partner, Mr. Llewellyn Peniston, was dishonest.

He was involved in a glass-bottom boat firm with Mr. Peniston when the turning point came, Supreme Court was told.

Mr. Thomson said he discovered a $4,000 cheque, intended as a lease payment on one of their boats, had gone into Mr. Peniston's personal company account instead.

Red-faced with anger and disbelief, he called Mr. Peniston and challenged him over the missing payment.

The next morning, the court heard, he found a $4,000 cheque from Mr.

Peniston's company Bermuda Travel Tours pushed under his office door.

"This was the first event where he clearly did something that made me feel that he was dishonest,'' Mr. Thomson testified.

The two men, former associates in the failed boat firm Bermuda Vacations, are fighting in court over whether Mr. Peniston should be declared bankrupt.

Mr. Peniston says Mr. Thomson tried to ruin him, and Mr. Thomson says Mr.

Peniston failed to pay him back when he loaned him $80,000.

Mr. Thomson, 43, told the court he was a computer expert whose finance systems were used by big multi-national companies, and whose US firm earned millions.

He started in business with Mr. Peniston after using his services as a travel agent.

But, he told the court, the relationship went downhill after the missing cheque incident.

Another thing that worried him, he said, was that payments Mr. Peniston collected from cruise ships for glass-bottom boat tours were not received by Bermuda Vacations on time.

About $48,000 was still outstanding when the firm went under last year, he said.

"Mr. Peniston was funding his company, Bermuda Travel Tours, with revenue that should have been in Bermuda Vacations.'' This made Mr. Thomson "extremely annoyed''.

Eventually, the court heard, the two men stopped speaking and Mr. Thomson moved out of their office.

Mr. Thomson admitted he told Mr. Peniston's secretary he would make her boss bankrupt.

But he said he always added that he would only act if Mr. Peniston failed to repay what he was owed or give him some security.

Mr. Thomson denied saying at a barbecue for Bermuda Vacations staff, before the cheque incident, that he wanted to make Mr. Peniston bankrupt.

And he denied that he failed to give his partner regular information on the state of the firm.

He added he once went with Mr. Peniston to meet top cruise line officials with whom Mr. Peniston was doing business.

Mr. Thomson said he was to be "the man with the money'', lending legitimacy to Mr. Peniston.

The case continues today.