Carlo Ancelotti has filed a lawsuit against Everton at the High Court two years after leaving the club to become Real Madrid's head coach.
The Italian’s lawyers have filed the suit in relation to ‘general commercial contracts and arrangements’.
The claim is listed to be heard in the commercial court.
Documents do not specify the circumstances surrounding.
However, Mail Sport has learned of a dispute between Ancelotti and Everton over a tax issue linked to a £2million bonus payment made to the Italian coach during his reign.
The development comes at the worst possible time for Everton, who are in the midst of a potential sale amid highly documented financial problems.
Last month, Everton secured a 'substantial' loan to help cover the cost of building their new Bramley Moore Dock Stadium.
Mail Sport revealed Everton owner Farhad Moshiri completed a deal through Ormskirk-based venture capital company Blythe Capital after a year of work to secure funding.