hi, I had this problem not too long ago.
To load the text file in I did this:
$oldcontents=implode("", file("$file"));
print("<textarea name=\"modmessage\" cols=\"100\" rows=\"15\">\n");
print($oldcontents);
print("</textarea><br>\n");
then when it wrote it it added extra line breaks so to get rid of them I did this before writing:
$HTTP_POST_VARS[modmessage] = ereg_replace("\r", "", $HTTP_POST_VARS[modmessage]);
hope that helped