Bermuda's Official Receiver, represented by the office of the Registrar of Companies, is balking at the prospect of trying to collect $1.5 million in debt from the 1,200 members of the Bermuda Workers Cooperative Society, owners of the defunct Co-Op Supermarket.

The debt represents about $1,250 a head in debt the members potentially owe if creditors seek to go after them as owners of an unincorporated association.

And if individuals refuse to pay, the process at its extreme could result in joint action against them, or alternatively hundreds of writs filed against individual members to collect the debt.

The Official Receiver is seeking to set aside a January 19 court order by Chief Justice Austin Ward allowing the winding up of the Co-Op Supermarket and appointing the Registrar of Companies as the official receiver.

Yesterday, Solicitor General William Pearce argued in Supreme Court that the Official Receiver should not have been appointed to oversee the winding up of the supermarket.

Since the Co-Op operated as an unincorporated association, it was not covered by either The Companies Act or by the Bankruptcy Act, he told Supreme Court Judge Justice Richard Ground yesterday. The Companies Act relates to incorporated entities, while the Bankruptcy Act deals with individuals.

The order allowed the directors of the Society to obtain a stay against writs taken out by creditors, who include importers BDC Ltd., Butterfield & Vallis, and Winter Cookson Petty.

Leave to set aside the appointment by the Official Receiver is being opposed by the three importers and the Society. If Justice Ground sets aside the decision by the Chief Justice to appoint the Registrar of Companies as the official receiver, the importers are faced with the prospect of chasing after the 1,200 members of the Society.

If the Registrar of Companies remains in place as the official receiver, it will be a Government body which takes on the role of trying to collect debt from members, many of whom belong to the Bermuda Industrial Union.

Justice Ground said he would give a decision on the case today.

BUSINESS BUC