Former director of Bermuda Fire Gregory Haycock spent his second day in the witness box under cross-examination by Geoffrey Vos QC, the lawyer representing law firm Conyers Dill & Pearman.

Mr. Vos took issue with certain points in Mr. Haycock's witness statement with regard to Bermuda Fire's legal advice.

At a June 11, 1991 meeting of Bermuda Fire's finance committee, the company's financial and legal advisors presented their views. Mr. Haycock's statement alleges that at no stage in the meeting did the advisors, including CD&P, express "any reservations about their proposals.'' "Did you remember the advice (CD&P lawyer) John Collis gave at that meeting?'' asked Mr. Vos. "He was strongly advocating that a holding company route be followed in reorganisation. The finance committee opposed Holdco for the same reason that (Bermuda Fire director) Donald Lines expressed at the previous meeting -- namely, that he thought it would it would not enable Subco to raise enough money from the market in the future.'' Mr. Haycock agreed.

"But it was at this meeting that the finance committee considered John Collis' advice,'' Mr. Vos continued, "and at this meeting they decided to go ahead with Subco, notwithstanding.'' "Correct,'' Mr. Haycock said, "but I believe at the end Mr. Collis' concerns were allayed when it came to the final reorganisation.'' "They were allayed,'' Mr. Vos suggested, "because the finance committee decided that there would be sufficient assets to pay the creditors, and that the valuations of international liabilities were satisfactory.'' Mr. Haycock agreed.

Mr. Haycock accepted that Mr. Collis had expressed a concern about the route which the finance committee, for commercial reasons, intended to follow.

In reference to a June 11 finance committee meeting, Mr. Haycock also said: "I think the word `problem' is an incorrect explanation of the international business being left with the old company. It was difficult, but it was not a `problem' company.'' It was at this meeting, Mr. Vos said, "the finance committee saw the light, saw that the Subco proposal couldn't work, and agreed to let its professionals look at Holdco, which was what John Collis wanted all along.'' "At this point, it didn't look as if the Subco route would be acceptable,'' Mr. Haycock agreed.

The case will continue on Monday.