The Palestinian leadership, in conjunction with Arab states, plans to submit a resolution to the UN Security Council stating that Israeli settlements in the West Bank are illegal and must be evacuated, Haaretz has learned. This initiative comes in place of an earlier idea of seeking Security Council recognition for a Palestinian state within pre-1967 lines.

The Palestinians believe the United States would veto any resolution recognizing a Palestinian state that was not the fruit of an agreement with Israel. But Washington would have trouble opposing a resolution that declared the settlements illegal under international law.

The prime minister's envoy for talks with the Palestinians, attorney Isaac Molho, has refused to take receipt of a document detailing the Palestinian leadership's positions on all the core issues of the conflict.

A diplomatic source said yesterday that chief Palestinian negotiator Saeb Erekat tried to hand the document to Molho during their meeting in Washington a few weeks ago. Several American officials, including special envoy for the peace process George Mitchell, were also present.

The document detailed the Palestinian positions that had earlier been presented to Mitchell during the months of proximity talks.

Prime Minister Benjamin Netanyahu's bureau responded that it cannot comment on what happened at a diplomatic meeting, because all parties to the talks agreed to maintain secrecy.

Netanyahu did comment yesterday on the Palestinians' refusal to conduct talks without a settlement freeze. Addressing his Likud Knesset faction, he said, "If the Palestinians want to find problems, we won't be able to advance. If they want to solve problems, I'm thinking of various ways to overcome the gaps and make progress."

Jonathan Lis contributed to this report.