Former regeneration chief Nick Kavanagh accused the council's chief executive of 'feeding the police' with information about him.
Mr Kavanagh was arrested at the Cunard Building by Merseyside Police as part of the force's Operation Aloft in December 2019. He was subsequently suspended from his chief officer job and was eventually dismissed in March 2021 following a council disciplinary hearing. He has not been charged with any offence and denies wrongdoing.
Mr Kavanagh is currently bringing an unfair dismissal claim against the city council at Liverpool Civil and Family Court. On Friday Mr Kavanagh told the court that he suspected Tony Reeves, the council's chief executive, of 'feeding the police' with information.
READ MORE: New Chinatown meeting at centre of explosive employment tribunal
Robert Fazakerley, representing Mr Kavanagh, asked his client about a report which the council commissioned into a number of controversial developments including New Chinatown. Developers North Point Global were behind the scheme.
Mr Fazakerley told the hearing that the report was sent by the council to the police. Mr Fazakerley added that he was not sure which specific police force or department the report was sent to.
Mr Fazakerley said: "Who were the police interested in, you or North Point Global?
Mr Kavanagh, said: "Both but I don't believe the police were in any way all over me. I think Reeves was feeding the police with the report."
Mr Kavanagh said that his uneasy relationship with Mr Reeves dated back to 2019. Mr Kavanagh said: "It became clear to me that relations with him were not good.
For the first time in 20 years I began applying for positions outside Liverpool. I just knew that things were not right. I knew it was time to move on.
"He wanted me out.
"When Reeves came in he was intent on making changes, big changes."
Judge Rachel Mellor said to Mr Kavanagh: " He (Tony Reeves) was brought in to clear up. If Mr Reeves make it clear part of his new broom strategy was to get rid of you, do you think this created a sense that people now knew who to get on with."
Mr Kavanagh said: "I knew it was time to move on."
Mr Kavanagh defended his role as the senior council officer in charge of regeneration across the city.
He said that he was responsible for bringing in £8.5billion of regeneration. He said: "So we did not achieve best value on £1.8m and it was 'skip straight to jail.' I was gobsmacked."
Mr Kavanagh said that he worked very closely with a large of team of senior officers. He said: "I only signed delegated action reports when the head of finance and city solicitor had done so."
He told the court that he did not understand why he faced disciplinary action but other senior officers were not. But Mr Kavanagh that he did not think any of the senior officers who worked for him had "done anything wrong."
He said: "I wanted the council to investigate Mark Kitts. But I don't believe he did anything wrong." Mr Kitts was assistant director of regeneration at the council during this period of time.
Mr Kavanagh also said that not every council report "crossed his desk."
Judge Mellor said: "You weren't dismissed for cosying up to developers." Mr Kavanagh responded by saying: "No I wasn't."
In his witness statement delivered to the court earlier this week Mr Reeves said it was contact from the boss of the previous owner of the New Chinatown Site, Urban Splash, that first raised concerns about then council regeneration boss Nick Kavanagh.
Mr Reeves said: "In late 2018 I was contacted by Jonathan Falkingham, the founder and creative director of Urban Splash in respect of concerns about the New Chinatown development and how Nick Kavanagh had dealt with the transfer of Urban Splash's interests to PHD1.
"Joe Anderson had also held discussions with Mr Falkingham and we agreed that an independent review would take place. Weightmans were instructed to carry out the review. Final report sent to the city solicitor June 2019.
"The report said that Nick Kavanagh had made a comment after the presentations to the effect that if Urban Splash transferred its interests to a developer called X1 then planning permission would not have been granted, which was a major factor in putting pressure on Urban Splash. The report had a recommendation that 'Liverpool Council considers whether investigations should be carried out in respect of the conduct of any individual officers.'
Mr Reeves said the contents of that report were of 'great concern'. He added: "It was clear that the recommendation of carrying out an investigation into the conduct of any individual officer required consideration in respect of Nick Kavanagh and his conduct. It became apparent that Merseyside Police were now also conducting their own investigation into the conduct of the claimant and other parties."
The hearing concluded on Friday. Judge Mellor is expected hand down her judgement in due course.
