The rare gold "Shah's caviar," insisted Craig Claiborne, "actually sparkles in your mouth." Fellow gastronomical guru James Beard pronounced both the salmon trout wreathed in crayfish and the baron of lamb "superb." The 1897 Château Lafite-Rothschild, Beard rhapsodized, was "absolutely ambrosial." New York magazine food critic Gael Greene thought the neige glacée Williamine had "a marvelous texture," and described the sliced fresh truffles with sweetbreads as nothing less than "wicked." But as for the $40-a-snifter Remy Martin, offered by the host as a surprise: "A bit anticlimactic," said Claiborne. "And besides, it's an outrageous price to pay for any cognac."

Somehow it seems less preposterous when the price of the rest of the meal is considered: $125. Some 40 guests paid it joyfully for a nine-course extravaganza celebrating the first birthday of the Palace, America's—and perhaps the world's—most expensive restaurant. As the five-hour feast drew to a close, proprietors Frank and Bibbi Valenza, French-born chef Claude Baills and the staff of 23 were summoned from the kitchen for a standing ovation.

For Frank Valenza, a product of P.S. 107 in the Bronx, applause has always been something of an addiction. Until he was 27, he scrambled for bit parts on the stage while paying the rent as a busboy at $100 a week. In 1963 Valenza threw in the towel as an actor, then draped it over his arm as the owner of a seven-table Manhattan restaurant called the Proof of the Pudding. Business boomed, and three years later he moved his restaurant to a smart uptown location that seated 300 people. Catering to a young and affluent crowd, the new Proof of the Pudding became one of the most successful restaurants in New York, grossing more than $2 million annually.

There was an added dividend for the owner. In 1970 Valenza met his saucer-eyed Norwegian wife, Bibbi, when she was directing fashion shows at the Proof of the Pudding. They were married two years later and now have a daughter, Liv Inga, 3.

Still, visions of prunes sucrées danced in Valenza's head. After pilgrimages to the three-star Les Frères Troisgros in Roanne and the "Lion of Lyons," famed chef Paul Bocuse, Valenza returned with the confidence to try to create the finest restaurant in the country. He already had the cash, $550,000 of his own money. "Everest was there," he says, "and it had to be climbed."

While Valenza lured 32-year-old Claude Baills, former chef on the France, away from the Laurent, one of the best restaurants in New York, Bibbi fashioned a setting of understated elegance to match the Palace's cuisine. The prices are less subtle. The minimum prix fixe dinner is $50 per person, plus taxes and obligatory 23 percent tip for a total of $65.50. The wine, of course, is extra, ranging from $10 to $450. "Comes the revolution," snarled John Canaday in the New York Times, "I think I can tell you where to find the mob. It will be milling around the Palace waiting for diners to exit so they can string them up on the nearest lamp posts."

Undaunted, Valenza's customers, ranging from European royalty to Texas oilmen, can't seem to spend enough. One regular has gone through $19,000 at the Palace in the past year, and five others have dropped more than $10,000 apiece. For their extravagance, Valenza has rewarded them with 14-carat-gold credit cards.

"If a man who makes only $8,000 buys a Chevrolet instead of a Volkswagen," Valenza asks, "is it any worse for a wealthy man to buy a Rolls? The same is true for food. You pay for quality." And then he adds, "Anyway, I don't want the $30 prix fixe crowd. They break the glassware."