MERSEYTRAVEL wants a judicial review into the Department for Transport's decision to scrap the £300 million Merseytram project.
The transport authority is also looking to recoup the money it has already spent on the scheme from the Government.
Councillor Mark Dowd, chair of Merseytravel, said: 'We have a strong case and I am hopeful the scheme will go ahead. We have acted honourably and been honest with the Government all the way through. The Government has embarked on a trail that was dishonest and we will fight this matter through the courts.' A letter of intent will be sent to the Government tomorrow (Friday) and it has seven days to respond before action begins. Any review would be heard early next year.