Co-Op Supermarket and the Bermuda Workers Cooperative Society. And it seems the 1,200 members of the unincorporated association might also not be liable for the supermarket's $1.4 million total debt.

In a decision given yesterday, Supreme Court Judge Justice Richard Ground discharged the Registrar of Companies from having to oversee the winding up of the unincorporated association.

The decision leaves creditors of the companies the prospect of attempting to collect the debts themselves from the consumer cooperative. Since the supermarket folded with assets of only about $18,000 and liabilities of $1.4 million, some of the lawyers involved had argued creditors might be forced to collect money from the 1,200 members of the Society.

In arguments made on Monday before Justice Ground lawyers for the Society and the creditors held out a scenario of hundreds of lawsuits and court cases against the members if the Registrar of Companies did not oversee the winding up.

However, as an aside to his decision, Justice Ground expressed doubts about whether such a scenario would occur.

Justice Ground said the winding up order gives "modest powers'' to the receiver which are "limited to getting in the assets, and in that respect I doubt, without deciding, that any liabilities of the individual members to the creditors can be considered as assets of the Society at all.'' In a January 19 court order, Chief Justice Austin Ward appointed the "Official Receiver of Bermuda'' -- generally taken to be the Registrar of Companies -- to wind up of the Co-Op Supermarket.

The Society's directors, which include PLP party chairman Victor Fishington, had applied for the court order as a means of staying writs filed against them by creditors attempting to collect the supermarket's debts.

But it subsequently turned out Registrar of Companies Kymn Astwood had never been asked to perform the function of official receiver, a duty he refused to perform. After the Society and three creditors refused to allow him to withdraw from the winding up, Mr. Astwood applied to set aside the order appointing him to the position.

Solicitor General William Pearce argued for Mr. Astwood 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 said. Justice Ground agreed with that interpretation.

"In my judgment there is no jurisdiction to force a person to act as receiver outside of the statutory schemes for corporate and personal bankruptcies,'' he stated. "...I do not, therefore, think that I can compel any person to act as a receiver if they do not wish to do so, nor is it for me to examine their reasons for declining the office.'' Mr. Ground also revealed the Bermuda Industrial Union (BIU) lent the supermarket $330,000. The supermarket also owes the BIU about $94,600 for rent, and $58,300 for purchases from the union's gas station for a total debt of about $483,000.

The cooperative owes another $105,900 in taxes and $40,300 in social insurance payments to the Government. Wholesalers BDC Ltd., Butterfield & Vallis, and Winter-Cookson, Petty are owed another $350,000.

The Co-Op Supermarket closed for business in October last year after it was unable to continue doing business.

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