Graham Carr has been talked out of leaving Newcastle.
The chief scout was considering his future on Tuesday night when he was overruled in the potential transfer of Douglas to Newcastle.
Carr had watched the central defender for more than 12 months and attempted to push through a deal at the start of the week.
However new director of football Joe Kinnear blocked the incoming transfer of Douglas, who was available on a free transfer after running down his contract at FC Twente in Holland.
At that point Carr, who had been given assurances that his role would not be dramatically altered, realised he had been undermined and his role weakened by the appointment of Kinnear and was contemplating walking away from the club.
The 68-year-old Geordie, who signed an eight-year contract this time last year, had to be talked out of leaving.
Managing director Derek Llambias however, believed his position untenable and he resigned on Wednesday morning.
Carr has been given assurances about his position but there remains the potential for more conflict during the forthcoming months as Kinnear looks to change Newcastle's squad of players.