Both parties in the long-running High Court dispute between Mr Larry Goodman and Mr Pascal Phelan are understood to have walked away shouldering legal costs exceeding €2 million (£1.6 million) each.

The case was stuck out yesterday morning on the application of Mr Phelan.

Counter claims which had been made by Mr Goodman were also withdrawn. Mr Phelan's decision to withdraw from the case is understood to have taken the Goodman side by surprise yesterday morning.

A number of sources said no money had been paid to Mr Phelan.

Mr Phelan took the case in June 1989 seeking damages for conspiracy, fraudulent misrepresentation and the procuring of breaches of agreements.

He was seeking damages from Mr Goodman and Mr Zakaria el Taher, a Middle Eastern businessman who was Mr Phelan's former partner in Master Meats.

One source said that from early in the case Mr Phelan had been seeking a large payment and there had never been any serious settlement negotiations.

A spokesman for Mr Goodman said he would not be making any comment.

A spokeswoman for Mr Phelan said; "Mr Phelan is not available to comment at the moment on any aspect of the case other than to say he is delighted with the outcome." She would not expand on this.

Mr Phelan sold his home, Lyrath Demesne, Co Kilkenny, recently and said the sale gave him the resources to see the case against Mr Goodman through. The property, on 160 acres, was sold for about €6.4 million.

However his business venture in the US, the Mars 2112 theme restaurants, have been in difficulty since the September 11th attacks.

The unexpected ending of the case came on day 63 of the High Court hearing and as lawyers for Mr Goodman were to seek an interlocutory injunction restraining Mr Phelan from making contact with or attempting to intimidate a witness or witnesses.

The motion was grounded on an affidavit sworn by Mr Joseph Halpin, a former financial controller of Master Meat Packers. No details of the allegations were opened in court.

Mr Goodman, in his counterclaims, was making 35 allegations of fraud, tampering with books and other matters, against Mr Phelan.

In 1989 €2.54 million (£2 million) cash belonging to Master Meats was lodged in court by order of the court. With interest the amount had by yesterday grown to €4.75 million.

The court ruled that the money be returned to Mr Goodman. The money did not represent an offer made to Mr Phelan as in libel cases.

Both men had three senior counsel working for them on the case. Mr Goodman had Mr Dermot Gleeson, Mr Paul Gallagher and Mr Donal O'Donnell. Mr Phelan had Mr Brian O'Moore, Mr Garret Cooney and Mr James Salafia.

The unexpected dropping of the case against Mr Goodman by Mr Phelan leaves both men still involved in litigation with Mr Taher.