Linda Reynolds and the federal government have been sent to mediation, as she continues suing over Brittany Higgins' compensation payout.
The former Liberal senator has alleged the government breached its duty of care to her by settling Ms Higgins' claim when it was acting on her behalf in 2022.
Ms Higgins, who previously worked as a staffer in Ms Reynolds' office, has alleged she was raped by Bruce Lehrmann in Parliament House in 2019, a claim the Federal Court found to be likely true in 2024.
Ms Higgins received $2.4 million from the Commonwealth in the settlement.
But other statements, including that Ms Reynolds mishandled the rape allegations and engaged in a campaign of harassment against Ms Higgins, have been found to be defamatory.
In the Federal Court on Tuesday, Justice Craig Colvin ordered the parties to enter mediation to try to settle the dispute.
Ms Reynolds has argued the government had taken control of her defence against Ms Higgins' workplace claims, noting she had not been present at the mediation between the parties to defend herself.
In her statement of claim, she said the government breached its duty of care by settling with Ms Higgins when there was no meaningful prospect of liability being established against her.
While alleging she had suffered reputational and mental harm, Ms Reynolds said she was also failed because no protections from further damage by Ms Higgins were included in settlement, such as a non-disparagement clause.
In its defence filed with the court, the government said it had the power to run Ms Reynolds' defence and that she had been afforded an opportunity to run it herself if she wanted to.
Parts of Ms Reynolds' claim were "embarrassing" because they did not address specifics required to prove a duty of care breach, the government said.
Embarrassing is a legal term meaning a pleading is ambiguous or too general and designed to embarrass the other party because they do not know what has been alleged.
The parties will be back in court on June 22.
Lehrmann has lost an appeal against the Federal Court's rape finding but has flagged taking the case to the High Court.
He denies raping Ms Higgins. His criminal trial was derailed by juror misconduct.
