46Acting in accordance with legal principle and practice

46  Acting in accordance with legal principle and practice

  An entity must handle claims and conduct litigation in accordance with legal principle and practice, taking into account:

 (a) the legal rights of the parties; and

 (b) the financial risk to the Commonwealth and the entity of pursuing their rights.

Note 1: Some examples of handling claims and conducting litigation in accordance with legal principle and practice are:

(a) acting in the financial interest of the entity and the Commonwealth to defend, fully and firmly, claims where a defence is properly available, subject to the desirability of settling claims wherever possible and appropriate; and

(b) generally enforcing costs orders in favour of the Commonwealth or the entity.

Note 2: In addition to the obligations arising under these Directions, section 11 of the Public Governance, Performance and Accountability Rule 2014 requires accountable authorities of non‑corporate Commonwealth entities to pursue the recovery of debts owing to the Commonwealth.