Senator Linda Reynolds has won a victory in her defamation case against Brittany Higgins, with the Western Australian Supreme Court forcing Ms Higgins to reveal who is responsible for administering her $2.4 million Commonwealth settlement.
Senator Reynolds brought the action against Ms Higgins as part of her defamation case against her former staffer.
The senator is seeking damages for social media posts she and her husband David Sharaz made that she says damaged her reputation.
Negotiations to resolve the matter failed and the court heard on Wednesday that Senator Reynolds will look at a copy of the Brittany Higgins Protective Trust to find out who the trustee is should proceedings go in her favour.
The court heard Ms Higgins established the trust a day after signing a settlement deed with the Commonwealth of Australia in December 2022.
The settlement was part of a personal injury lawsuit brought by Ms Higgins over allegations she was sexually assaulted by colleague Bruce Lehrmann in Parliament.
Ms. Higgins received $2.4 million in compensation as part of that claim.
Martin Bennett, a lawyer for Senator Reynold, told the court the trust was set up to protect Ms Higgins from potential future creditors, including his client.
Senator Linda Reynolds has won a victory in her defamation case against Brittany Higgins
The senator is seeking damages for social media posts made by Ms Higgins and her husband David Sharaz, which she says damaged her reputation.
He said an article published in Daily Mail Australia on 21 August 2023 spoke of how Ms Higgins had been left penniless when she received a “$3 million lifeline”.
He said it was easy to infer that the trust was set up to protect Ms Higgins from creditors when a person had cried foul and then been given a financial lifeline which was placed in a protective trust.
He said Ms Higgins must have been aware of the potential for future action against her because of falsehoods she allegedly told the Commonwealth in her personal injury claim.
“It is not necessary for the creditor to be a creditor, he can be a future creditor, which is perfectly within the law,” he said.
Mr Bennett also told the court that Senator Reynolds had lodged a complaint with the National Anti-Corruption Commission about the compensation payment made to Ms Higgins.
He said the senator told the committee the money should be returned to the Commonwealth and he wanted a finding made against the people who authorised the “extraordinarily rapid payment”.
The court heard Ms Reynolds was excluded from mediation talks leading to the compensation payment to Ms Higgins in December 2022.
Mr Bennett told the court the Commonwealth had taken over the proceedings and had refused to allow Senator Reynolds to attend the mediation or defend herself.
He said the commission should be looking into the conduct of Labour ministers Katy Gallagher and Mark Dreyfus and how they handled the compensation payments.
Linda Reynolds’ attorney, Martin Bennett. Photo: NewsWire/Sharon Smith
Representing Ms Higgins, Rachel Young SC argued that the senator’s actions were based on speculation and there was no intention to defraud creditors.
Ms Young said the trust was created on December 14, 2023 to hold the proceeds of the Commonwealth payment, not what was suggested in media articles.
Ms Young argued that the senator’s claims that the trust was set up to protect Ms Higgins from other creditors such as the Commonwealth, Penguin Random House and Bruce Lehrmann were also speculation as no other claims had been made against his client.
She said the senator’s argument that she was a future creditor was baseless and that there was no evidence other than speculation.
“She relies on the fact that she brought proceedings against Mr Sharaz in January 2023, so what,” he said.
‘It is then based on its defamation proceedings against Brittany Higgins, the publications challenged were made at least on July 4, 2023.
‘It is not an irrelevant factor to think about the moment in which the intention was formed, how could any intention to defraud Senator Reynolds be formed when no publications had even been made.’
Ms Young also argued that since no conclusion had been reached in the defamation case, it was premature to obtain a copy of the trust.
He said he presumed that the senator’s defamation proceedings would be successful and, if successful, then there were processes in place.
“This is an attempt to obtain a document to file an action that was filed too early and may never be filed,” he said.
In his ruling, Chief Justice Damien Quinlan said Ms Higgins was at least indebted to Senator Reynolds for costs, which would not fall due and would be payable until the end of the defamation proceedings.
He issued pre-action discovery orders allowing Senator Reynolds to obtain a copy of the trust, but it must remain confidential between the senator and her attorney.
Outside court, Mr Bennett said it was a good outcome for his client, who was about to embark on a very expensive trial.
