Henshaw's threat to Storey's job forces the council leader to call a meeting of his school's governors who give him their complete support, he reveals.
"There then followed a very difficult period when David Henshaw withdrew sending me his diary and his correspondence...I felt very isolated in all this...I contacted the chief executive of another authority and asked for advice...He was shocked and said that 'really you should suspend David Henshaw for behaving in this way'. I felt that would be inappropriate."
Story continued to lack the killer instinct even though he pursued the idea of taking disciplinary action against his renegade chief executive.
Storey tells how he met representatives from the Employers Association in Nottingham.
"A team of their staff, after several hours of discussion, got together a proposal in which they considered that David Henshaw's activities were of a serious nature. And that this should be a disciplinary matter. They made the point jokingly, that it was easier to get rid of Her Majesty the Queen than it was a chief executive."
The Employers Association advised the council leader to set up a special disciplinary committee to 'try' Henshaw.
"It could then consider suspending David Henshaw while the matter was being investigated. They also said that if he was suspended, there would have to be a report put together on David Henshaw's activities. They were happy to send a team up to Liverpool to put that report together."
But Storey faltered.
Weakly, he preferred the option of mediation to try and bring peace to the civil war.
In looking for a way to avoid a further bloody conflict, Storey let down his loyal supporters, democracy and the people of Liverpool.
It was to be his last chance to take strong and decisive action against Henshaw, but he fluffed it.
Amazingly, the arrogant Henshaw at first refused Storey's offer of mediation, believing he had the council leader on the run.
Then the evil cabal swung into action.
City solicitor Graeme Creer, who had been appointed by Henshaw, privately told the renegade chief executive of the Lib Dem group's confidential plans to set up a disciplinary committee to prosecute him.
Henshaw then moved quickly to avoid humiliation and agree mediation, with Sir Michael Lyons brought in to act as referee.
It sealed Storey's fate.