A recommendation was deferred until 8am on Wednesday morning and the meeting was adjourned by the chairman, Nigel Harris, after heated exchanges between an angry Dennis Skinner, MP for Bolsover, and the four trade union members of the party disputes committee over whether there was a case to answer against Ms Davies. The final decision will be taken by the NEC later the same morning.
Mr Skinner, a prominent member of the left-wing Socialist Campaign Group of MPs, failed to secure a seconder when he proposed that Ms Davies, a 31- year-old barrister, should be endorsed after she had spoken for three hours in her defence.
The complaints include claims that she was a Trotskyist, that she defied the Labour whip when she was an Islington councillor and is likely to do so as an MP, and that she failed to disclose at her selection meeting that she had been sentenced to 30 days in jail for non-payment of poll tax.
In the event, the poll tax was paid by a third party before the sentence officially took effect and Ms Davis was taken to prison.
Mr Skinner complained angrily after the meeting yesterday that the case should have been thrown out on the spot, that Ms Davies had been "first class" in her defence and that she would make an excellent member of the Labour front bench. He said she was the victim of a campaign against her by former members of Islington council.
He added: "In five-and-a-half years, Liz Davies only voted twice against a Labour whip, once to save a nursery school in Islington. This is chicken- feed. Neil Kinnock voted 77 times against a Labour government, most of them in respect of devolution. He finished up as leader."
The case has become something of a cause celebre. It has become a test of how far the Blair-led Labour Party is prepared to tolerate the kind of potentially dissident MP that have been thorns in the side of previous Labour prime ministers since the days of Clement Attlee.
This is why the implications for the party could go well beyond the immediate charges against Ms Davies, selected from an all-women's short list as the candidate for Leeds North East.
These include the claims that she did not declare her sentence for poll tax non-payment at her selection meeting and that she voted against the Labour whip at Islington when she was a councillor.
Ms Davies said, as she left the hearing yesterday, that she had fully responded to "all the ridiculous allegations against me" and added: "I am confident I will be endorsed and so is Leeds North East."
Ms Davies, who said she had submitted 120 letters or messages supporting her endorsement from a board spectrum of Labour Party opinion, later announced in a statement that she regretted the delay in resolving the matter.
"I have answered in full all allegations against me. It is clear there are no reasonable grounds for refusing to endorse me. I am confident NEC members who study my submissions will agree."
Several members of the committee acknowledged yesterday that Ms Davies had proffered a spirited, well prepared and highly articulate defence at the meeting. But although the committee promised to study the voluminous written and oral evidence over the next 36 hours there were strong signs that the majority of leadership loyalists on the committee will decide there is still sufficient evidence to withhold endorsement.
The NEC risks a possible court action by Ms Davies and a row at next week's conference if it finds against her. Peter Hain, the libertarian MP for Neath, is leading a lobbying operation designed to persuade the NEC to endorse her candidacy.Reuse content