Bermuda International Business Association (BIBA), he expressed concerns to the organisation's board that he may not have the time the post needs.

Mr. Tom Davis, who became BIBA president instead, said that the continuing uncertainty surrounding the controversial split of Bermuda Fire & Marine Ltd.

four years ago and the subsequent creation of BF&M Ltd. led the president and chief executive officer of BF&M to approach the board.

"He graciously said he would not be offended if the board wanted to consider someone else,'' Mr. Davis said. "It was a joint decision (between the board and Mr. Titterton) and one that made sense.'' In light of the BF&M/Bermuda Fire & Marine situation, "he (Mr. Titterton) said he felt uncomfortable making the time commitment necessary as chairman''.

Mr. Titterton's withdrawal from the BIBA post is just one aspect of the continuing fall-out from the 1991 decision by Bermuda Fire & Marine to separate its profitable domestic business from loss-making international business.

The latest twist in the saga has seen 1,001 shareholders, about 75 percent of the current stock owners, being served this week with writs by Bermuda Fire & Marine liquidators.

The writs stem from a dividend issued to them in 1991 when the company transferred the domestic insurance operations into BF&M Ltd. subsidiaries leaving behind the loss-making international insurance operations.

Subsequent to the transfer of domestic assets and liabilities to BF&M subsidiaries, the shares of the subsidiaries held by Bermuda Fire & Marine were distributed via a dividend in specie to Bermuda Fire & Marine's shareholders.

Joint liquidators Mr. Tony Joaquin and Mr. Gareth Hughes, arguing that the reorganisation was fraudulent, want the shares transferred back to defunct Bermuda Fire & Marine for the benefit of creditors of the company.

The company's creditors see the move as an attempt by shareholders to preserve assets which otherwise would have been available to meet future liabilities.

Under the 1991 reorganisation all assets and liabilities related to Bermuda Fire & Marine's domestic operations were transferred to subsidiaries including; BF&M General Insurance Company Ltd., BF&M Life Insurance Company Ltd., BF&M Management Ltd., BF&M Properties Ltd., Fortress Insurance Company Ltd., The Hamilton Reinsurance Company Ltd. and Woodbourne Insurance Company Ltd.

Bermuda Fire & Marine was left with $62 million in assets to cover $53 million in liabilities, according to an actuarial report by Tillinghast. Despite the actuarial report, losses continued to mount and the company is now estimated to be insolvent by $500 million.

The losses were the result of its international reinsurance operations through its association with HS Weavers (Underwriting) Agencies Ltd., which underwrote high risk, long-tail business creating what is called a "stamp''.

Bermuda Fire & Marine took a percentage of the risk written on the Weavers stamp and the nature of the business came back to haunt it when Weavers collapsed in 1990.

Failed companies on the Weavers stamp, which specialised in US liability cover, have estimated liabilities of around $5 billion.

Part of Bermuda Fire & Marine's international problems were linked to several of its reinsurers going insolvent, meaning it was unable to recover money to pay creditors.

Liquidators said liabilities are primarily owed to US insurers like Transit Casualty, a company in receivership since 1985 which is insolvent to the tune of billions of dollars.

Now, in an unusual legal move, the liquidators want the shares transferred to BF&M back, in order to pay outstanding claims.

When asked about the serving of writs to shareholders by liquidators' lawyers, Mr. Tim Marshall, spokesman for the recently formed BF&M Ltd. Shareholders Association, said: "We consider this to be a first.'' The association, formed on November 30 to defend against legal action by liquidators, is being chaired by former Premier Sir John Sharpe until the first general meeting slated for early in the new year.

The association will finance the defence on behalf of those who join through nominal membership fees.

The writs served are "considered to be without merit'', said the association.

"BF&M very much regrets that the liquidators have seen fit to pursue claims against a large group of innocent shareholders, particularly in circumstances where the validity of those claims is very doubtful,'' said BF&M.

Liquidators are not seeking damages from the 1,001 individual common shareholders.

Those who acquired BF&M shares in trading after the reorganisation are not affected by the recent legal action, said Mr. Marshall.

The recent suspension of trading of BF&M common shares will not affect payment of dividends to common shareholders nor the business or policyholders of the company nor trading of BF&M preference shares, BF&M said.

Preferred shares continue to trade on the Bermuda Stock Exchange but common share trading was suspended on October 26 after information about the legal proceedings was leaked to US trade publication Business Insurance.

As well as the news about the suit against the 1,001 shareholders, the trade publication reported several BF&M officials who were previous Bermuda Fire & Marine officials as well as solicitors and accountants associated with the reorganisation are also litigation targets and that liquidators are also pursuing a negligence suit against BF&M.

Lawyer for the defendants Mr. David Oliver QC said recently in open court that the only damage so far has been the suspension of trading of BF&M common shares on the Bermuda Stock Exchange. He said the injunction was sought to preserve public and investor confidence in BF&M's insurance operations, he said.

Liquidators said: "The Appeals Court will not, as suggested, be concerned in the hearing on March 4, 1996 with the question of service on the shareholders.

That issue has been finally determined in the joint liquidators' favour. The March hearing is an attempt by BF&M to overturn the Supreme Court's decision throwing out its application to have certain paragraphs of the writ and statement of claim struck out.'' In a statement, BF&M said: "The company has been advised that the chances of that strike-out application succeeding are very good, in which event trading in the shares could be resumed.'' The following is a chronology of events leading up to the service of writs against shareholders of BF&M Ltd.

November 1990: Original proposals for the reorganisation made.

September 1991: The dividend in specie was declared.

September 1993: Transit Casualty serves a statutory demand for alleged amounts due from Bermuda Fire & Marine.

October 1993: Bermuda Fire & Marine ceases paying claims, and subsequently directors decide to present petition for winding up of the company.

November 1993: Mr. Joaquin and Mr. Hughes of Ernst & Young are appointed joint provisional liquidators of Bermuda Fire & Marine by the Supreme Court of Bermuda.

December 1994: Bermuda Fire ordered into liquidation by the Supreme Court of Bermuda and subsequently determined to be very materially insolvent.

October 1995: Trading of BF&M common shares on the Bermuda Stock Exchange suspended.

November 1995: Writs are issued against BF&M shareholders. BF&M Ltd.

Shareholders Association formed.