i can't explain it really.. :/
since we tried everything even installing the CMS which we have just downloaded(we are using the cotonti.com) and did everything by the read me and it did not mention that directory so we never thought it needed the permissions changed..
again i have tried selecting all the folders and simply giving the "777" for all of them including the subfolders which should have changed the permissions for that directory too.. but it never did by the looks of it..
well im happy that we fixed it.. i guess i was right from the start about the permissions.. but im still unsure how exactly did i/other admin missed the directory..
