Torbay and Ealing Councils have started judicial review proceedings against the Audit Commission over the comprehensive performance assessment, and others are considering following suit.

The councils are continuing discussions with the Audit Commission but have lodged application papers with the High Court. Should the proceedings continue, the Audit Commission must come up with its case by early January, with a hearing likely shortly after.

Stephen Cirell, head of local government at law firm Eversheds and the solicitor representing the councils, said the CPA was unlawful because the Audit Commission did not have the power to carry it out.

He said:"The Audit Commission Act 1998 allows studies but an assessment is not a study and you cannot charge for studies anyway and they have charged for CPA. The Local Government Act 1999 allows inspections under section 10 but it cannot be an inspection as the CPA is not directed towards Best Value under the 1999 act."

He advised other councils not to pay outstanding CPA bills because the Audit Commission did not have the power to charge for it.

Meanwhile, the CPA "poor" rating received by Coventry social services has had a negative effect on staff morale following its zero stars in the refreshed star ratings. John Bolton, Coventry's social services and housing director, said social services staff felt they were once again "carrying the brunt for the council".

Public sector union Unison branded the CPA process "a misuse of time and money" which would not lead to improvements in the quality of services.