By Kate Holton
LONDON, Feb 21 (Reuters) - Rebekah Brooks fought back tears at the Old Bailey on Friday as she detailed her "car crash" private life and dysfunctional relationship with fellow editor Andy Coulson as part of her defence against phone-hacking allegations.
Taking the stand for the second day, the 45-year-old close friend of Rupert Murdoch and the last three British prime ministers, said she had had periods of "physical intimacy" with Coulson but denied a prosecution charge that they had a six-year affair.
Prosecutor Andrew Edis had opened the trial in October by arguing that the close nature of the relationship between the two former editors of the News of the World tabloid meant they both knew as much as the other about the criminal activities of journalists on the paper. Brooks and Coulson both deny conspiracy to hack into mobile phone voice messages.
Three senior journalists and a private investigator have admitted conspiracy to hack phones. Coulson, who succeeded Brooks in editing the now-defunct paper and is also on trial, went on to become Prime Minister David Cameron's spokesman.
"My personal life was a bit of a car crash for many years," Brooks said, shortly after asking for a break as her lawyer began asking questions about her first "roller coaster" marriage to soap actor Ross Kemp, her relationship with Coulson and her second marriage to racehorse trainer Charlie Brooks.
Brooks said she had been extremely close friends with Coulson, and on occasion had intimate relations with him between 1998 and 2006. "It was wrong and it shouldn't have happened but things did," she said.
The 45-year-old Brooks had told the jury on Thursday how she had worked her way up through the ranks from local newspaper researcher to head of Murdoch's British newspaper arm.
The relationship between the two former editors was discovered after police found a document containing a 2004 letter on a computer at Brooks' London home. She had written the letter after Coulson tried to break off the relationship.
"I do not know if anyone has been in the situation at a time of hurt - you come home and have a couple of glasses of wine and shouldn't go on the computer," she said, adding that the letter was written at a time of "emotional anguish", before she woke up the next day and thought better of sending it.
"Any affair, by its very nature, is quite dysfunctional," she said.
Brooks also revealed that a cousin had acted as a surrogate to help her and her second husband have a baby, called Scarlett. Charlie Brooks, a friend of the prime minister whom she married in 2009, is also on trial for trying to hide evidence.
Over two days of questioning in the witness box, Brooks's lawyer Jonathan Laidlaw led the former Murdoch protege through the details of her private life, how she operated in the male-dominated tabloid world and how a mass-selling tabloid was run.
On Friday, she detailed how she had signed a 1 million pound deal to secure excerpts of footballer David Beckham's autobiography and how the paper had run a damaging story on Sophie, Countess of Wessex, who is married to the Queen's youngest son Edward.
The Countess had been duped by a reporter who dressed as a "fake sheikh".
Detailing the financial side of the paper, Brooks told the court she had not been aware of the tens of thousands of pounds that was paid to private investigator Glenn Mulcaire who has admitted phone-hacking to generate exclusive stories.
The jury were told that Greg Miskiw, a former senior News of the World journalist who has admitted conspiracy to hack into phones, had arranged an annual contract with Mulcaire of 92,000 pounds ($153,500), unbeknown to Brooks who was editor at the time.
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