The 35-year-old socialite has issued the six figure writ against M&M Management, run by her publicist of ten years, Martine Montgomery, at London's High Court.
Miss Palmer-Tomkinson, who parted company with the agency in June 2005, has accused Miss Montgomery of failing to hand over money earned from her work in the entertainment industry.
Tara Palmer-Tomkinson is suing Martine Montgomery and her agency M & M Management, accusing her of failing to hand over money she has received from her work in the entertainment industryAs well as claiming damages for breach of duty, she is seeking a declaration of all the money left outstanding - except for amounts lawfully deducted - and an order for payment of all sums found due.
The troubled 'IT' girl, who has admitted to a previous addiction to cocaine, is also seeking an order for all proper accounts, inquiries and directions.
Friends of the British socialite claimed that the writ had put an "unbelievable strain" on Miss Palmer-Tomkinson - and was to blame for her recent erratic behaviour on the BBC's Celebrity Fame Academy.
"It has been an unbelievably stressful past few months for Tara and it has now all come to a head," said a source close to the reality TV star.
"Remember she is not suing any old anonymous company, but someone she was once incredibly close to.
"It is little wonder that Tara's behaviour might have been a little 'off' recently. But contrary to suggestions that she is back on drugs, it is simply the stress and strain of all of this that has caused her to act a bit weirdly.
"She has not spoken to Martine since legal proceedings began - in other words she went from seeing and speaking to Martine virtually every day to communicating to her solely through lawyers.
"But it is a matter of principle and Tara is torn between just wanting the case to be over and done with, and wanting back what she feels is rightfully hers."
Since parting company with Miss Montgomery, a one time close friend and confidante, Miss Palmer-Tomkinson has joined a hugely successful, London-based rival PR firm.
Miss Montgomery, who runs a celebrity and photographic agency from a studio in London's Chelsea, currently represents socialites Normandie Keith, Lady Isabella Hervey, Petra and Tamara Ecclestone, as well as celebrity chef, Aldo Zilli.
Although Miss Palmer-Tomkinson has been in the public eye for years, it was with Miss Montgomery's help that she relaunched her career, staring with an appearance on ITV 1 reality show. I'm A Celebrity Get Me Out of Here! five years ago.
Since then, stints as a TV presenter and commentator, as well as a string of high-profile relationships with men including James Blunt and Robbie Williams, have kept her firmly in the limelight.
A recent triumphant appearance on BBC1's Celebrity Fame Academy was only marred by bizarre, behind-the-scenes footage of her, which showed her wearing sunglasses indoors and sweating profusely, combined with seemingly erratic, on-stage performances.
Miss Montgomery, who has yet to submit her defence, was unavailable for comment.
The falling out with Miss Montgomery, and the resulting court case, are just the latest misfortunes to hit Miss Palmer-Tomkinson's troubled personal and professional life.
Eight years ago, a bumbling, incoherent appearance on the Frank Skinner prompted her to check into an Arizona rehab in a bid to overcome her cocaine demons.
But earlier this year she had reconstructive surgery on her nose after years of abusing the Class A drug had caused it to collapse.
Although she has frequently denied having an eating disorder, her painfully thin size 6 physique is another constant source of speculation.
She is reported to have collapsed recently during the filming of another reality TV show, Project Catwalk - again prompting talk that she was not eating properly.
Miss Palmer-Tomkinson's personal life, meanwhile, has been every bit as a chequered.
An illicit fling with British singer James Blunt, behind his long-term girlfriend, Camilla Boler's back, ended disastrously, with Miss Palmer-Tomkinson being portrayed as a "scarlet woman".
Her most recent serious relationship, with Matalan heir Jamie Hargreaves, ended 18 months ago, while relationships with other millionaires, Damien Aspinall, and Greg Martin, son of Beatles producer George, were similarly ill-fated.
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