Key Takeaways
- David Sharaz has been declared bankrupt in the federal court, just days after his wife, Brittany Higgins, was also bankrupted.
- The bankruptcy proceedings were launched by former Liberal senator Linda Reynolds after she successfully sued the couple for defamation.
- Sharaz’s estate will be sequestrated under the Bankruptcy Act, and Reynolds’ costs will be fixed at $5,690.
- Bankruptcy typically lasts for three years and comes with reputational damage and implications for obtaining credit.
- Trustee Daniel Juratowitch has been appointed to assess both Sharaz and Higgins’ financial affairs.
Introduction to the Case
The recent declaration of bankruptcy of David Sharaz in the federal court has sent shockwaves, especially given that his wife, Brittany Higgins, was also bankrupted in the same Perth court just days prior. The bankruptcy proceedings were launched by former Liberal senator Linda Reynolds after she successfully sued the couple for defamation. Reynolds had launched the proceedings in October, and on Tuesday, registrar Camille Goucke ordered Sharaz’s estate to be sequestrated under the Bankruptcy Act. This means that a trustee appointed by the court will take control of Sharaz’s estate and assets, and decide whether to sell off any assets to pay off creditors and whether to garnishee any earnings.
Background to the Defamation Case
The defamation case that led to the bankruptcy proceedings was related to a series of social media posts made by Sharaz and Higgins. In September, Sharaz was ordered to pay $92,000 for social media posts that the Western Australian supreme court found were defamatory against Reynolds. Sharaz was also found to be jointly responsible for another defamatory tweet to which Higgins responded. Additionally, Sharaz was found liable for Reynolds’ legal costs on an indemnity basis, which is expected to exceed $500,000. The court backdated the act of bankruptcy to 31 October, and trustee Daniel Juratowitch has been appointed to assess both Sharaz and Higgins’ financial affairs.
The Defamation Trial
The defamation trial that led to the bankruptcy proceedings was a high-profile case that concerned a series of social media posts made by Higgins. Reynolds asserted that the posts damaged her reputation, and in a 360-page judgment, Justice Paul Tottle agreed. The imputations included that Reynolds engaged in a campaign of harassment against Higgins, mishandled her rape allegation, and engaged in questionable conduct during Bruce Lehrmann’s aborted criminal trial for rape. Higgins had alleged that she had been raped by Lehrmann in the minister’s Canberra office, and a criminal trial of the rape allegations was abandoned in 2022 due to juror misconduct. Lehrmann has always maintained his innocence, but Justice Michael Lee found in a defamation case launched by Lehrmann against Network Ten that Higgins was, on the balance of probabilities, raped by her former colleague in the office.
The Bankruptcy Proceedings
The bankruptcy proceedings were launched by Reynolds after she successfully sued the couple for defamation. Sharaz was served the bankruptcy notice at a Melbourne cafe on 10 October as part of Reynolds’ attempt to pursue the damages awarded to her. Sharaz had announced in April 2024 that he would no longer fight the case as he couldn’t afford the legal fees. However, Higgins’ trial went ahead, and she was ordered to pay $135,000 plus interest in the court’s judgment. The bankruptcy proceedings will have significant implications for Sharaz and Higgins, including reputational damage and implications for obtaining credit. Bankruptcy typically lasts for three years, and the trustee will have control over their estate and assets during this time.
Conclusion
The declaration of bankruptcy of David Sharaz and Brittany Higgins is a significant development in the high-profile defamation case launched by Linda Reynolds. The case has highlighted the importance of being careful when making social media posts, as they can have serious consequences. The bankruptcy proceedings will have significant implications for Sharaz and Higgins, and it remains to be seen how they will recover from this setback. The case has also raised questions about the handling of rape allegations and the conduct of politicians and their staff. As the case continues to unfold, it is likely that there will be further developments and implications for all parties involved.
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