Transportable Shade Sheds Australia Pty Ltd v Aussie Shade Sheds Pty Ltd (Contempt Application)

This decision was about enforcement, not the final merits of the broader intellectual property dispute. TSS brought a contempt application after obtaining an urgent ex parte order on 4 June 2024. That order restrained the respondents from dealing with certain assets and products derived from intellectual property assets.

The commercial background matters because the restrained assets were tied to a sale agreement and later licence arrangements. The judgment says a liquidator sold certain business assets and intellectual property rights to what later became the second applicant, eSheds Pty Ltd. TSS then entered into an exclusive licence on 30 May 2024 under which the second applicant licensed intellectual property and associated rights and authorised use of trade marks. The contempt application therefore sat on top of a chain of documents that businesses often rely on in practice: a sale agreement, a schedule listing assets, and a later licence.

But when TSS tried to enforce the urgent order through contempt, the case turned on a basic but critical problem. The order did not list the assets itself. Instead, it defined them by reference to Schedule Part 1 of the sale agreement annexed to an affidavit. After the order was made, that annexure was not served. The court had to decide whether contempt could still be made out in those circumstances.

The judgment gives a clear sequence. First, the sale agreement existed as the document under which a liquidator sold certain assets to what later became the second applicant. TSS was incorporated on 5 December 2023. On 30 May 2024, TSS entered into a deed of grant of exclusive licence with the second applicant. Then, on 4 June 2024, another judge made an urgent ex parte order restraining the respondents from dealing with the relevant assets and products derived from the intellectual property assets.

The order referred to the assets by reference to Annexure JGM-5 to the Mogford affidavit. The judgment notes a drafting issue in the order's description of that affidavit, because it referred to the affidavit as having been filed on 1 June 2024, whereas by operation of the rules it was taken to have been filed on 3 June 2024. More importantly, after the order was made, the affidavit was served without Annexure JGM-5. The sale agreement was instead marked as a confidential annexure removed pursuant to the order, even though the suppression orders did not relate to it.

TSS then filed its contempt application on 19 June 2024. At the hearing on 19 September 2024, TSS sought an adjournment and leave to amend the statement of charge so it could rely on three additional affidavits said to show that the respondents already knew what assets were covered. The court refused both applications, dismissed the contempt application, and later on 24 September 2024 ordered that the relevant costs be payable on an indemnity basis.

The court was not deciding whether the respondents had behaved badly in a general commercial sense. It had to decide whether TSS had framed and proved a civil contempt case in the strict way the law requires. The judgment identifies several linked questions.

First, was the statement of charge compliant with rule 42.12 of the Federal Court Rules 2011 (Cth)? A contempt charge must identify the alleged contempt with precision. The respondents must be put on proper notice of the case they have to meet.

Second, should TSS be allowed to amend the statement of charge at the hearing, without notice, to add three further affidavits? TSS said those affidavits would show the respondents knew the content of the missing asset schedule.

Third, if the amendment were allowed, would the additional affidavits be admissible and useful? The court examined whether they provided cogent evidence of knowledge and whether some of that evidence should be excluded under section 135 of the Evidence Act.

Fourth, could the contempt application succeed at all when the underlying order defined the assets by reference to an annexure that had not been served? In civil contempt, the applicant had to prove necessary elements including that the order was clear, unambiguous and capable of compliance, and that it had been served. The judgment states that these matters had to be proved beyond reasonable doubt.

The central drafting problem was that the order did not itself list the assets. It restrained use and dealing with the “Assets” as defined in Schedule Part 1 of the sale agreement annexed to the Mogford affidavit as Annexure JGM-5. That meant a person trying to comply with the order had to identify the correct affidavit, locate the annexure, and then work through the schedule to know what was prohibited.

The service problem made that much worse. The annexure containing the sale agreement and schedule was not served. The court treated that as a serious defect. TSS tried to answer the problem by saying the respondents were otherwise aware of the content of the schedule. It argued, among other things, that the respondents could have read the earlier reasons, where the list of assets appeared, and that the exclusive licence annexed to the affidavit contained a schedule listing at least some of the intellectual property assets acquired under the sale agreement.

The court rejected those arguments. It said that the fact the respondents could have reviewed the earlier reasons did not mean they did. It also examined the schedule to the exclusive licence and found the descriptions ambiguous and, in some respects, vague. For example, the list referred to intellectual property including available designs, plans and engineering drawings as inspected by the purchaser, registered design rights, policies and procedures held by the liquidator in electronic format at completion, and other documentation used in the ordinary course of operating the business. The court said those descriptions contained qualifications and uncertainty. TSS had not shown that the respondents knew those qualifications were satisfied in relation to any particular document. That ambiguity fed back into the order itself, making it unclear.

TSS tried to amend the statement of charge at the start of the hearing, without notice, after identifying what its counsel described as a patent defect in the served affidavit package. The proposed amendment was, in substance, to add three affidavits said to establish that the respondents knew what the missing schedule contained. The court refused that application.

The first reason was pleading precision. The original statement of charge referred generally to affidavits said to contain instances of disobedience. The court held that this did not specify the alleged contempt with enough precision. The respondents should not have to fish through affidavits to work out the case against them. The proposed amendment had the same problem because it referred globally to the additional affidavits, even though oral submissions later showed that only particular paragraphs were really being relied on.

The second reason was evidentiary weakness. The court said that, even if the amendment had been allowed, the additional affidavits would not have been admitted because they fell far short of cogent evidence sufficient to prove, to the required standard, that the respondents knew the assets as defined in the sale agreement. The judgment then worked through the affidavits in detail.

In relation to Diprose, the court noted that he had ceased to be a director of Aussie Shade Sheds on 1 March 2024. TSS argued that he was effectively the controller of the company because he was the sole shareholder of a company that was itself the sole shareholder of Aussie Shade Sheds, and also suggested he was a de facto director. The court rejected the idea that shareholding alone made him the controller or meant his knowledge could automatically be imputed to the company. It also found the evidence relied on to show de facto directorship was insufficient.

The court considered evidence from Ms Leftwich, Mr Roberts and Mr Cotter. It found parts of that evidence irrelevant, vague, too tenuous, or directed to matters that did not establish awareness of the assets as defined in the sale agreement. Several parts were said to have such limited probative value that they would have been excluded under section 135 because of the risk of unfair prejudice, confusion, misleading effect or wasted time.

Downes J refused the oral application to amend the statement of charge, refused the oral application to adjourn the hearing, and dismissed the contempt application. The court later ordered that the costs payable to the first, second and third respondents in relation to those applications be paid on an indemnity basis.

The reasons were cumulative. The statement of charge did not comply with rule 42.12 because it failed to specify the alleged contempt with sufficient precision. The proposed amendment was also inadequate. The additional affidavits would not have been admitted in any event because they did not provide cogent evidence of the respondents' knowledge of the relevant assets and raised section 135 concerns. Most importantly, the contempt application itself failed because the underlying order was not clear, unambiguous or capable of compliance, and because the key annexure defining the assets had not been served.

The costs outcome is also important. The court said the defect in service should have been discovered before bringing the contempt application and that the application should have been withdrawn after discovery. That supported the later indemnity costs order.

This case is especially relevant for businesses whose rights are documented through insolvency sales, assignments, licences, schedules and annexures. In commercial practice, those documents often define assets by category and qualification. That may work for a transaction, but it can create real enforcement risk if a later court order simply points back to those documents without spelling out what is restrained.

If your business is trying to stop a competitor, former operator or breakaway business from using designs, engineering drawings, databases, policies, procedures or other IP-related material, you should assume the court will scrutinise the order and service package closely if you later seek contempt findings. The restrained party must be able to tell, from the order and the material served with it, what they cannot do. If there is uncertainty, contempt may not be available even if you believe the other side knew perfectly well what was in dispute.

The case also shows the danger of overreaching on personal liability. If you want to pursue individuals as well as a company, you need a clear legal and evidentiary basis. Former directorship, shareholding or broad assertions of control may not be enough. Finally, the indemnity costs order is a practical warning. Once a serious defect is identified, businesses should reassess quickly whether the enforcement application should continue.

The judgment is Transportable Shade Sheds Australia Pty Ltd v Aussie Shade Sheds Pty Ltd (Contempt Application) [2024] FCA 1112 in the Federal Court of Australia. The judgment date was 19 September 2024 and the reasons were published on 24 September 2024. The decision records dismissal of the amendment application, adjournment application and contempt application, followed by an indemnity costs order.

This page is limited to the contempt decision and the practical enforcement points clearly supported by the published reasons. The broader intellectual property dispute continued in the underlying proceeding, with amended pleadings and further case management orders also recorded in the judgment.