Bankruptcy Proceedings Hit Technical Snag
Former Liberal senator Linda Reynolds' attempt to recoup legal costs from Brittany Higgins through bankruptcy proceedings has encountered an unexpected delay. The federal court hearing scheduled for Tuesday was adjourned due to a technical paperwork issue, preventing Higgins from being declared bankrupt as anticipated.
The Defamation Battle Background
The bankruptcy action stems from Reynolds' successful defamation case against her former staffer. In August, Western Australia's Supreme Court ruled that some of Higgins' social media posts were defamatory, awarding Reynolds $315,000 in damages plus $26,109 interest. Justice Paul Tottle found the posts contained serious allegations, including that Reynolds had engaged in harassment and mishandled Higgins' rape allegation.
The court also ordered Higgins to pay 80% of Reynolds' legal costs, estimated to exceed $1 million. This substantial financial burden prompted Reynolds to initiate bankruptcy proceedings in October when Higgins failed to make payments.
The Compensation Question
Martin Bennett, Reynolds' lawyer, expressed significant frustration outside the court, highlighting that Higgins received a $2.4 million compensation payout from the Commonwealth but hasn't paid "not a cent" toward the judgment. "It cost her an enormous amount to prove that dishonest lies had been said about her and not a cent has been recovered," Bennett told reporters.
The bankruptcy proceedings aim to discover where Higgins' substantial compensation payment has been allocated. Reynolds has alleged that Higgins might be using a trust to protect these funds from creditors.
Broader Legal Implications
This case represents another chapter in the lengthy legal saga between the two women. Higgins had previously apologised to Reynolds after the former defence minister won their high-profile five-week defamation trial. The court's 360-page judgment made several significant findings, including that Higgins made 26 false or misleading statements in media interviews following her alleged sexual assault.
Higgins alleges that former co-worker Bruce Lehrmann raped her in Reynolds' ministerial suite in 2019. In a separate defamation case, a federal court judge found that Higgins was, on the balance of probabilities, raped by her former co-worker. Lehrmann is appealing this finding and has consistently denied the allegation.
The bankruptcy matter will return to court next Tuesday, while Higgins' husband, David Sharaz, who was also found to have defamed Reynolds, faces his own bankruptcy proceedings after being ordered to pay $85,000 in damages plus interest and costs.
