AUF Wiedersehen Pet star Jimmy Nail yesterday lost his battle for an increase in the £30,000 libel damages awarded by a judge.

The 50-year-old Newcastle actor and singer was awarded the amount in the High Court in March by Mr Justice Eady, who said he had cut the libel damages facing the News of the World and publisher Harper Collins by half because they had made immediate apologies and offers of recompense.

The ruling left the actor facing a legal bill estimated at £200,000 because he declined an offer totalling £37,500 to settle the case.

He took the case to the Court of Appeal, where Lords Justices Auld, May and Gage said yesterday that Mr Justice Eady made no error of principle and had reached a balanced conclusion. They dismissed the appeal.

Mr Nail, who was not in court, now faces having to pay the costs of the appeal hearing, which was one of the first challenges to the "offer of amends" procedure in libel cases.

Hugh Tomlinson QC, representing Mr Nail, had told the appeal judges the awards were not enough, adding: "Damages should not be set at a level which makes libel cheap at the price."

Mr Nail sued over a May 2002 article in the News of the World, which made false allegations about his sexual behaviour, and a 1998 biography of him by Geraint Jones titled Nailed.

Tom Crone, the legal manager at the News of the World, said: "The News of the World offered Mr Jimmy Nail a full apology and a substantial sum of money in compensation, which he rejected.

"His response was to demand a sum five times greater than the court deemed appropriate.

"The court has shown its distaste for avaricious claimants who might be tempted to follow in Mr Nail's footsteps."