Former Health Services Union boss Kathy Jackson says she doesn't have any assets left to freeze because she's running out of money to pay her mounting legal fees.
Her partner - Fair Work Commission vice-president Michael Lawler - says moves to seize Ms Jackson's assets would hurt him because he's already footing most of her bills.
The HSU is seeking to freeze Ms Jackson's assets as part of its civil case against her for allegedly acting outside her authority as national secretary and spending $660,000 in funds on personal expenses, including holidays and shopping.
The HSU wants to seize her assets to prevent their sale or transfer.
Counsel for the union, Mark Irving, told the Federal Court on Wednesday Ms Jackson was attempting to transfer property she owned to her partner to thwart the union's lawsuit.
"It's being done for the purpose of defeating the union's claims," he said.
Ms Jackson's lawyer, Deborah Dinnen, said the transfer was necessary because her client was running out of money.
The former union secretary has filed an affidavit explaining the agreement she has with her partner, who has been supporting her financially.
"She wishes to have access to the funds for the purpose of paying her legal fees," Ms Dinnen said.
Ms Jackson has not worked for several years and cannot get a bank loan because she has limited equity, the lawyer said.
Mr Lawler told Justice Richard Tracey that freezing Ms Jackson's assets would make life harder for him.
"I am under significant financial stress," he said.
The Fair Work Commission vice-president denied the property transfer was designed to circumvent the union's lawsuit.
He said he had predicted the contract would be misconstrued.
"It was designed this way because I knew it would be scrutinised in a hostile manner."
Mr Lawler says the application to freeze assets contained lurid applications against him.
"I have been tarred with the same brush," he said.
The matter has been adjourned until June 29.
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