Key points

• The Citibank case dealt with a $900 million payment sent in error to the lenders of Revlon, Inc, in the midst of a fraught dispute over the loan restructuring.
• Surprising most market participants, the court ruled that the lenders who refused to return the funds to the administrative agent were entitled to keep the money. (The case is currently on appeal.)
• The case attracted commentary primarily due to the sheer size of the payment error, and the corresponding risks posed by ‘back-office’ functions at financial institutions.
• But Citibank also highlights the widening gap in leveraged finance between the wishes and expectations of market participants and the actual outcomes they achieve under either (1) common-law default rules or (2) heavily negotiated contracts.
• In particular, the case raises questions such as (1) whether New York law remains an appropriate default choice for financing transactions, (2) whether the common law of contracts does or should continue to have relevance for financing transactions among sophisticated parties and (3) whether parties truly can contract for their desired outcomes when opportunistic behaviour is prevalent in the market.

中文翻译：

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9 亿美元的错误：针对花旗银行 2020 年 8 月 11 日的电汇（SDNY 2021 年 2 月 16 日）

关键点

• 在花旗银行的情况下处理了错误$ 900万金送到露华浓，公司的贷款人，在整个贷款结构调整充满争议之中。
• 令大多数市场参与者感到惊讶的是，法院裁定拒绝将资金退还给行政代理人的贷方有权保留这笔钱。（此案目前正在上诉中。）
• 该案之所以引起评论，主要是因为支付错误的规模庞大，以及金融机构的“后台”职能带来的相应风险。
• 但花旗银行也强调了杠杆融资在市场参与者的愿望和期望与他们在 (1) 普通法违约规则或 (2) 大量谈判合同下实现的实际结果之间不断扩大的差距。
• 尤其是，本案提出了以下问题：(1) 纽约法是否仍然是融资交易的适当默认选择，(2) 普通合同法是否确实或应该继续与成熟当事人之间的融资交易相关，以及 (3) ) 当机会主义行为在市场上普遍存在时，各方是否真的能够为他们想要的结果签订合同。