Boris Johnson is facing legal action over his decision to give a peerage to a billionaire party donor in defiance of advice from the watchdog for appointments to the Lords. Electoral Commission records show that Peter Cruddas, a former Conservative party treasurer, gave the Tories a further £500,000 just three days after taking his seat in the upper chamber last February. Lord Cruddas, a businessman and philanthropist who has given more than £3m to the Conservatives since 2010, has strongly denied any wrongdoing. At the time of his appointment, Downing Street took the highly unusual move of publishing an open letter from Johnson to Paul Bew, the chair of the Lords Appointments Commission, explaining why he was putting Cruddas in the upper house without its approval. However, the Good Law Project – which has brought a series of judicial review cases against the government over the award of contracts during the pandemic – has said it intends to challenge the appointment in the courts. More than 18,000 people have also signed a petition on the legal campaign group’s website calling for the removal of Cruddas’s peerage, saying it makes “a mockery of democracy”. Jo Maugham, the executive director of the Good Law Project, said it was unprecedented for the prime minister to press ahead with the nomination after objections were raised by the independent House of Lords Appointments Commission, adding: “We don’t only think it is odd. We also think it is unlawful.” The body – which vets new peerages – raised “historic concerns” over allegations that Cruddas had offered access to then prime minister David Cameron in exchange for donations to the party. In 2012, Cruddas, who was at the time the Tory party co-treasurer, was at the centre of the cash-for-access scandal. He resigned after it was revealed he was offering access to the prime minister and chancellor for up to £250,000. He was forced out after footage emerged of him apparently making the offer to undercover reporters from the Sunday Times. A year later Cruddas won £180,000 in damages in a libel action, although that was subsequently reduced to £50,000 after aspects of the original allegations were upheld when the paper appealed. The £500,000 donation made last year was the largest cash sum that the tycoon, who is worth £1.3bn according to the Sunday Times Rich List, has donated to the Tory party. He said at the time it was “definitely not true” that there was any link between the donation and his receipt of a life peerage. “That would be corruption and that’s definitely not the case,” he added. Maugham said the Good Law Project’s lawyers had advised there was “apparent bias” in Johnson’s decision to continue with his appointment regardless. He said: “The independent watchdog didn’t think Peter Cruddas should be given a peerage. But Boris Johnson ignored their advice and appointed him anyway. Just three days after he entered the Lords, he gave the Conservatives half a million quid. I don’t think this is lawful. “I think a fair-minded observer, presented with the facts, would conclude there was a real possibility or danger of bias in the prime minister’s decision-making.” The campaign group has set out its case in a pre-action protocol letter sent to the prime minister. A Downing Street spokesperson said: “All individuals are nominated in recognition of their contribution to society and their public and political service. “Lord Cruddas has a broad range of experiences and insights across the charitable, business and political sectors which allow him to make a hugely valuable contribution to the work of the Lords.”