Mundingburra MP and newly-appointed Goss cabinet minister Ken Davies yesterday said he would neither confirm or deny speculation that his legal battles with the Commonwealth Bank were being resolved through an out of court settlement.

Mr Davies, who is the new Emergency Services and Consumer Affairs minister, faces a $345,660 Supreme Court lawsuit over a loan from the Commonwealth Bank to a Townsville firm of accountants in which Mr Davies was a partner.

An action also has been launched against Mr Davies' wife Lyn for $208,235.

Mr and Mrs Davies also have faced another lawsuit as guarantors of a separate $139,247 loan.

These actions are now centre stage in Queensland politics, as Labor holds government by just one seat, and Mr Davies holds Mundingburra by just 16 votes.

Under state electoral law, a by-election for Mundingburra would occur if Mr Davies were at some future stage declared bankrupt and therefore forced to forfeit his seat.

Opposition sources yesterday said they had heard persistent rumours that the litigation had been, or was about to be resolved out of court.

But Mr Davies said he would "neither confirm or deny" any settlement had or was about to happen. "I don't want to comment on this stuff," Mr Davies said.

And ALP state secretary Mike Kaiser said the party had not been involved in funding any alleged settlement.

"It's hard to know how the party can involve itself in the legal actions ... there's no role for the party in either of them," Mr Kaiser said. "We've not taken a decision to pay it, or not to pay it. It's simply not a matter for the party."

The Mundigburra result also faces challenge by the Liberal Party in the Court of Disputed Returns.