THE former developer of Silver Hill is set to launch two legal challenges against Winchester City Council after it was kicked off the project.

Civic chiefs face a second judicial review in 18 months after ending their contract with TH Real Estate.

In a pre-action letter sent on Friday, the developer said the council had been "unreasonable, irrational" and "disproportionate" by not giving it time to change plans for the city centre.

Company bosses are also claiming damages after the council decided not to implement a compulsory purchase order on the site.

Legal advisors have told the council they have a strong case to defend the decision, made official a fortnight ago.

Cllr Stephen Godfrey, leader of Winchester City Council, said: "I don't think it was unexpected. We did discuss the risks of various legal actions reflecting the decision to terminate or not to terminate [the contract].

"Our legal advice was clear, which was that the decision was appropriate and well-founded, and that's why the vote was so clear."

It comes a year after another judicial review, launched by rebel councillor Kim Gottlieb, found the council had unlawfully kept the scheme from commercial tender.

TH Real Estate believes it should have been given time to appeal that decision and update its proposals, claiming the scheme on the table would not have met building standards.

Threatened the challenge earlier this month, it said Cllr Gottlieb's High Court hearing had scared off investors needed to fund the project.

In the letter via solicitors Hogan Lovells, the developer, also known as SW1, said: "Although SW1 and council agreed to revert to the [original] 2009 scheme, the Gottlieb judicial review has made it temporarily impossible for SW1 to enter into a binding agreement with a funding partner and therefore to satisfy the Funding Condition."

The letter added: "If the Gottlieb proceedings are determined in our client's favour, SW1 would likely be in a position to start building the scheme within a year, thus bringing regeneration and economic certainty to Winchester residents in the very near future as well as preserving the value of the very significant investment in the redevelopment to date."

A cabinet meeting is being scheduled for March to address the compulsory purchase issue and, if necessary, serve notice to buy the land before the order's expiry on March 19.

Cllr Godfrey added: "We obviously decided that the best course of action was to terminate the contract and not to activate the CPO.

"We're now going off to check [legal] opinion based on the letters to make sure that everything is as we expected it to be and we will respond fully at a special cabinet."

Cllr Gottlieb himself a developer, said the legal action could damage TH Real Estate's business.

"If other vendors hear Henderson are going to sue them every time they don't get their way, they're not going to sell anything to them," he said.

"To complain that the council hasn't given them a fair chance is quite extraordinary. This council has given them every chance and more.

"For developers, rewards are very high when you're successful, so you have to take the failures in your stride."