Sunkist Growers, Inc. v. Winckler & Smith Citrus Products

On March 30,1956, after judgment for plaintiffs below was entered, the trial judge fixed $2,000,000 as the amount of supersedeas bond on appeal. “It is further ordered that said bond may be by approved corporate sureties, or by deposit of Government bonds as provided in 6 U.S.Code § 15.” (Tr. p. 389.)

Defendant and appellant Sunkist has shown the cost of a $2,000,000 supersede-as bond would have been $40,000. We assume this refers to the annual premium. Appellants borrowed money, purchased $2,000,000 in Government bonds, and deposited them as security. The bonds were originally purchased at a $30,000 discount from face value. Appellants paid the prime interest rate then obtaining in the Los Angeles area, on the money borrowed, renewing said notes representing the amount borrowed each ninety days. This rate began at 3%% went to 4%, to 4%%, to 4%, to 31/2%, to 4%, to 41/2%, to 5%, and to 4y2%between April 20th, 1956 and July 27th, 1962. The income received from the bonds, $391,811.57, was set off against the expense, $542,587.75, leaving a net expense of $150,776.18.

Six annual yearly premiums, had they been paid, would have cost $240,000. The time here involved is six years and…