Victorian Liberal MP Moira Deeming is currently involved in further court proceedings concerning $1.55 million she is owed from a successful defamation case. The funds, held in a trust account, are intended to repay Hilton Grugeon, a NSW-based property developer who bankrolled her legal fight.

Mrs Deeming notified the Liberal Party of her intention to withdraw the $1.55 million. However, a breakaway group of Liberal leaders opposing the party's loan to former opposition leader John Pesutto has sought an injunction to prevent the release of these funds. This injunction is scheduled to be heard in court later this month.

Mr Grugeon continues to support Mrs Deeming, but sources told ABC that his lawyers have formally requested repayment, which could signal the start of bankruptcy proceedings against her.

The defamation case involved Mr Pesutto, who was ordered by the Federal Court to pay $2.3 million in legal costs after being found to have falsely implied Mrs Deeming was associated with neo-Nazis. The Liberal Party had loaned Mr Pesutto funds last year to cover Mrs Deeming's legal fees and prevent his bankruptcy.

In a statement to the party's state executive, Mrs Deeming wrote, "I am already facing bankruptcy for over $1.55 million in legal costs that a former Liberal leader was ordered by the Federal Court to pay to me." The state executive now has the evidence to decide whether to pursue mediation or move to disendorse her.

This internal conflict has been a significant distraction for the opposition, which is currently conducting a campaign to visit all 88 seats in Victoria during the parliamentary winter break.

Sources