Mr Byron said the apology would be the death knell of Tralee, a contentious development proposal south of the airport.

Mr Winnel's company, the Village Building Company, has been pushing Tralee for a decade and fighting the airport which says the development will place homes under flight paths. Mr Winnel said his apology and paying Mr Byron $250,000 for legal costs had nothing to do with Tralee. ''They're entirely different matters. It is about words used in expressing a view, not about substance of processing Tralee.''

Mr Winnel will retract and apologise for comments he made on radio in November 2008.

In a statement to be read in the Supreme Court, he will say: ''In those comments I alleged that Mr Byron lied to listeners when he said the Canberra Airport had made much smaller political donations than Village Building Company. I also alleged that he had engaged in false scaremongering. I accept that both of these allegations were untrue. I retract all such allegations without reservation and I apologise to Mr Byron for any hurt to him and to his family that has occurred by reason of those allegations.''