A Palestinian told a court he was hurt and angered after a neighbour hoisted an Israeli flag in his back garden during an alleged racist campaign against his family.

Andrew Milner, 46, of Gordon Road, Shoreham, denies racially-aggravated harassment against his neighbour Loai El-Oun and his wife Debbie.

The trial at Chichester Crown Court heard how a dispute broke out between the next-door neighbours, who had previously been on good terms, over a drainpipe which the El-Ouns claimed protruded on to their side of the boundary.

Milner is accused of placing a golliwog in a window overlooking the El-Ouns' garden, pointed a camera on a tripod at their property and hoisting the Israeli flag in his garden while Mr El-Oun was visiting family in the Gaza Strip.

Mrs El-Oun was upset by the volley of perceived taunts, between May 8 and June 21, 2002, and called the police, the court heard.

Mr El-Oun yesterday told the court Milner and his family were on good terms before a dispute about the positioning of a drain pipe arose.

He insisted Milner knew of his Palestinian origins and that the flag would be upsetting.

The Palestinian, who now has a British passport, told the jury: "Israel is the enemy because they have occupied my country and take all our lands.

"The Gaza strip is occupied territory and all my family is in Gaza.

"I would not say we were friendly with Milner but we would talk. We used to go - me, my mum, my wife - into the front garden and talk.

"He used to ask how my mum was living in Gaza. I used to talk for her. I can speak English, Russian and Arabic but my mother only speaks Arabic. He knew where I came from.

"I was in Gaza when I heard about the golliwog and the flag from my wife. I felt very, very angry. It's an Israeli flag. It's my enemy."

While being cross examined by Selwyn Shapiro, Mr El-Oun said he did not advocate the destruction of the Israeli nation and wanted to "live in peace".

Mr Shapiro pointed out how, despite having Palestinian parents, Mr El-Oun was born in Kuwait. The defence barrister accused Mr El-Oun of claiming to be Palestinian as "a label of choice for your neighbour dispute".

Mr Shapiro asked: "Don't genuine Palestinians think the state of Israel is situated on the historical site of Palestine?"

Mr El-Oun, who was unfamiliar with a number of facts about Palestinian politics and the conflict in the Middle East, said: "They should give us Jerusalem, the Gaza Strip and the West Banks."

The Palestinian admitted he did not understand the racist connotations of golliwogs until his wife explained but he stressed how hoisting the Israeli flag was abusive in the context of the neighbour dispute.

Mr El-Oun said: "The flag means a lot because he was doing it on purpose to aggravate us. Someone put it there to aggravate because they know I'm Palestinian."

The trial continues.