I tried performing the action in the comment by hrstrand 2009-03-27 (in
quotes below), and rebooted after making the change to the fstab file.

"I added this to /etc/fstab 
devpts /dev/pts devpts (rw,noexec,nosuid,gid=5,mode=620)"

this change to the fstab file also worked for me.  the package manager
and terminal or now appear to be operating normally.

-- 
update manager "Error failed to fork pty"
https://bugs.launchpad.net/bugs/338071
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