Siegwerk Australia Pty Ltd (In liq) v Nuplex Industries (Aust) Pty Ltd

Siegwerk Australia Pty Ltd (In liq) brought an action against Nuplex Industries (Aust) Pty Ltd alleging breach of contract in relation to the supply of epoxy resin for use in a lacquer applied to the inner lining of tuna cans. The dispute centred on whether the supplied lacquer complied with the contractual standards and whether a substitution of a component in the lacquer led to corrosion of the cans. The Federal Court was tasked with determining the legal issues concerning causation and the effectiveness of the expert evidence presented.

The primary legal issues were whether the defendant's breach of contract was causally linked to the corrosion of the cans and whether the plaintiff had discharged the burden of proof in a circumstantial case. The court had to evaluate the expert evidence, scientific literature, and the combination of circumstantial evidence and scientific evidence to ascertain factual causation. Additionally, the court needed to determine the applicability of a reverse onus, or “onus of exculpation,” in this circumstantial case.

The court held that the plaintiff had not established the requisite causal link between the defendant's breach and the corrosion of the cans. The court emphasised that while expert evidence was necessary due to the complexity of the scientific issues, it was not dispositive. The plaintiff's circumstantial case did not sufficiently support the inference that the defendant's breach caused the corrosion. Moreover, the scientific evidence, while informative, did not provide a conclusive answer regarding causation. The court concluded that the plaintiff had not discharged the burden of proving causation on the balance of probabilities.

The court made orders for both parties to submit short written submissions and draft proposed orders within specified timeframes, with costs reserved for a later determination.