Mediation talks between Moira Deeming, John Pesutto fail

Private mediation talks between Victorian Liberal leader John Pesutto and expelled MP Moira Deeming failed on Tuesday, increasing the likelihood of a costly court battle.

Private mediation talks between Opposition Leader John Pesutto and expelled MP Moira Deeming have failed, increasing the prospect of a public court battle.

The pair and their legal teams met for formal mediation on Tuesday for the first time since Mrs Deeming was expelled from the parliamentary wing of the Victorian Liberal Party in May.

But they emerged unable to reach a settlement following several hours of talks.

Mrs Deeming has threatened to sue Mr Pesutto for defamation after he accused her of having links with Nazis during a campaign to expel her from the party.

Liberal sources said the mediation outcome was a huge blow to Mr Pesutto who has insisted to colleagues the matter would not get to court.

It could prove to be both costly and publicly embarrassing for the leader.

Senior lawyers say the actions could take years to move through the courts, and could force Mr Pesutto and key staff to disclose private correspondence including text messages and emails.

It could also force senior members of the parliamentary team to publicly testify about the initial decision to initiate expulsion proceedings against Mrs Deeming.

Mr Pesutto has until now been unable to secure funding from the Liberal Party to cover his legal fees.

He has flagged an intention to ask the party’s administrative committee to provide legal indemnity insurance to all MPs.

Liberal MP Moira Deeming has threatened to sue John Pesutto. Picture: Ian Currie

However the Herald Sun has confirmed the Liberal Party has no insurance for defamation actions and has been told it would be financially impractical to do so.

It would leave Mr Pesutto facing a significant legal bill unless the party agreed to cover the cost out of their own funds.

Mr Pesutto has come under intense pressure from some sections of the party to reach a settlement with Mrs Deeming to kill the potentially damaging action.

There are concerns the matter is distracting from the work of the opposition more broadly.

A sticking point to any potential settlement is understood to be Mrs Deeming’s push for readmission to the parliamentary team.

John Pesutto is facing a significant legal bill is the case goes to court. Picture: David Crosling

Mr Pesutto told a party room meeting last week he would never agree to such a move.

His position is considered a moot point by some as any decision to allow Mrs Deeming back into the parliamentary team would require a party vote.

Mr Pesutto moved to expel Mrs Deeming in March after she attended a Let Women Speak rally on the steps of Parliament House.

As part of his campaign to expel her Mr Pesutto compiled and distributed a 15-page dossier of evidence backing his case.

In it, he accused her of having Nazi links and “conducting activities in a manner likely to bring discredit on the Parliament or the Parliamentary Party.”

It resulted in a nine-month ban from the party room.

She was later expelled from the party.