Local Host name resolution


I am running AIX 5.2 and have a question about the /etc/netsvc.conf
file. Currently I have a the following line:
hosts = local, bind

If I run a nslookup and put in a name that is in the hosts file for
instance a printer "testing" it will not find the name and resolve it.
I thought that the "local" would have it search the hosts file first.
Any help would appreciated.