Federal Court of Australia

The Owners – Strata Plan 872321 v 3A Composites GmbH (No 9) [2025] FCA 1108

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 33J(3) and/or s 33ZF of the Federal Court of Australia Act 1976 (Cth), the time for Tiptell Pty Ltd (Tiptell) to opt out of this representative proceeding is extended to 14 days from the date of these orders.

2.    Tiptell will pay the Applicant’s and the Respondents’ costs of this application, to be assessed by a Registrar of the Court on a lump sum basis, if not agreed.

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

REASONS FOR JUDGMENT

ANDERSON J:

introduction

1    By interlocutory application dated 19 June 2025, Tiptell Pty Ltd seeks an order that the Court extend the time permitting it to file an opt out notice in these proceedings pursuant to s 33J(3) or alternatively, s 33ZF of the Federal Court of Australia Act 1976 (Cth) (FCA Act).

2    The purpose of the order sought is to enable Tiptell to advance a cross-claim filed by it against the second respondent, Halifax Vogel Group Pty Ltd (HVG), on 18 December 2024 (the Cross Claim). The Cross Claim was filed in proceedings commenced by the Owners – Strata Plan No 88695 (the Plaintiff) in the Supreme Court of New South Wales on 1 July 2020 (the NSWSC Proceedings). The Cross Claim has not been served on the first respondent, 3A Composites GmbH.

3    The Cross Claim concerns claims made in relation to Alucobond PE and Alucobond Plus cladding panels (the Alucobond ACPs) affixed by the builder, Casumo Constructions Pty Ltd to the three buildings of which the Plaintiff is the owners corporation. Casumo is the fifth defendant in the NSWSC Proceedings.

4    By the Cross Claim, Tiptell alleges HVG is liable for breaches of the guarantee as to acceptable quality created by s 54 of the Australian Consumer Law (the ACL). Casumo has filed a cross-claim against 3A in the NSWSC Proceedings on substantially the same basis.

5    The Cross Claim is said to arise after the Plaintiff was permitted to amend its pleading to make a claim for complete replacement of all of the Alucobond ACPs on the three buildings in late 2024.

6    Tiptell submits that unless it is permitted to opt out, it may conceivably be shut out from prosecuting the Cross Claim and faces a real risk of being exposed to the entirety of the Plaintiff’s claim in relation to the Alucobond ACPs without any means of recovering those losses from HVG.

7    In this context, Tiptell seeks leave to extend the time to permit it to file an opt out notice in these proceedings.

8    The applicant and sub-group representative (referred to together as, the Applicant) only wish to be heard on the question of whether Tiptell is a group member in this proceeding. The Applicant contends that Tiptell is not a “Group Member” within the definition in [1] of the Second Further Amended Statement of Claim (2FASOC). However, the Applicant did not seek to be heard on the question of whether it was necessary for the Court to finally determine whether Tiptell was a group member in order to grant the relief it seeks.

9    3A, on this application, adopts the position of HVG in opposition to Tiptell’s application. 3A contend that whatever otherwise be the merits of Tiptell’s application, it is unnecessary for the court to determine whether Tiptell falls within the definition of “Group Members” in [1] of the 2FASOC on a final basis in order to dispose of the application. 3A submit that there is sufficient basis for the Court to conclude on a prima facie basis that Tiptell may be a group member, or at least has a bona fide claim, such that Tiptell’s application should otherwise be dealt with on its merits.

10    HVG opposes Tiptell’s application.

Background

11    Prior to 2012, Lichaa Metlege, Mona Metlege, and Joseph Metlege (collectively, the Metleges), and Tiptell, were the registered proprietors of 8 Bourke Street, Mascot, in New South Wales.

12    The Metleges and Tiptell, engaged Casumo to construct a 232 lot strata scheme comprising three multi storey residential and commercial buildings, known as Building A, Building B, and Building C (collectively, the Buildings).

13    The strata plan for the Buildings was registered on 12 December 2013, as SP88695. Upon or shortly after registration of the strata plan:

(a)    the common property in the Buildings vested in the Plaintiff pursuant to what is now s 28 of the Strata Schemes Development Act 2015 (NSW);

(b)    the land was subsequently subdivided into further strata plans of subdivision numbered: SP90091 on 24 July 2024, SP90993 on 1 August 2014, SP90457 on 14 October 2014, and SP90458 on 16 October 2014;

(c)    the Metledges were the registered proprietors of 33 lots in the Buildings; and

(d)    Tiptell was the registered proprietor of 33 lots in the Buildings.

14    Subsequently, between about 19 August 2014 and 5 November 2014 the Metledges transferred 33 lots in the Buildings to Tiptell. Tiptell subsequently disposed of the lots. The last lot was disposed of by Tiptell on about 22 August 2016.

15    On 14 February 2019, the Applicant commenced these representative proceedings pursuant to Pt IVA of the FCA Act.

16    On 1 July 2020, the Plaintiff filed a Summons and Technology and Construction List Statement (the First List Statement) and commenced the NSWSC Proceedings. It was alleged that Tiptell and others were liable for loss and damage attributable to, amongst other things, the existence and cost of replacing cladding. Annexure A to the First List Statement particularised the alleged cladding related defects and non-complying works in the “Common Property” in two words in paragraph 1(q): “defective cladding”.

17    Pursuant to orders made by Wigney J on 31 August 2020 and 30 October 2020, the Applicant published notification of the proceeding and group member rights both online and in various newspapers, in 2020 and 2021.

18    By order of 30 October 2020, the date by which any group member could file an opt out notice was 30 weeks from the “Distribution Date” of 17 November 2020. The final notice to group members identified 11 June 2021 as the last date to opt out.

19    I heard the initial trial of this proceeding between 26 August 2024 and 3 October 2024. The initial trial heard the claims of the applicant, including, relevantly, their causes of action for damages in respect of the alleged failure of Alucobond PE and Alucobond Plus to comply with the guarantee under s 54 of the ACL.

20    Judgment on the initial trial is presently reserved.

Evidence

21    The Applicant and 3A filed no evidence in respect of Tiptell’s application.

Tiptell’s evidence

22    Tiptell relies on the affidavits of Venothan Panicker, Tiptell’s solicitor, affirmed 19 June 2025 (Panicker) and Exhibit VSP-1, 8 July 2025 (Panicker 2), and 13 August 2025 (Panicker 3).

23    From the commencement of the NSWSC Proceedings in 2020 to around May 2023, the proceedings were repeatedly adjourned by consent to enable negotiations for settlement to take place. There was also delay occasioned by reason of the COVID-19 restrictions which were in place at that time.

24    Mr Panicker, on behalf of Tiptell, deposes that in the three years of negotiations, to the best of his knowledge and belief, no claim was made for the complete replacement of the Alucobond ACP’s used in the construction of the Buildings: Panicker [14]

25    On or about 1 July 2020 and 5 February 2021, the Plaintiff served reports from Credwell Consulting Pty Ltd in relation to the “defective cladding” claim dated 25 May 2020 (the May 2020 Credwell Report) and 4 February 2021 (the February 2021 Credwell Report) respectively. These reports did not identify the cladding as Alucobond ACPs: Panicker [15]; Panicker 2 [20]-[21].

26    The May 2020 Credwell Report records, amongst other things, that samples taken from select locations on Building B and Building C have a polyethylene content of less than 30% and therefore are not considered a banned product in accordance with s 9(1) of the Building Products (Safety) Act 2017 (NSW): Panicker, Exhibit VSP-1, p 26.

27    The February 2021 Credwell Report records, amongst other things, a visual inspection on select parts of the Buildings identifying where aluminium composite panels had been used: Panicker, Exhibit VSP-1, page 120.

28    Neither the May 2020 Credwell Report, nor the February 2021 Credwell Report expressly identified the manufacturer, brand or supplier of the alleged “defective cladding”. Nor did those reports expressly state that all cladding on each of the Buildings was combustible or required remediation or replacement.

29    On 6 December 2023, the Plaintiff served a report prepared by AE&D Fire Pty Ltd (AED) dated 6 February 2019 in relation to Building A (the AED February 2019 Report), which identified the relevant cladding as being “Alucobond PE” and “Alucobond Plus”. This was the first occasion on which the Plaintiff served any material in the NSWSC Proceedings identifying the cladding as being supplied and/or manufactured by HVG or 3A: Panicker [31]; Exhibit VSP-1, p 261; Panicker 2 [22].

30    Mr Panicker deposes that the conclusions in the AED February 2019 Report were based on an earlier report prepared by AED dated 31 October 2018, which was not served on Tiptell until about 8 August 2024: Panicker [32]

31    There were then extensions of the time for the Plaintiff to serve its evidence in the NSWSC Proceedings to 29 March 2024 and then 28 June 2024. The Plaintiff failed to comply with those orders: Panicker [22]

32    On 12 August 2024, the Plaintiff sought leave in the NSWSC Proceedings to file a proposed amended Technology and Construction List Statement (the Amended List Statement) and what is known as a “Loulach schedule” (the Loulach Schedule) in lieu of Annexure A to the First List Statement. The Loulach Schedule exceeded 6,000 pages and sought to advance approximately 4,700 items of alleged defects: Panicker [26].

33    Tiptell and Casumo opposed the filing of the proposed Amended List Statement and Loulach Schedule on the basis that:

(a)    the Loulach Schedule had the effect of completely recasting the Plaintiff’s claim;

(b)    the Plaintiff sought to rely upon the late service of additional expert reports to introduce a claim for the complete replacement of all cladding; and

(c)    Tiptell would be or has been prejudiced by reason of its inability to advance cross-claims before the long stop period(s) under s 6.20 of the Environmental Planning and Assessment Act 1979 (NSW) (the Long Stop).

34    On 28 August 2024, Ball J (as his Honour then was) granted the Plaintiff leave to file the proposed Amended List Statement and Loulach Schedule: Panicker [28]-[29].

35    On or about 9 September 2024, the Plaintiff served a further report prepared by Credwell dated 9 September 2024 which recorded, amongst other things, that cladding located on Buildings B and C required replacement (the 2024 Credwell Report): Panicker [37].

36    On or about 10 September 2024, the Plaintiff filed a notice of motion in the NSWSC Proceedings seeking leave to further amend the Amended List Statement (the Further Amended List Statement) to:

(a)    include a reference the 2024 Credwell Report; and

(b)    include additions to Annexure A in relation to the aluminium composite panels cladding located on the entire area of the external façade of Buildings A, B and C based on certain expert reports.

37    Mr Panicker deposes that Tiptell opposed the Plaintiff’s application, inter alia, on the grounds that the proposed amendments broadened the Plaintiff’s claim by introducing new locations of the Buildings which allegedly contained cladding which require replacement, and that the 2024 Credwell Report dealt with combustibility tests carried out in relation to the aluminium composite panels which were not previously conducted: Panicker [41].

38    On 13 September 2024, Hammerschlag CJ in Equity granted the Plaintiff leave to file the Further Amended List Statement subject to the defendants having leave to seek that the amendments be disallowed on the basis of any prejudice shown by reason of the Long Stop in relation to Buildings A and B: Panicker [42].

39    Mr Panicker deposes that the combined effect of the amendments was to allow the Plaintiff to substitute the earlier case of “defective cladding” with a case for replacement of all the cladding: Panicker [44]-[45].

40    Mr Panicker deposes that on 18 September 2024, Tiptell filed the Cross Claim against HVG and 3A. Tiptell submits that the HVG Cross Claim arises from the claims made by the amendments that the NSWSC permitted the Plaintiff to advance. Specifically, allegation(s) of defective cladding panels having been constructed as part of the common property of the residential development comprising the Buildings.

41    On 19 September 2024, Casumo filed a Cross Claim List Statement against 3A in substantially similar terms to the HVG Cross Claim.

42    Mr Panicker deposes that Tiptell did not serve the Cross Claim on HVG until 18 March 2025. That is because Tiptell and Casumo had earlier, on 14 February 2025, filed a notice of motion to oppose the leave granted by Hammerschlag CJ in Equity, which had not been determined: Panicker [47], [55]-[56].

43    On 1 May 2025, the Court made orders disposing of Tiptell and Casumo’s notice of motion and to reserve to final hearing the issues of whether the Plaintiff’s leave to amend should be revoked or the date on which the amendments are to take effect pursuant to s 65(3) of the Civil Procedure Act 2005 (NSW) on the grounds of, inter alia, prejudice to any party: Panicker [49]-[51].

44    Mr Panicker deposes that had Tiptell been aware of the extent of the Plaintiff’s claim in relation to the Alucobond ACPs during the opt out period, it would have either instructed him to register as a group member or taken steps to opt out: Panicker [46]

45    On 23 May 2025, Peden J dismissed a notice of motion filed by 3A in the NSWSC Proceedings against Casumo by which 3A sought to set aside the entirety of Casumo’s cross claim against 3A: Strata Plan 88695 v Metlege [2025] NSWSC 535.

46    Mr Panicker also deposes that notice of Tiptell’s interlocutory application has been given to each of the other parties in the NSWSC Proceedings, and that none of the parties have indicated that they wish to be heard on Tiptell’s application: Panicker 3 [4]-[11].

HVG’s evidence

47    HVG relies on the affidavit of Mark Kingsley Hughes affirmed 3 July 2025 (Hughes) and Exhibit MKH-1.

48    Mr Hughes deposes that on 11 June 2025, his firm filed a notice of motion on behalf of HVG in the NSWSC Proceedings seeking dismissal or, alternatively, a stay of Tiptell’s Cross Claim. After correspondence between solicitors on 17 June 2025, HVG and Tiptell agreed to adjourn HVG’s motion to allow for the filing of an interlocutory application to this Court, which had been foreshadowed by Tiptell’s solicitors on 17 June 2025. Mr Hughes deposes that HVG’s motion was adjourned on the basis that the outcome of the application by Tiptell to this Court would also be largely determinative of HVG’s notice of motion because:

(a)    HVG’s primary objection to the Cross Claim is that Tiptell is a group member in this proceeding; and

(b)    as stated in Panicker [66], Tiptell accepts that in order to prosecute its Cross Claim, Tiptell cannot simultaneously be a group member in these proceedings.

49    Mr Hughes deposes to his belief that Tiptell and the Plaintiff have not opted out of this class action proceeding: Hughes [30]- [31].

50    Mr Hughes deposes to the prejudice to HVG if Tiptell is permitted to opt out of this proceeding and to maintain the Cross Claim in the NSWSC Proceeding. Mr Hughes deposes that HVG will be forced to participate in two separate proceedings that involve identical issues to those already addressed in the initial trial in this Court. This, Mr Hughes deposes, is because the allegations made by Tiptell in the Cross Claim are substantially the same as the claims made by the Applicant in this proceeding in respect of their consumer guarantee claim: Hughes [36].

51    Mr Hughes deposes that as the Plaintiff is a group member in this proceeding, there is a substantial prospect that, if Tiptell is permitted to opt out, there will be a duplication of the assessment of loss and damage that may have been suffered by the Plaintiff overlapping with the claims made by Tiptell. Mr Hughes deposes that this is because the loss and damage alleged by each of them arises from the supply and affixation of the same Alucobond ACPs to the same buildings: Hughes [37].

52    Mr Hughes deposes that if Tiptell is permitted to opt out at this point in time, there is a substantial prospect that HVG would be forced to incur substantial further costs defending parallel proceedings in the NSWSC in respect of claims for loss and damage which were fully contested in this Court at the initial trial and on which this Court will deliver judgment in due course. Mr Hughes deposes that the costs incurred by HVG in this proceeding to date are significant and that he expects that the costs of defending the Cross Claim would also be significant: Hughes [38].

53    Mr Hughes deposes that he considers that if Tiptell is permitted to opt out now, there is a real risk of inconsistent findings being made between this Court and the Supreme Court of NSW in respect of:

(a)    the legal and factual issues arising in relation to the consumer guarantee claims; and

(b)    quantification of the alleged loss and damage said to have been suffered by the Owners Corporation and Tiptell resulting from the affixation of the Alucobond ACPs to the Buildings: Hughes [39].

Legal Principles

54    Pursuant to s 33J(3) of the FCA Act, the Court may, on application by, amongst others, a group member, “fix another date so as to extend the period during which a group member may opt out of representative proceedings”.

55    Section 33J(3) has been exercised in the context of the Court approving a discontinuance where it was common ground that the opt out period should be extended to permit group members who provided opt out notices late to be treated as having been opted out: see Davaria Pty Ltd v 7-Eleven Stores Pty Ltd [2020] FCA 1234, [63]-[66] (Moshinsky J).

56    In Fuller v Allianz Australia Insurance Ltd [2025] VSC 160, Matthews J observed at [48] that the Court had a discretion to allow late opt outs. Her Honour declined to do so in that case on the basis that “allowing late opt-outs is the exception rather than the rule, and it is appropriate that group members wishing to apply to extend the date by which they can opt out do so on the basis of proper material”.

57    For the purposes of the present interlocutory application, I accept that it is sufficient that the Court form a prima facie view that a person may be a group member.

58    In Wright Rubber Products Pty Ltd v Bayer AG [2010] FCAFC 85, Moore J at [34] (Jessup and Dodds-Streeton JJ agreeing at [81]) stated:

The fundamental statutory requirement is that the application (or some other document supporting the application) “describe or otherwise identify the group members”: s 33H(1)(a). This has been done, in the present case, unambiguously… If a person who may be a group member does not wish to ascertain whether they meet those criteria or is unable to do so but in any event does not wish to be involved in the proceedings, they can opt out of the proceedings. If a person who may be a group member is unable to ascertain whether they meet those criteria and wishes to prosecute with certainty a claim of the type being advanced by the applicant, then that person can opt out and pursue an individual claim.

59    In Dyczynski v Gibson (2020) 280 FCR 583; [2020] FCAFC 120 (Murphy, Lee and Colvin JJ), the Full Court upheld the appellants’ contention that the primary judge erred in making a declaration that the appellants were not group members within the class description in the amended statement of claim (albeit not for the purposes of s 33J). The appellants sought to set aside an order dismissing the proceedings so that they could continue with their claim against Malaysian Airlines.

60    Murphy and Colvin JJ made the following observations:

[26(a)]    in relation to the contention that there is no factual basis upon which the appellants fall within the class description, we disagree. The affidavit evidence on appeal discloses that there exist facts, circumstances and legal rights, anterior to and separately from the class action, which may ground the appellants having a right or entitlement to relief under subparagraph (iii) of the class description. The fact that they may not succeed at trial in showing that they fall within that subparagraph does not mean that they do not have a bona fide claim to do so. At this stage it is unnecessary for them to be able to establish a right or entitlement to relief;

…

[226]    Nothing we have said should be understood as questioning the power of the primary judge to finally determine, as a preliminary question or in an interlocutory application, whether the appellants were class members because they fell within one or more of the subparagraphs in the class description. But, at the time the appellants’ application came before his Honour, the applicant in the proceeding was Ms Gibson, and the question before his Honour was, in substance, whether the settlement approval and dismissal orders were validly made. In order to bring that application the appellants did not need to show anything more than that they had bona fide claims to be class members, and in our view they did. They were interested parties with sufficient standing to complain that the class action had not been validly dismissed and, for the purposes of their application, they did not need to demonstrate that they should be finally adjudicated to be members of the class.

(Original emphasis.)

61    Alternatively, s 33ZF permits the Court of its own motion to make any order the Court thinks appropriate or necessary to ensure that justice is done in the proceedings even where no application has been made by a group member. In Prygodicz v Commonwealth (No 2) (2021) 173 ALD 277; [2021] FCA 634, Murphy J stated at [246]-[247]:

[246]    The Commonwealth went as far as to contend that the Court does not have power to fix another date so as to extend the period during which a group member may opt out of the proceeding pursuant to s 33J(3) of the FCA, because no application has been made by a group member or party. It contended that s 33ZF of the FCA, understood in light of BMW Australia Ltd v Brewster [2019] HCA 45; (2019) 94 ALJR 51, is not a source of power for the Court on its own motion to order that a person cease to be a group member, particularly in light of the specific power conferred by s 33J(3). It said that an order extending the opt out period to allow group members to opt out of the settlement is not capable of being characterised as an order “to ensure that justice is done in the proceeding” as between the parties to the proceeding.

[247]    In my view the Court has power to extend the time for opt out without there being an application by the parties or a group member. The power in s 33ZF is not restricted to ensuring justice is done in the proceeding only as between the parties as the Commonwealth submitted. Understood in the context of the representative regime, and taking into account the Court’s protective role in relation to group members’ interests in an application under s 33V, in my view the power in s 33ZF extends to ensuring that justice is done in the proceeding as between group members. In my view the ratio in Brewster does not extend as far as the Commonwealth contended.

Issues for Determination

Issue 1 – Is Tiptell a Group Member?

62    Both Tiptell and HVG assert that Tiptell is in fact a group member in this proceeding. The Applicant asserts that Tiptell is not a group member on the basis that the loss and damage Tiptell claims is for a head of loss that is not being claimed by the Applicant on behalf of group members in this proceeding under the 2FASOC.

63    Alternatively, Tiptell, HVG and 3A submit that whether Tiptell is in fact a group member is a matter which Tiptell need not demonstrate on a final basis on this interlocutory application.

Consideration

64    For the reasons that follow, it is unnecessary for me to determine on a final basis whether Tiptell is in fact a group member within the definition found in paragraph [1] of the 2FASOC.

65    First, determining on a final basis whether Tiptell is a group member is undesirable where there is an overlap between the issues that would need to be resolved to make such a final determination, and some of the issues in the initial proceeding on which the Court is currently reserved. The questions whether (a) Tiptell has suffered loss or damage for which statutory damages or compensation is claimed as pleaded in the 2FASOC, or whether (b) the relevant Alucobond cladding in Tiptell’s case was first supplied to a “consumer” in the Relevant Period, are both bound up in the definition of the group in 2FASOC respectively. Both questions involve complex issues of fact and law which are not readily amenable for final determination on an interlocutory application such as this.

66    Second, it is sufficient on the present application that Tiptell establish on a prima facie basis that it may be a group member or that it has a bona fide claim to be a group member: Wright at [34] (Moore J); Dyczynski at [26(a)], [226] (Murphy and Colvin JJ).

67    I am satisfied that there is a sufficient basis for the Court to conclude on a prima facie basis that Tiptell may be a group member within the meaning of [1] of the 2FASOC, and that Tiptell has a bona fide claim, subject to final determination, that it falls within the class.

68    Under [1] of the 2FASOC, group members are persons who, as at the date of the 2FASOC (in summary):

(a)    either previously owned a building situated in Australia or have previously had an ownership interest in a part of a building situated in Australia;

(b)    where the relevant building or part of a building is or was fitted with Alucobond ACPs;

(c)    have suffered loss or damage for which statutory damages or compensation is claimed, as pleaded in the 2FASOC; and

(d)    where the Alucobond ACPs were first supplied to a consumer in the period between 14 February 2009 and 14 February 2019.

69    Paragraph 1(c) directs attention to [83] and [89] of the 2FASOC. [83(b)] of the 2FASOC pleads that group members have suffered loss and damage by reason of or otherwise resulting from the Alucobond cladding fitted to relevant buildings not complying with the “Acceptable Quality Guarantee”. Tiptell’s Cross Claim seeks relief against HVG in the form of a compensatory order in respect of the Plaintiff’s claim against Tiptell on the basis that HVG is directly liable to Tiptell for loss and damage allegedly occasioned to Tiptell on the basis of breaches of the acceptable quality guarantee under s 54 of the ACL. Tiptell appears to claim compensation from HVG on the basis that it acquired Alucobond cladding as a consumer and is therefore entitled to the benefit of the acceptable quality guarantee under s 54 of the ACL.

70    The particulars to [83] identify the loss and damage claimed for each group member as being, in summary, the cost of removing and replacing the cladding, the cost of remediation measures, the reduction in value of the building, other costs and losses due to the fitting of the cladding (such as increased insurance premiums or building safety assessments). The Applicant submits that Tiptell is not a group member because it does not claim to have suffered any loss or damage of the relevant kind. The Applicant submits that Tiptell makes a claim for compensation for a head of loss (namely, liability to another party) that is not being claimed by the Applicant on behalf of group members in this proceeding. The Applicant submits that Tiptell does not claim that it incurred any costs by reason of its prior ownership of the building on which the cladding was installed.

71    As HVG identifies however, the particulars to [83] of the 2FASOC also note that further particulars in relation to group members’ losses will be provided following opt out and the determination of the Applicant’s claim and identified common issues at the initial trial. HVG submits that [83] of the 2FASOC does not purport to exhaustively particularise group members’ loss and damage as it recognises that loss is an individual issue. HVG submits that the Applicant ran its case at the initial trial on the basis that group members’ losses were not restricted to the extent of those claimed by the Applicant.

72    On the basis of the submissions identified above, I am satisfied that Tiptell, on a prima facie basis, may be a group member or that it has a bona fide claim to be a group member. I expressly do not make any finding beyond this. I am therefore satisfied, for the reasons given, that the Court’s discretion to extend the time for Tiptell to file an opt out notice pursuant to s 33J(3) of the FCA Act is engaged.

Issue 2 – Should the Court extend the opt out period for Tiptell under s 33J(3) and/or 33ZF?

Tiptell’s submissions

73    Tiptell submits that, as a starting point, it is entirely consistent with the scheme of Pt IVA of the FCA Act to permit a party to opt-out to commence separate proceedings: Wright at [34] (Moore J); Muswellbrook Shire Council v The Royal Bank of Scotland NV [2016] FCA 819 at [19] (Rares J).

74    Tiptell submits that it is no answer to the present application for HVG (and 3A who adopts HVG’s position on this issue) to assert that Tiptell should not be permitted to opt out merely because doing so would enable Tiptell to commence separate proceedings. Had Tiptell in fact opted out at an earlier time prior to the opt out date, HVG could not resist separate proceedings being brought by Tiptell against it on that basis alone.

75    Tiptell submits that the fact that it now seeks an extension of time to opt out does not alter the reality that Tiptell is permitted to pursue those claims upon opting out.

76    Tiptell submits that the NSWSC Proceedings will inevitably be required to determine issues which may overlap with the findings which may be made by this Court because:

(a)    the Plaintiff has claimed in the NSWSC Proceedings that the Alucobond ACPs, being cladding manufactured by 3A and supplied by HVG, ought to be replaced;

(b)    Casumo has commenced a separate cross-claim against 3A alleging substantially the same allegations in relation to the cladding that Tiptell alleges against HVG in Tiptell’s Cross Claim;

(c)    3A failed in its attempt to have Casumo’s cross-claim dismissed; and

(d)    the Plaintiff’s claimed losses are precisely the losses that Tiptell seeks to recover from HVG if it is found liable to either or both in respect of the Alucobond ACPs.

77    Tiptell submits that the inevitability of the overlap of issues make it appropriate for the NSWSC Proceedings to include the Cross Claim of Tiptell as against HVG.

78    Tiptell further submits that unless it is permitted to opt out, it may be prejudiced by the real prospect that it is unable to prosecute its Cross Claim and may fall between “two stools”. That is, if inconsistent findings are made in relation to the Alucobond ACPs in these proceedings vis-à-vis the NSWSC Proceedings, then Tiptell faces the real possibility that it may be exposed to liability in the NSWSC Proceedings for which it may be precluded from recovering from HVG at all.

79    In addition to the above, Tiptell submits that there are four further discretionary factors in favour of granting Tiptell’s application for an extension of time to opt out. First, Tiptell submits it is apparent that it has been forced to bring the present application at this time by circumstances largely beyond its control. Tiptell refers to Mr Panicker’s evidence that had Tiptell been aware of the extent of the Plaintiff's claim in relation to Alucobond ACP’s during the opt out period, Tiptell would have either instructed him to register as a Group Member or taken steps to opt out.

80    Second, Tiptell submits, that it is conceivable that if the Plaintiff had not succeeded in its amendment application in late 2024, Tiptell would have faced a substantially different claim in relation to the Alucobond ACPs. Tiptell submits that it was only after the NSWSC approved the amendments, that both Tiptell and Casumo separately cross-claimed against HVG and 3A (respectively) in the NSWSC Proceedings.

81    Third, Tiptell submits, there is no prejudice to the applicant or existing group members if Tiptell were permitted to opt out.

82    Fourth, Tiptell submits that if it is required to remain a group member, and the Applicants in these proceedings succeed, and the Plaintiff also succeeds in its claim against Tiptell, Tiptell is unlikely to receive an amount of compensation in these proceedings which reflects its exposure to the Plaintiff. Tiptell submits that this may occur by reason of:

(a)    any litigation funding arrangement or orders made by the court requiring group members to contribute to the costs or funding of the proceedings from any damages or compensation; and

(b)    any settlement or compromise for an amount which represents less than Tiptell’s true exposure.

HVG’s submissions

83    HVG submits that the factors that are relevant to the exercise of the Court’s discretion on Tiptell’s application are:

(a)    Tiptell’s reasons for not opting out;

(b)    the period of time between the opt out notice and Tiptell's application and what steps, if any, have been taken in this proceeding in the meantime;

(c)    Tiptell’s grounds for seeking to opt out;

(d)    any prejudice to Tiptell, other group members, and the respondents; and

(e)    the effect on Tiptell of refusing its application.

84    HVG further submits that Tiptell should not be allowed to obtain a “preview” of the initial trial in this proceeding before seeking to relitigate the same issues in the NSWSC Proceedings.

85    As to Tiptell’s reasons for not opting out, HVG submits that it is apparent that Tiptell’s application is a result of it making deliberate forensic decisions. HVG submits that Mr Panicker’s evidence is that Tiptell decided not to opt out because it did not understand the true scope and nature of the Plaintiff’s claim against it until September 2024: Panicker [68]. HVG submits that Mr Panicker does not directly address the issue of when Tiptell became aware that Alucobond cladding was used on the Buildings. HVG submits that Mr Panicker does not suggest that Tiptell, as the developer of the Buildings, was not aware of the type of cladding used on the Buildings at the time they were constructed, or that Tiptell ever believed that the “ACP cladding” on the Buildings was something other than an Alucobond product. HVG submits that, on any view, by December 2023 at the latest, when the Plaintiff served the AED February 2019 Report, Tiptell was aware that the Plaintiff alleged that all Alucobond cladding on one of the three Buildings (Building A) needed to be replaced. HVG submits that this was many months before the initial trial in this proceeding commenced but, even at that late stage, Tiptell did not seek to opt out of this proceeding.

86    As to the lapse of time and progress of this proceeding, HVG submits that Tiptell’s application comes more than four years after the opt out notice was sent to Group Members. In that time, this proceeding has been to a fully contested initial trial with judgment now reserved. HVG submits that Tiptell, in this application, seeks to justify its decision not to opt out by Mr Panicker’s assertion that the Plaintiff’s claim was “not pleaded or substantiated by expert evidence” until September 2024: Panicker [45]. HVG submits that explanation should be rejected. HVG submit that Tiptell, through the present application, seeks to avoid the consequences of its own forensic tactics

87    As to the lapse of time and progress of this application, HVG submits that the application comes more than four years after the opt-out notice was sent to group members, and in that time, the proceeding has been to a fully contested initial trial with judgment now reserved.

88    As to the grounds for opting out, HVG submits that the asserted basis of Tiptell’s application is the prospect of “irreparable prejudice” in the form of inability to take part in judgment or settlement because it has not registered. HVG submits that there is no such prejudice as there has been no settlement of this proceeding, or judgment in this proceeding on common issues and the Court has not made any further orders compelling unregistered Group Members to register. The fact that Tiptell has not registered to participate in this proceeding has no bearing on whether it will be able to gain any benefit from this proceeding.

89    As to prejudice, HVG submits that there is a significant prospect that it would suffer serious prejudice if Tiptell is to opt out now. That prejudice takes the form of the prospect of having to contest multiple claims by different parties in different courts concerning the same Alucobond cladding affixed to the same buildings.

90    HVG submits that Tiptell is seeking to opt out from this proceeding to re-run the same consumer guarantee claim this Court has already heard at the initial trial of this proceeding. HVG submits that permitting Tiptell to opt out now gives rise to a substantial risk of inconsistent findings between this Court and the NSWSC in respect of the same subject matter. HVG submits that while Tiptell argues that it is “entirely consistent” with Pt IVA of the FCA Act to permit a party to opt out of a class action to commence separate proceedings, that may be true in cases involving a “traditional” opt out, prior to the commencement of the trial of the class action proceeding. HVG submits that this does not apply in cases where, as here, the initial trial of the proceeding has already occurred.

91    In this context, HVG refers specifically to s 33J(4) of the FCA Act which provides that:

Except with leave of the Court, the hearing of a representative proceeding must not commence earlier than the date before which a group member may opt out of the proceeding.

92    HVG submits that this requirement serves several purposes, one of which is to prevent group members from previewing the class action trial before making a forensic decision about whether to opt out. HVG refers to the following observations of Lee J in Matheson Property Group Pty Ltd (Trustee) v Virgin Australia Holding Ltd (2022) 165 ACSR 550; [2022] FCA 1243 at [41]:

[41]    First, it is important to keep in mind that this is a class action and there has been no opt out. Usually, of course, there should be no final determination of any issue in a class action until after group members have had the opportunity to opt out. The reasons are obvious: there should be no “binding” of group members to a substantive order until they have had the opportunity of considering whether they wish to have their rights affected by an order in the class action, and it would also be unfair to allow a group member to adopt a “wait and see” approach as to how a trial of common issues was going and then make a decision to opt out (and hence prevent a “statutory estoppel” arising). But this is an unusual case. Setting a date for opt-out in this case is premature, and what I have resolved is a discrete issue not directing affecting the substantive claims of group members (and no orders under s 33ZB of the FCA Act were sought by either party).

(Emphasis added.)

93    HVG submits that the fact that Tiptell has had an opportunity to preview the trial in this proceeding before deciding to make this application, is a powerful reason why the application should be refused. In HVG’s submission, this is particularly so given that, on Tiptell’s own evidence, it knew by December 2023 that the Plaintiff alleged that all Alucobond cladding on one of the three buildings (Building A) needed to be replaced and yet took the forensic course of waiting until after the initial trial of this proceeding to make this application.

94    HVG submits that while it is true that the effect of refusing Tiptell’s application may also risk a duplication of proceedings concerning the same loss in respect of the same buildings, that prospect is said to arise due to forensic decisions of the Plaintiff in suing in the NSWSC Proceedings without disclosing that it was a group member in this proceeding until 19 June 2025, and Tiptell’s own forensic decision of waiting until 10 months after the conclusion of the initial trial to make this application.

95    As to the effects of refusing the application, HVG submits that Tiptell would suffer no identifiable prejudice if its application is refused. HVG submits that Tiptell is not precluded from taking part in any judgment or settlement in this proceeding, and that if this Court determines Tiptell’s individual claim under s 54 of the ACL, that would enable Tiptell to vindicate any rights it has against HVG under the ACL, would avoid the risk of subjecting HVG to a multiplicity of proceedings, and would avoid the risk of inconsistent findings between courts.

Consideration

96    I am satisfied, on the evidence, that it is appropriate to exercise the Court’s discretion pursuant to s 33J(3) or s 33ZF of the FCA Act to extend the time for Tiptell to opt-out of these representative proceedings for the following reasons.

97    First, I am satisfied that the NSWSC Proceedings will be required to determine issues which overlap with the findings which may be made in this Court because:

(a)    the Plaintiff has claimed in the NSWSC Proceedings that the Alucobond ACPs, being cladding manufactured by 3A and supplied by HVG, ought to be replaced;

(b)    Casumo has commenced a separate cross-claim against 3A making substantially the same allegations in relation to the cladding that Tiptell alleges against HVG in Tiptell’s Cross Claim; and

(c)    the Plaintiff’s claimed losses in the NSWSC Proceedings are the losses that Tiptell seeks to recover from HVG if it is found liable to either or both in respect of the Alucobond ACPs.

98    HVG accepts that there is an overlap of legal and factual issues arising in relation to the consumer guarantee claims brought under the ACL in this proceeding. These circumstances make it appropriate for the NSWSC Proceedings to include Tiptell’s Cross Claim against HVG.

99    Second, I accept Tiptell’s submission that it is entirely consistent with the Scheme of Pt IVA of the FCA Act to permit a party to opt out to commence separate proceedings. Had Tiptell in fact opted out during the opt out period, HVG could not have resisted separate proceedings being brought by Tiptell against it on that basis alone. Upon opting out, Tiptell is permitted to pursue those claims in separate proceedings against HVG.

100    I accept Tiptell’s submission that any prejudice which HVG may suffer by having to defend the NSWSC Proceedings arises out of the option to opt out of these proceedings and not from the application to extend time to opt out of these proceedings.

101    Third, I am satisfied, on the evidence, that Tiptell has explained adequately the reason why this application was made so late. From the commencement of the NSWSC Proceedings in 2020 to around May 2023, the proceedings were repeatedly adjourned by consent to enable the parties to negotiate a potential settlement. There was also some delay due to COVID-19 restrictions, although the extent to which this contributed to the overall delay is unclear.

102    Of more relevance is that, on 6 December 2023, almost two and a half years after the last date to opt out, the Plaintiff in the NSWSC Proceedings served the AED February 2019 Report, in relation to Building A, which identified for the first time that the relevant cladding was Alucobond PE and Alucobond Plus. This was the first occasion on which the Plaintiff served any material in the NSWSC Proceedings identifying the cladding as being supplied and/or manufactured by HVG or 3A.

103    At that time, the claim remained somewhat confined. It was not until (i) 24 August 2024 that the Plaintiff was granted leave to file its Amended List Statement, (ii) the service of the 2024 Credwell Report around 9 September 2024, and then (iii) 13 September 2024 when the Plaintiff succeeded in its application to file the Further Amended List Statement that Tiptell was fully confronted with the claim now made by the Plaintiff which was in respect of all Alucobond cladding on the entire area of the external façade of the Buildings, being, in effect, a claim for $15,000,000 for the replacement of all cladding on the Buildings. Mr Panicker deposes that, had Tiptell been aware of the extent of the Plaintiff’s claim in relation to the Alucobond ACPs during the opt out period, it would have either instructed him to register as a group member, or taken steps to opt out.

104    I accept Tiptell’s submission that the combined effect of the amendments allowed in September 2024, was to allow the Plaintiff to substitute the earlier case of “defective cladding” with a case for replacement of all the cladding on the Buildings. Tiptell filed the Cross Claim against HVG on 18 September 2024. In this context, I accept that the Cross Claim arises from the claims made by the amendments that were permitted in September 2024 in the NSWSC Proceedings. I also accept Tiptell’s explanation that the reason Tiptell did not serve the Cross Claim on HVG until 18 March 2025 was because Tiptell had, on 14 February 2025, filed a notice of motion to oppose the leave granted by Hammerschlag CJ in Equity, which had not been determined. I accept therefore that Tiptell’s delay in opting out is attributable to the evolving nature of the claim against it, and the necessity to await the outcome of interlocutory applications which were determinative of its position.

105    Fourth, the Applicant has not submitted that there will be any prejudice to them if Tiptell is permitted to opt out.

106    Fifth, unless Tiptell is permitted to opt out, it may be prejudiced by the real prospect that it is unable to prosecute the Cross Claim against HVG in the NSWSC Proceedings. That may result in Tiptell being exposed to liability in the NSWSC Proceedings for which it may be precluded from recovering from HVG at all.

107    Sixth, I am satisfied on the evidence that Tiptell has not taken a “wait and see approach” to observe how the initial trial in this proceeding progressed before deciding to make this application to opt out. Tiptell has explained to my satisfaction the reasons why it did not opt out during the opt out period which ended on 11 June 2021, and why the application was made at the late stage it was made.

108    Finally, HVG has failed to identify any practical difference in its position if Tiptell was permitted to opt out now, as distinct from some earlier point in time. In either case, HVG would be required to defend these proceedings and potentially other proceedings in relation to the Alucobond ACPs.

109    For the reasons given, I will extend the time for Tiptell to file an opt out notice until 14 days from the date of the orders.

110    Tiptell, by making this application, has sought an indulgence from the Court which in no way was caused or contributed to by the conduct of the Applicant, 3A or HVG. Those parties have acted reasonably in the manner in which they have responded to the application and, in the circumstances, Tiptell will be ordered to pay their costs of this application.

DISPOSITION

111    Pursuant to s 33J(3) and/or s 33ZF of the FCA Act, the time for Tiptell to opt-out of these representative proceedings will be extended until 14 days from the date of these reasons. Tiptell will pay the Applicant’s and the respondents’ costs of this application to be assessed by a Registrar of the Court on a lump sum basis, if not agreed.

Associate:

Dated:    10 September 2025