FEDERAL COURT OF AUSTRALIA

TLAS Pty Ltd as trustee for the TLAS Trust v Arrowes Roading Safety Pty Ltd (Costs) [2026] FCA 1621

ORDERS

THE COURT ORDERS THAT:

1.    Within 14 days of the date of these orders, the Respondent must pay the Applicant the sum of $759,925.84 (Judgment Sum), comprising:

(a)    a refund of the purchase price of the ACT Vehicle of $586,080;

(b)    interest on the purchase price from 16 June 2023 to the date of these orders in the amount of $158,339.55;

(c)    compensation comprising storage costs of $14,152.00; and

(d)    interest on the storage costs of $1,354.29, comprising the sums set out in the Schedule to these orders.

2.    $200,000 of the Judgment Sum must be held by the Applicant’s solicitors in trust, subject to the following:

(a)    within seven (7) days of the payment of the Judgment Sum, the Applicant must procure from the funds in trust, and provide confirmation to the Respondent of, the discharge of NAB’s PPSR interest over the ACT Vehicle; and

(b)    within 14 days of the matters in Order 2(a) above, on a date to be agreed between the parties:

(i)    The Applicant must make available for collection, and the Respondent is to collect, the ACT Vehicle from 40 Main Jindivick Road, Jindivick, Victoria at the Respondent’s cost;

(ii)    the Applicant is to provide the Respondent with the ACT Vehicle and all keys, manuals and other parts; and

(iii)    the Respondent must issue any adjustment note or other document as required by the A New Tax System (Goods and Services Tax) Act 1999 (Cth) to reflect the refund.

3.    Contemporaneously with the collection of the ACT Vehicle as described in Order 2(b) above, the Applicant and the Respondent must sign the document in the form in Annexure A to these orders for the purpose of transferring ownership of the ACT Vehicle from the Applicant to the Respondent.

4.    If the Respondent fails to pay the Judgment Sum fully in accordance with Order 1, without prejudice to any other rights or remedies that the Applicant enjoys, the Applicant be permitted to sell the ACT Vehicle by private treaty or auction (on the giving of seven (7) days’ notice to the Respondent) and apply the net proceeds towards the unpaid balance of the Judgment Sum.

5.    The amount of security for costs totalling $140,000.00 paid into Court by the Applicant pursuant to the orders of the Court made on 5 November 2025 be released by the Court into the Applicant’s solicitors’ trust account.

6.    The Respondent pay 50% of the Applicant’s costs of the proceeding (except for the costs relating to the preparation of the affidavit of Mr Mucalov affirmed on 25 November 2025), to be taxed if not agreed. By reason of the orders of the Court made on 5 November 2025, the Applicant’s costs should be set off against the Respondent’s costs of the interlocutory application dated 14 July 2025.

7.    The proceeding is otherwise dismissed.

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

SCHEDULE

Interest on the storage costs calculated to the date of these orders:

ANNEXURE A

CONFIRMATION OF TRANSFER OF OWNERSHIP OF ACT VEHICLE

PARTIES

TLAS Pty Ltd as trustee for The TLAS Trust

(ACN 607 716 754)

(TLAS)

Arrowes Roading Safety Pty Ltd

ACN 652 292 843

(Arrowes)

(individually each is a Party and collectively they are the Parties)

RECITAL

R.1    Pursuant to the Order:

(a)    Arrowes has paid TLAS a refund for the ACT Vehicle; and

(b)    TLAS must facilitate the transfer of ownership of the ACT Vehicle back to Arrowes, at Arrowes’ cost.

IT IS AGREED:

1.    DEFINITIONS

The following definitions apply in this Confirmation:

1.1    ACT Vehicle means the automated cone truck with Vehicle Identification Number JALFRR34PJ7000490.

1.2    Arrowes means Arrowes Roading Safety Pty Ltd (ACN 652 292 843).

1.3    Confirmation means this document.

1.4    Order means the orders of Justice Hespe in Federal Court of Australia Proceeding No. VID719/2024 dated 28 October 2026.

1.5    TLAS means TLAS Pty Ltd (ACN 607 716 754), as trustee for The TLAS Trust.

2.    COLLECTION OF THE ACT VEHICLE

2.1    The Parties acknowledge that at the time and date specified below, TLAS surrendered possession of the ACT Vehicle to Arrowes at which time Arrowes accepted possession and ownership of the ACT Vehicle:

Location: 40 Main Jindivick Road, Jindivick, Victoria

Date:

Time:

2.2    The Parties acknowledge and confirm that, in accordance with Order 2(b) of the Order, at the time and on the date specified in clause 2.1 herein, all keys, manuals and other parts of the ACT Vehicle that were in TLAS’ possession at that time were provided by TLAS to Arrowes.

3.    TITLE

3.1    This Confirmation is of no force and effect unless and until each Party has executed the Confirmation below.

3.2    Execution of the Confirmation is to take place at the time of collection of the ACT Vehicle as contemplated by clause 2.1 herein.

3.3    The Parties agree and acknowledge that the title and any risk associated with the ACT Vehicle will pass from TLAS to Arrowes on the date and at the time specified in clause 2.1 herein.

4.    ELECTRONIC EXECUTION

4.1    The Parties agree that the Confirmation may be executed electronically, including by electronic signature, and that electronic signature affixed to the Confirmation will have the same force and effect as an original handwritten signature.

4.2    The Parties consent to the execution and exchange of the Confirmation by electronic means, including by PDF, email, or through an electronic signing platform (such as DocuSign or Adobe Sign).

4.3    The Confirmation may be executed in counterparts, and all counterparts taken together constitute one instrument. A counterpart executed electronically and transmitted electronically will be deemed an original.

REASONS FOR JUDGMENT

HESPE J:

INTRODUCTION

1    On 16 September 2026, the Court delivered judgment in TLAS Pty Ltd as trustee for the TLAS Trust v Arrowes Roading Safety Pty Ltd [2026] FCA 1356. The parties were ordered to provide proposed draft orders giving effect to those reasons, including orders as to costs.

2    The parties largely agreed on the form of the orders to be made, but disagreed as to the terms in which an order for costs ought to be made. The parties provided competing forms of order for costs together with written submissions.

3    The applicant (TLAS) submits that the appropriate order for costs is that the respondent (Arrowes) pay TLAS’s costs because costs ought to follow the event. TLAS succeeded in obtaining an order for a refund of the purchase price and damages for the consequential loss of the storage costs.

4    Arrowes submits that the appropriate order for costs is that the parties bear their own costs of the proceeding, or alternatively, TLAS should be awarded no more than 15 per cent of its costs on the standard basis. Arrowes contends that TLAS was only successful in respect of the warranty claim. This was separable from:

    The misleading or deceptive conduct claim in respect of which TLAS had not been successful,

    TLAS only being awarded one out of eight heads of damages, and

    TLAS’s abandoned claims under the Australian Consumer Law (ACL) in sch 2 of the Competition and Consumer Act 2010 (Cth) and for loss of profits, all of which consumed a substantial part of the costs of the proceeding.

5    In either case, any costs awarded to TLAS should be set off at taxation against Arrowes’ costs of the interlocutory application dated 14 July 2025, which TLAS was ordered to pay on 5 November 2025.

CONSIDERATION

6    Section 43 of the Federal Court of Australia Act 1976 (Cth) confers a discretion on the Court to award costs. The discretion is wide, but is required to be exercised judicially. The exercise of the discretion is guided by settled principles: Harvard Nominees Pty Ltd v Dimension Agriculture Pty Ltd (in liq) [2023] FCAFC 140; (2023) 299 FCR 224 at [15] (Colvin, Stewart and Feutrill JJ).

7    The relevant legal principles include:

(1)    The “usual rule” is that costs follow the event: Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 at [11]–[12] (Black CJ and French J). In this Court, the “event” in the context of an award for costs refers to the overall outcome, rather than success or failure on individual issues or claims: Queensland North Australia Pty Ltd v Takeovers Panel (No 2) [2015] FCAFC 128; (2015) 236 FCR 370 at [9]–[18] (Dowsett, Middleton and Gilmour JJ).

(2)    There are at least three categories of situations in which the party that is successful overall may be deprived of costs, or even ordered to pay the costs of the other party or parties. These categories may overlap: Queensland North Australia at [11]. The categories include:

(a)    where the successful party has only been partially successful in terms of the relief claimed.

(b)    where the successful party has obtained the claimed relief, but has not succeeded on all bases (factual or legal) upon which it claimed that relief.

(c)    where the conduct of the successful party has contributed in some way to the parties incurring unnecessary costs.

8    In the present case, TLAS was only partly successful in terms of the relief it sought. Its claims for damages for loss of profits were abandoned at closing submissions. Its claims for damages had been sought on the basis that the sale of goods agreement was void ab initio. That claim was unsuccessful.

9    Furthermore, TLAS did not succeed on all the legal bases on which it had sought relief. It abandoned its claims under the consumer guarantee provisions of the Australian Consumer Law during the course of opening submissions. More importantly, TLAS did not succeed in relation to its misleading and deceptive conduct claim. This claim involved the leading of expert evidence and consumed a material part of the hearing time.

10    TLAS also prepared and filed an affidavit of Mr Mucalov, affirmed on 25 November 2025 which was not read.

11    In the circumstances, adopting a broad brush approach, and recognising that TLAS was successful in obtaining relief for breach of the contractual warranty, the Court considers that Arrowes should pay 50% of TLAS’s costs (aside from the costs relating to the preparation of the affidavit of Mr Mucalov), to be taxed if not agreed. TLAS’s 50% of taxed costs should be set off against Arrowes’ costs of the interlocutory application dated 14 July 2025, the costs of which were ordered to be paid by TLAS. A broad brush approach based on matters of impression and evaluation should be undertaken: Ridge Estate Pty Ltd v Fairfield Pastoral Holdings Pty Ltd [2024] FCAFC 17; (2024) 302 FCR 375 at [206] (Banks-Smith, O’Sullivan and Feutrill JJ).

12    The other orders will be made in the form agreed by the parties.

Associate:

Dated:    28 October 2026