Things appear to be going from bad to worse at Nanaimo city hall, which has now filed a lawsuit against its own mayor, Bill McKay.

The case revolves around former mayoral assistant Marilyn Smith, who has worked for many Nanaimo mayors over the past 25 years.

After she was reassigned last April, Smith went on medical leave and filed constructive dismissal and human rights claims against the city, before settling for an undisclosed amount.

According to the city's statement of claim filed on Dec. 28, the mayor allegedly shared a confidential email from the city's chief administrative officer with Smith.

The city says the email contained confidential and personal information about Smith and related "human resource issues."

It also says the mayor and councillors were specifically requested to refrain from communicating with the Smith "due to anticipated litigation."

But the lawsuit alleges after the mayor shared the email with Smith, she used it to support her claim against the city.

The city is looking for losses or damages, including the payment given Smith and any legal fees associated with fighting her claim.

Mayor waiting to respond

McKay told CBC News he only learned of the lawsuit recently.

"I have not yet been served on the matter you refer to. I am not aware of the details of the action, so I cannot comment," he said in statement.

But he was a bit more forthcoming about events at city hall when he spoke to CHEK News on Tuesday.

"It didn't surprise me. It seems to be the mood of the day," he said.

The lawsuit is the latest development in a series of ongoing disputes between the mayor and several councillors that have dominated the city's civic affairs in recent months.

In November, the city asked the RCMP to investigate the same issue along with several others.

In October, Councillor Gord Fuller told the mayor to "bite me" during a heated exchange at a meeting.

In March, seven city councillors signed a letter asking McKay to resign over allegations of bullying behaviour, but the mayor refused to step down.

A spokesperson with the Federation of Canadian Municipalities said they couldn't recall a situation where a municipality sued a sitting mayor.

With files from Madeline Green and CHEK News