Jaguar and McLaren resolve Newey contract spat

Jaguar maintained it had a binding contract with Newey to join them from August 2002 and issued an injunction against McLaren and the 42-year-old Englishman last week. However, after Mr Justice Eady heard arguments from both parties today - a delay of a day over the original date for the hearing - McLaren and Jaguar said they were, "very pleased this matter (was) quickly resolved in a professional and courteous manner."

Newey will stay with McLaren beyond the end of his current contract, but is set to quit the design of F1 cars for the pursuit of other projects. Newey has been linked to a McLaren-originated America's Cup yacht design.

In prepared statements from both teams, McLaren acknowledged that Jaguar had acted in good faith throughout. The statements added that the relationship between Jaguar and McLaren had always been a good one and that it had not been damaged by the situation.

After issuing its injunction, Jaguar had appeared outwardly bullish of reaching a settlement favourable to the Milton Keynes team. However, the statement released noted that, "Jaguar now understands the circumstances in which the confusion between McLaren and Adrian Newey arose and has therefore decided to accept McLaren's apologies over this matter."

Newey said: "I regret this matter has occurred, but I'm delighted it's now been resolved. I apologise for any difficulties that have been caused. I am sure that we will all now put this matter behind us and concentrate on our common passion for motor racing."

The aerodynamics ace's conciliatory tone was matched by McLaren team boss Ron Dennis, who said: "I would like to apologise for any misunderstanding caused for what has become a confused and complex affair. I am sure that in the future, our relationship will be an excellent one, and our rivalries confined to on-track competition."

Jaguar Racing overlord Niki Lauda, whose team comes away from the affair empty-handed and still searching for the elusive final pieces to make it an F1 front-runner, added: "I am glad this matter has been concluded and it is gracious of Ron Dennis and Adrian Newey to each offer an apology which are (both) fully accepted by Jaguar Racing."

Experts on European employment law say that Jaguar's chances of winning a contract dispute with McLaren were slim, based on Newey's decision to stay with his current employers and on European Union law favouring the employee, not the employer, in such matters.