> thanks, can you give me some direction as to how to look for those files and recover them?
Try the following procedure. This has worked for several others to restore
the functionality of the message folders:
1. Use Help | About Pegasus Mail | Info to determine your mail directory. Exit Pegasus mail.
2. Go to the HOME mail directory and look for the MAIN.PMM and MAIL.PMI files. If they are missing then there is not much you can do. If they exist then the hierarch.pm is probably messed up.
3. Rename the file HIERARCH.PM in your HOME mail directory to HIERARCH.SAV.
4. Run WinPMail. Your HIERARCH.PM will be re-created and should start working correctly.
Note: This will delete any tray structure you have created and it
will have to be recreated. The process will not affect any
mail of mail folders you have, it only affects the display of
the folders.
> thanks, can you give me some direction as to how to look for those files and recover them?
Try  the following procedure.  This has worked for several others to restore
the functionality of the  message folders:   
1.      Use Help | About Pegasus Mail | Info to determine your mail directory.  Exit Pegasus mail.   
2.    Go to the HOME mail directory and look for the MAIN.PMM and MAIL.PMI files.  If they are missing then there is not much you can do.  If they exist then the hierarch.pm is probably messed up.   
3.      Rename the file HIERARCH.PM in your HOME mail directory to HIERARCH.SAV.  
4.      Run WinPMail.  Your HIERARCH.PM will be re-created and should start working correctly.  
Note:  This will delete any tray structure you have created and it
           will have to be recreated.  The process will not affect any
           mail of mail folders you have, it only affects the display of
           the folders.