A Responsibility for this distressing situation lies with the governors, not the staff, who can't do much while the governors fail to assume responsibility for the person they have technically elected of their own free will to lead them. I say "technically" since I know that in practice it is often not so simple. It is often said in the business world that the person who has set a company on a winning course is often not the right one to lead it through the next stage. Yours is an extreme case in point. The governing body's power in law is corporate and the chair has no legal right to make any decisions except in emergency. Most of your chair's decisions therefore have no legal force. In any case, most matters he occupies himself with are not governors' concerns at all, but professional.A chair often represents the governors in selecting staff, but this is legal only if they have deliberately delegated their power in this way. It is wiser to agree on a system involving other governors as well, since legal responsibility for the choice remains with the governing body.
Whatever its history, it is time now for the school to stand on its own feet. I cannot find any legal limit on the tenure of an acting head, but it is normally a brief stop-gap measure and it is wrong for the school to be without secure permanent leadership so long. The governors must decide together when to advertise the headteacher post and set up a selection panel. They must as a body insist on proper discussion of all matters requiring decisions, and rule out any intervention in daily management, especially on the chair's (imagined) personal authority. If they cannot secure acceptance of this by the current chair they will have to be brave in the autumn meeting and propose someone else who will accept the legal limits on his or her role. As well as damaging the school, this misuse of the chair's role could have dangerous consequences for the individual as well as for the school. For this reason, I think that governors would be best advised to share the problem with their Diocesan board for education.