On the opening day of his libel action against Mohamed Al Fayed, the millionaire owner of Harrods, a jury was told how Mr Hamilton tried to change the law for the benefit of the multinational Mobil Oil and then demanded pounds 10,000 for his efforts.
The former MP for Tatton allegedly misled the Deputy Prime Minister at the time, Michael Heseltine; the Cabinet Secretary, Sir Robin Butler; the Tory Chief Whip, Richard Ryder; and the Parliamentary Commissioner, Sir Gordon Downey, when questioned about the payment.
George Carman QC, for Mr Fayed, told the court that Mobil Oil was "flabbergasted, embarrassed and shocked" to receive the demand for money from Mr Hamilton.
At a meeting in October 1994, five days after allegations appeared in newspapers of Mr Hamilton receiving cash and other benefits from Mr Fayed in return for asking parliamentary questions on his behalf, the MP for Tatton was questioned by Mr Heseltine, Sir Robin and Mr Ryder.
The MP denied the allegations and did not disclose that he had tried to move an amendment during the committee stage of the Finance Bill, which would have saved the oil industry pounds 77m that year.
Subsequently Mr Hamilton was also questioned by the Parliamentary Commissioner about claims that he had asked questions on behalf of Mobil. Mr Hamilton again denied it, without revealing his part in moving an amendment to clause 116 of the 1989 Finance Bill.
Mr Carman also told the jury about how Mr Hamilton had accepted cash in brown envelopes from Mr Fayed, thousands of pounds in Harrods gift vouchers and free luxury holidays.
But Desmond Browne QC, for Mr Hamilton, said Mr Fayed was a "phoney Pharaoh" who would be buried by the sheer bulk of his lies.
"Mr Fayed, we say, is a classic Jekyll and Hyde figure - a man with a jovial side, a man with a thoroughly evil side."
He went on: "Mr Fayed is a habitual liar. He is a deeply vindictive man, a man ready to take his revenge on those who he sees as responsible for exposing the lies he tells."
Mr Hamilton is suing Mr Fayed and the Channel 4 programme Dispatches for libel over claims that he took money and gifts in return for asking parliamentary questions.
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