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Dmca add favorites remove favorites free download 501 x 357. Wwe money in the bank 2022: Jumping around and making yourself a moving target makes it harder for an enemy to land a shot, but it. What happens when you accidentally transfer ~$900 million to somebody you didn’t mean to?
The Cast
Revlon is a multinational American Cosmetics company.
Citibank is a bank.
Brigade Capital is a hedge fund.
And a few days back, all three actors were involved in a dramatic sequence of events that can be best described as “comical”. The only problem — it’s not.
The Story
Revlon was expected to transfer a few million dollars to some of its lenders. Citibank was expected to facilitate this transfer. Unfortunately, somebody in Citibank goofed up. Instead of sending the money from Revlon’s account, Citi transferred $900 million to a group of lenders from its own account. Citibank quickly realised the mistake. They apologised (I think) and asked the lenders to return the money. Some of them agreed. Some of them weren’t all too enthusiastic about parting with their newfound riches. Brigade Capital, one of the biggest beneficiaries flat out refused to even consider Citi’s request.
At this point, you’re probably thinking — Finders Keepers. But alas, playground rules don’t apply in the real world. It’s all very very complicated.
The principle of Unjust Enrichment
In contract law, unjust enrichment happens when there’s an enrichment of one party at the expense of another in circumstances that the law sees as unjust. It can happen for instance when someone pays money to another individual under the mistaken belief he is liable to pay the amount. And in the event, such a transaction does transpire, the law imposes an obligation upon the recipient to pay back the money in full.
The application of this principle is illustrated in a popular case from English Common Law — Kelly v Solari.
The matter was regarding a life insurance policy. Mr. Solari had passed away. His widow claimed £200 from the insurance provider upon his death. The claim was paid in full. But soon enough, the insurers found out that the policy had lapsed before the death of Mr. Solari. They realised they weren’t liable to pay because Mr. Solari had missed a premium installment.
And the judges agreed. They noted —
Where money is paid to another under the influence of a mistake in circumstances where if the true facts had been known the money would not have been paid, an action lies to recover the money and it is against the conscience of the recipient to retain it.
Mrs. Solari had to return the money even though she wasn’t in the wrong here. So one could contest that Citibank is entitled to receive its money. However, there is a tiny complication here. Although the bank contests the transaction was a clerical error, Revlon was, in fact, liable to pay the money to Brigade Capital.
The Logic
In 2016, Revlon acquired Elizabeth Arden, an American Cosmetics brand. Brigade Capital financed part of the $1.8 billion loan deal Revlon used to buy the company. As the administrator of the gargantuan arrangement, it was incumbent on Citibank to collect payments from Revlon and transfer it to the lenders, including Brigade Capital. The company was expected to transfer $1.5 million in interest payments to the hedge fund a few days back. Instead, they sent $176.2 mn from their own account — a sum totalling all the accrued interest and the principal in full.
Brigade contests that this is simply a prepayment. A loan that was paid before it was due. How can it be a mistake when Citibank transferred the exact amount outstanding under the original credit agreement? What kind of mistake is that?
Citibank offers a counter. Their first line of defence is Revlon’s own statement — “Revlon did not pay down the loan or any part of the loan”. That’s what a representative from Revlon had to say when asked about the matter. Besides Revlon did not have this kind of money in their own account. The company is struggling financially. It’s also one of the reasons Brigade does not want to return the money. They don’t think Revlon will be able to honour its obligations. They think Revlon is bound to default soon enough.
For Citibank, this is a potential defence. It said and we quote — “Virtually no company, let alone a distressed retail and consumer company such as Revlon, would ever make such a substantial prepayment while dealing with the significant financial consequences caused by the ongoing pandemic.”
Ergo, it must be a mistake. But since Brigade refused to cooperate, Citigroup sued the company in a Federal Court and tried to force its hand.
The judge saw merit in Citi’s argument. The company was offered temporary relief after the judge granted Citigroup’s request to freeze roughly $175 million the bank paid the hedge fund. So, for now, Brigade can’t withdraw, transfer or dispose of the money, until the court can hear both sides and rule on the matter.
Is it a mistake?
Is it not?
That is, quite literally, the million-dollar question.
What do you think?
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