That's not Brigade Capital's problem, and that's also not Revlon's problem.
I think it's entirely obvious brigade should return the money. But, playing devil's advocate:
Brigade gets a payment, 'out of nowhere' (it wasn't agreed upon beforehand, nor part of the repayment schedule), from the bank of Revlon, earmarked 'revlon'. Hey, the intent is clear enough, and Brigade sees this as an implicit contract. This transfer can be seen as equivalent to a note from the bank: "I, CitiBank, in my function as the bank of Revlon, hereby prepay some of the debt, and whilst revlon did not personally sign this note, that is okay because I am their bank, you can trust me."
And Revlon, having made no such agreement with citibank, also 'wins' their case and this money isn't scratched out of their accounts.
CitiBank, having made the error, is going to have to eat the 9 digit loss, but is of course allowed to recoup it, according to the normal schedule, and without charging interest (not that this matters much, what with interest being near nil), vs. revlon.
If revlon goes broke before they can, that's a bad day for citibank.
NB: To be clear I think when talking about 9 digits, this is a preposterous interpretation, but it IS one.
>Hey, the intent is clear enough, and Brigade sees this as an implicit contract.
The only way you get anything remotely resembling something such as an implicit contract is by butchering the legal concept into unrecognizability, which admittedly, the tech sector has enabled other sectors to do with wild abandon. A contract requires a meeting of the minds, consideration for all, and to explicitly lay out mutually agreed upon terms. Unless both sides agreed to see it the same way, it isn't a contract. It's a worthy subject to resolve via litigation, and to be frank, out as the Brigade at significant risk of possible criminal charges if a judge is not amused and Citibank heads to the Attorney General.
Isn't the whole point of the UCC to remove all sorts of litigious details in contract situations like making payments?
eg, If I agree to pay my babysitter $50 and write an American-style check (aka bank draft), me and the babysitter don't need to negotiate the finer details of that payment method.
Yes. However, you have the capability to void and recover the sums represented by that cheque. It's built into the system in that sense. This is why most debt servicers implement different flows for early payments. You need an explicit indication from the payer they intended to make that extra payment. It may not seem like as big a thing when you're talking small-claims court amounts of money, but once you hit the bigger tiers of financial transaction, this is exactly why people are dedicated toward ensuring all the i's are dotted and t's crossed in order to ensure payments in the right amount end up in the right places in the right amounts.
That's not Brigade Capital's problem, and that's also not Revlon's problem.
I think it's entirely obvious brigade should return the money. But, playing devil's advocate:
Brigade gets a payment, 'out of nowhere' (it wasn't agreed upon beforehand, nor part of the repayment schedule), from the bank of Revlon, earmarked 'revlon'. Hey, the intent is clear enough, and Brigade sees this as an implicit contract. This transfer can be seen as equivalent to a note from the bank: "I, CitiBank, in my function as the bank of Revlon, hereby prepay some of the debt, and whilst revlon did not personally sign this note, that is okay because I am their bank, you can trust me."
And Revlon, having made no such agreement with citibank, also 'wins' their case and this money isn't scratched out of their accounts.
CitiBank, having made the error, is going to have to eat the 9 digit loss, but is of course allowed to recoup it, according to the normal schedule, and without charging interest (not that this matters much, what with interest being near nil), vs. revlon.
If revlon goes broke before they can, that's a bad day for citibank.
NB: To be clear I think when talking about 9 digits, this is a preposterous interpretation, but it IS one.