Butler 'took ring off Diana's body'

Michael Faux told the inquest into Diana's death that the former royal butler also kept documents, including papers note-headed with the Buckingham Palace crest, and burnt them.

Mr Burrell had also considered throwing some of the property off the side of a ship in order to get rid of them, according to Mr Faux, who worked for him for a year until 2003.

He claims he saw Mr Burrell take "one or two" bin bags with property he had "hidden" at a neighbour's home in Farndon, Cheshire, and "frantically" burn them in his back garden in November or December 2002.

He told the jury in central London that an anxious Mr Burrell was "upset and virtually crying" when Mr Faux at first refused to sign a confidentiality agreement.

Mr Burrell stressed he "needed him" to sign. No sooner had he agreed than Mr Burrell told him that he had an engagement ring. Mr Faux said he was "led to believe" it was Diana's.

Under questioning from Nicholas Hilliard, for the coroner, Mr Faux told the court: "He said that he took it from the body in Paris." Mr Faux said that he thought it "was not right that he had taken it off her finger", probably in the hospital, and that he felt "disgusted" with him.

The jury has heard that Diana had received a gold Bulgari friendship ring from lover Dodi Fayed which she wore on her right hand.

There was also a £11,500 Repossi ring, which some claim was an engagement ring, bought in the weeks before the couple died. But, since the crash, this could be placed either at Dodi's Paris flat or under the control of his father, Harrods tycoon Mohamed al Fayed, the jury heard.

The now US-based Mr Burrell, who refuses to return to the witness box, rejects Mr Faux's claims.