The Queen has ordered Exeter University to set up a grievance committee to hear complaints from Avril Henry, a professor whose research was abandoned because it was ineligible for the research assessment exercise.
The THES revealed in March that vice-chancellor Sir Geoffrey Holland had denied Professor Henry a hearing, prompting a complaint by the Association of University Teachers that his decision was unconstitutional.
This week, the Lord Chancellor's Department, acting for the Queen as the university's visitor, instructed the university to set up a hearing.
The hearing, expected in October, will strike a chord for those who claim that the dash for research funding caused by the RAE is damaging research and eroding academic freedom. A senior Exeter manager has conceded that the university had no "academic and moral" case for pulling funding.
Professor Henry, of the school of English, was given Pounds 4,631 to complete an interactive computer application that would catalogue sculptures at Exeter Cathedral. She had agreed a two-year research-only contract that would run until her retirement in July.
But Exeter withdrew the funds when it emerged that Professor Henry's retirement would render her work ineligible for the 2001 RAE. Director of research Diane Purkis told Professor Henry that the "awful truth" was that the university could not "get any RAE joy from it".
Peter New, head of the school of English, acknowledged that Professor Henry's work was "of international standing" - it has subsequently won funding from the Leverhulme Trust - and accepted that "on academic and moral grounds (her) case is very strong". But he rejected her complaints, ruling that the university officers acted in accordance with the rules.
Sir Geoffrey rejected Professor Henry's attempt to mount a formal grievance against Mr New and declined to set up a grievance committee.
Chris Cheesman, AUT assistant general secretary, said this week: "We assume the university council will want to review their internal processes and the role of the vice-chancellor in trying to prevent them resolving this grievance."
Professor Henry said her case cast doubt on the university's claims that its "prime objective" was the support of research.
A university spokesman said he could not comment owing to senior staff leave.