Woolgrowers fighting a bitter rearguard action after comprehensively losing a legal row over Wool Board money were today given Supreme Court leave to appeal – on grounds of an alleged relationship between the judge and a lawyer in the hearing.

Saxmere Co Ltd, Escorial Co Ltd, Richard King and Russel Stewart Emmerson and Forest Range Ltd have alleged former Court of Appeal judge Justice Bill Wilson faced a potential conflict of interest in the case he heard.

Saxmere and associates have fought a series of legal battles seeking cash from Wool Board Disestablishment Co Ltd (DisCo), the last remnant of the statutory producer board.

Supreme Court justices Peter Blanchard, Andrew Tipping, and Noel McGrath said today the losers in the Saxmere case could ask for the judgment to be set aside “because of a reasonable apprehension of bias resulting from Wilson J’s relationship with Mr (Alan) Galbraith QC”.

The woolgrowers’ latest effort involves an alleged relationship between the judge and the QC, and a row over whether Justice Wilson fully disclosed his joint ownership of a multimillion-dollar racehorse stud with Galbraith, a barrister who represented the Wool Board in the Saxmere case.

The growers have claimed Justice Wilson and Galbraith were both directors and shareholders of Waikato’s Rich Hill thoroughbred horse stud.

Justice Wilson, who has since been appointed a Supreme Court judge is reported to have disclosed in a phone call to the growers’ lead barrister, Francis Cooke QC, that he shared horse racing interests with Galbraith.

Justice Wilson, and two other judges, ruled in favour of Galbraith’s clients, the Wool Board and the Attorney General.

The sheep farmers initially took action against the Wool Board for refusing to recognise “Saxon” as a merino wool type.

They won a judgment in the High Court in December 2005, for damages against DisCo, but in August last year lost in the Appeal Court, which set aside all orders made in the High Court.

DisCo is effectively a subsidiary of the farmer-owned Wool Equities Ltd and the assets of the former Wool Board it holds include $290 million in Wool Board tax credits, though those are only available to offset tax liabilities.

DisCo said last year it had set aside funds of up to $7 million to fight any continuing legal action by the Saxon farmer s .

DisCo has so far spent about $2.2 million of the money but has clawed back some in successful court challenges.

The Supreme Court said today the latest proposed appeal was dependent on proof of facts, but “raises important questions concerning the administration of justice”.

“If the arguments intended to be made by the appellants succeed, there would be an appearance of a miscarriage of justice,” the court said.

The approved ground for the appeal covered both the alleged apprehension of bias and any questions concerning possible waiver on the part of the appellants.

But the Supreme Court proposed to give Justice Wilson a chance to make a written statement to the court, and the registrar was ordered not to list any fixture until directed by the court.

It was preferable for the matter to be determined in the Supreme Court.

If the woolgrowers were to succeed, it was unlikely the Supreme Court would re-hear the substantive matter decided by the Appeal Court “having earlier decided that it does not meet the leave criteria under the Supreme Court Act”.

In such circumstances, the Supreme Court was likely to direct the case to be re-heard in the Appeal Court.