Palestinians facing eviction in Jerusalem have rejected a proposal from Israel's Supreme Court that they rent their homes from a Jewish settlement organization.

Judges suggested they become "protected tenants" and stay in the city's eastern Sheikh Jarrah neighborhood.

But the four families involved in the long-running legal dispute, and dozens of others affected by the threat of explusion, said they would not recognize Israeli ownership.

The agreement would have seen Palestinian families pay 1,500 shekels ($465, €390) a year to Nahalat Shimon, the group trying to reclaim the properties.

Mohammed El-Kurd, one of the Palestinians who is part of the case, criticized the move on social media.

"Instead of making a ruling on land ownership, the court decided to evade its responsibilities and pressure us into reaching an agreement with settlers," he tweeted.

"No decision or agreement has been reached."

Ilan Shemer, a lawyer representing the Jewish Israelis, called the proposed deal "an empty arrangement."

What is the background to the row?

It represented a last ditch attempt to broker a compromise between both sides ahead of a final ruling later this year.

The land's registered Jewish owners say they want to evict the Palestinian residents for non-payment of rent.

But the Palestinians say the properties were granted to them by Jordan when it settled the families there after taking control of the area during the Arab-Israel war of 1948.

Judges at a local Jerusalem court dismissed this argument in October last year and upheld the evictions, prompting an immediate appeal.

Israel's Supreme Court had been scheduled to issue a ruling in May, but it delayed its decision after the attorney general requested more time to consider the cases.

Why is the dispute so important?

The legal battle is being closely watched by human rights groups and the international community.

The row has stoked some of the worst violence between Israeli police and Palestinians in Jerusalem in years.

Militant group Hamas, who rule the Gaza Strip, said Israel's treatment of the Palestinian families was one of the reasons why they fired rockets at Jerusalem during an 11-day conflict in May.

Shortly after the announcement of an Egyptian-brokered cease-fire, UN human rights chief Michelle Bachelet called on Israeli authorities "to immediately halt the process of evictions."

The Israeli government has long insisted that the cases are not a matter for the state, but a private property dispute.

Sheikh Jarrah is in east Jerusalem, which Palestinans want as the capital of any future Palestinian state.

Israel captured that part of the sacred city in the 1967 Middle East war and views all of Jerusalem as its capital.

jf/nm (AFP, Reuters)