pirmax Exova Report, the Acronem Report, the Ignis Certificates, and the Ignis Report. Attention will now turn to each of those documents.

5.2.1 The Pirmax Exova Report

69    In or around early 2016, Huntsman on behalf of Pirmax engaged the CSIRO to carry out a fire test on the HR Panel Product in accordance with AS ISO 9705-2003. At the time, however, Exova had the only testing facility approved by the National Association of Testing Authorities (hereafter, “NATA”). Accordingly, the CSIRO arranged for Exova to carry out the test instead. Exova carried out the test on 14 April 2016, and produced the Pirmax Exova Report on 9 May 2016 (with revisions coming later, as set out at [67(a)]).

70    The cover page to the Pirmax Exova Report stated that it is a “test report”, and recorded the “Test Date” as 14 April 2016. As recorded in its full title, the test to which the report relates is a “[f]ire test of a ceiling lined with PIR insulation panels, tested in general accordance with AS ISO 9705-2003”. The “Report Sponsor” is listed as the CSIRO. The second page of the Pirmax Exova Report records that it was first issued on 9 May 2016, and was re-issued three times, with each further issue correcting typographical errors.

71    Under the heading “test assembly”, the Pirmax Exova Report described the test as follows:

The test assembly comprised a fire test room whose ceiling was lined with the material being subjected to the test. The fire test room comprised of studwork walls and ceiling lined with plywood and two layers of 16 mm thick fire grade plaster board on the internal side. When unlined the fire test room had the internal dimensions of 3600 mm by 2400 mm by 2400 mm in height. The short wall opposite the ignition source had a centrally located doorway opening 800 mm wide by 2000 mm in height. The room was lined with the sample material on the ceiling only.

72    Under the heading “test procedure”, the report stated:

STATEMENT OF COMPLIANCE

The test was performed in general accordance with the requirements of AS ISO 9705-2003. The test procedure was subject to the variations below.

VARIATIONS TO TEST METHOD

…

At the request of the client the specimen was not installed in strict accordance with the standard installation method in AS ISO 9705 — 2003 (wall and ceiling lined) rather a ceiling only installation was undertaken.

73    The Pirmax Exova Report then described, in some detail, various aspects of the test procedure that was followed, and the test measurements that were recorded. Under the heading “test results”, the report stated as follows:

The peak heat release rate determined during the test was 831 kW.

Classification

Exova Warringtonfire Aus is unwilling to recommend that the data obtained from this test is suitable for the determination of group number in accordance with the regulatory requirements of Clause C1.10 of NCC (BCA).

5.2.2 The Acronem Report

74    The Acronem Report was prepared by Dr Cameron Chick, and approved by Mr Hughes-Brown. It is not a test report; Acronem did not perform any kind of test on the HR Panel Product about which it reported. Rather, the Acronem Report is Acronem’s review and analysis of the Pirmax Exova Report, upon which it purports to attribute to the HR Panel Product a group number for NCC purposes. It was initially issued on 30 May 2016, with a revised version issued on 2 February 2017 (which incorporated the various revisions that had been made to the Pirmax Exova Report).

75    As the Acronem Report recorded, its purpose was:

To perform an assessment of the fire hazard properties of the [HR Panel Product] ceiling lining system to satisfy the National Construction Code 2016, Volume One, Building Code of Australia (NCC-BCA), Clause C1.10-4 requirements for:

-    Group number, and

-    Smoke Growth Rate Index (SMOGRA_RC).

76    The Acronem Report recorded as follows how that assessment was to be (and was) made:

The assessment is made on an analysis of relevant test data compared with the requirements of the NCC-BCA as presented in the following documents:

-    [the Pirmax Exova Report].

-    National Construction Code 2016, Volume 1, Building Code of Australia, Class 2 to 9 Buildings.

-    AS 5637.1:2015, Determination of fire hazard properties.

The assessment addresses the Group number and SMOGRA_RC of:

-    [the HR Panel Product] when installed as a ceiling lining system as tested in [the Pirmax Exova Report].

The assessment is valid subject to the conditions and limitations outlined herein. It must not be interpreted as encompassing any other matter or product. This assessment specifically excludes any application where [the HR Panel Product] is installed as a wall lining.

77    Under the heading “NCC 2016, Volume One, BCA Relevant Requirements”, the report stated:

As per NCC-BCA Part A1, fire hazard properties indicate how a material or assembly behaves under specific fire test conditions. The fire hazard properties relevant to this assessment include Group number and smoke growth rate index (SMOGRA_RC).

These fire hazard properties are assessed in accordance with A0.2(b) through compliance with the deemed to satisfy requirements. Evidence of suitability in accordance with A2.2(a) is provided through the combination of:

(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.

Means of compliance: [the Pirmax Exova Report].

(iii)     [sic] 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.

Means of compliance: This report which has been verified by a qualified Fire Safety Engineer listed on the Australian ‘National Professional Engineering Register’ for Fire Safety Engineering.

In accordance with A2.4(c), group number or smoke growth rate index (SMOGRA_RC) has been determined in accordance with Specification C1.10, Clause 4(b).

78    It is apparent, then, that the Acronem Report was intended to serve as a certificate of the kind described in A2.2(a)(iii) of NCC 2016 and, when read in conjunction with the Pirmax Exova Report, to provide evidence that the HR Panel Product satisfied C1.10 (a Deemed-to-Satisfy Provision).

79    Under the heading “Group Number and Smoke Growth Rate Index”, the Acronem Report further provided, relevantly:

…

C1.10 requires the fire hazard properties of the ceiling linings, materials and assemblies in a Class 2 to 9 building to comply with Specification C1.10.

Specification C1.10 Clause 4(b) requires the group number and smoke growth rate index of a ceiling lining system to be determined in accordance with AS 5637.1.

Specification A1.3 lists documents adopted by reference including the new reference to AS 5637.1 which incorporates the following transitional note, “Test reports indicating a group number of wall and ceiling linings determined under versions of the BCA applicable prior to 1 May 2016 remain valid until 1 May 2019”.

Whilst AS 5637.1, Clause 5.2.1 identifies specific specimen requirements for AS ISO 9705-2003, the NCC 2016, Volume One, Building Code of Australia, Specification A1.3 reference above makes provision for the validity of test reports determined under previous versions of the BCA applicable prior to 1 May 2016 until 1 May 2019.

…

The [HR Panel Product] lining system was mounted to the ceiling of the test chamber in accordance with AS ISO 9705, G 2 Alternative specimen configuration, “Other possibilities are… to test the product covering only the ceiling and having standard wall materials.”, rather than G.1 Standard specimen configuration (ceiling and walls). AS ISO 9705-2003, Note 22 identifies “Different specimen configurations are possible depending on the practical use of the product under test and the specific situation that is to be studied.”

…

The peak heat release rate determined during the test was 0.831 (MW). The test did not reach flashover and supports a Group 1 rating of the ceiling lining system subject to the limitations of use detailed in Section 7.

80    The Acronem Report concluded:

The ceiling lining system has been tested in accordance with G.2 of AS ISO 9705-2003, with the product covering only the ceiling and having non-combustible wall materials.

The test results for the [HR Panel Product] ceiling lining system support a Group 1 rating and Smoke Growth Rate Index of 21.0 (m²/s² x 1000) subject to the limitations of use detailed in Section 7.

This assessment is based on the test report [i.e. the Pirmax Exova Report] and documentation listed. Whilst the responsibility for the accuracy and applicability of the test and report remains with their authors, I am of the opinion that such test and report have been prepared, controlled and reviewed on sound basis.

81    Section 7, “Validity”, then recorded the limitations alluded to above. They include that the assessment “specifically excludes any application where [the HR Panel Product] is installed as a wall lining”.

82    Pirmax asserts that the Pirmax Exova Report when read together with the Acronem Report satisfied the evidence of suitability requirements of NCC 2016, and thereby enabled the determination of a group number for the HR Panel Product when installed as a ceiling lining.

5.2.3 The Ignis Report

83    Pirmax also places reliance on the Ignis Report, which was written and authorised by Mr Hughes-Brown. The stated purpose of the Ignis Report was:

…to report the applicable use and compliance of the various [HR Panel Products] against the requirements of the National Construction Code – Volume One – Building Code of Australia, 2015, 2016, 2016 Amendment 1 (BCA)…

84    Like the Acronem Report, the Ignis Report was not a test report, and was instead intended to serve as a certificate from a professional engineer as contemplated by cl A2.2(a)(iii) of the NCC. The report stated, relevantly, that the HR Panel Product has been evaluated and considered to comply with the NCC for use on internal ceilings as soffit lining (being the use addressed in the Pirmax Exova Report and the Acronem Report). The Ignis Report also stated that the HR Panel Product complied with the NCC when used within the wall cavity for internal and external walls and within external panel wall stud frames (that is, not as a lining).

85    Under the heading “ceiling soffit lining – deemed to satisfy provisions” the Ignis Report relevantly recorded:

3.1 Introduction

BCA Clause C1.10 as well as BCA Specification C1.10 sets the requirements of a ceiling soffit lining to be evaluated in accordance with AS 5637 and achieve a required Group number for the respective location.

3.2 Testing, Evaluation and compliance

The [HR Panel Product] with a silver finish has been tested by Exova Warrington in accordance with AS ISO 9705 in a soffit insulation with the following results demonstrating a Group 1 classification.

The [HR Panel Product] has been tested by AWTA in accordance with AS/NZS 3837:1998. Based on the multi-layered approach under Clause 5.4 of AS 5637.1:2015 the combustible component being the core has been tested. The results demonstrate a Group 3 classification and can be used in sprinklered areas of building where a Group 3 classification is permitted under the BCA.

The above results are applicable and compliant to the BCA Deemed to Satisfy requirements under the National Construction Code – Volume One – Building Code of Australia – 2015, 2016 and 2016 Amendment 1.

86    Under the heading “fire safety summary” the Ignis Report concluded:

The above evaluation has considered the use of the [HR Panel Product] in three applications:

1.    Ceiling soffit application exposed or concealed

2.    Internal wall cavity insulation

3.    External wall cavity insulation or internal lining of external concrete wall

The use of the [HR Panel Product] with a silver or white face in application 1 and 2 above comply with the requirements of the BCA Deemed to Satisfy Provisions under current conditions for the application within sprinklered or non-sprinklered buildings where a Group 1 material is permitted. The black faced material is permitted to be only used in sprinklered protected buildings were a Group 3 material is permitted. Table 1 of BCA Specification A1.3 details that test reports indicating the group number of wall and ceiling linings determined under versions of the BCA applicable prior to 1 May 2016 remain valid until 1 May 2019.

5.2.4 The Ignis Certificates

87    As already recorded, in evidence also was a series of certificates issued by Ignis in respect of the HR Panel Product. Each of the Ignis Certificates was described as an “Engineering Certificate” or an “Engineering Evaluation Certificate”.

88    Mr Hughes-Brown gave evidence that the purpose of each certificate was to provide, in respect of the HR Panel Product, a “succinct snapshot…in a single document” of the applicable clauses and performance criteria in the NCC, to demonstrate compliance with the NCC, and to set out any limitations in respect of the product. He described it as “a summary or reduced detail report or certificate” based on the Ignis Report, and stated that it “provide[d] an overview…the reader still needs to go to [the Ignis Report] for further details of justification”.

89    Taking the certificate issued on 21 January 2019 as an example, its purpose is recorded as follows:

The purpose of this Certificate is to document the applicable use and compliance of the [HR Panel Product] against the requirements of [NCC 2016] for insulation to be used as a[n] internal soffit lining. The relevant installation is as per the attached installation detail provided by PIRMAX. This certificate is to be read in conjunction with [the Ignis Report].

90    Like the Ignis Report, each certificate was intended to serve “as a certificate from a professional fire engineer in accordance with Clause A2.2(a)(v) of [NCC 2016 Amendment 1]”. After describing the HR Panel Product and the various formats in which it was available, the certificate continued:

Scope of Use

•    [the HR Panel Product] has been evaluated and considered to comply with the requirements of the BCA in the following applications:

Limitation

•    Within Australia, The Silver and White [HR Panel Product] can be used as an internal lining to ceilings where Group 1 products are required where the building or compartment is provided, with or without an Automatic Fire Sprinkler System.

•    The Black [HR Panel Product] can be used as an internal lining to ceilings where a Group 3 product is required in a sprinkler protected building.

91    At the end of the certificate appear two boxes, which it is convenient to replicate:

92    Although the form of the Ignis Certificates changed over time (the certificates in evidence spanned a three-year period from November 2016 to June 2019), the substance of the representations that they contained remained consistent—in particular, from around 21 November 2018, the Ignis Certificates represented that the HR Panel Product achieved a group 1 rating in silver and white finish and a group 3 rating in black finish.

5.3 Marketing the HR Panel Product

93    Mr Lewinsohn gave evidence that Pirmax marketed the HR Panel Product by issuing “technical datasheets”, and disseminating them to distributors, customers and potential customers—either by providing the technical data sheets to those persons by email or making them available for download on the Pirmax website. Pirmax also provided its distributors and direct accounts (those customers to which Pirmax supplied products directly) with the reports described at [67] above. Mr Lewinsohn gave evidence that Ms Menadue “arranged preparation of the technical data sheets and other marketing material for [the HR Panel Product]” based on those reports.

94    Several versions of the technical data sheets were in evidence, most of which were undated but referred to by their respective “version”. Early iterations of the data sheets included the following statements about the HR Panel Product:

(a)    “Fully compliant to the Australian National Construction Code”;

(b)    “Achieves a Group 1 BCA/NCC fire classification when tested to AS ISO 9705-2003, compliant to the 2016 National Construction Code”;

(c)    “Applications: Soffit (Carpark Application), Walls External/Internal, Raised Underfloor, Ground Floor Slabs, Ceilings, Roofs, Domestic and Commercial Ducting, External Cladding”;

(d)    “NCC/BCA Compliant”;

(e)    “Group Classification AS ISO 9705:2003: Group 1 Lining”; and

(f)    “Group Classification AS/NZS 3837:1998: Group 1 Lining”.

95    A subsequent version of the data sheet, labelled as “v 3.2” (and apparently dated 17 January 2018), included the following representations:

(a)    “Achieves a Group 1 BCA/NCC fire classification when tested to AS 5637.1 (ISO 9705), compliant to the National Construction Code, NCC/BCA Volume 1: Specification C1.10”;

(b)    An image stylised as a circular rubber stamp engulfed in flames with the text “AS 5637.1 CLASSIFICATION” around the circumference of the stamp and “GROUP 1” in large text embossed across the centre of the stamp;

(c)    “Applications: Soffit (Carpark Application), Walls, Raised Underfloor, Ground Floor Slabs, Ceilings, Roofs, Domestic and Commercial Ducting”;

(d)    “NCC/BCA Compliant”; and

(e)    “Group classification: AS 5637.1 (ISO 9705) Group 1”.

96    A further version of the data sheet (publicly available from at least December 2019) included the following representations:

(a)    “Achieves a Group 1 BCA/NCC fire classification when tested to AS 5637.1 (ISO 9705), compliant to the National Construction Code, NCC/BCA Volume 1, Specification C1.10 (ceiling/soffit only)”;

(b)    “Typical applications include:

(c)    “NCC/BCA Compliant”; and

(d)    “**Group Classification AS 5637.1 (ISO 9705) Group 1 [in silver finish] Group 1 [in white finish] Group 3 [in black finish]”.

97    The double asterisk that preceded the representation about the HR Panel Product’s group classification corresponded with a double asterisk at the bottom of the next (and final) page of that data sheet, which read as follows:

**Achieves a group 1 classification in accordance with AS 5637.1:2015 and AS 1530.3 under BCA Clause C1.10 Clause 4 and 7 respectively. The AS ISO 9705-2003 testing included a soffit application only. Black Facing option achieves a group 3 in SOFFIT applications

98    Mr Lewinsohn also gave evidence that, by means of marketing, Pirmax made various statements about the HR Panel Product on its website, including as follows

(a)    “tested to meet the stringent requirements of the building codes australian and national construction code”;

(b)    “fire safety certified”;

(c)    “Pirmax PIR Panels meet the stringent requirements of the Building Codes Australia (BCA) and National Construction Code (NCC)”;

(d)    “Group 1 ISO 9705-2003 ceiling lining system in accordance with BCA 2016”; and

(e)    “Has Pirmax been tested for ASISO 9705-2003? – Yes, Pirmax has a Group 1 AS ISO 9705 – 2003 / AS 5637.1:2015, Determination of fire hazard properties. The peak heat release rate determined during the test was 0.831 (MW). The test did not reach flashover and supports a Group 1 rating of the ceiling lining system in accordance with BCA 2016 (Refer to page 8 of Acronem NCC 2016 Fire Hazard Properties Assessment for ceiling only applications report summary)”.

5.4 Kingspan’s concerns about Pirmax’s performance claims

99    As alluded to earlier, Kingspan is a subsidiary of Kingspan Group PLC, a global manufacturer of building products. It has been manufacturing rigid thermoset polyisocyanurate insulation foam for nearly 40 years, and has been selling rigid thermoset insulation in the Australian market since 2009. It manufactures its products at various locations around the world, including at a manufacturing facility in Somerton, in Melbourne’s north.

100    In addition to its rigid thermoset polyisocyanurate products, which are produced under the product name “Therma”, Kingspan manufactures a rigid thermoset phenolic insulation product range called “Kooltherm”, which includes the “Kooltherm K10” product. As already stated, Kingspan and Pirmax compete in the market for the supply of rigid thermoset insulation products—in particular, Kingspan’s Kooltherm product range competed directly with the Pirmax HR Panel Product.

101    There was evidence that Kingspan had a practice of testing its competitors’ products from time to time. Mr Gibson gave evidence that:

Kingspan…carries out product testing to ensure that we are competing on a level playing field. When we see claims made by our competitors that we are dubious about, we will often investigate further…

For Kingspan, the process of investigating the performance claims made by a competitor will usually commence with a desk top analysis. This involves Kingspan’s technical R&D team obtaining the literature available on the product, including the product data sheets and the relevant product certificates, along with a sample of the relevant product certificates, along with a sample of the relevant product. We review this information and material and if our further investigations do not identify any anomaly or concern in which case we do not further investigate. If we find that there are anomalies or there are performance claims that are beyond what are typical for the product type, we usually write to the company and seek verification.

If the manufacturer’s response on verification of its claims is not satisfactory to Kingspan’s analysis, Kingspan usually proceeds to undertaking testing of the product.

This testing may be done internally in the first instance, however, if the results do not verify the product’s performance claims, we typically engage a third party to obtain samples and have the product independently tested.

102    Similarly, Mr Anderson gave the following evidence:

I also regularly monitor the compliance of competitors’ products to check that their compliance claims are accurate. When evaluating a competitor’s product, I usually commence by working closely with Ashley Vicente to conduct a technical examination of the product technical data to test against the performance claims made by the manufacturer to the market.

If we form the view that those claims are unreasonable or unsupported by technical evidence, then, from time to time, depending on the impact which Kingspan perceives the product is having on Kingspan’s business, I may arrange for the product to be tested either by Kingspan internally, by a third party externally, or both. The properties we test for are typically thermal and fire performance, being the two most important properties of rigid thermal insulation being relevant to NCC requirements for energy efficiency and fire safety.

103    Mr Gibson and Mr Anderson each gave evidence that, shortly after Pirmax’s entry into the market, they began to suspect that Pirmax was overstating the performance of the HR Panel Product’s thermal, dimensional and fire resistance properties. Mr Gibson gave evidence that, although phenolic products (like Kingspan’s Kooltherm product range) typically achieve greater fire performance and produce less smoke than polyisocyanurate products, Pirmax had made claims to the effect that the HR Panel Product outperformed the Kooltherm product range and “any other conventional [polyisocyanurate] product manufactured anywhere in the world”. Mr Anderson likewise gave evidence that he doubted the HR Panel Product could achieve similar thermal and fire performance to the Kooltherm K10 product “because Pirmax was a relatively new manufacturer…and because K10 was a phenolic insulation that typically achieves a better thermal performance [than] polyisocyanurate”.

104    In light of those concerns—and consistently with its approach to testing its competitors’ products—Kingspan began investigating the performance claims made by Pirmax in respect of the HR Panel Product.

105    Mr Anderson gave evidence that, in March 2016, he instructed a Kingspan employee, Ms Ashley Vicente, to conduct testing of the HR Panel Product’s thermal performance internally at Kingspan using a heat flow meter on-site in Perth. Mr Anderson believed that the results of those tests showed that the HR Panel Product’s thermal conductivity rating was higher (meaning its insulation performance was poorer) than what Pirmax had represented in the advertising and technical materials that he had reviewed.

106    Mr Anderson also gave evidence that, from around June 2016, he became aware of the Pirmax Exova Report which, he said, caused him concern, given:

(a)    the report did not refer to the HR Panel Product, but instead referred to a test specimen identified as “Daltofoam MR 40788” and “Suprasec 5005”;

(b)    the test report was sponsored by the CSIRO, and not Pirmax;

(c)    the testing was conducted on 14 April 2016, which was two weeks prior to the commencement of NCC 2016 (which provided for testing in accordance with AS 5637); and

(d)    the test report was issued on 9 May 2016, after NCC 2016 had come into effect.

107    Mr Anderson stated that he likewise held concerns about the Acronem Report, because it was not issued before 1 May 2016.

108    Mr Anderson gave evidence that, in light of the results of the internal testing that Kingspan had performed, he decided to commission independent testing on the HR Panel Product. Initially, Mr Anderson arranged for Kingspan to engage the AWTA to conduct a series of thermal conductivity tests from mid-2016 through to early-2019. He gave evidence of his belief that the testing performed by AWTA revealed significant material variability in the HR Panel Product’s thermal performance. He also arranged for Kingspan to engage the CSIRO to perform thermal conductivity testing on the HR Panel Product. The CSIRO issued a report in respect of that testing on 2 December 2016 (the “CSIRO Report”), which showed that the specimen that it tested achieved a thermal conductivity rating that Mr Anderson considered was significantly in excess of what Pirmax had advertised.

109    Mr Gibson gave evidence that by the end of 2016, and as a result of Kingspan’s internal investigations, Kingspan was of the view that:

(a)    the thermal performance and fire performance claims made by Pirmax in its advertising materials and technical data sheets overstated the performance of the HR Panel Product; and

(b)    there were anomalies in Pirmax’s AS ISO 9705 fire test documentation.

110    In particular, Mr Gibson gave evidence that Kingspan was of the view that Pirmax’s claims that the HR Panel Product achieved a group 1 fire rating were false, and that Pirmax was claiming the HR Panel Product had a group 1 fire rating without having conducted the requisite testing in accordance with AS 5637.1.

5.5 Kingspan’s counter-marketing efforts

111    By at least early-2017, Kingspan commenced what was described as a “counter-marketing” campaign. It began sharing its concerns about the HR Panel Product with building industry participants. It did so with the aim of discrediting Pirmax’s performance claims, while simultaneously putting its own product forward as a more reliable alternative. Mr Gibson gave evidence in cross-examination that counter-marketing was common “in our industry and our business”.

112    Initially, those concerns were focused on the HR Panel Product’s thermal performance and its dimensional qualities. For example, on 25 January 2017, Mr Andrew Wisbey, who held the role of Kingspan’s “State Specification Manager WA”, sent an email to certain employees at Multiplex with the subject line “RE: David Jones Mandurah”. That email read, in part, as follows (errors original):

…

Further to my previous email we believe that one of the products proposed for David Jones is PIRMax. PIRMax is an Australian made PIR board which has been on the market for approximately 1 year now. Should there be any failures to the product will PIRMax be in a position to rectify them?

For this application the product used will need to achieve a group number showing fit for use as a lining material. This is achieved through the ISO9705 full scale room burn test. Attached are the test results from PIRMax to claim this Group number.

Please note that page 4, 6 and 8 of this report the product description is 70mm thick PIR insulation with 0.6 mm thick embossed aluminium foil”, however independent testing of the product in the market place is showing that the foil facing used on the product is up to 50% thinner than the product tested. Please see attached AWTA report with foil face thickness showing between .3 and .38 foil being used. The foil thickness is relative to the performance of the product in the event of a fire. We strongly support testing with this .3 or .38 foil would have failed.

As we mentioned on the Perth Stadium project Alex, Kingspan is the largest manufacturer of PIR in the world however Phenolic insulation is more fit for purpose due to its increased fire properties and less smoke obscuration. We also hold FM approval which no PIR board obtains.

We were not specified in this project but I feel compelled to highlight to you some of the products and testing results in the market today. Without third party certification such as CODEMARK, it is a very complicated process to research all these documents.

…

113    On 6 February 2017, and in light of the results expressed in the CSIRO Report, Mr Anderson (on behalf of Kingspan) sent what was described as a “warning letter” to Pirmax, which set out Kingspan’s concerns regarding Pirmax’s representations about the HR Panel Product’s thermal conductivity rating and attached a copy of the CSIRO Report (the “Warning Letter”). That letter also set out Kingspan’s concerns about the dimensional properties of the HR Panel Product—specifically that the Pirmax Exova Report referred to the HR Panel Product as having “foil facing that was 0.60 mm thick”, whereas Kingspan had obtained a sample of the HR Panel Product for which the foil facing was 0.36 mm thick. That, the Warning Letter read, “suggests that there has been a significant change of specification which could affect the results obtained in the AS ISO 9705 test”.

114    By letter dated 14 February 2017, Pirmax’s then solicitors, Obst Legal, responded to the Warning Letter. That response, however, was sent to an electronic fax number that was then not in use. Having not received (or been aware of) any response to the Warning Letter, the assumption within Kingspan was that Pirmax had declined to engage with the matters that it set out.

115    In any event, the correspondence from Obst Legal denied Kingspan’s allegations about the HR Panel Product’s thermal conductivity rating, and disputed that the specimen the subject of the CSIRO Report was in fact the HR Panel Product. The letter did, however, clarify that the dimensional claims with which Kingspan took issue—namely that the Pirmax Exova Report referred to the HR Panel Product as having a foil facing of 0.60 mm thickness—were the result of a typographical error, and that the product to which the Pirmax Exova Report related instead had a foil facing of 0.06 mm.

116    On 9 March 2017, Mr Gibson sent an email to Mr Craig Burr, Kingspan’s sales director for Australia and New Zealand, with the subject line “PIRMAX Warning Letter” containing his “suggested wording” for an email to be sent to two builders, ProBuild and Multiplex, regarding the HR Panel Product. That email read, relevantly (errors original):

Further to our discussion today see my suggested wording to send to ProBuild and Multiplex below Craig.

We take some risk here folks but these guys are clearly attacking our specifications with overstated performance claims. We need to defend a level playing field and hold them accountable to declaring honest performance claims. Customers need to be warned to seek further advice and the community needs to be protected from non-conforming buildings. If they are to fight it then let them bring the fight to us, so long as we play a straight bat we will be within the law.

Regards SG

Dear xyz,

The attached communication between ourselves and the Directors of PIRMAX [i.e. the Warning Letter] is for your information only and has been provided to you on request by you in response to your concerns.

To date we have had no response from PIRMAX to the attached warning letter that warns them that on the evidence presented that PIRMAX are supplying non-compliant product. Our technical department has since commissioned further tests on material collected from the field and these additional tests further evidence the position outlined in our warning letter to PIRMAX.

Evidence collected by Kingspan over more than six months supports the position that the product’s thermal performance is overstated by up to 33% and that the material described in their fire certificates is not consistent with the physical characteristics and dimensions of the material collected from the field.

I have also been told that our Technical Team now intends to drawing these facts to the attention of authorities along with a copy of the correspondence attached and a list of projects as evidence of where the product has been misused.

My advice to you is to seek further advice and an independent risk assessment of the product you are intending to substitute Kingspan Kooltherm for as it has been specified for a specific reason and it is third party certified as compliant. The cost of using non-conforming products in well documented and generally far out ways the costs of the original installation.

Your truly

…

117    The next day, Mr Ryan Hitzman, Kingspan’s national business development manager, sent an email to a representative from ProBuild with the subject line “Probuild Promenade Apartments – PIRMax Non Conformance and Supply Chain” that adopted, with some variation, the template set out in Mr Gibson’s email above. Mr Hitzman’s email attached a copy of the Warning Letter and the CSIRO Report. There were other examples in evidence of emails following the same template having been sent to other building industry participants.

118    On 24 March 2017, Mr Anderson lodged on Kingspan’s behalf an online complaint with the Australian Competition and Consumer Commission regarding his concerns about the HR Panel Product. The “Description” section of that complaint read as follows (errors original):

I am Technical R&D and Accreditations Manager for Kingspan Insulation Pty Ltd in the Asia Pacific region. Kingspan is a global supplier of insulation products with approx 90% of products sold in Australia being Australian manufactured. PIRMAX Pty Ltd manufactures building insulation in Victoria using polyisocyanurate (PIR) foam to produce rigid thermal insulation boards. The material thermal resistance (R-value) of these boards relies on the thermal conductivity of the foam, and having arranged for independent sampling and testing of PIRMAX PIR insulation we have found the R-value to be 25% deficient of the declared R-value on the PIRMAX data sheet for this product. This effectively means that this thermal insulation will actually transmit 33% more heat than what is promoted, meaning buildings will lose or gain significantly more heat than what they have been designed for.

We have also found that the fire testing report is not representative of the PIRMAX product being currently sold as the foil facer used in the test is considerably thicker than the facer used in practice. The foil facer is declared as 0.6mm thick in the test report, while independent testing by AWTA reports foil thickness of 0.36mm on product sold in practice. This could make to make a significant difference to the fire test results.

These issues were reported to PIRMAX on 4 Feb but no response has been received to date.

The reports mentioned above are all available on request.

119    In early-April 2017, Pirmax, apparently aware that Kingspan had begun to share its concerns about the HR Panel Product with others, caused the following message to be published on its website:

Urgent Notice to our valued current and future customers

It has come to our attention that a competitor has been issuing misleading information and falsified test reports to unsuspecting clients in an attempt to discredit our product. The test facilities from whom these test results are alleged to have been sourced have been notified of this fraudulent activity.

We produce a product that is designed to safeguard you and your family, and we take our testing and compliance very seriously, so in the interest of being transparent we have chosen simply to ensure that we have any required test and compliance documentation available to our valued customers upon request.

Remember: If you feel that you may already be in possession of questionable documentation purporting to be that of our product or simply wish to request information for your building requirements, please contact us and we will happily make arrangements to discuss them and to issue validated and genuine documentation to you.

…

To clarify some specifications that were directly challenged;

•    What is the K value of Pirmax Pir? – Pirmax has a K value of K 0.020. Tested to AS/NZS 4859.1 for the Thermal Insulation of Buildings…

•    Has Pirmax been tested for ASISO 9705-2003? – Yes, Pirmax has a Group 1. AS ISO 9705 – 2003 / AS 5637.1:2015, Determination of fire hazard properties. The peak heat release rate determined during the test was 0.831 (MW). The test did not reach flashover and supports Group 1 rating of the ceiling lining system.

•    What is the thickness of the foil? – Our foil is .06mm as stated on our EXOVA/Acronem AS ISO 9705 test results.

120    On 11 April 2017, Mr Gibson sent an email to four Kingspan employees, including Mr Anderson and Mr Burr, with the subject line “RE: New PIRMAX Website Notice”. That email read as follows:

We have the go ahead to start a legal process against these guys now.

We need to be 100% sure of our facts though. I also need a list of projects where Kingspan was specified and PIRmax was supplied. In addition we need to prove that PIRmax provided information to the contractor that was false and was relied upon by the contractor (this is essential).

Keith and Karim can you please put together a brief similar to the one we did for Choice Solutions. This will be sent to our solicitors but we may also consider using it in the field.

Keith I think that they are still relying on their original samples by the way.

We play fair on this but hard gents so make sure we do our homework and we are 100% on the facts.

Craig also please make sure our sales teams are not over reaching in the field either as we don’t want to be pursued ourselves in respect to misuse of market power or misleading information.

Regards

Scott Gibson

121    At around that time, Pirmax lodged a complaint with the Victorian Small Business Commission regarding Kingspan’s conduct. That complaint was the subject of a mediation session. Although some form of agreement was apparently contemplated, the dispute ultimately did not resolve.

122    Mr Gibson gave evidence that he instructed Mr Anderson to review one of the Ignis Certificates upon which Pirmax relied to support its claims about the HR Panel Product. Mr Gibson gave evidence that Mr Anderson “raised with me a number of concerns regarding the quality and legitimacy of the information contained in the 2017 Ignis Certificate”. On 13 September 2017, Mr Anderson wrote a letter to Mr Hughes-Brown setting out those concerns. That letter read, in part, as follows:

Further to our discussion last week I wish to formally advise you of the deficiencies we see in respect to the Evaluation Report 4212 I01R01 [i.e. one of the Ignis Certificates] provided by Ignis Solutions to PIRmax Pty Ltd relevant to their PIRmax range of Polyisocyanurate insulation panel.

Our complaint is not with Ignis Solutions per se but with the information relied upon in your report as follows and highlighted in the marked up version attached:

…

b)    Exova Warringtonfire report No. 42119200.1 (AS ISO 9705)

i.    This report does not identify PIRMAX Insulation Panel as the tested specimen. It does describe the lining material tested as PIR insulation produced from Daltofoam MR 40788 and Suprasec 5005 and that it was autohesively bonded to a 0.06mm embossed aluminium foil in a continuously foaming process by PlRmax Pty Ltd. This does not identify the tested sample as PIRMAX Insulation Panel, and the Daltofoam reference numbers are different to the number reported in Report No. 315800-00.1, therefore they cannot be considered to be the same product.

ii    While the test date for this test is reported as 14th April 2016, the test report was not issued until 9th May 2016. This is after the 1st May 2016 when NCC 2016 became effective, and this version of the NCC calls up AS 5637 which in turn calls up the AS ISO 9705 test method, but also requires explicitly that the test must be conducted with the test material installed in both the ceiling and walls of the test room in order to determine the Group Number. While the reference to AS 5637 in NCC 2016 states that “Test reports indicating the group number of wall and ceiling linings determined under versions of the BCA applicable prior to 1 May 2016 remain valid until 1 May 2019”, PIRMAX Insulation Panel has not been verified as Group 1 by this test method under prior versions of the NCC.

…

We believe that the details above are significant in their relevance to the expert opinion provided by Ignis Solutions and that a number of the certificates are irrelevant or unreliable. The onus is rightfully on the manufacturer to inform the consultants they engage if and when they make material changes to their products, or any other detail, that could affect the validity of assessments and evaluations used to promote their products, and we understand and accept that this may not have occurred with you.

While it is up to you ultimately to decide your own course of action in this case, we feel we should inform you that it is Kingspan's intention to draw attention to the anomalies above if questioned in cases where the PIRmax Insulation Panel is being proposed to substitute our own Kooltherm products in projects and we believe that as the PIRMAX product being supplied to market was not the product assessed by Ignis that your Expert Opinion should be withdrawn on the basis that the items we have highlighted are found to be now invalid.

We understand you to be a well credentialed and respected expert in this field so please don't see this as an attack on your credibility we are simply drawing your attention to facts that otherwise may affect your expert opinion.

123    The next day, 14 September 2017, Mr Hughes-Brown responded to Mr Anderson’s letter by email in the following terms:

Hi Keith

Thank you for your email and associated letter.

The matter of accurate information and consistency in product details is of utmost importance to myself and Ignis Solutions.

We have attempted contact with PIRMAX and will continue to follow through with an investigation on the points you have raised.

Thank you for bringing this to our attention.

Regards

…

124    It was around that time that the focus of the counter-marketing communications emanating from Kingspan shifted from the HR Panel Product’s thermal conductivity rating and other physical properties (which are not in issue in this proceeding), to Pirmax’s claims that the HR Panel Product achieved group 1 classification.

5.6 Kingspan’s misleading or deceptive conduct allegation

125    On 12 October 2018, Kingspan’s solicitors, Herbert Smith Freehills, wrote to Pirmax setting out the concerns that Kingspan then held. That letter, which is extensive, traversed in detail each of the reports and certificates relied upon by Pirmax, and explained the reasons why Kingspan believed that Pirmax’s reliance was misplaced, and why it considered that Pirmax’s conduct was misleading or deceptive. It read, relevantly:

We are instructed by our client that:

(a)    Pirmax Pty Ltd (Pirmax) produces a range of PIR MAX Insulation Panels (Products) which it supplies to the Australian building industry;

(b)    Pirmax distributes to the market various advertising and promotional material in relation to the Products (Advertising Material); and

(c)    the Advertising Material references incorrect test results and specifications and overstates the performance of the Products.

For the reasons explained in further detail below, by this conduct, Pirmax has and continues to engage in conduct that is and was misleading and deceptive in breach of the Australian Consumer Law (ACL).

…

Pirmax has [distributed] and continues to distribute to the market Advertising Material in relation to the Products via the websites accessible at https://www.pirmax.com.au/ (Pirmax Website) and http://reflexinsulation.com.au/ (Reflex Website).

In particular:

(a)    various technical data brochures are accessible via the Reflex Website which contain product specifications and installation instructions (Technical Data Sheets); and

(b)    a range of reports are accessible via the ‘Compliance’ page of the Pirmax Website which are described as “Safety, Certification and Test Reports” (Test Reports).

…

In the Pirmax website, Reflect Website and Technical Data Sheets, Pirmax makes the following statements about the Products:

(a)    the Products fully comply with the National Construction Code (NCC) and Building Code of Australia (BCA);

(b)    the Products have a thermal conductivity (K-value) of 0.020;

(c)    the Products have ‘Group 1 NCC/BCA Fire Classification according to AS/NZ 3837:1998’ and ‘Group 1’ fire classification in accordance with AS ISO 9705 – 2003 / AS 5637.1:2015; and

(d)    the Products are constantly checked in accordance with ASTM C518, before, during and after the manufacturing process.

    (Pirmax Statements)

Pirmax relies on a number of Test Reports in support of the Pirmax Statements, however, for the reasons explained in section 4 below, the Pirmax Statements go beyond the conclusions reached in the Test Reports and are therefore baseless, false and misleading.

(references omitted)

126    Specifically, as to the Ignis Report and the Acronem Report, the letter stated:

4.2    Ignis Product evaluation

…

On page 8 of the [Ignis Report], Section 3 states:

The installation of the PIRMAX insulation within the ISO 9705 test was as a soffit only and not on both the ceiling and wall as required by ISO 9705.

Compliance with ISO 9705 is required to demonstrate compliance with AS5637:2015. The tests and reports contained within and relied on by the [Ignis Report] were not conducted with the Products installed in the ceiling and wall, as required in accordance with AS 5637:2015.

Accordingly, the [Ignis report] cannot be used by Pirmax to support compliance claims with AS 5637:2015 and NCC 2016…

4.3    Acronem Report

Pirmax relies upon [the Acronem Report] in support of the statements that the Products satisfy the requirements for Group 1 Fire Certification.

The conclusions reached in the Acronem Report are:

(a)    expressly limited to the PIRMAX PIR Insulation Panel Foil Faced (Daltofoam MR 40788 and Suprasec 5005); and

(b)    unacceptable under NCC 2016 as those conclusions are based on the AS ISO 9705 report No. 42119200.1 dated 9th May 2016, which:

(1)    postdates the date the NCC 2016 was enacted; and

(2)    as discussed above, involved the material being tested in the ceiling of the test room only.

Accordingly, the Acronem Report cannot be used by Pirmax to support its compliance claims in respect of any of the Product Variations, Product Thicknesses, Product Applications or Product Alternative Facers.

127    The letter concluded:

6    Pirmax has and continues to engage in misleading and deceptive conduct

For the reasons explained…above, the Test Reports relied upon by Pirmax in support of the Pirmax Statements do not demonstrate or substantiate that each Product variation is compliant or that those Product Variations have been tested to demonstrate compliance as represented by Pirmax.

…

Kingspan previously sent Pirmax a ‘non-compliance’ letter on 6 February 2017 [i.e. the Warning Letter] which set out some of Kingspan’s concerns regarding the statements Pirmax was making in relation to the Products. As you are aware, Kingpsan requested Pirmax to produce test reports which backed up Pirmax’s compliance claims, however, to date, no such test reports have been produced.

Instead, Pirmax continues to make the Pirmax Statements to the market on the basis of the conclusions reached in the Test Reports, which, as explained above, do not support the sweeping claims made by Pirmax in relation to the Products.

For reasons unknown to Kingspan, Pirmax has elected not to conduct the appropriate testing for the Product Variations, Product Thicknesses, Product Applications and Product Alternative Facers.

In all circumstances, Pirmax has [engaged] and continues to engage in misleading and deceptive conduct by claiming:

(a)    the Products fully comply with the NCC and BCA;

(b)    the Products have a thermal conductivity (K-value) of 0.020;

(c)    the Products have ‘Group 1 NCC/BCA Fire Classification according to AS/NZ 3837:1998’ and ‘Group 1’ fire classification in accordance with AS ISO 9705 – 2003 / AS 5637.1:2015; and

(d)    the Products are constantly checked in accordance with ASTM C518, before, during and after the manufacturing process.

7    Next steps

As explained above, by distributing the Advertising Material to the market which references incorrect test results and specifications and overstates the performance of the Products, Pirmax has [engaged] and continues to engage in misleading and deceptive conduct.

Further, by overstating the performance of the Products, Pirmax is not only misleading the market and thereby gaining an unfair competitive advantage, Pirmax is also potentially causing and/or contributing to the construction of dangerous and non-compliant buildings.

Accordingly, Kingspan demands that Pirmax…undertake to Kingspan by no later than 5:00pm on Friday, 26 October 2018 that Pirmax will:

(a)    remove the false Technical Data Sheets and Group 1 Classification fire tests and representations from the Pirmax Website and any other content, information, materials or documents which contain the current incorrect specifications for each Product Variation;

(b)    until further testing is conducted in accordance with (c) below:

(1)    withdraw compliance claims for each Product Variation; and

(2)     issue a statement to the market, distributors of Pirmax Products and existing customers requiring them to cease publishing the Advertising Materials informing them that you are undertaking further testing in accordance with (c) below;

(c)    in respect of each Product Variation:

(1)    conduct testing in accordance with the relevant standards;

(2)    restate the thermal performance R-Values;

(3)    publish the updated test results on the Pirmax Website; and

(4)     prepare updated technical data reports, product brochures and installation manuals containing the updated test results.

As explained previously, should Pirmax refuse and/or fail to give this undertaking to Kingspan within the prescribed time, Kingspan will take further action against Pirmax without further notice.

…

128    By letter dated 20 November 2018, Pirmax’s then solicitors, Collins & Stephens, provided a brief response to the letter of 12 October 2018. It read, in part:

We note from the 12 October Letter that the substance of the allegations made by Kingspan are… that “Pirmax had and continues to engage in misleading and deceptive conduct”.

We are instructed, for the avoidance of any doubt, that:-

i.    these allegations are expressly and strenuously denied in every respect by Pirmax; and

ii.    any ‘further action’ as foreshadowed in 7 of the October Letter) will be vigorously defended by Pirmax.

5.7 Kingspan testing alerts

129    For completeness, there were various “testing alerts” in evidence, which were stylised marketing documents developed by Kingspan aimed at discrediting Pirmax and the HR Panel Product. Ultimately, nothing turns on the specific representations contained in the testing alerts. Nonetheless, they form part of the course of conduct in which Kingspan engaged, which Pirmax urges the court to take into account for the purpose of determining whether representations made subsequently were relevantly misleading or deceptive.

130    One of the testing alerts contained the heading “Are you really getting the product that was tested?”. Its purpose, clearly enough, was to raise questions about whether the product that was the subject of the Pirmax Exova Report was the same as the HR Panel Product being supplied to the market. It contained the following summary of the “Product Tested: PIRMax HR Panel”:

The test reports they are using to claim a Group 1 classification under AS ISO 9705 and AS/NZS 3837 are actually different product names and neither are named PIRMax HR Panel. One is called “Daltofoam MR40788 in combination with Suprasec 5005” and the other is called “Daltofoam MR 42201”.

131    Another testing alert had the heading “Are you really getting the product you’ve been sold?” Its focus was on variations in the density of samples of the HR Panel Product. It read, relevantly:

Five density measures were taken from PIRMax products sourced from July 2016 to July 2017. None of them matched the density used for the ISO 9705 test (40 kg/m³). The samples varied with 37.6 kg/m³ being the lowest and 60.5 kg/m3 being the highest, representing a variance of -6% to +51% from the density tested to ISO 9705.

Such a wide variance in product density can be an indication of poor quality control in the manufacturing process.

Product density can affect both thermal performance and fire performance.

Poor quality control and wide variations such as this call into question the credibility of both thermal and fire test reports purporting to support the compliance and performance claims of a product as one cannot be certain that the manufacturing composition of the product which was tested matches the specifications of the product being supplied to the market.

132    There was in evidence a series of internal emails between Kingspan staff regarding the creation and development of the testing alerts, as well as evidence of those testing alerts in what appeared to be their final form. There was also some, albeit limited, evidence of those testing alerts being distributed to building industry participants. To take one example, on 10 May 2018, Mr Damian Squire, Kingspan’s area sales manager for South Australia and the Northern Territory, sent an email to Mr Kendall Aplin of Aplin Cook Gardner, an architectural firm, with the subject line “PIRMax Insulation – Park Central” attaching one of the testing alerts. That email read, relevantly (errors original):

…

Please find attached some information currently available on PIRMax PIR panels. You will notice that PIRMAX are not the sponsor of either of these tests and that two separate Daltofoam chemical compositions are referenced on the test reports. PIRMax Pty Ltd registered as a business on the 3rd March, 2015 according to a public search of the ASIC database. The date quoted on the one of the attached test reports predates the official establishment of the PIRMax business by some 19 months.

Furthermore, Please see some information below on the different chemical make up between the Kooltherm closed cell Phenolic Resin and PIR.

Also see attached documentation demonstrating compliance to the NCC for the Kingspan K10 insulation board. As discussed we manufacture our Kooltherm insulation from a chemical called closed cell phenolic resin, Kingspan choice to manufacture using phenolic resin as it provides superior thermal values and most importantly fire performance. In the event of a fire Kooltherm will release two and a half times less smoke than a PIR manufactured boards. Kingspan is one of the word largest manufacturers of PIR Globally.

Our Technical Department have had some experience with Pirmax and when looking into their thermal values there are some concerns with the accuracy of them. As a manufacture[r] of PIR we know that PIR cannot perform to the same thermal values of closed cell phenolic resin so on three separate occasion[s] we have tested the Pirmax boards and found that their thermal values are over stated by 12 – 15 percent.

This PIRmax product was installed as a substitute to Kingspan K10 Soffit Board on the Park Central project.

I hope you find this information useful.

…

133    There were other similar emails in evidence by which Kingspan employees disseminated these testing alerts. Ultimately, as already stated, nothing turns on the specific representations contained in the testing alerts or the extent of their dissemination. Nonetheless, they were another plank in Kingspan’s counter-marketing activities.

5.8 Kingspan’s testing of the HR Panel Product

134    In late 2018—having been engaged in a dispute with Pirmax over a lengthy period, and having failed to bring about the outcome that it desired—Kingspan commissioned Exova to conduct testing of the HR Panel Product. Mr Gibson gave evidence that Kingspan arranged for the delivery of three packs of the HR Panel Product in a white finish and in 60 mm thickness from one of Pirmax’s distributors, 4 Corners Insulation, to Kingspan’s premises at Somerton. Those products were then couriered to Exova’s test site in Dandenong South. An affidavit made by Mr Gibson annexed, relevantly, photographs of the product to be tested, which he stated were taken at 4 Corners Insulation on 30 November 2018, and an invoice from 4 Corners Insulation dated 11 December 2018 for “3 x Packs of Pirmax 60mm 2.4m x 1.2m WHITE (5 sheets per pack)”. Kingspan also engaged Dr Barnett to attend the installation and testing of the HR Panel Product by Exova and to prepare a report of his observations. On 12 December 2018, Exova conducted a test of that product, which it video-recorded. A copy of that recording was later provided to Kingspan.

135    Exova produced a report dated 22 January 2019 based on the results of that testing (hereafter, the “Kingspan Exova Report”). Dr Barnett also produced a report (hereafter, the “Barnett Report”), which was initially issued on 22 January 2019 and revised three times, with the latest version issued on 25 February 2019.

5.8.1 The Kingspan Exova Report

136    The Kingspan Exova Report was entitled “Ceiling and wall lining tested in accordance with AS ISO 9705:2003 (R2016) and AS 5637.1:2015”. The objective of the Kingspan Exova Report was recorded as being “[t]o determine the fire hazard properties of a ceiling and three walls lined with panels of Product X subjected to a test in accordance with AS ISO 9705:2003 (R2016) and AS 5637.1:2015”, and the test specimen was described as follows:

The test specimen comprise of a wall lining of double foiled faced 60 mm thick PIR panels of Product X. The lining material was fixed to three walls and the ceiling using 14 g x 125 mm screws with Ø37 mm x 1.5 mm thick washers…The panels were PIR laminated with aluminium foil on both sides, with a white foil facing the internal of the room and a reflective foil facing the external side of the room.

137    Under the heading “Statement of compliance”, the report read:

The test was performed in accordance with the requirements of AS ISO 9705:2003 (R2016) and AS 5637.1:2015 for the purpose of determining the group number that may be assigned to the material using the classification schemes given in AS 5637.1:2015 and “C/VM2 – Verification Method: Framework for Fire Safety Design”.

138    In the section entitled “Performance criteria and test results”, the Kingspan Exova Report recorded:

The National Construction Code of Australia (NCC) and AS 56371:2015 allow the classification of materials by Group Number, which indicates the amount of time taken for the material being tested to reach flashover under AS ISO 9705:2003 R2016 test conditions. The NCC and AS 5637,1:2015 define flashover to be heat release rate of 1 MW, so materials are classified, in accordance with NCC 2016 Spec C1.10 and AS 5637,1:2015, by the time taken for the heat release rate, as measured during the AS ISO 9705:2003 R2016, to reach 1 MW as per the scheme below;

•    Group 1 – Materials classified as Group 1 do not reach flashover after ten minutes exposure to a heat source delivering 100 kW immediately followed by a further ten minutes exposure to 300 kW.

•    Group 2 – Materials classified as Group 2 reach flashover after ten minutes of exposure to a 100 kW heat source.

•    Group 3 – Material classified as Group 3 reach flashover after two minutes, but before ten minutes of exposure to 100 kW heat source.

•    Group 4 – Materials classified as group 4 reach flashover before two minutes of exposure to a 100 kW heat source.

The material subjected to this AS ISO 9705:2003 82016 test achieved a heat release rate of 1 MW after 39 seconds exposure to a 100kW heat source. Therefore, the system has achieved a classification of Group 4.

The NCC and AS 5637.1:2015 also define the smoke growth rate index, or SMOGRA_RC, as a quantity which may be obtained from the smoke obscuration measurements obtained in the AS ISO 9705:2006 R2016 test. The SMOGRA_RC for a material is obtained by finding the maximum value of the average rate of smoke growth, where the averages are found from the total smoke obscuration determined over intervals of one minute, then dividing that value by the time that maximum occurred and multiplying the result by 1000.

The maximum average rate of smoke growth far this material occurred at 39 seconds into the test and was found to be 103.6 m²s^-1. Therefore, the SMOGRA_RC value for the material is 2657 m²s^-2 x 1000.

139    The Kingspan Exova Report concluded:

The Product X Board wall and ceiling lining has been subjected to a reaction to fire test in accordance with AS ISO 9705:2003 R2016 and AS 5637.1:2015.

The specimen achieved the following performance requirements as defined in AS ISO 9705:2003 R2016, AS 5637.1:2015 and the National Construction Code of Australia (NCC):

•    Group number                            :    4

•    SMOGRA_RC (in m2s-2 x 1000)     :    2657

The specimen achieved the following performance requirements as defined in the C/VM2 – Verification Method: Framework for Fire Safety Design:

•    Group number                             :    4

•    Average smoke production rate     :    30.2 m²s^-1

140    The Kingspan Exova Report did not describe the product as the HR Panel Product, instead referring to it as “Product X”. Mr Gibson gave evidence that that was because “Exova Warringtonfire ha[d] an official policy not to identify tested products in test reports when the testing is commissioned by third parties…without the consent of the manufacturer”. Indeed, in an email to Mr Anderson sent on 30 November 2018 with the subject line “RE: Boards for AS ISO 9705 Testing for delivery”, Mr Anthony Rosamilia of Exova explained as follows (errors original):

Hi Keith

I am writing in regard our phone call and request to test PIRmax’s (another company’s) panels in order to obtain a group number in accordance to AS5637.1. Our position on testing a company’s product for another company is as follows:

We either test and report the product without the specifics of the product being mentioned, namely the Product and Company; or we can provide a report with a full description of the product when we have obtained the company’s (who’s product is being tested) written permission that we can test their product on your behalf.

Please let me know how you want to proceed.

Kind Regards, Anthony

141    For its part, Pirmax did not accept that the product tested was in fact the HR Panel Product. It also disputes that the test performed by Exova and, consequently the Kingspan Exova Report, accorded with AS ISO 9705.

5.8.2 The Barnett Report

142    The Barnett Report was published by Basic Expert Pty Ltd, a company of which Dr Barnett is the managing director.

143    The Barnett Report describes the background and scope of the report, the various documents Dr Barnett reviewed for the purpose of preparing the report, and the test itself. Under the heading “Conclusion”, it stated, relevantly, as follows:

3.1 Anticipated Group number ratings

3.1.1    I reviewed the material in four websites, one for Pirmax panels and three for Reflex Insulation [one of Pirmax’s distributors] as well as the Pirmax HR-Panel Technical Data Sheet V.0 which was provided to me… They refer to the White Pirmax panel that was tested, and both indicate a Group number of 1 for the product. These documents (including the Reflex Technical Data website) imply that the Group number was determined in accordance with AS 5637.1 and testing to AS ISO 9705.

3.1.2    I reviewed the IGNIS Certificate dated 21 January 2019. The Certificate references an IGNIS compliance report IGNS-6408 I02R00 dated 08.01.19 which is not available on the website.

3.1.3    The test referred to in the IGNIS Certificate 6408-03 I02R01 of the White Pirmax panel, is where the Pirmax panel lined only the ceiling of the test room.

3.1.4    The National Construction Code references AS 5637.1 which then specifies the use of ISO AS 9705 to determine Group numbers. AS 5637.1 section 5.2.1 states “Tests of walls or ceilings alone shall not be used for determining group number or SMOGRA_RC”.

3.1.5    Therefore, the test of the ceiling (soffit) referred to in the IGNIS Certificate 6408-03 I02R01 did not conform to the National Construction Code’s requirement for the use of AS 5637.1 to determine a Group number.

3.2 Test results

3.2.1    As tested in accordance with the National Construction Code’s requirement to use AS 5637.1 the tested White Pirmax panel

•    failed to achieve the criteria for a Group number of 1

•    achieved a Group number of 4

…

3.3 Misleading information

3.3.1    In light of my findings in 3.2.1 and Warringtonfire’s findings in 3.2.2, the information referred to in 3.1.1 is false and misleading, i.e. the product has a Group number of 4 NOT a Group number of 1.

3.3.2    The IGNIS engineering evaluation is wrong as the Pirmax HR Panel (white) has a Group number of 4 when tested and not 1 as Hughes-Brown reports. The tested Group number is the relevant one, not one based on an Engineering Evaluation Certificate.

3.3.3    The use of a product with a Group number of 4 in locations within a building where a Group number of 1 is required by the Deemed-to-Satisfy provisions of the National Construction Code is not only contrary to the appropriate provisions of the building code but may result in not achieving the performance requirements of the NCC and may result in an unsafe situation.

…

4.2 Pirmax Group Number claim

4.2.1    As stated in 3.3.1 the Pirmax Foil-Faced Panel (white) does not have a Group number of 1 when tested to AS5637.1 (ISO9705).

4.2.2    As stated in 3.1.4 the test may not be used for a soffit application only to determine the Group number or the SMOGRA_RC.

4.3 Testing of wall and ceiling wall systems

4.3.1    The NCC is clear that products tested to AS5637.1 (ISO9705) must include a complete system and the test results may not be used to evaluate a wall system or a ceiling system if the complete system (wall and ceiling configuration) isn’t tested.

4.4 Information within the Pirmax Technical Data Sheets and test reports via the website

4.4.1    As stated in 3.3.1 the information within the Pirmax Technical Data Sheets and test reports regarding the group number is misleading. The product has a Group number of 4, not 1.

144    On 11 February 2019, Kingspan’s solicitors, Herbert Smith Freehills, wrote to Pirmax’s then solicitors, Collins & Stephens, outlining Kingspan’s concerns that Pirmax continued to make misleading or deceptive representations about the HR Panel Product. By that correspondence, Kingspan’s solicitors provided copies of the Kingspan Exova Report and the Barnett Report, and proposed that the parties and their legal representatives meet on a without prejudice basis to discuss those reports and Kingspan’s concerns about the HR Panel Product more generally. Pirmax, by letter from Collins & Stephens, declined that proposal, denied any allegation of misleading or deceptive conduct, and invited Kingspan to raise its concerns about the HR Panel Product with the relevant authorities.

145    The next day, on 12 February 2019, Mr Burr sent an email with the subject line “PIRmax 5637” to several Kingspan employees, which read as follows (errors original):

Hi team

Update from my side, I had confirmation from a NSW customer today that PIRmax doesn’t have a 5637 test as of today but have assured the client that they will have their ducks lined by 1 May

Huge opportunity over the next week to drive as many people to ask the question of these guys as possible (whisper was they got Gp3 and will be retesting looking for a Gp2)

Make sure there is doubt over what product is out there what Gp No it will claim moving forward .

Use the CSR info to refer how difficult it is to get a Gp 2 and note that they have a Gp 1 for Ceiling only and a Gp 3 Wall & Ceiling with metal angles this is a massive change in claimed performance of the same product

Create a storm while the window is open it will take weeks for them to unravel and go back to the market with a result after May 1

Target your highest compliant customers and the influencers in the market.

Good luck out there team and enjoy !

146    It was around that time that Kingspan’s efforts appeared to hone in on Pirmax’s claim that the HR Panel Product was compliant with AS 5637.1. In response to Mr Burr’s email mentioned in the previous paragraph, Mr Anderson sent the following email (to Mr Burr only):

I suggest that we make an issue of the fact that they claim compliance with 5637, and have been for some time so it shouldn’t be difficult for them to present a 5637 complaint Group 1 report.

Regards,

Keith

147    The next day, 13 February 2019, Mr Burr sent a further email to a similar group of recipients as the email sent on 12 February 2019. That email read, in part, as follows (errors original):

Hi all after a discussion with Keith he drew my attention to the fact that PIRmax have been claiming a Group 1 in accordance with 5637 for some time, I thought that they had removed these claims from their website but on investigation they still have the attached on line so….

So from that I have downloaded the brochures as on today they have on the web claiming either compliance to 5637 or NCC 2016 amendment 1 (same)

…

As per prior email discussion they have responded in the market when questions with “we will be compliant by 1 May”

But armed with the attached I will be asking then to go back and question “what do you mean you will be compliant by 1st May your literature states that you have Group 1 in accordance with 5637 so please send me that test result”

And I will obviously arm them with the copies of ours as to what they need to get

We know that they won’t be able to produce a 9705 test in accordance with 5637 ! let alone a report stating a Group 1

Thus going against their documents and published claims.

Please use this when you can, always be factual and refer to their own website for claims using our test as a reference what to ask for.

Any questions please refer to your manager for clarity

Good luck and have fun

148    Meanwhile, Kingspan continued its counter-marketing activities. It is unnecessary to describe those activities in further detail. It suffices to record that Kingspan, through its employees (and with the imprimatur of Kingspan’s management), sent emails to various building industry participants—including builders, contractors, insurers, and superintendents—highlighting what Kingspan considered to be the deficiencies in the HR Panel Product and the materials used to market it.

5.9 Project Shield and Sword

149    Mr Gibson gave evidence that, in mid-February 2019, he prepared what he described as a “strategic document”, which he entitled “Project Shield and Sword” (the “Project Shield and Sword Document”). The purpose of the Project Shield and Sword Document, Mr Gibson said, was to instruct Kingspan’s senior management and sales team as to the manner in which they were to convey the results of the Kingspan Exova Report and the Barnett Report to market participants. Mr Gibson’s document became the genesis of a marketing push from Kingspan known as “Project Shield and Sword”.

150    On 18 February 2019, Mr Gibson sent an email with the subject line “Project Shield and Sword” to Kingspan’s Australian senior management team attaching a copy of the Project Shield and Sword Document. That email read as follows:

Hi Gentlemen,

It is now time for us to defend ourselves and regain some lost ground against PIRMax. The attached brief outlines what our strategic approach is to the market and the manner in which we must communicate. The attached documents are Controlled Documents and not for broad circulation and note that the brief itself is strictly confidential and for internal circulation within your teams only.

The objective is to firstly protect our specifications from attack from PIRmax and their claims of Group 1 compliance under AS5637.1 (ISO 9705) and secondly hold them accountable for their claims and draw attention to the findings of the independent investigative report by Dr Jonathon Barnett who bring[s] into question the validity of their fire compliance statements.

The brief outlines the professional and ethical manner in which we must execute the strategy ever mindful that this may go to court so every communication we make to the market may be scrutinised. The email template includes the test report and covering email must send with them as signed off by our solicitors. Craig will also follow up with additional tactical coaching in terms of field work.

Good luck gentlemen, let’s get out there and keep the bastards honest.

Regards

Scott Gibson

151    The Project Shield and Sword Document included the following statements:

Objective:

•    Shield: To protect our specifications from attack from PIRmax and their claims of Group 1 compliance under AS5637.1 (ISO 9705).

•    Sword: Draw the attention of the Authorities and Building Professionals to the findings of the independent investigative report by Dr Jonathon Barnett. Wrong foot our competitors on AS5637 compliance ahead of the 1st of May deadline by promoting our own ISO 9705 documentation as evidence of what they should be asking for.

Remember our TPA Training

•    W[e] never discuss pricing in any way shape or form with a competitor.

•    We never threaten a supplier with supply termination if they carry a competing product.

•    We never force suppliers to sell at a particular price.

•    We never make False & Misleading statements

•    We never supply product that is not fit for purpose.

•    We never make misleading statements to a customer or consultant.

•    We never rubbish a competitor product.

•    Bottom Line – We Never Lie…

Note: There is a saying that says you shouldn’t do something you could not tell your mother…the legal equivalent is that you should not put in email something you wouldn’t be prepared to see in court…

…

Controlled Document Protocol

•    Both the Basic report by Dr Barnett and the Warrington Fire Test report on PIRmax are to be treated as controlled documents.

•    As a controlled document, they are to only be distributed to approved recipients and they must be sent with the scripted covering email template provided (not to be amended) in this guide.

•    Craig Burr is the person designated with the authority to approve a recipient.

•    Once approved please BCC all email correspondence to Neil Cox & Craig Burr so the communication is registered.

152    The Project Shield and Sword Document then set out the scripted email template, to which I shall refer as the “First Scripted Email”. That template read as follows (errors original):

Subject: PIRmax 60mm HR-Panel – AS/ISO 9705 test results

Dear [insert]

From time to time, Kingspan conducts tests on its competitors insulation products to check whether they perform as advertised to the market.

In December 2018, Kingspan engaged Warringtonfire (an independent NATA accredited test laboratory) to conduct an AS/ISO 9705 test, in accordance with AS 5637, on a white Pirmax 60mm HR-Panel. This panel has been advertised for some time as a Group 1 product when tested in accordance with AS 5637.

The test was held on 12 December 2018 and was witnessed by Dr Jonathan Barnett who is a leading fire safety engineering expert and Chair of Engineers Australia’s Society of Fire Safety.

Attached for your urgent review are copies of the:

(i)    Warringtonfire Test Report dated 22 January 2019 (Warringtonfire Report); and

(ii)    Expert report of Dr Jonathan Barnett dated 11 February 2019 (Barnett Report).

Both the Warringtonfire Report and Barnett Report concluded that Pirmax’s white 60 mm HR-Panel product failed to achieve the criteria for a Group 1 fire classification and instead, rather disturbingly, only achieved Group 4 classification.

Dr Barnett observed that “The failure criteria of flashover (as determined by a maximum heat release rate of 1 MW), was reached in about 40 seconds.”

I also note Dr Barnett’s comment that “The use of a product with a Group number of 4 in locations within a building where a Group number of 1 is required by the Deemed-to-Satisfy provisions of the National Construction Code is not only contrary to the appropriate provisions of the building code but may result in not achieving the performance requirements of the NCC and may result in an unsafe situation.”

I reiterate that this is the independent view of the Chair of Engineers Australia’s Society of Fire Safety.

Yours truly

153    The Project Shield and Sword Document concluded with the following two slides:

Verbally Quotable Points

•    Kingspan Insulation is part of Kingspan Group Limited, a publicly traded company with an annual turnover of $4.4 billion Euro. “We don’t play games when it comes to compliance and fair trading law, we cant.”

•    The PIRmax website and brochures clearly make the claim that they are Group 1 compliant under AS5637.1. [I]n fact they reference this 3 times on their HR Panel Data Sheet. The independent report I have sent you clearly concludes something very different.

•    Kingspan’s Kooltherm K10G2 product is tested in accordance with AS5637.1, it has a confirmed Group 2 rating and is fit for the purpose it has been specified in. In support of this we have the relevant ISO 9705 fire certificate and a third party CodeMark Certificate downloadable from our website.

•    If this manufacturer is making a fire compliance claim to AS5637.1 then insist you have a copy of the actual ISO 9705 fire certificate which will confirm its group number. They will either have it or they wont as it is a very transparent document and should be available on request as ours is on our website.

Preparation

•    Know the relevant Code

•    Review the test material in detail so you know it back the front.

•    Practice your scripted information so you are comfortable with it.

•    Know their documents and their website intimately so you can guide people through it.

•    The other side are in denial so expect a rebuttal.

•    Play the ball not the man.

154    On the same day, 18 February 209, Dr Barnett sent an email with the subject line “ISO9705 test” to Mr Hughes-Brown regarding his assessment of the HR Panel Product. That email read as follows:

Hi Ben

I witnessed the test in the attached lab report (the material was the PIRMAX HR white). I’m very concerned as I believe you wrote an assessment saying that this product has a group 1 rating. As you’ll see it failed in roughly 40 seconds, which gives it a group 4 rating.

I think we need to chat.

Kind regards

Jonathan

155    Mr Hughes-Brown responded to Dr Barnett’s email shortly thereafter. His response read as follows (errors original):

Hi Jonathan

Thank you for your email. I do find it disappointing that competitors of products do these things. I understand the CSIRO has stopped conducting such tests as it causes such problems. Nonetheless here we are.

I have not reviewed or endorsed the installation in the configuration detailed within the test report as achieving a Group 1. I understand that a number of these tests have occurred in late December but we are only seeing the results and reports now. This certainly changes the approach needed for the safe use of PIR or PUR or Phenolic.

Clearly all rigid foam manufacturers will need to have a greater focus on their installation and treatment as detailed in 9705.

My assessment relates to ceiling only application and expires with the permission under the BCA and is not applicable under BCA 2019 unless a new test is undertaken.

I also note that the installation and fixing system is not a controlled criteria under BCA 2019. Another disappointment.

I am curious as to Warringtons statement on the uncertainty of the fire resistance test. Particularly given that AS ISO 9705 is a reaction to fire test and not a Fire Resistance Test. I am not sure I have seen anyone use PIR or PUR or Phenolic in a FRL test.

I am also sure that after a number of tests over the past year that Kingspan would be in a very similar position and would be better suited to improve their products capacity to be used where a Group number <4 is achieved.

I also find it curious that the NSW FAQ document recently released makes reference to PUR and PIR but not Phenolic.

Look forward to chatting soon.

156    By late-February 2019, in accordance with the strategy promulgated in the Project Shield and Sword Document, certain persons at Kingspan had sent emails largely in the form of the First Scripted Email (attaching the Kingspan Exova Report and the Barnett Report) to several market participants, including building professionals, architects, and insurers. Kingspan also sent letters to various regulators that deployed similar wording to the First Scripted Email, albeit those letters contained more detail than the First Scripted Email.

157    Mr Gibson gave evidence that he did not observe a discernible impact from the emails that were sent in the form of the First Scripted Email. Accordingly, Mr Gibson said, in or around early-April 2019, Kingspan arranged for the video recording of the testing undertaken by Exova to be edited so as to incorporate a written and voice-over narration (hereafter, the “Narrated Video”).

158    In reality, and although nothing turns on it, it seems that the Narrated Video had been planned from the outset of Project Shield and Sword. By email to Mr Anderson sent on 18 February 2019 (the same day that Mr Gibson shared the Project Shield and Sword Document with Kingspan’s Australian senior management), Mr Gibson stated as follows:

Can we quickly obtain a copy of the video showing the PIRmax material tested to 9705 at Warrington’s so we can reference it.

Neil we will need Radhika to put together a very quick presentation for us. I will brief you on it today but as a heads up it will involve you as a voice over introducing the test, the video of the test and then a quote from Jonathan Barnett’s report.

It needs to be very factual, accurate and concise in what it presents, the video will tell a thousand words so [not] much else is needed.

159    In any event, Kingspan produced the Narrated Video and uploaded it to YouTube as an “unlisted video”, meaning only those persons provided with its URL could view it (that is, the Narrated Video could not be accessed by using YouTube’s search function). The Narrated Video featured the following voice-over, which it is convenient to replicate in full (as transcribed by Pirmax’s solicitors):

On 12 December 2018, Kingspan engaged an independent NATA accredited test laboratory to conduct an AS/ISO 9705 test in accordance with AS 5637 on Pirmax’s 60mm Pirmax HR panel white product.

This is an unedited video of that AS/ISO 9705 fire test.

The outcome of the test was Pirmax’s 60mm Pirmax HR panel white product reached flashover in less than 40 seconds.

As at 1 April 2019, Pirmax promotes the 60mm Pirmax HR Panel White product as achieving a group 1 rating under AS/ISO 9705, AS 5637.

This means the Pirmax HR panel white product should last 20 minutes under this test.

The test starts at 2:00 minutes.

[test commences, fire lit]

15 seconds – the blaze has reached the ceiling.

25 seconds – a thick smoke starts to form on the ceiling.

35 seconds – flames breach the door.

39 seconds – flashover occurs. Flashover is recorded once the Heat Release Rate (HRR) measured in the compartment reaches 1,000 kW.

60 seconds – the room is at the catastrophic failure point, completely engulfed by flames and thick black smoke.

Effectively hitting flashover before 2 minutes of burn time is a group 4 outcome.

While this product is being widely promoted by its manufacturer as Group 1 compliant under AS 5637.1 this test has determined it to be group 4, and not fit for purpose as an insulated soffit lining under either the Australian or New Zealand construction codes.

…

160    Also in early-April 2019, Kingspan developed a second scripted email template, which was to be used when providing the Narrated Video to recipients (the “Second Scripted Email”). The Second Scripted Email read as follows (emphasis original):

Dear xyzz

For your information as a follow up to our earlier conversation, please see the following video link to the independent AS/ISO 9705 fire test Kingspan sponsored at Warringtonfire on the 12th of December 2018 on PIRmax HR Panel White 60mm product.

PIRmax HR Panel White 60mm AS/ISO 9705 Fire Test Video: [URL identified]

The fire test is in real time and was conducted independent to Kingspan on product sourced in Melbourne direct from a PIRmax distributor. The test was supervised and witnessed by an independently engaged qualified fire engineer arm’s length to Kingspan in fact no Kingspan employees were present at the test. The resulting independent report produced by the engineer subsequent to the test, was provided to PIRMax on the 12th February 2019 following a number of formal complaints by Kingspan to PIRmax about their performance claims. To date the product continues to be promoted by PIRmax as Group 1 Compliant under AS5637 meaning it should last 20 minutes in this test before reaching flashover.

The test report on PIRmax HR Panel White 60mm insulation board confirmed a Group 4 outcome with total Flashover occurring in 39 seconds as depicted in this video.

Yours truly

161    There was evidence that, in April and May 2019, certain Kingspan employees sent emails largely in the form of the Second Scripted Email (which contained the URL to the Narrated Video) to the New South Wales Department of Fair Trading, the Victorian Building Authority, the Department of Mines Industry Regulation and Safety, as well as several building professionals, architects, and insurers. There was also evidence of Kingspan employees continuing to send emails in the form of the First Scripted Email during that period.

162    For convenience, I shall refer to the emails sent on behalf of Kingspan from February 2019 onwards (being those in the form of the First Scripted Email, by which the Kingspan Exova Report and the Barnett Report were provided) and in April and May 2019 (being those in the form of the Second Scripted Email, by which a link to the Narrated Video was provided) collectively as the “Project Shield and Sword Emails”.

163    Although Mr Gibson gave evidence that the Project Shield and Sword Emails were sent to a limited number of recipients, it was nonetheless clear that they brought about the effect that Kingspan desired (at least to some extent). There was evidence of builders (or other building professionals, such as surveyors, project managers or superintendents), apparently having received the Project Shield and Sword Emails, rejecting the HR Panel Product for use in building projects. Indeed, there was evidence of one instance in which the HR Panel Product was directed to be removed from a building in which it had already been installed, apparently in light of the information contained in the Project Shield and Sword Emails (including the Narrated Video).

164    As already recorded, the proceeding was commenced by originating application dated 17 May 2019, by which Pirmax also claimed interlocutory relief. In particular, Pirmax sought to enjoin Kingspan from publishing, broadcasting, conveying or disseminating, relevantly, the Narrated Video and any further Project Shield and Sword Emails.

165    At the first return of the application before Davies J on 17 May 2019, Kingspan undertook to remove the Narrated Video from YouTube by 4:00 pm (WST), Saturday 18 May 2019, and immediately to cease and desist from publishing, broadcasting, disseminating or otherwise exploiting the Narrated Video in any publication, medium or forum whatsoever by itself or by any of its agents or representatives.

Part 6: The ISO3 Product

166    In early 2019, Pirmax began to develop what became the ISO3 Product. The ISO3 Product is similar to the HR Panel Product, both chemically (it is likewise a modified polyisocyanurate rigid thermal panel) and in the manner in which it is manufactured, but it has a thicker aluminium foil facing.

6.1 The ISO3 Product reports

167    As with the HR Panel Product, several of the reports relied upon by Pirmax in respect of the ISO3 Product were also in evidence. They were:

(a)    a test report by Exova entitled “Wall and ceiling lining tested in accordance with AS ISO 9705:2003 (R2016) and AS 5637.1:2015” and dated 18 March 2019 and a classification report entitled “Classification of a wall and ceiling lining to AS 5637.1:2015” dated 29 April 2019 (so as to avoid unnecessary reference to both reports, and given they convey the same results, I shall instead refer only to the classification report; hereafter the “Pirmax Exova ISO3 Report”).

(b)    test reports prepared by the AWTA issued on 18 June 2019, 17 March 2020 and 18 March 2020 with test numbers “19-002612”, “20-000989” and “20-000991”, respectively.

(c)    a report by Acronem entitled “RE: Seismic Fixing Requirements – PIRMAX ISO3 with Hilti X-IE 6” and dated 20 December 2019.

(d)    a series of reports by Ignis ranging from 11 May 2019 to 17 February 2020 concerning the ISO3 Product.

168    It is unnecessary at this juncture to describe in detail all of the reports that were in evidence in respect of the ISO3 Product. However, like the Pirmax Exova Report in respect of the HR Panel Product, the Pirmax Exova ISO3 Report assumes significance in respect of the ISO3 Product. It was the primary report upon which Pirmax relied in support of the performance claims that it made about the ISO3 Product. Subsequent reports produced by Acronem and Ignis relied on the results that it contained.

6.1.1 The Pirmax Exova ISO3 Report

169    As it did with the HR Panel Product, in order to obtain a group classification for the ISO3 Product, Pirmax engaged Exova to carry out a fire test of the ISO3 Product. Exova performed that test on 5 March 2019, in respect of which it produced the Pirmax Exova ISO3 Report. As the Pirmax Exova ISO3 Report recorded, the test specimen comprised of a wall lining of “70 mm thick double aluminium foil faced (embossed) polyisocyanurate PIR panels (Pirmax ISO3)”, which were used to line three walls and the ceiling of the test room (that is, in accordance with AS 5637.1). Relevantly, under the heading “Classification”, the Pirmax Exova ISO3 Report stated as follows (errors original):

The test was performed in accordance with the requirements of AS ISO 9705 – 2003 (R2016) and AS 5637.1:2015 with the purpose of determining the Group Number that may be assigned to the material using the classification schemes given in AS 5637.1:2015.

AS 5637.1:2015 allow the classification of materials by Group Number, which indicates the amount of time taken for the material being tested to reach flashover under AS ISO 9705 – 2003 (R2016) test conditions. AS 5637.1:2015 define flashover to be a Heat Release Rate of 1 MW, so materials are classified, in accordance with AS 5637.1:2015, by the time taken for the Heat Release Rate, as measured during the AS ISO 9705 – 2003 (R2016), to reach 1MW as per the scheme below:

•    Group 1 – Materials that does not reach flashover when exposed to 100 kW for 600s followed by exposure to 300 kW for 600s.

•    Group 2 – Materials that reaches flashover following exposure to 300 kW within 600s after not reaching flashover when exposed to 100 kW for 600s.

•    Group 3 – Materials that reaches flashover in more than 120s but within 600s when exposed to 100 kW.

•    Group 4 – Materials that reach flashover within 120s when exposed to 100 kW.

The material subjected to this AS ISO 9705 - 2003 R2016 test achieved a Heat Release Rate of 1 MW after 207 seconds exposure to a 100 kW heat source. Therefore the system has achieved a classification of Group 3.

…

Table 3        Test results

170    Several of the other reports summarised at [167] are based on, and therefore incorporate, the conclusions expressed in the Pirmax Exova ISO3 Report—relevantly, that the ISO3 Product achieved a group classification of 3 when tested to AS ISO 9705 and AS 5637.1.

6.2 Marketing the ISO3 Product

171    Mr Lewinsohn gave evidence that Pirmax marketed the ISO3 Product by issuing technical data sheets and installation guides that, initially, it provided to its distributors and direct accounts, as well as customers and potential customers by email; and, later, by publishing those documents on its website. It also provided some of the reports listed at [167] to its distributors, direct accounts, and customers (or potential customers).

172    Mr Lewinsohn gave evidence that the technical data sheets and installation guides were based on the information contained in the Pirmax Exova ISO3 Report, as well as one of the reports prepared by Ignis. To take one example, a technical data sheet produced in respect of the ISO3 Product included the following representations in respect of fire resistance performance:

Achieves a Group 3 BCA/NCC fire classification when tested to Wall and ceiling lining tested in accordance with AS ISO 9705:2003 (R2016) and AS 5637.1:2015

…

…

173    Additionally, Pirmax published information about the ISO3 Product on its website, which included representations equivalent to those contained in the technical data sheets issued in respect of the ISO3 Product (as set out in the preceding paragraph).

6.3 Kingspan’s concerns about ISO3 performance claims

174    Mr Gibson gave evidence that Kingspan became concerned that Pirmax’s claims in relation to the fire performance of the ISO3 Product were inaccurate. The gravamen of Kingspan’s complaint was that Pirmax relied upon a test of the ISO3 Product in silver finish only, whereas the advertising materials and technical data sheets for the ISO3 Product contained representations as to its fire resistance performance without differentiation as to its colour finish. That is, those materials contained representations to the effect that the ISO3 Product achieved a group 3 classification in accordance with AS ISO 9705:2003 and AS 5637.1:2015, irrespective of whether it had a silver, white or black finish.

6.4 Kingspan’s testing of the ISO3 Product

175    In light of its concerns, Kingspan wrote to Pirmax (via their respective solicitors) requesting copies of the test reports relied upon by Pirmax in support of its fire performance claims for the ISO3 Product. It did not receive a response. Kingspan thereafter arranged for a sample of the ISO3 Product in white finish to be tested by Exova. That testing occurred on 28 October 2019. Kingspan engaged Dr Barnett to attend the testing and produce a report of his observations. Exova produced two similar test reports each dated 11 November 2019. Like the two reports produced by Exova for Pirmax, one was a detailed “test report” and the other a somewhat more concise “classification report” (again, so as to avoid unnecessary reference to both reports—given they convey the same conclusions—I shall refer to the classification report only as the “Kingspan Exova ISO3 Report”). Dr Barnett produced a report of his observations, the final version of which was dated 20 December 2019 (the “Barnett ISO3 Report”).

176    Exova did not perform a test on the ISO3 Product in black finish. Kingspan asserted that, in the absence of Pirmax producing a test report for the ISO3 Product in black finish, it lacked reasonable grounds for representing that the ISO3 Product in black finish achieved a group 3 classification.

6.4.1 The Kingspan Exova ISO3 Report

177    The executive summary to the Kingspan Exova ISO3 Report recorded as follows:

This report documents the findings of the reaction-to-fire test of a wall and ceiling lining undertaken on 28 October 2019 in accordance with AS ISO 9705:2003 (R2016) and AS 5637.1:2015.

The test specimen consisted of Polyisocyanurate (PIR) foam panels laminated with embossed aluminium foil skins (white and silver coloured) on both sides, as nominated by the test sponsor. The boards were fixed to the internal lining of the test room with the white coloured foil facing inside the room using timber screws and plastic fasteners. A summary of the classifications achieved in accordance with AS 5637.1:2015 is provided in Table 1.

Table 1        Classification in accordance with AS 5637.1:2015

178    Then, under the heading “Classification”, the Kingspan Exova ISO3 Report stated, relevantly, as follows:

AS 5637.1:2015 allows the classification of materials by group number – this indicates the amount of time taken for the material being tested to reach flashover under AS ISO 9705:2003 (R2016) test conditions. AS 5637.1:2015 defines flashover to be a heat release rate of 1 MW, so materials are classified, in accordance with AS 5637.1:2015, by the time taken for the heat release rate to reach 1 MW.

The group classifications are:

•    Group 1 – Materials classified as Group 1 do not reach flashover after ten minutes exposure to a heat source delivering 100 kW immediately followed by a further ten minutes exposure to 300 kW.

•    Group 2 – Materials classified as Group 2 reach flashover after ten minutes of exposure to a 100 kW heat source.

•    Group 3 – Materials classified as Group 3 reach flashover after two minutes, but before ten minutes of exposure to a 100 kW heat source.

•    Group 4 – Materials classified as Group 4 reach flashover before two minutes of exposure to a 100 kW heat source.

The material subjected to this AS ISO 9705:2003 (R2016) test achieved a heat release rate of 1 MW after 93 seconds exposure to a 100 kW heat source. Therefore, the system has achieved a classification of Group 4.

…

6.4.2 The Barnett ISO3 Report

179    The Barnett ISO3 Report was published by Basic Expert Pty Ltd (of which Dr Barnett was the managing director). The Barnett ISO3 Report recorded that, on 28 October 2019, Exova conducted a test on “the 40 mm white Pirmax ISO3 Panel System”, which test (along with aspects of the assembly of the test room) Dr Barnett witnessed. The Barnett ISO3 Report described its scope as being “focused on answering questions contained within the 25 October 2019 letter from [Kingspan’s solicitors] contained in Appendix B”. The report then sets out those questions, together with Dr Barnett’s responses to them, under the heading “[q]uestions by HSF”. Question one concerned the compliance requirements in the NCC 2019 concerning fire hazard properties, and needn’t here be restated. The remaining questions and answers are set out below (errors original):

1.6.2    Question 2 – Identify and explain the results of the Exova ISO3 test by reference to your observations and the Exova ISO3 report.

ANSW: The Exova report confirms my observations that the tested panel system reached flashover within 93 seconds from the start of the fire exposure. As shown in Figure 2, this means that the tested panel system has a group number of 4. This indicates the material falls under the most hazardous classification and is not permitted for use as a wall and ceiling lining material in Class 2 to 9 buildings as specified in Specification C1.10 of the BCA.

1.6.3    Question 3 - State whether the results of the Exova ISO3 test determined any (and if so, what) group number for:

(a)    The ISO3 product specimen which was the subject of the test.

ANSW. Yes. The ISO3 Panel achieved a Group Number of 4.

(b)    Variants of the ISO3 product manufactured in another colour facing, thickness or size.

ANSW. No. Variations to the tested configuration should be assessed as materials manufactured in another color facing or thickness may lead to a considerable variation in the fire performance of the system. This is primarily due to different thermal properties specifically radiant heat absorption, transmission and reflection. These properties affect heat transfer to and from the lining, flame spread rate on the lining and the heat release rate (which directly impacts time to flashover). For example, a dark color has a different emissivity than a light color for a given lining. In practical terms, the radiant heat transfer is directly proportional to the emissivity.

Part 7: The Australian Consumer Law claims

7.1 Legislative scheme

180    The ACL was introduced by the Trade Practices Amendment (Australian Consumer Law) Act (No 2) 2010 (Cth), and commenced on 1 January 2011.

181    Chapter 2 of the ACL is entitled “General protections”. It contains s 18, which prohibits a person from engaging, in trade or commerce, in conduct that is misleading or deceptive, or that is likely to mislead or deceive. Section 18 of the ACL is the successor to the much-litigated s 52 of the Trade Practice Act 1974 (Cth).

182    Chapter 3 of the ACL is entitled “Specific protections”. It contains s 29, which provides, relevantly, as follows:

29 False or misleading representations about goods or services

(1)    A person must not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services:

(a)    make a false or misleading representation that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use; or

(b)    make a false or misleading representation that services are of a particular standard, quality, value or grade; or

(c)    make a false or misleading representation that goods are new; or

(d)    make a false or misleading representation that a particular person has agreed to acquire goods or services; or

(e)    make a false or misleading representation that purports to be a testimonial by any person relating to goods or services; or

(f)    make a false or misleading representation concerning:

(i)    a testimonial by any person; or

(ii)    a representation that purports to be such a testimonial;

relating to goods or services; or

(g)    make a false or misleading representation that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits; or

(h)    make a false or misleading representation that the person making the representation has a sponsorship, approval or affiliation; or

(i)    make a false or misleading representation with respect to the price of goods or services; or

(j)    make a false or misleading representation concerning the availability of facilities for the repair of goods or of spare parts for goods; or

(k)    make a false or misleading representation concerning the place of origin of goods; or

(l)    make a false or misleading representation concerning the need for any goods or services; or

(m)    make a false or misleading representation concerning the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy (including a guarantee under Division 1 of Part 3‑2); or

(n)    make a false or misleading representation concerning a requirement to pay for a contractual right that:

(i)     is wholly or partly equivalent to any condition, warranty, guarantee, right or remedy (including a guarantee under Division 1 of Part 3‑2); and

(ii)    a person has under a law of the Commonwealth, a State or a Territory (other than an unwritten law).

…

183    Section 33 of the ACL provides as follows:

A person must not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose or the quantity of any goods.

7.2 Relevant legal principles

184    In Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357, French CJ and Kiefel J observed as follows (at 364 [5]):

The cause of action for contravention of statutory prohibitions against conduct in trade or commerce that is misleading or deceptive or is likely to mislead or deceive has become a staple of civil litigation in Australian courts of all levels.

185    Indeed, the principles to be applied have been the subject of extensive judicial consideration and are not materially in dispute. Here, the conduct said to have fallen foul of the requirements of the ACL all involved the making of representations about Pirmax’s products. It was accepted that all of it was engaged in in trade or commerce. What remains in dispute is whether, or to what extent, it was relevantly misleading or deceptive.

186    Whether conduct is misleading or deceptive, or is likely to mislead or deceive, is an objective question of fact that the court must determine for itself: Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304, 341-342 [102] (Gummow, Hayne, Heydon and Kiefel JJ) (hereafter, “Campbell v Backoffice Investments”). The central question is whether the impugned conduct, viewed as a whole, has a sufficient tendency to lead a person exposed to it into error; that is, to form an erroneous assumption or conclusion about some fact or matter: Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 197 (Gibbs CJ) (hereafter “Parkdale Custom Furniture”); Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640, 651-652 [39] (French CJ, Crennan, Bell and Keane JJ).

187    Conduct is likely to mislead or deceive if there is a real and not remote possibility that it will do so, regardless of whether it is more or less than a 50 per cent chance: Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82, 87 (hereafter, “Global Sportsman”; Bowen CJ, Lockhart and Fitzgerald JJ); Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2020) 278 FCR 450, 459 [22] (Wigney, O’Bryan and Jackson JJ). It is not sufficient that impugned conduct merely has a tendency to cause confusion or wonderment. Something more is required: Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45, 87 [106] (Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ) (hereafter, “Campomar Sociedad, Limitada”); Google Inc v Australian Competition and Consumer Commission (2013) 249 CLR 435, 443 [8] (French CJ, Crennan and Kiefel JJ) (hereafter, “Google v ACCC”).

188    It is not necessary to prove an intention to mislead or deceive, nor that the impugned conduct misled or deceived anyone in fact: Parkdale Custom Furniture, 197 (Gibbs CJ); Google v ACCC, 443-444 [9] (Grench CJ, Crennan and Kiefel JJ). While evidence that a person was, in fact, misled may be probative, it is not essential and does not itself establish a contravention of the prohibition to which s 18 gives effect: Global Sportsman, 87 (Bowen CJ, Lockhart and Fitzgerald JJ). Further, conduct may be found to be misleading or deceptive, or likely to mislead or deceive, even where the persons to whom the conduct was directed were not actually misled or deceived: Australian Competition and Consumer Commission v LG Electronics Australia Pty Ltd [2018] FCAFC 96, [4], [54] and [64] (Allsop CJ, Jagot and Lee JJ). A person will engage in misleading or deceptive conduct by passing on misleading information given to him or her by others, unless that person disclaims any belief in the truth or falsity of that information: Yorke v Lucas (1985) 158 CLR 661, 666 (Mason ACJ, Wilson, Deane and Dawson JJ). Whether a corporation that publishes or passes on the misleading representation of another has itself engaged in misleading or deceptive conduct will depend on whether it would appear to ordinary and reasonable members of the relevant class of persons that the corporation has adopted or endorsed that representation: Google v ACCC, 446 [15] (French CJ, Crennan and Kiefel JJ).

189    Allegations of breach of s 18 of the ACL call for the impugned conduct to be assessed as a whole, in all of the circumstances that attend it: Parkdale Custom Furniture, 199 (Gibbs CJ); Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592, 605 [39] (Gleeson, Hayne and Heydon JJ) (“Butcher v Lachlan Elder Realty”). To look merely at isolated parts of a person’s conduct without considering their effect as a whole is to invite error: Butcher v Lachlan Elder Realty, 625 [109] (McHugh J, dissenting), endorsed in Campbell v Backoffice Investments, 341-342 [102] (Gummow, Hayne, Heydon and Kiefel JJ). While it is necessary to consider allegations of misleading or deceptive conduct as pleaded, such consideration must extend to all of the relevant surrounding facts and circumstances: Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672, [597] (Wheelahan J). Those relevant circumstances include the person or persons to whom the conduct was directed. In considering conduct towards a class of persons, the court must isolate by some criterion or criteria a representative member of the class for assessment: Campomar Sociedad, Limitada, 84-85, [101]-[103] (Gleeson CJ, Gaudron McHugh, Gummow, Kirby, Hayne and Callinan JJ).

190    There is generally no relevant distinction between the phrases “misleading or deceptive” in s 18 of the ACL and “false and misleading” in s 29: Australian Competition and Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682, [14] (Gordon J); Australian Competition and Consumer Commission v Mazda Australia Pty Ltd (2021) 158 ACSR 31, 51 [88] (O’Callaghan J).

191    There is, however, a distinction between the language used in s 18 and the language used in s 33 of the ACL. As has been observed, “[t]he latter has been said to apply to a narrower range of conduct” and what is required under s 33 “is that there be an actual probability that the public would be misled”: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73, 82 [44] (Allsop CJ); see also Australian Competition and Consumer Commission v H J Heinz Company Australia Ltd (2018) 363 ALR 136, 144 [37] (White J).

7.3 Pirmax’s ACL claims

7.3.1 Alleged misleading representations made by Kingspan

192    In its amended concise statement filed in the proceeding, Pirmax alleges that by publication of the Project Shield and Sword Emails, the Narrated Video, the Kingspan Exova Report, and the Barnett Report, Kingspan engaged in conduct, in trade or commerce, that was misleading or deceptive or likely to mislead or deceive, or that constituted the making of false representations that a product (namely the HR Panel Product or Pirmax products generally) was of a particular standard, quality or grade. By that conduct, Kingspan is alleged to have contravened ss 18 and 29 of the ACL. It is convenient to replicate the relevant paragraphs of the amended concise statement:

12    The…[Narrated] Video and/or the [Project Shield and Sword] Emails contained statements and representations which were and are false, misleading or deceptive or likely to mislead or deceive, including:

(a)    The [HR Panel and ISO3] Product is unsafe for use as an insulated wall or ceiling lining.

(b)    The [HR Panel and ISO3] Product is not fit for purpose as insulated wall or ceiling lining under the Australian and New Zealand construction codes.

(c)    The [HR Panel and ISO3] Product fails fire resistance testing to the standard applicable for use as insulated wall or ceiling lining.

(d)    PIRmax widely and falsely promotes the [HR Panel and ISO3] Product as compliant and/or fit for purpose as insulated ceiling/soffit lining under the Australian and New Zealand construction codes, when in fact the product is not compliant and/or fit for this purpose.

(e)    PIRmax widely and falsely promotes the [HR Panel and ISO3] Product as compliant with the applicable Australian standard (AS 5637.1: 2015) to last 20 minutes of fire before failure (flashover at 1,000 kW heat release rate), when in fact failure is reached in less than 40 seconds.