The federal government has told the High Court it may seek security for its legal costs as the Labor opposition launches a challenge to Nationals MP David Gillespie's eligibility to sit in Federal Parliament.
Dr Gillespie is one of a number of MPs whose eligibility will be examined by the High Court, but his case centres on a potential financial conflict of interest rather than the citizenship provisions in the Constitution.
The first steps in the case were taken in Sydney on Wednesday at a preliminary hearing before High Court Justice Virginia Bell.
Guy Reynolds, SC, for the government, told Justice Bell "we have written to the [Labor Party] .... about the possibility of security for costs".
Mr Reynolds said it was "an issue that may arise in the future".
If an order for security for costs was made, it could require the ALP to make a payment into court or to provide a guarantee.
The court would consider a range of factors in deciding whether to make such an order, including the strength of the ALP's case.
Fairfax Media revealed in February that Dr Gillespie owns a small suburban shopping complex in Port Macquarie and one of the shops is an outlet of Australia Post, a government-owned corporation.
The ALP has obtained legal advice that says this arrangement could result in Dr Gillespie's election being ruled invalid under section 44(v) of the Constitution, which disqualifies anyone with a "direct or indirect pecuniary interest" in an agreement with the Commonwealth public service from sitting in Parliament.
If Dr Gillespie is disqualified, it would spark a byelection in his seat of Lyne, potentially bringing down the government, which only has a one-seat majority.
The case is being brought by the former Labor candidate for the seat, Peter Alley.
The court heard on Wednesday that a subpoena would be issued to Australia Post.
The story Labor faces potential costs order in High Court fight over Nationals MP first appeared on The Sydney Morning Herald.