Kerry Stokes fights $30m costs bid in Ben Roberts-Smith defamation trial

The billionaire media mogul is fighting to set aside subpoenas that may reveal more details of his agreement to bankroll the Victoria Cross recipient’s disastrous defamation case.

Ben Roberts-Smith. Picture: Toby Zerna

Billionaire media mogul Kerry Stokes and other financial backers of Ben Roberts-Smith are fighting to set aside subpoenas issued by Nine newspapers in the battle over who will pay the $30m costs of the former soldier’s failed defamation action.

Mr Stokes has been ordered to hand over documents that could reveal more details of his agreement to bankroll the Victoria Cross recipient’s defamation case, after Justice Anthony Besanko last month ruled several allegations of war crimes against Mr Roberts-Smith by the newspapers were substantially true.

However, on Friday lawyers acting for Mr Stokes’ private company, Australian Capital Equity, and his majority-owned Seven Network told Justice Besanko they would be applying to have parts of the subpoenas set aside.

The subpoenas covered correspondence between the companies and their lawyers, as well as records of attendance by the lawyers at the trial, and have also been served on Seven commercial director Bruce McWilliam and law firm Herbert Smith Freehills.

Mr Stokes funded Mr Roberts-Smith’s defamation case, first through Seven West Media – a publicly listed company – before transferring the loan liability to his private company. ACE stood to claim 15 per cent of any damages won by Mr Roberts-Smith – over and above the loan repayment.

VC recipient Ben Roberts-Smith in 2012. Picture: Channel 7

The Seven Network chairman is also understood to be bankrolling an appeal lodged by Mr Roberts-Smith’s lawyers against the decision 10 days ago.

Justice Besanko found that, on the balance of probabilities, Mr Roberts-Smith was complicit in four murders of unarmed detainees, including a farmer kicked off a cliff in the village of Darwan and a one-legged man dragged from a tunnel at the compound known as Whiskey 108. Justice Besanko said Mr Roberts-Smith was “not an honest and reliable witness” and had “motives to lie” to the court.

Mr Roberts-Smith resigned from his executive position at Seven West Media shortly after the verdict. He has agreed to pay costs but is unlikely to be able to stump up anywhere near the estimated $30m in combined fees.

The newspapers are seeking to show ACE and/or Seven exerted some control over the management of the defamation case.

Justice Besanko ruled the subpoenas sought by Nine were not a “fishing expedition” but had a legitimate forensic purpose. The documents were supposed to have been produced on Friday, but barrister Neil Young KC, representing ACE and the other respondents, told the judge the subpoenas were too wide.

“From the documents I have just read, they don’t define precisely what is the issue that remains outstanding,” he said. “There’s correspondence debating some aspects of narrowing and that … doesn’t come to a conclusion. So we don’t precisely know what the scope of the issue is that remains outstanding.”

Queen Elizabeth II shakes hands with Mr Roberts-Smith in 2018. Picture: Getty Images

Other subpoenas were “complicated”, Mr Young said, with some identifying multiple people and others referring to the loan agreements “in any way”. “We have objections to various aspects of the breadth of the subpoenas.” The newspapers are seeking costs on an indemnity basis, which cover a much higher proportion of a successful party’s costs in cases where, for example, the losing party has rejected a reasonable offer of settlement. No criminal charges have been laid against Mr Roberts-Smith, who continues to maintain his innocence.

However, The Australian revealed last month the Office of the Special Investigator is poised to access the defamation case’s secret Sensitive Court File, indicating prosecutors intend to use previously undisclosed evidence in a future war crimes hearing.

The subpoena application will return to court on July 27; the costs hearing is set for September 4.