An 11th-hour offer from a defamed MP to partially defer an ousted state Liberal leader’s $2.3 million legal bill in exchange for guaranteed preselection has fallen over.
Victorian Liberal Moira Deeming wrote to former opposition leader John Pesutto, his successor Brad Battin and Victorian Liberal president Philip Davis on Sunday with a series of demands to spare Mr Pesutto bankruptcy.
Mr Pesutto was ordered to pay $2.3 million in legal costs to Mrs Deeming after the Federal Court found he defamed her by implying she was associated with neo-Nazis who gatecrashed a Melbourne rally she attended in 2023.
A bankruptcy notice was served to Mr Pesutto on Friday, leaving him 21 days to pay the debt, sign up to a payment arrangement or face bankruptcy.
Bankruptcy would force his exit from Victorian parliament, setting up an expensive by-election in his marginal state seat of Hawthorn in Melbourne’s east.
In her letter to the trio, seen by AAP, Mrs Deeming said she was “dismayed” the state party was considering an approach from Mr Pesutto to meet his financial obligations to her.
“It is because of the extraordinary support that I have received from rank-and-file members that I make this offer with the intention that the funds they have raised to fight the Labor Party remain solely directed to that important objective,” she wrote.
Her demands included Mr Pesutto paying the roughly $760,000 he has raised and deferring the remainder of his debt until March 30, 2027.
A special resolution would have had to be passed to endorse preselection for her upper house seat so she could “enjoy the right to serve my community without any internal distractions which is something denied me to date”.
She also requested the party, through Mr Battin, pen an unreserved written and public apology to her and appoint of an independent person from outside the state to review internal dispute resolution mechanisms.
The offer was non-negotiable and expired at 5pm on Tuesday after the parties were unable to agree.
“I have suffered through a gruelling two and half years where almost every offer I made to negotiate a settlement was rejected,” she wrote.
“This is my final attempt to spare the Liberal Party further harm and to afford Mr Pesutto, and his family, the dignity that was denied to me, my husband and my children.”
One senior Liberal told AAP it was “outrageous” to attempt to use the pair’s long-running dispute to secure preselection.
Liberal preselection is traditionally completed through a vote of rank-and-file members, with the process for the next state election in November 2026 expected to begin from September.
AAP has also been told the money raised by Mr Pesutto was conditional on the party lending him the rest, about $1.5 million, which he has vowed to pay back with interest.
The party’s administrative committee is expected to meet to discuss Mr Pesutto’s request on June 19.
Mrs Deeming and Mr Pesutto were contacted for comment.
