6:16p.m. 7th May 2008

Australia Zoo’s Terri Irwin has avoided a potentially costly and lengthy legal battle after a multi-million-dollar lawsuit was today settled out of court.

The wife of the late Crocodile Hunter and the zoo were due to go to trial later this year over the lawsuit, involving a complex loan deal with an offshore bank.

The zoo was being sued for $2.5 million and Ms Irwin for $60,000 by debt collection company Alyssa Treasury.

But Melbourne County Court judge Maree Kennedy today ordered the case be dismissed after a confidential agreement was reached out of court between Alyssa Treasury and Australia Zoo, Terri Irwin and seven other unrelated companies.

Judge Kennedy ordered that a security payment of $42,000 paid to the court in March by Alyssa Treasury be paid to Ms Irwin’s solicitors Pointon Partners, who were also acting on behalf of the seven other parties.

- AAP