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Carson Yeung and his representatives plan to take legal action with a view to blocking Karren Brady's severance package, which the new regime at Birmingham City believe to be excessive. The former managing director, who left St Andrew's earlier this month after spending 16 years at the Premier League club, is guaranteed to collect a minimum of £700,000 over the next 12 months under the terms of her departure.

Brady will also pick up a further £260,000 if Birmingham retain their Premier League status this season while the list of benefits she will receive includes a company car, an executive box at St Andrew's for the next 12 months, two directors' box tickets for each away fixture for six months, a mobile phone for a year and private health insurance for her and her family.

It is possible that the new board will challenge Brady's "golden goodbye" on the basis that awarding such a generous contract was not in the best interests of the company and this ran counter to the Birmingham directors' fiduciary duty.

Birmingham would not comment other than to confirm: "This matter is in the hands of our lawyers."

Brady was not available for comment but it is understood that Yeung, the club's president, was made aware of the terms of her contract when he paid £15m for a 29.9% stake in Birmingham in 2007. The list of benefits and details of her remuneration package would also have been disclosed again in the summer, when Yeung rekindled his interest in the club and carried out due diligence prior to completing the takeover.

Either way, the current dispute will do little to alter the feeling that the existing and outgoing board have little respect for one another. David Sullivan, the former plc chairman, and Brady had previously criticised Yeung for his aborted takeover two years ago, which coincided with Birmingham suffering relegation to the Championship. The Hong Kong businessman, meanwhile, recently claimed that Sullivan had "pushed" him into trying to buy the club outright in 2007 against his wishes.

In relation to Brady, the Birmingham board is believed to be particularly frustrated that she has retained the use of the "chief executive's box", which she is not expected to use personally this season. On Saturday Brady donated the facility to the Teenager Cancer Trust, the club's nominated charity for 2009-10, only for Birmingham to relocate her guests to another executive box because of the dispute.

(Source: Guardian.co.uk)