A foundation trust has accused Monitor of being “grossly unfair” and “intimidatory” and claims it is considering legal action against the regulator.

Monitor announced at the end of September that Colchester Hospital University Foundation Trust had breached its standards.

In our view the entire process has been disproportionate and grossly unfair and we are likely to make a formal legal challenge

The regulator said the trust was failing to meet healthcare standards, failing to co-operate with other NHS bodies, and failing in overall governance and in its “duty to act effectively, efficiently and economically”.

In an email to other foundation trusts, seen by HSJ, Colchester chair Richard Bourne complained Monitor’s process “ignored large amounts of evidence of a favourable nature”.

The email says: “In our view the entire process has been disproportionate and grossly unfair and we are likely to make a formal legal challenge.

“The approach also appears to be deliberately intimidatory and they [Monitor] have made threats of various kinds to take action against myself, other directors and governors.”

Monitor rebutted the claims. It said in a statement: “We reject suggestions that we have not been transparent in our approach; we have written to the trust setting out the reasons we found it to be in significant breach and provided a detailed file containing the relevant information.”

It said it would monitor the trust closely and “consider whether further regulatory action is necessary”, including intervention. The trust breached the elective waiting time target in the final quarter of 2008-09 and the first quarter of 2009-10.

The trust said in a statement: “Our chair sent a confidential email to his counterparts at six other foundation trusts which have also recently had issues with Monitor in order to explore the possibility of sharing experiences with them.”

It said the email was not meant for publication.

Meanwhile, Monitor has appointed Jeffrey Ellwood as interim chair at financially troubled Dorset County Hospital Foundation Trust. Previous chair Robin SeQueira resigned, telling local media he did not want to preside over expected service closure and redundancies at the small district general hospital.

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