Birmingham will demand more than £5million ($8million) in compensation from Aston Villa if they try to appoint Alex McLeish as their next manager.
And Blues even plan to seek an injunction against their bitter rivals to prevent them from hiring the former Scotland boss.
Villa have approached their city rivals to discuss the legal situation regarding McLeish after the Scot quit his job as manager on Sunday.
The contact from Villa was not an official approach, but it can be disclosed that an email was sent to Birmingham seeking clarification about McLeish's status.
Blues' acting chairman, Peter Pannu, spent Monday talking to lawyers about their strategy and there has been a suggestion that they will try to place McLeish on gardening leave.
He still had two-and-a-half years left on his contract when he sent an email to Pannu on Sunday announcing his resignation. But it is understood that McLeish - currently on holiday in Corsica - is pursuing a case for constructive dismissal against Birmingham.
Pannu said: "I got an email from Aston Villa, finally replying to all of our queries.
"As expected, their legal department said 'now Alex McLeish is a free agent having resigned, we're free to speak to him'. This confirms all suspicions. This shows what has happened.
"Within the first year he (McLeish), or the club who sign him, have to compensate us at £5.4m.
"The first year expires on June 30. The second year starts July 1, when the compensation fee is £3m.
"The urgency of the whole thing, with this email from Aston Villa, shows they can't even wait 17 days when the compensation is lower. It shows what this is all about.
"Because of this, what option is left to Alex McLeish and his advisers? To make allegations against Carson Yeung, against the board, for interference or whatever excuse to show constructive dismissal.
"I'll be seeking an injunction preventing Villa from hiring him. I'll be reporting what's happened to the Premier League. This is like conspiracy to defraud.
"It's borderline criminal. That's how strong I'll put it."