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Fierce battles occurred overnight in the Croatian town of Pakrac between Serbs and Croats following a weekend in which 42 people were killed.Police said Serbian guerrillas hit the town in Western Slavonia, a new conflict zone east of the capital of Zagreb. The latest assault in the undeclared war between Serbia and Croatia began late the night of Aug. 19, ending a lull after a weekend of fighting. Yugoslavia's state presidency will meet Aug. 20 to try yet again to find a way to end the fighting, which has killed more than 250 people since Croatia declared independence from Yugoslavia June 25. The latest violence follows a cease-fire ordered Aug. 7. Serbian guerrilla leader Milan Martic, the Serbs' chief military coordinator in the Krajina area south of Zagreb, said Pakrac was only the first step in a new offensive. Mr. Martic's comments were likely to confirm Croatian fears that Serbia is carving out the western borders of a greater Serbian state. Croatian leaders have been further shaken by the overthrow of Soviet leader Mikhail Gorbachev and fear that Serbia, run by communists, could be encouraged by the ascendancy of hard-liners.

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