She said she had also known Slater as a friend for about 11 years.
Flannagan, who has been a practising lawyer since January 2012, told the court that between June 24, 2015 and May 5, 2017 she spoke to Slater several times.
"There was talk about a dossier of information," she told the court. "There was suggestion this dossier contained more info than was available publicly. I needed to know what allegations we were potentially dealing with."
"I discussed these things with [the Craigs]. The Craigs told me they too were concerned that if more allegations were published, this might negatively affect their [adoption] application."
After hearing radio news reports regarding the sexual allegations against Craig involving former press secretary Rachel MacGregor, and that Slater had more information to be released, she made contact with the blogger.
Craig endorsed the approach, the family and harassment lawyer said.
"I considered I knew Cameron well enough that I could call him and ask what was coming."
The Craig's did not want "further speculation" to affect their children, she said.
"I told Cameron I was asking about [the allegations] for a client, but that the nature of the matter was privileged ... the conversation had to remain between us and he assured me it would.
"I wanted to cover the risk that he would tell someone else ... I was counting on him to honour that."
However, Slater claims he believed Flannagan was acting on behalf of a "victim" of Craig's, and the blogger saw her as a source providing her with further information about the allegations against Craig.
Flannagan said Slater "appeared to assume that this client of mine was another 'victim' of Mr Craig's".
On June 25, 2015, Slater phoned Flannagan asking to speak to her client, she replied, "the odds of that were highly unlikely" and told Slater, "the case I'm acting in is quite different".
Further communications between the pair continued, and on April 27 last year, Slater sent a private Facebook message to the lawyer asking to speak to her about Craig.
However, the following day she replied that she was unable to discuss the matter as it was privileged.
"I had not said anything about a victim," she said.
Slater claims he had reasonable grounds to believe Flannagan was acting for a victim.
An emotional Flannagan told the court, "my obligation of confidentiality could still not allow me to tell Cameron who my client was".
When cross-examined by Slater's lawyer, Brian Henry, Flannagan said it was her idea to call Slater.
"I don't think Mr Craig knew I had that relationship [with Slater] until I made that phone call."
Slater was recalled to the witness stand to be questioned over Flannagan's evidence.
"I'm just lost for words at the betrayal of someone I considered a friend," the blogger said.
During cross-examination by Craig, who is representing himself, Slater was asked if he felt it was a "credibility contest" between himself and Flannagan.
Slater did not accept Craig's claim.
He also did not accept Craig's proposition that Flannagan was in a difficult position due to client confidentiality agreements.
Craig asked, "did you genuinely believe that at the time she was approaching you as a source to provide you information?"
Slater replied, "yes ... little did I know that she was reporting back to you".
When questioned by Justice Toogood if Slater had betrayed Flannagan over the confidentiality of their conversations, the blogger said, "I guess technically I did".
The trial continues with MacGregor later expected to give evidence.
Craig's claims against Slater
Craig says the allegations written on Slater's blog Whale Oil Beef Hooked were irresponsible, inaccurate and very damaging.
In his opening address, Craig, who is representing himself, set out some of the central claims Slater made against him:
• That he had sexually harassed his former press secretary, Rachel MacGregor.
• He'd given her a "large sum of hush money" which Slater claimed the harassment was true.
• Craig had lied because he told his party and the public the accusations weren't true.
• Craig was a "sexual deviant" and had harassed another woman.
• Craig engaged in "devious conduct" regarding the Conservative Party.
