An elderly woman has lost her battle for compensation from police amid allegations they damaged her signed photograph of Hitler.

Dorothy Phillips, 77, from Clandown, near Bath, took Avon and Somerset Police to court over claims the photo, which she valued at £10,000, had faded while it was being held at Bath police station as part of an investigation.

The photo was one of a hoard of "sensitive" items seized during a search of the house she shares with her son, Robert, 41, as part of an operation the police now admit was illegal.

Members of Bath police searched the house back in November 2006 after Mr Phillips became embroiled in a row with a neighbour and was later accused of making a racist remark.

During the search officers confiscated the photograph, some Romanov cufflinks, flags, books on SS members and other material they felt supported claims Mr Phillips was involved with racist organisations and had the intent to stir up racial hatred.

Mr Phillips had spent many years living in the house of the controversial former Prime Minister of Rhodesia, Ian Smith, a man billed by his many critics as an unrepentant racist.

But Mr Phillips rejected the accusations and said the investigating officers were attempting to smear him as a Nazi sympathiser.

The case was eventually dropped and in January of this year Avon and Somerset Police accepted the search and the seizure of property had been illegal and awarded Mr Phillips £7,500 compensation. However, the pair were unhappy with the state in which the photograph was returned and decided to seek compensation.

Mrs Phillips told the Western Daily Press: "I bought the photograph at auction, hoping it would be an investment for the future and kept it in a darkened room to preserve its condition.

"I wish I had never bought the damn thing now as nobody will touch it and it's caused so many problems."

Yesterday she told the hearing at Bristol County Court the damage to the photo would knock £5,000 off its value if she were to sell it.

But that claim was discounted by barristers acting for the police and the sitting Judge Bursell.

The couple have twice before sought compensation but have been unable to provide evidence proving the depreciation in value to the court. They say they have been unable to find a valuer who will touch such a politically controversial item so were ordered to pay the police's court costs both times.

Elliot Gold, acting for Avon and Somerset Police, said Mrs Phillips had entered an amended claim in November of last year that was largely based on the same evidence.

This was thrown out in an appeal hearing in April, but because Mrs Phillips collapsed in court and she was ordered to pay further court costs as she was being taken to hospital in an ambulance, she had grounds to appeal the sum awarded.

Judge Bursell granted Mrs Phillips the right to appeal the costs incurred at the previous hearing but, to save tax-payers' money, calculated the sum then and there.

He ordered Mrs Phillips to pay a total of £1,716 in costs towards Avon and Somerset Police for bringing the three separate hearings. But he said if she ever found expert evidence of the value of the damage caused to the photo, she would have grounds to appeal.

Speaking after the hearing, she said: "I don't think we will ever be able to prove the photo was damaged but it has been worth pursuing.

"It just angers me that all this is the result of a search they had no right to carry out and we, the victims, have been painted as villains."

Avon and Somerset police did not wish to comment last night.