NEW YORK, Oct 31, 2001/ --- Donatella Versace made an appearance via satellite in a Sydney court today to deny she has ever met an Australian private eye the family is suing for defamation.

Donatella repeatedly denied ever meeting private investigator-turned-author Frank Monte. Monte, 55, is the author of "The Spying Game," a book which alleges the family has mafia links and was secretly involved in designer Gianni Versace's death.

The book, which was due to be published in June this year but was withdrawn after the Versace family threatened legal action, reproduces conversations Monte claims he had with Gianni. Monte claims he was hired to protect the famed designer during 1996 and 1997 and during that time Gianni confided in him about the family's alleged links with the mafia.

But Donatella told the Federal Court Monte had never worked for her brother Gianni. "I know that Gianni never met Mr. Monte in his life," she said. "I have never met Mr. Monte on any occasion in my whole life."

She also denied Monte's claims that there was a rift in the family. "We had a great relationship. We were not only in partnership but the best of friends as well."

Gianni and Donatella's brother Santo Versace, also gave evidence in the Sydney court. "I object to all of the book, I object to the fact that Mr. Monte met my brother - there is nothing true about what Mr. Monte is saying," Santo told the court.

Monte's allegations of working for Gianni were also refuted by his former longtime girlfriend Justine Wallace. She told the court that Monte used a fax sheet he found on a New York sidewalk to pretend he worked for the designer.

In a statement tendered to the court, Wallace contends that Monte picked up the fax sheet and said "this could come in handy." She claims he also said "I can't believe I have got the signature of Gianni's secretary and actual fax cover sheet."

Wallace said that when Gianni was gunned down outside his Miami mansion in July 1997, Monte "dummied up" several faxes to make it look like they were sent from Gianni.

She said Monte offered her $100,000 to keep her mouth shut and even threatened to kill her as he prepared the manuscript for his book.

According to reports, as Wallace gave evidence to the court Monte leafed through a series of explicit photographs of her, and then offered copies to the media.

The case is continuing.