sorry, what exactly are you trying to do/read? If the textfile shows | (the pipe symbol) it should read it...unless of course, its a different encoding?
have you tried to readToEnd() into a string to see if the text read contains the | symbol?
string theFile = file.ReadToEnd();
I've also noticed you have a counter in the code, it is not required and should be removed even though it has no effect in the processing of what you are trying to read.
you should also do a Peek() to see if there is data rather than the !=null condition as this would still throw a nullreferenceexception or an indexoutofrange exception:
string FILELINE;
// Read the file and display it line by line.
using (System.IO.StreamReader file = new System.IO.StreamReader(@"c:\test.txt"))
{
while ((file.Peek() > -1)
{
//System.Console.WriteLine(line);
FILELINE = file.ReadLine();
TAB1_listBox_file.Items.Add(FILELINE);
}
}