A petition has been made to the courts to wind up Daina Ltd. - the troubled parent company of such retailers as Buds, Beans and Books and now closed-down Smuggler's Reef.

The company, which is owned by veteran retailer John Casling, was put in to receivership last year but Mr. Casling bought back the assets of the company and continued to run the operation.

Now legal action by at least one of Mr. Casling's creditors - the company's total liabilities are understood to have been $2.6 million at the end of September, 2001 - has landed the matter before the courts. The creditor - who did not wish to be named - is being represented by Conyers, Dill & Pearman lawyers Jeffrey Elkinson and Robin Mayor.

Mr. Elkinson said if successful in their action, the court would order the "wind up" of the company. Mr. Elkinson added: "The client is not going to accept the position of the company that they are going to be unable to pay creditors - and then happily continue in business." Last year, John McKenna of Ernst & Young acted as receiver on behalf of secured creditor the Bank of NT Butterfield. In receivership, the assets of Daina Ltd. were divided in to five parts including Buds, Beans and Books; a going concern and put out for tenders.

The only offer came from Mr. Casling himself - for an undisclosed sum which was understood to be less than the Bank's debt of more than $1 million - as McCofski Ltd.

Mr. Casling, at the time, called the legal action "similar to a Chapter 11" in the US, as it gave him the opportunity to restructure, and carry on with the business.

It is understood that Mr. Casling does not have the means to repay all his creditors but that he has considered offering preferred shares in the company as a debt payment option.

Of the $2.6 million debt, $700,000 is a personal debt owing to the company from Mr. Casling as shareholder, but Mr. Casling has indicated that he cannot at present repay.

Mr. Casling had not returned calls from The Royal Gazette by press time yesterday.