Josie Smith, 36, told Derby Crown Court that she was assaulted by the spirit as she lay in bed and felt like she had been raped.

She and he husband Andrew, also 36, are being sued by two sisters after refusing to pay the final £3,000 instalment on Lowes Cottage, Upper Mayfield in Staffordshire.

The court heard that the Smiths withheld full payment of the original sum of £44,000 after a series of incidents made them suspect the house was haunted.

They say the sisters, Susan Melbourne and Sandra Podmnore, failed to tell them about the ghost before they bought it in 1994 and moved in with their children Daniel, Stephen and Lindsey.

They have filed a counterclaim against the sisters.

Mrs Smith said she had experienced a number of strange things including visions of a little boy with bright red, piggy eyes, weeping walls and objects moving.

She said on one occasion "I felt something touching me beneath my nightdress. It only stopped when I shouted 'no'. Afterwards I felt I had been raped."

The couple asked for help from a priest, the Rev Peter Mockford, who specialises in the paranormal.

He told the court he believed there was a paranormal presence in the house.

'I do not believe in ghosts'

Giving evidence, both sisters said they had no knowledge of ghosts in the house or that the house had ever been haunted.

Mrs Melbourne told the court: "I have never experienced a ghost and I have never heard of a haunted house in Mayfield. I do not believe in ghosts."

Their lawyer, Thomas Dillon, told the court: "When the plaintiffs called the Smiths about the outstanding money they were told it was not going to be paid because the house was haunted."

Mr Dillon told the court that the Smiths had invented the story to avoid paying the outstanding money.