This case is an unusual example of an LMA “standard” debt trade leading to litigation in the UK Supreme Court and demonstrates that standardised terms are by no means immune to dispute, despite their frequent use. It is also an interesting example of the judiciary taking into account the practical implications in the specific commercial context of the debt trading market, in addition to a legal consideration of the LMA standard wording, when reaching its decision.
The Supreme Court has held that the Loan Market Association standard terms and conditions for par trade transactions (the “LMA Terms“) do not allow a transferor to recover from the transferee part of a “Payment Premium” pertaining to the period prior to the date of transfer.
The Court will not readily infer continuing rights and obligations in the context of the LMA loan market, where standardised documentation has been designed to facilitate the trading of debt, often many times over.
Continue reading >>>
Copyright © 2019 Weil, Gotshal & Manges LLP, All Rights Reserved. The contents of this website may contain attorney advertising under the laws of various states. Prior results do not guarantee a similar outcome. Weil, Gotshal & Manges LLP is headquartered in New York and has office locations in Beijing, Boston, Dallas, Frankfurt, Hong Kong, Houston, London, Miami, Munich, New York, Paris, Princeton, Shanghai, Silicon Valley, Warsaw, and Washington, D.C.