Property tycoon Nicholas Van Hoogstraten had been accused of fraud by a businessman he is alleged to have had murdered, a court heard today.

Mohammed Sabir Raja was stabbed five times and shot in the face at his home in front of two grandsons in July 1999.

At the Old Bailey today David Waters, prosecuting, said before he died, Mr Raja's two teenage grandsons heard him say: "These are Hoogstraten's men. They have hit me, they have hit me."

The jury heard Van Hoogstraten, of Framfield, near Uckfield, had earlier branded Raja a "maggot" and said: "We pick thorns that are a pain and we break them."

Mr Waters said Mr Raja's relationship with Van Hoogstraten dated back to the late Eighties.

He said: "They were both involved in property, Van Hoogstraten on a very much larger and more successful scale than Raja.

"Putting their relationship in its simplest form, Mr Raja would purchase properties, Van Hoogstraten loaned Raja money in order to do so and the title deeds to these properties would be kept by Van Hoogstraten until Raja repaid monies owed."

Mr Waters said: "Matters started to go wrong in the early Nineties. By 1993 a dispute had arisen about how much money Raja owed.

"In 1994 Mr Raja issued proceedings against Van Hoogstraten, against three of his companies, alleging breach of contract, breach of trust and applying to the court to make declarations in relation to his ownership or tiles to the properties.

"However, in 1998 and 1999 the stakes were raised by Raja. He applied to the court to amend the claim to include the much more serious allegation that Van Hoogstraten had been guilty of fraud."

Van Hoogstraten, David Croke and Robert Knapp all deny murder.

Van Hoogstraten also denies conspiring with Croke, Knapp and others to murder Mr Raja.

On the opening day of the trial yesterday, the court heard Van Hoogstraten, 57, used two hitmen posing as gardeners to kill Mr Raja, 63, at his home in Mulgrave Road, Sutton.

Today Mr Waters told the jury Van Hoogstraten's diaries included details of a series of loans to "Bob". He said Van Hoogstraten confirmed in police interview that these related to Knapp.

Between August and November 1999, £7,000 was loaned. Mr Waters told the jury: "You have to decide whether they were loans or for services rendered for getting rid of that thorn Raja."

Yesterday, Mr Waters told the court: "Nicholas Van Hoogstraten, we do not suggest took any physical part in the murder. In fact at the time of the murder he was in all probability on his way to Gatwick from where he flew at noon to Nice.

"What is suggested in relation to Van Hoogstraten is that despite his non-presence at the scene at the time of the murder, he was a party to the murder because it was carried out by Croke and Knapp at his instigation, for his purposes, and because of the problems and differences which had arisen between him and Mohammed Raja."

Mr Waters said it was a "contract murder" carried out on Van Hoogstraten's behalf.

Mr Waters said there was a billion to one chance blood found at the murder scene did not belong to 59-year-old Croke, of Bolney Road, Moulsecoomb, Brighton, or a close relative.

The court heard Croke and Knapp, 53, of Convent Street, Abbeyfeale, Co Limerick, stabbed Mr Raja and shot him before reloading and shooting him in the face.

On the day of the murder Mr Raja was in his house with his teenage grandsons Waheed and Rizvan.

Mr Waters said: "The first they heard was raised voices followed by a very loud bang from upstairs, although they could not know it at that time, it was a gun being fired.

"It had probably gone off during the course of a struggle and the shot went into the ceiling as opposed to Mr Raja for whom it was intended".

The grandsons ran downstairs. Their grandfather was holding his chest.

He said: "There was blood on his shirt. He had already been stabbed, but not, at this stage, shot.

"In the porch area were two men, one had a sawn off shotgun over his knee and one of the grandsons saw him break it in an attempt to reload it.

"He was wearing a floppy hat, boiler suit and gardening gloves."

The grandson saw white powder over his hat and suit from the dislodged ceiling plaster.

"The second man was behind the first and wearing similar clothing. He had a moustache which appeared to the grandson to be false and had a gardening fork in his hand."

The prosecution alleged they were disguised as gardeners.

The grandson shouted to his brother to ring the police. The gunman then raised the gun and shot Mr Raja in the face, before running out of the house, the court heard.

The trial continues.