Horde/IMP issue with folders/filters

[James]

(Apologizes if this is a RTFM or OFN thing)

Install:
Latest stable (non-cvs) Horde, IMP, Kronolith and Turba
Linux 2.4.17
Debian
UW-IMAP (from latest Debian testing package)
Exim (from latest Debian testing package)

Here is the issue.

I create a folder.  Lets call it testdir.  On the server I check and it
seems to be put in /home/james/mail/ as "testdir" (file).  "testdir"
appears in my Folders list as
- INBOX
- someotherbox
- someotherbox
- someotherbox
- testdir

I make a rule so that when something comes into my mailbox (With for
example [imp] in it), it gets forwarded to the "testdir" folder.

In the "Filter Rules" list, it says: 
Move messages to the mail%2Ftestdir folder where the Subject: field
contains [imp] 

After applying the rule, I get:
problem with filter rule 2: folder does not exist: mail%2Ftestdir

Anyone pass me a clue as to what is going on and/or how to remedy this?

- James