Legal action to evict anti-capitalist protesters from the doorstep of St Paul's Cathedral has been halted.
St Paul's Canon Pastor the Right Reverend Michael Colclough said suspending the legal bid was "the right way to go".
The City of London Corporation, which was due to hand a letter to the protesters warning them they had 48 hours to clear the site or face High Court proceedings, said it was "pausing" its legal action.
The protest outside St Paul's has caused divisions in the cathedral's hierarchy and led to the resignations of its dean, the Right Rev Graeme Knowles, Canon Chancellor of St Paul's Giles Fraser and part-time chaplain Fraser Dyer.
The cathedral said Rt Rev Knowles's resignation had given it the "opportunity to reassess the situation".
Speaking after a meeting between church officials and protesters, Rt Rev Colclough said: "This has been an enormously difficult time for the cathedral but the chapter is unanimous in its desire to engage constructively with the protest and the serious issues that have been raised, without the threat of legal action hanging over us.
"Legal concerns have been at the forefront in recent weeks but now is the time for the moral, the spiritual and the theological to come to the fore."
He said he believed the protesters had the right to protest and hoped the church would act as a brokering agent in the dispute.
The Bishop of London, Dr Richard Chartres, said: "The alarm bells are ringing all over the world. St Paul's has now heard that call.
"Today's decision means that the doors are most emphatically open to engage with matters concerning not only those encamped around the cathedral but millions of others in this country and around the globe."
