Stewart's albums of jazz standards have become big US and UK hits

He had been given the cash as an advance on his fee and said he should be allowed to keep it.

Stewart's lawyers and agents at ICM talent agency also have to pay damages of $1.6m (�0.8m) for their roles in negotiating the contract for the tour.

The singer cancelled the nine-show tour a month before it was due to start.

He was not in the court on Friday to hear the verdict.

He fronted The Faces during the 60s and 70s

Dennis Holahan, the lawyer for the tour operators from Peru, Argentina and Oklahoma, said he hoped the case sent out a message that "big players" in the media cannot get away with treating "little players" with "arrogance and greed".

The original contract for the tour called for Stewart to be paid $2.1m (�1m) in advance for shows in Central and South America that would start in February 2002.

Stewart, who has had a recent comeback in the charts, was paid the advance before his associates cancelled the tour in mid-January 2002 but did not return the money.

Mr Pollack and two other promoters sued, and Mr Holahan said: "These men and their companies were ruined by this," adding the case would "restore their credibility and personal reputations".

'Ridiculous'

Skip Miller, the lawyer who represented Stewart and his co-defendants, said the singer had been entitled to keep his fee and be compensated for earnings he lost by not touring.

He said outside the court: "It's ridiculous to find liability against a lawyer and an agent for doing their jobs.

"It's crazy. I will get this overturned if it's the last thing I do."

He added that under California law, a business adviser has a privilege against liability.

Stewart was the UK's biggest rock star of the 1970s and he found fame both with The Faces during the 60s and 70s as well as through his solo work.

Some of his biggest early solo hits include Maggie May and You Wear It Well.

And his recent foray into the world of jazz resulted in three volumes of The Great American Songbook becoming hits on both sides of the Atlantic.