This is how I fixed it. I don't know it's the correct way to do it but it works.
skin1/customer/main/subcatagories
replace
Code:
{if ($navigation_page eq "")||($navigation_page eq "1")}{$current_category.description|regex_replace:"/[\n]/":"
"}
{/if}
with
Code:
{if ($navigation_page eq "")||($navigation_page eq "1")}{$current_category.description}
{/if}
Cheers