The final outcome of the Rose Gibb case may not be known until after the election, after judgement was reserved today in her Appeal Court hearing.

However Ms Gibb, who is fighting her former employers for a £250,000 severance deal, may have taken heart from the judges’ comments as her legal battle reached its end.

Lord Justice Laws said that when a public body and its employee entered into a contract in good faith, “I would think that it would take a great deal to persuade the court to interfere”.

Ms Gibb signed a contract and left Maidstone and Tunbridge Wells Trust days before the publication of a critical report into C difficile outbreaks there. The trust later refused to pay the majority of the deal, saying it was beyond its powers to have entered into it in the first place.

Ms Gibb lost a High Court case to recover the money and has now gone to the Court of Appeal.

Jane McNeill QC, representing the trust, said it is “absolutely plain that irrelevant considerations were taken into account” by the trust’s remuneration committee when agreeing the deal.

This would mean the trust was going beyond its powers and would render the agreement void.

The trust has already paid Ms Gibb £75,000 in lieu of six months’ notice but has refused to pay her the remaining £175,000, despite conceding that if she had been sacked, she would have had a case for unfair dismissal and possibly get the maximum award of just under £70,000.

However Lord Justice Rimer questioned why the trust had paid money in lieu of notice but not the likely amount of any employment tribunal award.

The judges also questioned the idea that by agreeing to a confidentiality clause in her severance agreement, Ms Gibb had not given up a significant benefit. Lord Justice Sedley said: “She was banned from any public criticism of the trust. It was not inconsequential. It was of very real benefit to the trust.”

But Miss McNeill argued that Ms Gibb did not have a valid claim against the trust for “unjust enrichment” for various reasons. She could have lodged a claim with an employment tribunal; because she did not do this within three months, she is likely to have lost the right to this. The trust had told her before the deadline was up that it was arguing that it had gone beyond its powers in agreeing the payment.

Antony White QC, for Ms Gibb, said the payoff did not require Treasury approval to be legal and that normal practice was for deals to be referred to strategic health authorities.

But he added that the former trust chair James Lee – who chaired the remuneration committee which agreed the payment – had told an inquiry that the £250,000 deal had been discussed with the chief executive officer of the SHA, who had told him 12 months pay’ would be the norm.

“This was discussed and fully agreed by her,” he said.