In Body Corporate Number DPS 91535 v 3A Composites GmbH [2022] NZHC 985, the High Court recently concluded that neither the Consumer Guarantees Act 1993 (CGA) nor the Fair Trading Act 1986 (FTA) applied to a claim against a German manufacturer of cladding products.
The defendant, 3A Composites GmbH (3AC), was a German manufacturer of a cladding product installed on the plaintiffs’ buildings. The plaintiffs alleged that the product was highly flammable because it contained aluminium composite panels with a polyethylene core. Panels of this kind were the main reason why the fire at Grenfell Tower in London had spread so rapidly. The plaintiffs brought proceedings against 3AC, as well as the importers and distributors of the cladding in New Zealand. They alleged negligence, breach of s 6 of the CGA and breaches of the FTA. In response, 3AC protested the New Zealand court’s jurisdiction.
The High Court upheld 3AC’s protest in relation to the CGA and FTA causes of action, on the basis that they fell outside of the territorial scope of the Acts. In relation to the CGA, the Court concluded that the Act did not apply to an overseas manufacturer like 3AC that did not have a presence in New Zealand (see [38]–[47]). In relation to the FTA, the Court concluded that the Act did not apply to 3AC’s allegedly misleading or deceptive conduct, apparently on the basis that the conduct did not fall within s 3(1) extending the Act to “conduct outside New Zealand” (at [117]).
An analysis of the decision is available in the latest issue of the New Zealand Law Journal: Maria Hook “Does New Zealand consumer legislation apply to a claim against a foreign manufacturer?” [2022] NZLJ 201. The note argues that the Court misapplied the principle of territoriality and that, on a closer examination of the statutes – combined with an application of the general principles of the conflict of laws – the claims were at least arguably covered by New Zealand law.
