Huntsman Corporation Australia Pty Ltd v Qenos Pty Ltd

Huntsman Corporation Australia Pty Ltd appealed to the Court of Appeal of New South Wales against findings made by the trial judge concerning a contract with Qenos Pty Ltd. The dispute centred on whether a change in the methodology used to calculate the New Territories Contract Price (NTCP) constituted a "material change" under a relevant provision of their contract, which would have impacted the pricing mechanism.

The primary legal issue before the Court of Appeal was whether the trial judge had erred in concluding that the changes to the NTCP calculation methodology, implemented in February 2001, did not amount to a "material change" as contemplated by the contract. Specifically, the court had to determine if the NTCP, despite a shift in its calculation, continued to serve the same purpose and measure the same price movements as it did at the time the contract was entered into in 1998.

The Court of Appeal, affirming the trial judge's decision, reasoned that while the methodology for calculating the NTCP had changed after January 2001, the index itself was still designed to perform the same function and measure the same price movements. The trial judge had accepted evidence that the NTCP continued to be an estimate of the price paid by large buyers for ethylene, and that CMAI (the publisher of the index) remained prepared to make special adjustments if market conditions warranted it, as it had done in previous years. The court found that the core purpose of the NTCP had not fundamentally altered, and therefore, the change in methodology did not constitute a "material change" in terms of the contract's pricing provisions.

The appeal was dismissed, and Huntsman Corporation Australia Pty Ltd was ordered to pay Qenos Pty Ltd's costs.