Nicole Kidman was starring in The Hours when the story was printed

Kidman also accepted a public apology from the Daily Mail at the High Court.

A libel judge heard that the Daily Mail newspaper alleged she had led Law, who was married with young children, to cheat on his wife, causing the breakdown of his marriage.

It was also suggested in the article on 6 March that her repeated denials of the affair were dishonest.

"The publication of this article has caused grave damage to the claimant's personal and professional reputation and she has suffered considerable embarrassment and distress," solicitor Gideon Benaim told Mr Justice Gray.

"Her embarrassment was particularly acute as the allegations coincided with the run-up the Oscars award ceremony in Los Angeles in which she had been nominated for an award for Best Actress in a Leading Role for her role in The Hours."

Daily Mail editor Paul Dacre and journalist Nicole Lampert freely accepted that the allegations were untrue and without foundation.

They apologised for the distress and embarrassment caused and agreed to pay legal costs as well as damages.