Any councillor found guilty of misconduct could face suspension for up to four years.

Inspectorate spokeswoman Vicki Bonet said she was unable to make further comment, but councillor Stephen Mayne said two matters are under investigation.

The first regards a letter sent to councillor Grace La Vella’s employer, Carey Baptist Grammar, in 2010.

The letter, signed by ‘‘a concerned parent’’, alleged Cr La Vella conducted council activities while working as a counsellor at Carey, and used Carey resources.

Cr La Vella denied the accusations and claimed the letter in question was not sent by a parent. ‘‘The contents of the letter are factually incorrect and this is one of the reasons we know it was not a parent,” she said.

Cr La Vella said she had information about the identity of the letter writer, but did not want to comment further as the matter was under investigation by the local government inspectorate.

In a separate investigation, the inspectorate will investigate an email between council officers and councillors detailing legal costs incurred last year and in 2010.

Legal costs listed include $10,000 paid to defend Cr Mayne and councillor David Ellis against the Chinese Community Social Services Centre Inc in a defamation action and $45,000 on the councillor conduct panel to investigate former councillor Fred Chuah in 2010.

Details of the costs were reported in MW on November 22 last year.

But Cr Mayne said the council had asked the inspectorate to investigate after the internal council email was published on the Vex News website on December 15.

He approached the Inspectorate in December with chief executive Lydia Wilson, mayor Geoff Gough and deputy mayor Jennifer Yang.

He agreed ratepayers had the right to know how much money had been spent on legal costs but said the council needed to know who was responsible for the ‘‘information leak’’ and the letter to Cr La Vella’s employer.

Monash University Governance Research unit associate professor Ken Coghill said it was unlikely that informing the media about legal costs which were readily available on the public record would constitute a breach of the Local Government Act.

He said any councillor responsible for trying to embarrass a fellow councillor by leaking documents should be referred to the conduct panel.