From the beginning, their relationship has not been a typical one.

If Edward Bennett Williams and Hank Peters respected each other, it was only grudgingly. Because they are from such diverse backgrounds -- Peters a career baseball man, Williams one of the country's most successful trial lawyers -- they probably never would be friends or fully understand each other.

People who know both men said Peters, general manager of the Baltimore Orioles, would become frustrated by Williams' trying to make baseball decisions. Meanwhile, Williams, owner of the Orioles, would become frustrated because Peters was ultra-cautious.

Now, in the seventh year of Williams' ownership, their differences have become public, and the reason is the Orioles' farm system. Williams says he is embarrassed and angered by the condition of the system -- and intends to fix it, regardless of whose toes are stepped on.

"It really hit me something was wrong when I had to spend $12 million for free agents after the '84 season," Williams said. "Fixing the farm system is the No. 1 thing on my plate."

To show he's serious, he has hired 33-year-old Doug Melvin to make objective evaluations. And taking a slap at Peters and his baseball people, Williams said: "I can't get any real answers."

He goes on to compliment the New York Yankees, Toronto Blue Jays and Detroit Tigers.

"Right now, I think the Yankees have the best organization in baseball," Williams said.

He does not mention the Orioles, and this, too, is a slap at Peters and the Orioles' baseball staff. Such remarks have not gone unnoticed.

"If Hank were a little younger [Peters is 61]," a friend said, "he would walk out. But he's getting older, and his contract isn't up until he's 65."

Peters, coming as close as he will to criticizing Williams, said: "Fourteen of our 25 players came from our farm system last year, and no other top team had that many.

"I don't know if I have to apologize. Everyone has a different philosophy about the farm system, but you can't lose sight of the bottom line, which is to produce players for your major league team."

In the midst of an interview last week, another prominent employe burst out: "Hell, let him fire me if that's what he wants to do."

Williams does not seem bothered, only curious.

"In one meeting, they told me I lost three draft picks because I signed the three free agents [in 1984] and that had hurt the farm system," Williams said. "But those picks wouldn't even be candidates for the major league roster for four years. I had to laugh at that."

He was skeptical enough of the answers that he brought in Melvin. But like Peters and farm director Tom Giordano, Melvin is a baseball man, and he knows that the answers -- and solutions -- won't come quickly.

So who is right? Is Williams one more meddling baseball owner, or has he trusted employes who have failed him?

Several respected baseball people said the Orioles' farm system is dangerously thin, but in saying that, they also saluted the Orioles for bringing up a stream of excellent players -- outfielders Larry Sheets and Mike Young and pitchers Nate Snell and Ken Dixon in the last two years alone. They point to last season's team that had 14 former farm hands, most of any winning club in either league.

At the same time, these men have criticisms. They say the weird science of drafting and developing players is so fragile that a blip or two can cripple an organization, and the Orioles have had some blips.

They say, too, that perhaps the Orioles' baseball people have not been aggressive enough about making decisions on young players.

"You should sit down and take a look at your kids," one personnel man said. "If you say, 'I don't think this guy will ever play for the Baltimore Orioles, you should make a move to trade him. The Orioles have probably been slow making these decisions."

If the system is down, it is not dead. Many scouts believe outfielder Ken Gerhart and shortstop D.L. Smith will play in the major leagues, along with pitchers John Habyan, Jeff Ballard and Eric Bell.

Unquestionably, though, the organization is not loaded, and Williams is upset about that and the records of the Rochester Red Wings, the Orioles' Class AAA team.

Rochester finished 58-81 and 20 1/2 games out of first last season and 52-88 the year before. Worse, last year's team included not only youngsters, but veterans such as Jerry Augustine, Nelson Norman, Roy Lee Jackson, Bobby Molinaro, Rod Allen and Darrell Brown -- players who have kicked around dozens of other organizations.

"I heard the [Class AA] Charlotte players had a saying," one Orioles minor-leaguer said. " 'Old ballplayers never die. They just go play for Rochester.' "

Peters concedes that the Rochester club has had too many veterans, but says he believes that's the price you pay for sending so many youngsters to the majors in a short period.

When the Orioles played Rochester Tuesday afternoon, Rochester had only six players who began their pro careers in the Orioles' system.

As Williams digs for answers, he may find some problems as old as the game itself.

In a sport in which the average salary is $375,000 and its news often deals with drug tests, baseball is still tied to its roots.

The scouts.

These are not the men who drive 450 SLs and wear Ralph Lauren jackets, but the ones with Chevys and windbreakers. They earn between $22,000 and $26,000 a year, and they travel alone, many times driving five hours just to see one high school kid pitch.

Since 95 percent of draftees never make it to the big leagues anyway, what constitutes failure?

"It's the most inexact science on earth," Peters said. "People not in the game have a hard time realizing that. We knew about Don Mattingly. Everyone did. But no one knew he was going to be this kind of player."

Since the Orioles win, they pick low in the draft, and because of that there will be no Harold Baines, Dwight Gooden or Darryl Strawberry in their Christmas stocking.

"When you pick where we do, you try to find guys who can run and throw and hit," Giordano said. "You draft 25 players, and if three of them make it, you've had a helluva draft."

The flip side is that if you draw blanks for a couple of years, you're going to have problems.

"They're going to have to go back and see if their scouts are making bad recommendations, and they probably are," one baseball executive said. "Everything hinges on getting the players in your organization."

Melvin's most difficult task may be in deciding whether this is true. He is no stranger to such work, having done a similar job for the Yankees.

"I want to know who's working," Williams said. "Scouting is a strange business because they have to be self-motivated. If we have scouts going to work twice a week, we need to know about it."

Peters said he knew the Orioles would be in for lean years soon after he was hired to replace Frank Cashen in 1976.

"They had made a critical mistake," Peters said. "They bought the concept of the Central Scouting Bureau. That was something that was going to save teams a lot of money because instead of needing 30 scouts, you'd only need a handful to do your double-checking.

"When I came in, I found what had happened. They were winning games in their farm system, but when we looked closer, we found that the Rochester team was loaded with prospects [Eddie Murray, Dennis Martinez, Scott McGregor, Mike Flanagan, Rich Dauer]. Below that, they had only one prospect, Sammy Stewart, who was at [Class A] Miami.

"The thing about scouting is that time substantiates whether your opinions were right or wrong, and unfortunately, these were right. We were just void of prospects."

What Peters did amounted to starting over. He pulled the Orioles out of the Central Scouting Bureau and started reassembling a scouting team.

"It's a tedious thing," he said. "You go through hell, and a lot of mistakes are made. Finally, I believe we've rebuilt the scouting staff, and we're in position to draft."

But Williams believes there must be something wrong with the farm system because he was forced to spend $12 million on free agents a year ago. The Orioles' baseball people say these were public-relations moves, because the talent was there.

John Shelby and Young, up from the farm -- in Shelby's case, after a demotion following two seasons with the Orioles -- hit a combined .276 with 35 homers and 108 RBI. Outfielders Fred Lynn and Lee Lacy, two of the three free-agent signees, had 285 more at bats and produced eight more RBI and three fewer home runs.

Further, the Orioles brought up pitchers Dixon and Snell, who won 11 games, and Sheets, who hit 17 homers and drove in 50 runs.

"I think the guys from our farm system did as much as the free agents, didn't they?" Manager Earl Weaver asked. "I don't want to see the farm system get criticized for something it doesn't deserve."

Williams said there is no timetable on what action, if any, he will take. Melvin said he's getting to know the organization, that he was not hired to get anyone fired.

He does realize he is in a delicate position.

"Very," he said.