Sharon Shoesmith was sacked without compensation by Haringey Council last December, after a damning report into her department's failings.
She has launched judicial review proceedings for compensation against the council, children's minister Ed Balls and regulator Ofsted.
Her lawyer James Maurici said Balls had effectively convicted his client "with no opportunity whatsoever to be heard", the Press Association reported.
He told the court: "As matters stand, the simple fact is the claimant will never work again. She has been financially ruined and her health has been very seriously affected."
Balls sent Ofsed inspectors into Haringey last November after the trial of those responsible for the death of Baby P. The inspectors condemned the council's child protection procedures as "inadequate".
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