Linda Reynolds’ lawyer says Brittany Higgins claims she’s broke, hasn’t paid ‘a cent’ to defamation case debt
Linda Reynolds is “incredibly disappointed” Brittany Higgins still hasn’t paid one cent from her $2.4 million settlement with the Federal Government towards massive bills from her defamation case loss.
The ex-Liberal senator’s lawyer Martin Bennett made the remark after his client’s bid to have Ms Higgins declared bankrupt in the Federal Court was delayed for a week by a technical snag.
Ms Reynolds swiftly moved to recoup damages and court costs after winning her bitter Supreme Court defamation case against Ms Higgins and her husband David Sharaz in August.
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By continuing you agree to our Terms and Privacy Policy.She served bankruptcy notices on both of them but the 21 days they had to pay the debt lapsed, so she pushed ahead with her bid to secure formal court declarations that the couple were now bankrupt.
When creditors secure such an order, the debtor’s estate is sequestrated and their financial affairs are managed by an external trustee.
Mr Sharaz accepted service of Ms Reynolds’ bankruptcy notice and creditor’s petition personally, so Mr Bennett’s team didn’t need to get a substituted service order against him.
She applied for it, however, and complained that meant she incurred more legal bills.
But Ms Higgins was served via her lawyer Carmel Galati without a substituted service order, and Federal Court registrar Camille Goucke questioned on Tuesday whether she could make it retrospectively.
This was an issue that needed to be resolved before the matter could proceed, Ms Goucke said.
“The debtor wanted to deal with this on an arm’s length basis,” Mr Bennett told the registrar.
“We say that the service of the notice effectively was done with the consent of the debtor.”
The lawyer added Ms Reynolds “didn’t want to put Ms Higgins through” being served personally, noting concerns around her mental health.
“Plainly, she was aware of the notice and its expiration,” Mr Bennett added.
“Ms Higgins desires to make no submission to the court.
(Linda Reynolds is) incredibly disappointed that Ms Higgins got $2.4m worth of taxpayer money and has paid not a cent towards the judgment against her.
“There is no question of prejudice to Ms Higgins - it was done for her benefit.”
Ms Goucke adjourned the matter until next Tuesday, noting: “We are into technical bankruptcy jurisdiction”.
Mr Bennett told the court that Ms Higgins had “paid not a cent” to his client.
Outside court, he told reporters: “In the history of this matter ... it’s a small delay”.
“It’s frustrating, but it’s an appropriate step to take by the registrar,” he said.
“These matters set precedents. She (the registrar) needs to worry about the technical efficacy of it.
“We take it as being within the court’s power to make a retrospective order for substituted service in circumstances where Ms Higgins knows about it, has a solicitor.
“The solicitor authorises it, confirms it in writing and accepts service.
“These are things that occur in a technical area.”
If the substituted service order can’t be made retrospectively, Mr Bennett said his team would simply have to secure a prospective order and serve the bankruptcy notice again.
This would just add to Ms Reynolds’ wait for cash after her expensive court battle.
“She’s incredibly disappointed that Ms Higgins got $2.4m worth of taxpayer money and has paid not a cent towards the judgment against her,” Mr Bennett said.
“It cost her (Ms Reynolds) an enormous amount ... and not a cent has been recovered so far.
“But we’ll see.”
A trustee would investigate the protective trust in which Ms Higgins placed the settlement, he said.
“Ms Higgins is saying she personally has no money left,” Mr Bennett said.
“Where’s the $2.4m?”
The settlement was reached over her claims Ms Reynolds mishandled Ms Higgins’ allegation she was raped by colleague Bruce Lehrmann in the former politician’s Parliament House office in Canberra in 2019 after a night out drinking.
The assertion, aired by Ms Higgins and Mr Sharaz in social media posts in 2022 and 2023, was at the heart of the defamation action and strenuously rejected by Ms Reynolds.
After her bruising loss following a blockbuster trial last year - which had former prime minister Scott Morrison but not Ms Higgins among two dozen witnesses - she was ordered pay more than $340,000 in damages.
Mr Sharaz was ordered to pay up to $220,000 in damages, comprising $85,000 payable by him alone and $135,000 that the couple are jointly liable for.
Ms Higgins also must pay 80 per cent of Ms Reynolds’ court costs, which she has described as being in the “millions”.
Mr Sharaz’s court costs must be paid on an indemnity basis, which are awarded only in exceptional circumstances and cover all costs and disbursements reasonably incurred.
A date has not yet been set for Ms Reynolds’ separate court bid to have Mr Sharaz declared bankrupt.
“He hasn’t indicated a defence to it,” Mr Bennett said.
“We’ll just wait for a listing from the court.”
The couple reportedly sold their chateau in France recently for an estimated $700,000.
Mr Lehrmann continues to maintain his innocence after his 2022 rape trial was aborted due to juror misconduct and the charge was then dropped.
Ms Reynolds’ separate Federal Court action against the Commonwealth and the legal firm it engaged to handle the settlement, HBL Ebsworth, is scheduled to have its first case management conference in Perth on Wednesday.
