Threatened construction firm BermudaTech is suing partner Jonathan Baxter in the latest controversy to surround the business, The Royal Gazette has learned.

The writ was filed on Friday against Mr. Baxter, who is one of the partners in the company, along with Terry Griffiths and Maurice Caines.

It is unclear what the grounds for the legal action are, but the official receiver has been brought in and discussions about the future of the company are being held with the bank.

It came to light last week that the future of BermudaTech was hanging in the balance after Mr. Griffiths told the Works and Engineering Ministry that two of his partners had resigned and Mr. Baxter could not be located.

The general contractor was in the process of carrying out extensive refurbishment work at Spice Valley Middle School, but vacated the multi-million dollar project when they ran into trouble at the start of last week.

Works and Engineering Minister Alex Scott said there was two options he could take to complete the site, but promised that it would be finished by the August deadline.

The first would be for BermudaTech to continue, provided the company did not go under and that it was able to satisfy him that it had the finances and manpower to finish the job.

Alternatively, he said his Ministry could oversee the remainder of the project, with all the subcontractors previously in place being retained.

Last night, The Royal Gazette was unable to speak to Mr. Baxter about the writ. However, he called the newspaper on Friday night after arriving back on the Island earlier that day.

He said he had been to Canada with his brother to sort out his mother's affairs, and had no idea the company had run into so much trouble.

And he said contrary to reports in the media, he had not disappeared or deliberately left the Island to escape the controversy, but was merely tending to family matters.

He said he had already met with the bank on Friday afternoon, and was planning to call Mr. Scott later that night.

But Mr. Baxter, who runs three other businesses, said he believed BermudaTech could get back on track and could finish the Spice Valley project.

He said: "I have been fuming about this. I don't know what has happened while I have been away. It looks like someone has panicked, and, in turn, made the bank panic.

"This is mind boggling, I want everyone to know that I did not disappear. I have never walked away from something. Bermuda is my home and I would never do that.

"Unless the receiver says something, there is no reason why we cannot finish it (Spice Valley). As far as I'm concerned, we have an agreement there and we will stick to it. I want to get us back on track."

Yesterday, Mr. Scott said he was still waiting to hear what BermudaTech's official position was, so he could begin to make plans with his department.

But he had no idea that Mr. Baxter was being sued by the company.

Mr. Scott said: "Our position is just as it was. We are still waiting to hear from BermudaTech or the receiver to see if its felt that BermudaTech can go forward with the project, and, if so, under what terms.

"We would need to see if the deadline would be the same, and if the conditions would remain the same. I would then ask my technical officers for recommendations.

"BermudaTech, as such, can no longer make corporate decisions. They have to come from the receiver.

"It has to be soon because everyday the clock is ticking. We are giving BermudaTech a very short window of opportunity to respond. I have to know this week. I will become very uneasy if the matter goes beyond this week."