Council takes legal advice after papers run story based on leaked opinion from QC

Liverpool City Council has revealed it is taking legal advice after two local newspapers ran a story based on a leaked opinion commissioned by the authority from a top QC.

The story in the Trinity Mirror-owned Liverpool Echo and the Liverpool Daily Post related to the appointment of David McElhinney as acting chief executive of the council in July 2010, initially for a six-month period.

McElhinney was chief executive officer of Liverpool Direct – a £70m-a-year joint venture between BT and the council – at the time.

Liverpool sought advice from Matrix Chambers’ Cherie Booth QC, the wife of Tony Blair, on the potential for conflicts of interest and the proposed steps for dealing with them.

The newspapers claimed in their story that the council had not followed the QC’s advice fully. They also published a copy of the opinion.

But the council has subsequently said the leaked document was only an initial view, and that the relevant part of that advice – in relation to a proposed period of gardening leave for McElhinney after the temporary appointment ended – did not appear in a later, final opinion. The authority insisted that it had fully complied with that final advice.

In a joint statement on the authority’s website, Liverpool’s leader, Cllr Joe Anderson, and its chief executive, Ged Fitzgerald, said: “You may have seen or heard about a story carried recently in the Daily Post and Echo regarding legal advice in respect of the role of (Interim) Chief Executive in the summer of 2010. The facts are set out below.

“However, this is actually about something much more important. We cannot have a situation in the Council where it is considered either acceptable or appropriate to steal documents and to pass them on to the press. The Council and the City face far too many other challenges than to have to deal with salacious, speculative stories masquerading as in the public interest. Provisions exist for whistle blowing and to ensure probity, value for money and transparency. This story was about none of those things.”

Anderson and Fitzgerald accused the papers of selectively quoting from “a stolen, legally privileged confidential document”.

They added: “Unfortunately for them the document was only initial advice. The final advice (which remains confidential) did not include the matter they claim and the Council met and exceeded all of the points set out in the final advice.”

The leader and chief executive insisted that they were trying to build an open and transparent organisation.

“We have already taken steps to improve internal and external communication but we know we need to do even more on that,” the statement said. “We have no problem with scrutiny or accountability to the people we represent and the people who pay our wages, but stories that are designed only to bring down the reputation of the City and the Council are not accepted and need to be challenged.”

Anderson and Fitzgerald said “this kind of thing” damaged the hard work staff put it on a daily basis. “We are not prepared to see their efforts undermined by such stories,” they added.

A spokesman for Liverpool said the local authority would not comment further as it is currently taking legal advice.

He added that the council was still dealing with enquiries from the Daily Post and Echo, but had withdrawn proactive co-operation.

Alistair Machray, editor of the Echo, said the papers were "in a period of reflection" with the council and so would not be commenting further at this stage.