Cardinal Bernard Law, testifying for the first time in open court since a priest sex abuse scandal rocked his archdiocese, insisted Friday that an announced $30 million settlement with alleged victims was never finalized.

"I believed this to be a proposed settlement," Law told plaintiffs' attorney Mitchell Garabedian at a hearing on the disputed agreement, which was announced in March.

Attorneys for 86 victims of defrocked priest John J. Geoghan are pressing the Boston archdiocese to stick to the agreement, which the archdiocese's finance committee refused to honor in May, saying it could not afford it.

Law had testified earlier this year in closed depositions in the continuing sexual-abuse scandal, and some of that testimony was made public later. But he made his first public statements in court Friday.

Garabedian had Law read from an article in the archdiocese's newspaper, The Pilot, in which Law said that "this settlement is an important step in reaching closure" for Geoghan's alleged victims. He also pointed to a March 15 editorial in the paper that said the case had been settled.

Garabedian asked Law, who is publisher of The Pilot, why he had never referred to the settlement as "proposed."

"I did not use that word as a qualifier, I wish obviously now that I had used it," Law said. "It would have expressed the intent of my words more effectively."

But Law maintained under repeated questioning that the context was clear and that the settlement would not be final until all 86 accusers and the archdiocese finance committee had signed it.

The archdiocese's Finance Council backed out of the settlement in May, saying it would cause severe financial hardship.

Garabedian also questioned Law about his role, separate from his religious duties, as the head of a corporation with civil authority over the archdiocese. Law said he acted in the case as an individual, not as a corporate entity.

Under questioning by his attorney J. Owen Todd, Law said he couldn't sign the agreement once he knew there wasn't enough money to fund it.

On objections from Law's lawyers, the judge steered Garabedian away from questions on Geoghan's alleged abuse or its effects on the victims.

The archdiocese is considering filing for bankruptcy if it is forced to pay a large settlement, The Boston Globe reported Friday, citing unnamed church advisers.

The advisers told the Globe that bankruptcy is being considered as a "worst-case scenario." The archdiocese, facing fewer donations and a weakened economy, has already cut its budget by a third.

Chancellor David Smith said Friday that the church was asked "in pursuit of a global settlement ... to review how bankruptcy might apply to the archdiocese."

"No recommendation has been received nor obviously has any decision been taken," he said.

Garabedian put himself on the stand for several hours Thursday. Under questioning by his law partner, William H. Gordon, he detailed months of discussions that led to the deal.

"The kind of conduct that went on here was a fraud on the court, ... or at the least, negligent representation," Gordon told Judge Constance M. Sweeney.

In sometimes prickly exchanges, Todd questioned Garabedian on why he would assume such a complicated agreement was final when he had not received signed documents from all the defendants.

Next week, Law is scheduled to give depositions in separate abuse cases. Settlement talks recently broke down with lawyers for alleged victims in those 240 other pending cases.

Meanwhile, the archdiocese announced the suspension of a priest accused of abuse that occurred more than 25 years ago. Twenty priests have been suspended in Boston since the scandal erupted in January.

The nearby Worcester Diocese also placed a priest on leave because of allegations of sexual misconduct involving minors more than two decades ago, years before he was ordained.

Elsewhere Friday, a priest in New Mexico accused of hiring teenage boys for prostitution pleaded no contest to five counts of attempted evidence tampering. The Rev. Robert Malloy will face less than five years in prison under a plea deal.