Jeremy Hunt was given legal advice not to make representations to business secretary Vince Cable on the BSkyB bid, the Leveson Inquiry has heard today.The Culture Secretary was told in November 2010 it would be “unwise” to communicate with Cable – then in charge of overseeing the bid – or speak to any third party about the bid. The advice came a week before Hunt sent an internal memo to David Cameron supporting the News Corporation takeover.Jonathan Stephens – Permanent Secretary to the Department of Culture, Media and Sport – had written to officials asking whether Hunt was allowed to have a role in the bid process. Patrick Kilgarriff, the DCMS head of legal, sent a follow-up email on December 7.He said: “Thanks I appreciate that the advice is not what JS [Stephens] and possibly JH [Hunt] wanted to hear but I think it amounts to - 'do nothing, do not try to convey your thinking to VC [Cable], he must act quasi-judicially and only through formal processes'.”On December 21, Hunt replaced Cable as minister in charge of the decision, after the business secretary was recorded saying he had declared war on Rupert Murdoch.The inquiry was shown an email from Kilgarriff - sent on the same same day - concerned about public comments Hunt had made in support of the bid after News Corp launched the bid in June 2010.He called the comments "not helpful" and warned they could suggest an element of pre-judgment.He added: "That said, the view is far from definitive as is demonstrated by the wish not to second-guess decision-making by regulator and 'it isn't clear to me' so unhelpful and enough to draw comment and perhaps challenge, but probably not fatal when a well-reasoned decision is made with conclusions based on all the relevant evidence."Stephens told the inquiry Hunt actively sought legal advice and praised him for his neutrality over the bid. He said he warned the Secretary of State to be careful in his new role and have only formal contact with News Corp. The circumstances under which Hunt took over the bid were "uppermost in everyone's minds".The department were concerned that News Corp could use Cable's comments in a judicial review, if the bid was rejected by the DCMS.Stephens added: "Hunt needed to take an even-handed approach, giving all sides an appropriate opportunity to make representations, ensuring that the process was without bias or the appearance of bias."Hunt's SpAd drawn into "web of manipulation and exaggeration"Stephens also told the inquiry Jeremy Hunt’s special adviser Adam Smith was drawn into a “web of manipulation and exaggeration” by News Corporation over the BSkyB bid.He said Smith had been drawn beyond what he wanted to do against his will by News Corporation lobbyist Frederic Michel.Stephens recommended Smith be asked to resign after a batch of email and text message correspondence between the special adviser and Michel was made public on April 24, when James Murdoch appeared the Leveson Inquiry.In his written witness statement he said: “The following morning I told the Secretary of State [Hunt] I thought the number, extent, depth and tone of contacts suggested by those emails went beyond what was acceptable.”Smith had told Hunt he would step down the previous evening, but was told by the Culture Secretary his job was safe.He later told the inquiry: “The judgment I’ve formed is that sadly Mr Smith – I personally believe against his will and against his intentions – was drawn into a sort of web of manipulation and exaggeration and was inadvertently, I think, drawn beyond what he indented to do or wanted to do, but unfortunately was drawn beyond it.”Stephens said he was unaware Smith’s contact with Michel went far beyond information sent to the department from the News Corp legal team. He said the requirements of the Culture Secretary and his team to be fair and unbiased were the “meat and bread” of internal meetings in the department after Hunt was asked to oversee the bid in late 2010.He said Smith had been present at several meetings with Hunt, DCMS legal advisers and expert counsel when requirements around the quasi-judicial process were discussed.He added: "That was the bread and butter of those discussions, was asking when can we meet News Corp... do we need to meet other people, what can we share, with whom, at what stage, what are our obligations if we show this to one side, do we have an obligation to show it to others - and that was the constant discusission on all these meetings."In a letter to Smith following his resignation, Stephens said: “How you left today was characteristic of the selfless and self-effacing way that you've approached your role. I am sorry it was inevitably so traumatic.”He told the inquiry: “It was a very difficult, traumatic, situation for Adam and for the department which worked closely with him and respected him.”Lord Justice Leveson – who called the controversy a “calamity” for Smith and the DCMS – asked Stephens how this situation could have been avoided.Stephens said Smith should have been warned about Michel’s “powers of advocacy” and assured the judge the Cabinet Office has recently issued guidance on quasi-judicial decisions.