Out-of-court deal in UKIP row

The new UKIP leader on the London Assembly is to be paid costs after a legal dispute with members of his own party.

Damian Hockney threatened libel proceedings against two of UKIP's most senior figures after false suggestions that he was linked to the extremist BNP.

Mr Hockney, 46, one of two UKIP members on the assembly, took action against party chairman David Lott and head of communications Mark Croucher, demanding they act to clear his name.

Both sides are expected to release a joint statement announcing they have settled out of court.

An insider said: "We expect it to say Damian Hockney had nothing to do with the BNP and that UKIP has agreed to pay his costs, in the region of ?10,000."

The row started when Mr Hockney sent a private memo to 500 UKIP party members last November saying he feared the party was drifting away from its commitmentto leave the EU. The memo was leaked and used to attack the UKIP on a BNP website, after which rumours circulated that he was somehow involved with the party.

"A tortuous link was made between myself and the BNP which I could not accept," he said. "It was based on information that I made available to the whole party as an internal memo."