Myers v. Colorado Pulp & Paper Co.

To a decree denying to certain general creditors interest on their allowed claims, either at the legal rate claimed by them, or four percent, which was allowed all other like creditors, the creditors suffering the discriminatory judgment bring error. The controversy is rooted in the Colorado Pulp and Paper receivership proceeding, which had the attention of this court in Rossi v. ColoradoCo., 88 Colo. 461, 299 Pac. 19, and Sparling Co. v. ColoradoCo., 88 Colo. 523, 299 Pac. 41. In the Sparling review (p. 528) we determined that the general creditors "will be restored to a basis of one hundred percent, with legal interest."

It appears that June 19, 1931, after the matter had been remanded, some of the general creditors stipulated to accept the face of their claims, plus four percent from January 12, 1928, when general claims were allowed, but none of the creditors prosecuting this writ signed the stipulation, and in many ways manifested their unwillingness to be bound by it; that July 10, 1933, the court ordered certain sums paid into the registry for the benefit of the general creditors; that June 7, 1934, the court ordered that general creditors who had stipulated to accept the face of their claims and interest at four per cent, should be paid in accordance with the stipulation, and that general creditors not represented by counsel, although they had not signed the stipulation, should be paid on like basis, but that general creditors represented by an attorney named in the order, being those here, should have only the face of their claims; that in justification of the dissimilar treatment accorded creditors of the same class, it is stated in the order that those made to feel the court's displeasure, "have unnecessarily delayed the court in the carrying out of the terms of the said stipulation and agreement of June 19, 1931, have increased the costs and expenses of this proceeding * * *, and have delayed the winding up of the affairs of said insolvent corporation, and that, by reason thereof, in equity and good conscience, they should not be allowed any interest on their claims."

[1, 2] We think there was error. First, the complaining creditors were not bound by the stipulation. Second, the sole basis of the strictures was that these particular creditors had through orderly process sought to maintain what they conceived were their legal rights. Their claims had been formally adjudged, precisely as the claims on which interest was ordered to be paid, and on the same day. Interest attached from date of allowance. This award of the law was not subject to the conscience of the chancellor.

[3] The motion to dismiss the writ, based on the ground that counsel for plaintiffs in error had withdrawn from the clerk's office checks covering the sums awarded these creditors in the court's mistaken order, we believe to be without merit. Considering that at the time of such withdrawal the creditors were actively perfecting this writ and what was withdrawn was of money unquestionably theirs, we cannot think they are estopped to claim interest, the only item involved below and here. Besides, the testimony is that the checks have not been cashed.

Let the order be that the judgment is reversed.

MR. JUSTICE HOLLAND not participating.