Christopher Knaus and Paul Karp – Timor-Leste's president, Jose Ramos-Horta, has welcomed the "wisdom and fairness" of the decision to end the prosecution of Bernard Collaery, saying the lawyer is a "good man" who represented the best of Australian ideals.
Collaery and his client, intelligence officer Witness K, are viewed as heroes in Timor-Leste for their role in exposing Australia's 2004 operation to bug the nation's government offices to gain the upper hand in oil and gas negotiations.
Australia's decision to prosecute the pair in 2018 caused tensions over the spying affair to resurface. Timor-Leste leaders described it as an "insult".
Lawyers for Collaery indicated on Friday that he may apply for costs.
On Thursday, Ramos-Horta told the Guardian that the decision to drop the case against Collaery was a welcome one, and sent a message of personal thanks to the prime minister, Anthony Albanese.
"I am pleased that wisdom and fairness have prevailed," he said.
Ramos-Horta described Collaery as a "good man" and a "fair man", who displayed "the best [in] Australia's national culture of fairness".
The sentiment was shared by Xanana Gusmao, Timor-Leste's first president, who has personally written to Albanese to express his thanks.
In a statement, Gusmao described the bugging operation as "illegal and unconscionable" and said Collaery and Witness K were "greatly respected in Timor-Leste" for their enormous contribution to the nation.
"The decision of the Australian government to discontinue the prosecution is just and fair," he said. "It is the right decision for the relationship between Timor-Leste and Australia. The decision allows our countries to move forward in a positive way to strengthen our relationship of friendship and cooperation."
The decision, announced by the attorney general, Mark Dreyfus, on Thursday afternoon, prompted widespread relief among human rights advocates, lawyers and supporters of Collaery, who have fought for an end to the prosecution since it began in 2018.
At an ACT Supreme court hearing on Friday, Justice David Mossop formally vacated the trial, which was set to begin in October, and set a one week deadline for Collaery to apply for costs.
On Friday Collaery's counsel, Christopher Ward, told the court that "there may be an application in relation to costs", arguing that there had been "substantial resources" expended over several years in relation to the case.
Justice Mossop queried whether it would be possible to award costs in a criminal case. Outside the court, Ward told Guardian Australia "there will be an application" and that objection would be addressed.
In court, the commonwealth's barrister, Perry Herzfeld, said he had nothing to say on that issue unless and until an application for costs is made.
Parties are also yet to agree on how documents, including classified material, should be stored. Ward noted the ordinary course is for the court to keep complete records.
Justice Mossop vacated the trial, excused the director general of ASIS from several sub poenas, and ordered that Collaery's legal team make any application for costs by 15 July.
The case against Collaery had been bogged down in fights over the degree to which secrecy would hide parts of his trial. The former government, using the National Security Information (NSI) Act, intervened to ensure key parts of the trial were held behind closed doors, arguing some of the evidence would compromise Australia's national security.
In some instances, Collaery and his own lawyers were unable to see the evidence being used to argue for such extensive secrecy.
Collaery's lawyers said the case had "raised important issues about the degree of secrecy permitted by our courts under current legislation".
"The approach threatens the capacity of a defendant to receive a fair trial," the Gilbert and Tobin partner Dr Kate Harrison said.
The Law Council of Australia said the case highlighted the need for a review of the NSI Act.
"The Law Council considers the NSI Act currently tilts the balance too far in favour of the interests of protecting national security at the expense of the rights of the accused and maintains that it is not a proportionate response to addressing the risk that information prejudicial to national security may be released," the council said in a statement.
The laws governing Australia's intelligence agencies give little to no protection for whistleblowers to disclose sensitive information. The Law Council said secrecy offences should be reviewed to "ensure there are adequate protections for whistleblowers and their legal advisers who are concerned about potential matters of illegality".