Paul McCartney, Heather Mills Face Off in Court

Divorce battle enters tense phase as the two spar over the Beatle's fortune

Nearly two years after Paul McCartney and Heather Mills announced their separation, the duo appeared in a London court Monday to hammer out a divorce resolution.

McCartney, 65, and Mills, 40 – who wed at an Irish castle in 2002 – are battling over a financial settlement for Mills and arrangements for their four-year-old daughter Beatrice. According to previous reports, the former model is seeking a deal worth up to $100 million.

On Monday morning, Mills and McCartney – both wearing gray suits – were separately spotted entering Court 34 in the Family Division of London’s Royal Courts of Justice.

McCartney, wrapped in a black and white scarf, said, “Good morning,” to a group of journalists waiting outside the closed court hearing.

A tense-looking Mills, wearing a pink blouse and stiletto ankle boots, declined to comment as she entered the 19th century courtroom – where she is expected to represent herself. (She parted ways with her legal team last November, claiming she couldn’t afford the bills.)

As the two attempt to reach an agreement over the next five days, Mills will conceivably be able to cross-examine McCartney in front of the judge.

Battling It Out

The pair – who split in 2005 and have been battling it out in the press ever since – emerged from the courtroom briefly just after noon for a bathroom break. Mills was escorted by a bodyguard while McCartney chatted with his senior attorney, Fiona Shackleton (who represented Prince Charles against Princess Diana). They broke for lunch just before 1 p.m. (local time), but Mills remained inside for an additional 15 minutes, having several packages delivered along with what appeared to be an overhead projector.

Neither Mills nor McCartney (whose first wife, Linda, died from cancer in 1998) have entered into a committed relationship since the split.

McCartney, however, has been linked to several women, including Rosanna Arquette. Just last week, they were spotted leaving a London eatery. But when photographers starting taking photos of the pair, Arquette hopped out of his Lexus and hailed a taxi.

“It was no big deal,” his rep tells PEOPLE. “They are just mates.”

Mills, meanwhile, has tried to keep a low profile in recent months after a damaging period when she repeated railed against the media. Her British publicist resigned over the ill-planned strategy.

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