the recent Telecommunications Commission's decision was illegal.

The telephone company's lawyers Mark Diel and Ronnie Myers faced off against the Commission's legal counsel, the Attorney General, for several hours yesterday in a private Chambers hearing with Puisne Judge Denis Mitchell.

But Telecommunications director Ted Pitman said last night the newly appointed nine-member Commission was confident its decision was lawful and would be upheld.

He said the Commission stood by the ruling which permitted only modest increases to the local monthly line rental of homes and businesses.

And the Commission also ordered BTC to maintain current staffing levels and capital expenditure plans unless it first proved to the Commission that any cuts would not affect the service level given to customers.

BTC had proposed drastic hikes to the fees to offset the $33,000 it claimed it was losing a day after Government ordered the company to slash its charges to international carriers in line with those in the US.

Mr. Justice Mitchell eventually agreed yesterday that the Supreme Court should at a future date hear BTC's application for a judicial review of the ruling handed down by the Commission on January 27.

It is understood BTC will seek either a declaration that the decision is unlawful or an order that the decision be quashed.

Mr. Diel and Mr. Myers will argue the decision was unreasonable and exceeds the Commission's jurisdiction under the Telecommunications Act.

BTC chief executive officer Lorraine Lyle said: "We believe the recent decision by the Telecommunications Commission impinges on management rights and it cannot be allowed to go unchallenged.

"We, like any other company in Bermuda, have the right to manage our business without outside interference. The precedent set by this action could have consequences far beyond those for BTC.''