Manuel Noriega's defense lawyers, saying they were betrayed by the U.S. attorney's office in a botched deal to pay their fees, have threatened to reveal details of the CIA's secret payments to their client.

A prosecution-sponsored proposal to have the government pay the lawyers as much as $350 an hour fell apart Thursday when a federal judge said he could find no legal basis for the arrangment. Opponents had called it a "legal slush fund" for Noriega.As their part of the deal, Noriega's defense had agreed to postpone a showdown over $11 million they say their client received from the CIA and other intelligence agencies. That agreement is now void, lead defense attorney Frank Rubino said after a hearing on the issue.

"They couldn't take the heat that came out over this agreement," Rubino said of the U.S. attorney's office. "Now we shall litigate every dime Gen. Noriega's been paid by this government, and we shall litigate it as publicly as possible."

U.S. District Judge William Hoeveler said both sides must now go back and litigate the issue of $20 million seized by federal authorities in 27 bank accounts around the world and said he wanted a quick resolution. The defense is demanding some of the money to pay expenses they estimate could reach $5 million. They say the government has hired two dozen attorneys to prosecute their client and is prepared to spend almost $40 million.

Hoeveler has questioned the prosecution's contention that the frozen money is all drug-related and their reluctance to turn any of it over to Noriega.

The judge said the final word was his.

Noriega, who agreed to the arrangement in court Monday, is jailed in the Metropolitan Correctional Center outside of Miami. He was brought to Florida after surrendering to U.S. troops in Panama on Jan. 4, two weeks after they invaded the country.

The former Panamanian leader is charged in a February 1988 indictment with turning Panama into a way station for Colombia's Medellin drug cartel, accepting $4.6 million in bribes to allow them to process and ship cocaine to the United States through his Central American country.

The deal for the government to pay Noriega's legal fees began to unravel when outside attorneys questioned the plan. They said federal law only sanctions the payment of $75 an hour to one attorney for a defendant.

Michael O'Kane, a defense attorney for Noriega co-defendent Daniel Miranda, fired off a letter to the U.S. comptroller of the currency. O'Kane argued that the government has no right to pay the excess fees, nor to accept an assignment from Noriega to pay back the Treasury.