Ukip’s leadership contest has been thrown into fresh controversy as a leaked email reveals that the party was threatened with legal action by two of the candidates if frontrunner Steven Woolfe were allowed to stand.

Woolfe, the MEP for North West England, was ruled ineligible by the party’s governing body after his application to run arrived 17 minutes after the deadline for nominations.

It has now emerged that two of his rival candidates had warned behind the scenes that they were willing to sue the party if Woolfe were given any leeway. The revelation has prompted claims that he was the victim of a deal “behind closed doors”.

An email from John Bickley, Ukip’s treasurer, to a local party chair claims that the national executive committee ruled against Woolfe on the ground that the party was facing a legal challenge from the candidates, which it would lose.

Bickley writes: “NEC members are directors of Ukip. They have a fiduciary duty to protect the party from legal challenges & ensuing costs. Giving one candidate different terms would be in breach of the contract we have with the other candidates. At least two candidates informed us that they would mount a legal challenge if we did so. We would have lost.”

Bickley further claimed in the email that the party undertook an investigation into its computer servers to corroborate Woolfe’s claim that the system was at fault, but were unable to find any problems that would have justified his late application.

Woolfe claimed to have submitted his application at 11.35am, before the midday deadline, on the 31 July. It was claimed that it was due to technical problems on the party system that it did not successfully go through until 12.17pm.

Bickley writes in the email: “Steven has affirmed that he submitted his application in good time. I questioned whether the band width of the Ukip servers was sufficient to cope with two applications simultaneously and am advised that this was investigated internally...

“I requested a server downtime report on Aug 1st that confirmed that the servers had been fine for at least 6 days before the deadline. [By the way] the site & servers are set up to cope with much more traffic than 6-8 leadership candidate submissions. It can cope with scores...

Bickley added: “All members are equal & therefore all must be treated equally. Would you be kicking up such a fuss if an unknown member had submitted his or her papers late, or is it just celebrity members?

“I suggest you direct your anger & frustration at the person that deserves it, Steven. He’s the one that’s let you down. Why not ask why he did so?”

Responding to the revelations, Paula Walters, chair of the Wirral branch of Ukip, said the party had failed to be honest with the members about the events leading to Woolfe’s exclusion. Walters, who was a supporter of Woolfe’s leadership campaign, said: “We fought in the referendum against deals behind closed doors. That was what we fought for and it was what I have believed Ukip stands for, and what I believe it still stands for among members.

“The members should have been told about this. The candidates who threatened to sue the party should now stand down. I don’t think they are fit for purpose. I think the remaining candidates should agree for Steven to go back on the ballot in a spirit of democracy. Who would want to win by default?”

There are six candidates. The favourite, Diane James, has missed every hustings so far because she is in France, and is yet to formally launch her campaign.

It is understood that Woolfe is considering his own legal action over the Ukip NEC’s ruling. It is likely that there will now be an extraordinary general meeting of the party to debate the disbanding of the NEC. Woolfe’s supporters have accumulated enough constituency party resolutions to force the holding of such a meeting in the autumn.