Last Wednesday’s judgment in the conjoined cases of Goldman Sachs International v Novo Banco SA and Guardians of New Zealand Superannuation Fund and others v Novo Banco SA will not be terribly relevant to transactional debt finance lawyers, but they should be aware of the continuing disputes arising from the demise of Banco Espirito Santo, because they are topical, and they must understand the basics of the BRRD. On 3rd July 2014 BES drew down in full a USD 835m loan arranged by Goldmans. On 31st July, it went bust. Cue all manner of unhappiness from the lenders, doubtless directed both at BES and at Goldmans. On 3rd August 2014 the Portuguese Central Bank established a bridge bank – Novo Banco – which assumed all BES’s liabilities unless they were owed to a creditor which held more than 2% of the equity in BES. In December 2014 the PCB concluded that Goldmans was the creditor under this loan, and owned more than 2% of the equity, and so declared that the loan had not been transferred to Novo Banco. Goldmans are challenging this in Portugal on both counts. Meanwhile, they sued Novo Banco in England for repayment (on the basis that it had assumed the BES loan liability) attempting the difficult argument that whilst the August decision was binding in the UK under BRRD Article 3 (“The administrative or judicial authorities of the home member state shall alone be empowered to decide on the implementation of one or more reorganisation measures in a credit institution… They shall be fully effective …throughout the Community”), the December refinement of it was not. The Supreme Court refused to be convinced, pointing out this meant trying to persuade the court “that in the eyes of an English court Portuguese law must be treated as having transferred [the loan liability] to Novo Banco although it would not be so treated in the eyes of a Portuguese court”. Lord Sumption noted: “Since the ordinary purpose of any choice of law rule is to ascertain which legal rules should be applied in the relevant foreign jurisdiction, this [would be] a paradoxical result”.