The Abbott government approved Bob Day's potentially unconstitutional office deal against the advice of its own bureaucrats, who raised specific concerns about his financial stake in the building.
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Government documents reveal the Department of Finance initially rejected Mr Day's request to relocate his electorate office from downtown Adelaide to a building he owned in the suburb of Kent Town.
But Mr Day - who resigned from the Senate this week after his national building empire collapsed - refused to take no for an answer and put the request to then-special minister of state Michael Ronaldson.
Mr Ronaldson sought a briefing from the department, which advised him in no uncertain terms to reject the proposal.
"I recommend that you agree to not approve the establishment of a new electorate office for Senator-elect Day," the department's entitlements manager told the minister in a February 2014 letter.
Mr Day said he wanted to move offices because the current office – then still occupied by outgoing Labor senator Don Farrell – was difficult to find, surrounded by traffic and had poor parking.
Relocating to his office in the nearby suburb of Kent Town, which was then listed as the federal secretariat for Family First, would also save him 15 minutes on his morning commute, he said.
The department rejected those arguments and also explicitly warned Mr Ronaldson about the ownership arrangements.
The building was then owned by Mr Day's company B&B Day Pty Ltd, but Mr Day had agreed to sell the building and make it a condition of sale that the new owner lease his office to the Commonwealth.
"Finance has concerns about how such a transaction might be perceived," it said in its notes to Mr Ronaldson.
But Mr Ronaldson appears to have rejected the advice.
About three weeks later, he wrote to Mr Day saying "it was good to meet with you last week in Adelaide".
"I am prepared to give further consideration to your proposal to remain in your existing office space," he wrote.
The meeting came as the recently elected Abbott government was seeking to establish good relationships with the Senate crossbenchers so it could get its agenda through Parliament.
Mr Day, a former Liberal, supported about 90 per cent of the government's bills during his time in the Senate.
Mr Ronaldson set out a list of four conditions, including that the space meet the necessary Commonwealth conditions, that he cover the cost of rent at the downtown office and he be responsible for costs.
The letter also suggests that Mr Day told Mr Ronaldson he had already sold the building - which government sources now say didn't actually occur until September 2014, six months after the pair met.
"I confirm your advice to me that you have disposed of your interest in the Kent Town property," Mr Ronaldson said.
Indeed in a letter to the department in May 2014, Mr Day said the new owner was Fullarton Investments.
Bob Day letter by FairfaxPolitics on Scribd
A subsequent feasibility report by the department found a range of problems with the Kent Town office space, including that the ground floor was unsuitable and there was no disabled access to the upper floors.
The department told the minister the building would have to undergo a security upgrade, the air-conditioning was "severely degraded" and the full cost of refurbishment would be about $165,000.
Mr Ronaldson told Mr Day he would have to meet the costs. Mr Day said he was "happy to accept the terms and conditions".
Shortly after Mr Day resigned on Tuesday the government announced it would ask the High Court to examine the validity of Day's election because of a potential "pecuniary interest" relating to the Kent Town office.
The seat could fall to Labor, One Nation or in the best case scenario for Family First, stay with the party.
