Montessori Academy is hoping it can still salvage a deal with the National Trust to develop their facility and provide 100 new spaces for students.

The school held a board of governors meeting yesterday after receiving the news that their landlords, the National Trust, had rejected plans to improve the Tivoli site.

The decision has left the school, which desperately needs more space, in a qaundry over its future at the Warwick site, as the lease is due to run out in 2001.

But last night principal Margaret Hallett remained upbeat that talks may continue with the Trust in a bid to reach an agreement that satisfies both sides.

"We would like to continue dialogue, we don't want to stop talking, that is important,'' she said.

"We need to feel optimistic, we had some very good ideas and wanted to work in the best interests of the children, Trust and Bermuda.'' The Board is awaiting the minutes of the Trust meeting to decide whether they will appeal the decision.

The school has searched the Island for a new site, but to no avail and is loathe to leave Tivoli, which is seen as an ideal place to teach youngsters.

But its waiting list of 40 children, ranging in age from three to 12 years old, means it needs to expand.

The rejected plans were to demolish a barn and replace it with a two-storey, six classroom building. In addition, Montessori wanted to extend their lease by 99 years.

But the Trust said it did not make the decision lightly and said it was a major ruling to make, since it would bind the organisation for future generations.

In addition, they have now decided to speed up a management plan on Tivoli, to determine the future of the site.

The Montessori board of governors highlighted the improvements they made to the 11.3 acre property, after taking it over in a derelict state in 1991.

In a statement they said: "We view our relationship with Tivoli as one of preservation and stewardship, and regret the narrow interpretation the National Trust has adopted regarding its mandate for the property.

"It is one of the few spaces left in Bermuda which can be maintained effectively as open space, while serving the educational needs of Bermuda's children.

"It presents a unique opportunity for the Trust to inculcate a spirit of environmental sensitivity in Bermuda's youth through the Montessori Education Trust.'' The plans, which also included a cedar forest, bird sanctuary and model farm, had received backing from the Planning Department but failed to win over the 13 Trust council members. Mrs. Hallett said the school was presently regrouping and was not in a position to make a decision yet.

But she said she hoped the minutes of the meeting would give an indication of what areas they could negotiate on.