CALDERWOOD & HARKNESS LLP Solicitors & International Arbitration Counsel 45 Moorgate, London EC2R 6AR, United Kingdom Tel: +44 (0)20 7946 0100
10 March 2025
PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION
Mr. Nikolaos Papadimitriou Chairman & Chief Executive Officer Thalassa Shipping & Logistics SA 14 Akti Miaouli, 4th Floor Piraeus 185 35 Greece
Ms. Ioanna Christodoulou General Counsel Thalassa Shipping & Logistics SA 14 Akti Miaouli, 4th Floor Piraeus 185 35 Greece
Re: Enforcement of LCIA Award No. 224718 — *Thalassa Shipping & Logistics SA v. Korinthian Maritime Holdings Ltd.* — Closing Report and Recommendations
Dear Mr. Papadimitriou and Ms. Christodoulou,
1. Introduction and Purpose of Letter
Calderwood & Harkness LLP ("C&H" or the "Firm") writes in its capacity as lead enforcement counsel to Thalassa Shipping & Logistics SA ("TSL" or "Thalassa") in connection with the multi-jurisdictional enforcement of LCIA Award No. 224718 dated 28 June 2024 (the "Award") rendered against Korinthian Maritime Holdings Ltd. ("KMH"), a Cypriot private limited company incorporated under the laws of the Republic of Cyprus (Registration No. HE 387421) and registered at 28 Themistokli Dervi Avenue, Suite 601, Nicosia 1066, Cyprus.
The purpose of this letter is fourfold:
(a) to provide TSL with a comprehensive closing report on the enforcement campaign conducted by C&H and its network of local counsel across four jurisdictions — England & Wales, the Republic of Cyprus, the Republic of Singapore, and the United Arab Emirates — over the period from July 2024 through February 2025;
(b) to summarize the total recoveries achieved, both through court-ordered enforcement mechanisms and through a voluntary payment by KMH, and to reconcile those recoveries against the full quantum owed under the Award;
(c) to address the outstanding balance remaining due to TSL and to identify the remaining enforcement opportunities available to recover that balance; and
(d) to set out C&H's recommendations for the residual monitoring and collection phase of this matter, including the transition from an active enforcement engagement to a reduced-scope monitoring arrangement.
This letter is furnished pursuant to, and should be read in the context of, the C&H engagement letter dated 12 September 2024, which established the scope of the enforcement-phase engagement and the applicable fee arrangements. The engagement letter, as TSL will recall, followed and superseded the initial advisory-phase engagement under which C&H provided strategic enforcement advice in the period immediately following the issuance of the Award.
This letter should also be read in conjunction with the prior Bi-Weekly Status Reports (Nos. 1 through 10, issued at fortnightly intervals between 27 September 2024 and 28 February 2025) and the Final Status Report & Matter Close Recommendation dated 10 March 2025 (delivered under separate cover contemporaneously with this letter). Those reports contain granular procedural detail and contemporaneous analysis that is summarized, rather than repeated in full, in the present closing report.
Nothing in this letter constitutes a waiver of any privilege, and the contents are subject to the attorney-client communication privilege applicable under English law and any other relevant jurisdiction. This letter is not intended for disclosure to any third party without C&H's prior written consent.
2. Executive Summary
Before proceeding to the detailed discussion, we set out for convenience an executive summary of the key figures and outcomes of the enforcement campaign.
The Award, rendered on 28 June 2024 following a ten-day evidentiary hearing, was in the total sum of £96,450,000 in damages and pre-award interest, comprising the following heads:
(i) Damages for wrongful early redelivery of M/V Aegean Fortuna: £42,300,000;
(ii) Outstanding hire and damages for M/V Crimson Horizon: £28,150,000;
(iii) Restitution of fabricated off-hire deductions for M/V Volga Spirit: £2,740,000;
(iv) Loss of profit and market differential damages: £16,480,000; and
(v) Pre-award interest at 5.25% per annum simple: £6,780,000.
In addition, the Tribunal ordered KMH to bear 85% of the total costs of the arbitration. The total costs awarded to TSL amounted to £12,150,000, comprising LCIA administrative and tribunal costs of £3,240,000 and TSL's own legal costs of £8,910,000.
The combined Award plus Costs therefore totalled £108,600,000.
Post-award interest was awarded at 5.25% per annum simple on the principal sum of £96,450,000, running from 29 June 2024 until the date of payment. Through 15 March 2025 (a period of 260 days), post-award interest is estimated at £3,607,726.03, calculated as follows:
£96,450,000 × 0.0525 × (260 ÷ 365) = £3,607,726.03
The Grand Total owed by KMH to TSL as of 15 March 2025 is therefore £112,207,726.03.
Against this liability, the enforcement campaign has achieved total recoveries of £96,590,000 across all jurisdictions and through all enforcement mechanisms, including the voluntary payment made by KMH on 3 February 2025. This represents a recovery rate of approximately 89% (more precisely, 88.94%) of the Award plus Costs figure of £108,600,000.
For reference, the USD equivalent of the original Award at the exchange rate prevailing on 28 June 2024 (£1 = USD $1.2441) was approximately USD $120,000,000, underscoring the scale of both the dispute and the enforcement campaign.
The outstanding balance as of 15 March 2025 stands at £15,617,726.03, comprising principally unrecovered costs, the full post-award interest accrual, and a residual portion of the original Award amount. Post-award interest continues to accrue on the unpaid portion at a rate of approximately £13,876 per day.
The active enforcement campaign was conducted over a period of approximately eight months (July 2024 through February 2025), during which C&H coordinated proceedings across four jurisdictions simultaneously, working with three sets of local counsel and specialist forensic accountants and maritime valuers.
We consider this to be a highly successful enforcement outcome, achieved against a respondent that actively sought to dissipate and conceal its assets across multiple jurisdictions, and which vigorously contested enforcement at every stage. The following sections provide the detailed narrative.
3. Background: The Underlying Dispute and Arbitration
3.1 The Charter-Party Agreements
TSL is a Greek-headquartered société anonyme (AFM: EL-801456729) with its principal offices at 14 Akti Miaouli, 4th Floor, Piraeus 185 35, Greece. Founded in 1987 by the Papadimitriou family, TSL operates a fleet of 34 vessels (comprising dry-bulk carriers, tankers, and container feeders) and generated annual revenues of approximately €620 million in FY2023. The company's share capital is held 72% by the Papadimitriou family trust (administered through First Hellenic Fiduciary Services SA) and 28% by Aegean Capital Partners SA, a Greek institutional investor. TSL is widely recognized as one of the leading mid-cap independent shipowners in the Eastern Mediterranean and Black Sea trade.
Between 2019 and 2021, TSL entered into three time charter-party agreements with KMH for the employment of dry-bulk carriers owned by TSL and its fleet subsidiaries. The relevant charters were as follows:
(a) M/V *Aegean Fortuna* (IMO 9784521, Supramax Bulk Carrier, 58,200 DWT, marshall Islands flag): time charter-party signed 15 March 2019 for a period of 36 months, plus or minus 30 days in charterer's option, at a daily hire rate of USD $13,500 net. This charter was governed by an amended NYPE 2015 form with additional rider clauses negotiated between the parties.
(b) M/V *Crimson Horizon* (IMO 9801334, Handymax Bulk Carrier, 37,500 DWT, Liberian flag): time charter-party signed 22 January 2020 for a period of 24 months, plus or minus 20 days in charterer's option, at a daily hire rate of USD $11,250 net. This charter was similarly based on an amended NYPE 2015 form.
(c) M/V *Volga Spirit* (IMO 9756892, Panamax Bulk Carrier, 76,400 DWT, Cyprus flag): time charter-party signed 10 June 2021 for a period of 18 months, plus or minus 15 days in charterer's option, at a daily hire rate of USD $16,800 net. This charter incorporated a Baltime 1939 (as revised 2001) form with bespoke amendments.
All three charter-party agreements were governed by English law and contained LCIA arbitration clauses providing for arbitration seated in London under the LCIA Rules then in force. The arbitration clauses were substantively identical, each providing for a three-member tribunal with the presiding arbitrator to be appointed by the LCIA Court in default of agreement by the party-nominated arbitrators.
KMH is a Cypriot private limited company (Registration No. HE 387421) controlling a fleet of approximately 18 dry-bulk carriers through a network of single-purpose vehicle ("SPV") subsidiaries incorporated in Cyprus, the British Virgin Islands, and the marshall Islands. KMH is beneficially owned by the Volkov family, with Mr. Andrei Volkov serving as the ultimate beneficial owner ("UBO") and de facto director and Mr. Sergei Volkov (Andrei Volkov's brother) serving as a registered director. The Volkov family's ownership is structured through a series of BVI and Cypriot holding companies, including Korinthian Holdings (BVI) Ltd. (BVI Company No. 1987543) and Volkov Maritime Investments Ltd. (HE 392106, Cyprus). Prior to the commencement of the dispute, KMH's estimated net asset value was approximately USD $280 million, based on the aggregate value of its fleet, its operational cash flows, and its corporate treasury holdings across multiple banking relationships.
3.2 KMH's Breaches
The dispute arose from three distinct categories of breach by KMH under the charter-party agreements:
(a) Wrongful early redelivery of M/V *Aegean Fortuna: KMH purported to redeliver M/V Aegean Fortuna* on 18 June 2022, approximately 14 months prior to the earliest permissible redelivery date under the charter-party. KMH contended that the vessel was off-hire due to alleged deficiencies in its performance specifications, a contention that the Tribunal subsequently found to be factually unfounded. The wrongful early redelivery caused TSL to lose the benefit of the charter at above-market rates for the remaining period, during which the dry-bulk market experienced significant softening. The Tribunal assessed damages at £42,300,000, reflecting the market differential over the unexpired charter period together with additional costs of re-positioning and re-employment of the vessel.
(b) Failure to pay hire on M/V *Crimson Horizon: KMH ceased making hire payments in respect of M/V Crimson Horizon* from 1 July 2022 onwards. Despite repeated demands by TSL and the issuance of formal anti-technicality notices, KMH failed to remedy the arrears, which accumulated to £4,280,000 before TSL exercised its contractual right to withdraw the vessel on 15 September 2022. The Tribunal awarded outstanding hire, damages for early termination, and associated losses totalling £28,150,000.
(c) Fabricated off-hire deductions on M/V *Volga Spirit: Over the course of the charter period, KMH systematically applied off-hire deductions to its hire payments for M/V Volga Spirit* based on purported periods of off-hire that the Tribunal found to have been fabricated or grossly exaggerated. The evidence, including AIS data analysis, superintendent reports, and independent surveyor testimony, demonstrated that the vessel was operational and performing within charter specifications during the relevant periods. The Tribunal awarded restitution of the fabricated deductions in the amount of £2,740,000.
In addition to the vessel-specific damages, the Tribunal awarded loss of profit and market differential damages of £16,480,000, reflecting the broader economic harm to TSL from KMH's pattern of deliberate breach, and pre-award interest of £6,780,000 calculated at 5.25% per annum simple on the various heads of damage from the dates of breach to the date of the Award.
3.3 The LCIA Arbitration
The arbitration was commenced by TSL's Request for Arbitration filed on 14 November 2022, registered by the LCIA under Reference No. 224718. The three charter-party disputes were consolidated by agreement of the parties (and with the consent of the LCIA Court) into a single arbitration proceeding.
The Tribunal was constituted on 8 February 2023 and comprised:
• Presiding Arbitrator: Sir Malcolm Fenton-Clarke (appointed by the LCIA Court), a retired High Court judge and former Admiralty judge with extensive experience in maritime and international commercial arbitration;
• Co-Arbitrator: Professor Athena Drakopoulos (nominated by TSL), Professor of Maritime Law at the University of Piraeus and a member of the LMAA Support Members' list;
• Co-Arbitrator: Dr. Henrik Dalmqvist (nominated by KMH), a Swedish arbitrator and former partner at Dalmqvist & Eriksson, Stockholm, with a practice focused on shipping and commodities disputes; and
• Tribunal Secretary: Ms. Fiona Beckett, a barrister at Whitfield & Halsey LLP, London.
The arbitration proceeded through a compressed procedural timetable involving two rounds of written submissions, fact and expert witness statements, document production (conducted under the IBA Rules on the Taking of Evidence in International Arbitration, 2020 Revision), and a ten-day evidentiary hearing held from 11 to 22 September 2023 at the International Dispute Resolution Centre (IDRC), Fleet Street, London. Oral evidence was heard from seven fact witnesses and four expert witnesses (two quantum experts and two market experts).
The Tribunal issued its Final Award on 28 June 2024 in the total sum of £96,450,000 in favour of TSL, together with costs of £12,150,000 allocated 85% to KMH. The Award was unanimous. The Tribunal's reasoning extended to 287 pages and addressed each head of claim and each of KMH's defences in considerable detail. The Tribunal made express findings that KMH had acted in bad faith in connection with the wrongful early redelivery of M/V Aegean Fortuna and the fabrication of off-hire deductions for M/V Volga Spirit, observations that subsequently proved relevant in the English enforcement proceedings.
4. Enforcement Campaign: Jurisdiction-by-Jurisdiction Summary
Following the issuance of the Award, KMH failed to make any voluntary payment within the 28-day period stipulated by the Tribunal and failed to respond to C&H's formal demand letter dated 29 July 2024. C&H thereupon commenced the multi-jurisdictional enforcement campaign described below. The jurisdictional strategy was developed in consultation with TSL's in-house team and was informed by the forensic asset-tracing work of Hartwell Pemberton LLP ("HP"), which identified KMH's principal asset concentrations across the four target jurisdictions.
4.1 England & Wales
4.1.1 Section 66 Application and Permission to Enforce
C&H filed an application for permission to enforce the Award as a judgment of the High Court pursuant to Section 66 of the Arbitration Act 1996 on 15 July 2024 in the Commercial Court of the Queen's Bench Division of the High Court of Justice (Claim No. CL-2024-000487). The application was supported by the first witness statement of Hannah Brinkley, a senior associate at C&H, which exhibited the Award, the arbitration agreement, and evidence of service on KMH.
Permission to enforce was granted by Mr. Justice Ashworth on 2 August 2024 by order on paper, the Court being satisfied that there was no basis to refuse enforcement. The order gave KMH 14 days in which to apply to set aside the order granting permission, a period which KMH subsequently allowed to expire without challenge to the Section 66 order itself (although KMH did subsequently file a separate application under Sections 68 and 69 of the Arbitration Act 1996, as discussed below at Section 4.1.4).
4.1.2 Worldwide Freezing Order
Contemporaneously with the Section 66 application, C&H applied on an urgent without-notice basis for a worldwide freezing order ("WFO") against KMH. The application was heard by Mr. Justice Ashworth on 16 July 2024 and was granted in the standard Commercial Court form, restraining KMH from removing from England & Wales or in any way disposing of, dealing with, or diminishing the value of any of its assets worldwide up to the value of £108,600,000 (being the Award plus Costs).
The WFO was supported by evidence demonstrating:
(a) a good arguable case on the merits (established by the Award itself);
(b) a real risk of dissipation, evidenced by KMH's pattern of transferring assets between SPV subsidiaries in the period following the Award, its failure to engage with TSL's demand for payment, and intelligence obtained by HP indicating that KMH had instructed its bankers to prepare for significant intercompany transfers; and
(c) the existence of assets within and outside the jurisdiction, supported by HP's preliminary asset-tracing report.
The WFO was served on KMH at its registered office in Nicosia and on Harkness Whitford & Co. (SRA No. 614823), the London solicitors instructed by KMH. The WFO included ancillary disclosure provisions requiring KMH to disclose, by affidavit sworn within seven days, all assets worldwide exceeding £25,000 in value, including the nature, value, and location of each asset.
On the return date of 30 July 2024, the WFO was continued with certain modifications agreed between the parties. The modifications included a provision for KMH to spend up to £500,000 on ordinary course legal costs without prior application to the Court, and a clarification of the treatment of KMH's interests in fleet SPVs (which were treated as assets subject to the WFO to the extent of KMH's beneficial interest). The WFO remains in force as of the date of this letter, and its continuation (at a reduced level) forms part of our recommendations below.
4.1.3 Third-Party Debt Order — Meridian Trust Bank Ltd.
Armed with the Section 66 enforcement order and the information obtained through the WFO disclosure process, C&H applied for an interim third-party debt order ("TPDO") against Meridian Trust Bank Ltd. (50 Lombard Street, London EC3V 9EA) in respect of funds held in accounts maintained by KMH at that institution. The application was made pursuant to CPR Part 72.
The interim TPDO was granted on 5 August 2024, freezing the sum of £18,720,000 held by Meridian Trust Bank Ltd. to the credit of KMH's sterling and US dollar accounts. KMH did not file evidence opposing the making of the order final, and the Court accordingly made a final TPDO on 3 September 2024, directing Meridian Trust Bank Ltd. to pay the sum of £18,720,000 to TSL in satisfaction of the judgment debt to that extent. The funds were received by C&H's client account on 5 September 2024 and promptly remitted to TSL's designated recovery account at Ionian National Bank SA, Athens.
4.1.4 KMH's Set-Aside Application
On 19 August 2024, KMH, acting through Harkness Whitford & Co. (Partner with conduct: Mr. Thomas Harkness), filed an application to set aside the Award on two grounds:
(a) Under Section 68 of the Arbitration Act 1996, alleging a serious irregularity affecting the Tribunal, on the basis that the Tribunal had failed to deal with an issue put to it by KMH (namely, KMH's counterclaim for alleged damage to M/V Aegean Fortuna during the charter period) and that this constituted a serious irregularity within the meaning of Section 68(2)(d); and
(b) Under Section 69 of the Arbitration Act 1996, seeking permission to appeal on a point of law, contending that the Tribunal had erred in its application of the principles governing the assessment of market differential damages under English law and had applied the wrong date for the assessment of available market.
C&H filed a detailed skeleton argument opposing both limbs of the application. With respect to the Section 68 challenge, C&H demonstrated by reference to the Award itself that the Tribunal had dealt with KMH's counterclaim at paragraphs 412 to 467 of the Award and had dismissed it on the merits; KMH's complaint was in substance a complaint about the outcome rather than any procedural irregularity. With respect to the Section 69 application, C&H submitted that the Tribunal had correctly applied the settled principles established by the House of Lords in The Elena d'Amico [1980] 1 Lloyd's Rep 75 and the Court of Appeal in The New Flamenco [2017] UKSC 43, and that KMH's proposed appeal had no realistic prospect of success.
The application was heard by Mr. Justice Ashworth on 11 October 2024. In a reserved judgment delivered on 25 October 2024, His Lordship dismissed both limbs of the application in their entirety. The Section 68 challenge was dismissed on the basis that the Tribunal had plainly dealt with the counterclaim and that KMH's real complaint was that the Tribunal had dealt with it adversely, which did not amount to a serious irregularity. Permission to appeal under Section 69 was refused on the basis that the Tribunal had correctly identified and applied the relevant legal principles and that the question raised by KMH did not meet the threshold for permission under Section 69(3). The judge observed, in terms, that KMH's challenge was "in substance a disguised appeal on the merits of the kind that the Arbitration Act 1996 was designed to prevent."
Costs of the set-aside application were awarded to TSL on the indemnity basis, reflecting the Court's view that the application had been without merit and had been pursued as a tactical measure to delay enforcement. Those costs were assessed at £385,000 and have been included in the cost recovery calculations set out below.
4.1.5 England Recovery Summary
The total recovery achieved in England & Wales was £18,720,000, obtained through the final TPDO against Meridian Trust Bank Ltd. on 3 September 2024. This sum was received by TSL within approximately seven weeks of the commencement of enforcement proceedings, demonstrating the efficacy of the English enforcement framework and the value of the early WFO and ancillary disclosure.
4.2 Cyprus
4.2.1 Recognition and Enforcement Application
Given that KMH is a Cypriot-incorporated company with significant assets in Cyprus (including its shareholding in Oceangate Ventures Ltd. and funds held at Cypriot banks), Cyprus was identified as a primary enforcement jurisdiction from the outset of the campaign.
On 9 August 2024, an application for recognition and enforcement of the Award was filed in the Nicosia District Court (Case No. 2247/2024) pursuant to the provisions of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (the "New York Convention"), as implemented in Cyprus through the International Commercial Arbitration Law of 1987 (Law 101/1987) and the relevant provisions of the Cyprus Arbitration Law, Cap. 4. C&H instructed and coordinated with Kyprianos Makrides & Partners, a leading Nicosia litigation firm, as local counsel for the enforcement proceedings. The partner team at Kyprianos Makrides with conduct of the matter comprised Mr. Andreas Kyprianos (Senior Partner) and Ms. Nadia Makrides (Partner).
KMH opposed the enforcement application through its Cypriot lawyers, Vassiliadis & Economou LLC (Mr. Georgios Vassiliadis, Managing Partner; Ms. Eleni Economou, Partner), raising two grounds of opposition under Article V of the New York Convention:
(a) Article V(2)(b) — that enforcement of the Award would be contrary to the public policy of Cyprus, on the basis that the quantum awarded was allegedly disproportionate and constituted a "penal" damages award incompatible with Cypriot public policy; and
(b) Article V(1)(b) — that KMH had not been given proper notice of the appointment of the Tribunal or of the arbitral proceedings, an allegation predicated on a claimed deficiency in the service of the Notice of Arbitration on one of KMH's BVI holding companies (which was not, in fact, a party to the arbitration).
Both grounds were without merit. The public policy ground was dismissed on the basis that the damages awarded by the Tribunal were compensatory in nature, assessed in accordance with well-established principles of English law, and that there was no basis for the contention that their enforcement would offend Cypriot public policy. The proper notice ground was dismissed on the basis that KMH itself (as opposed to its non-party holding company) had been properly notified and had participated fully in the arbitration throughout.
The Nicosia District Court issued an enforcement order on 30 September 2024, granting full recognition and enforcement of the Award in Cyprus.
4.2.2 Freezing Injunction and Asset Execution
In advance of the enforcement order, and to prevent dissipation of KMH's Cypriot assets pending determination of the enforcement application, Kyprianos Makrides obtained a freezing injunction from the Nicosia District Court on 12 August 2024. The freezing injunction covered two principal categories of assets:
(a) KMH's shares in Oceangate Ventures Ltd. (HE 401293): Oceangate Ventures is an intermediate Cypriot holding company registered at 28 Themistokli Dervi Avenue, Suite 604, Nicosia 1066, which in turn holds the shares in various fleet SPV subsidiaries, including Dnepr Shipholding Inc. (BVI Company No. 2014876), the registered owner of M/V Volga Spirit. Oceangate Ventures was 100% owned by KMH as at the date of the freezing injunction. The shares in Oceangate Ventures represented a significant asset, as the company's underlying fleet SPV holdings and associated operational assets were valued in excess of USD $40 million.
(b) KMH's bank accounts in Cyprus: KMH maintained operational accounts at Cascade Savings Bank and Tarrant Commerce Bank, both in Nicosia, which were frozen pursuant to the injunction.
Following the enforcement order of 30 September 2024, Kyprianos Makrides moved promptly to execute against both categories of frozen assets. The execution process involved:
(i) an application for the forced sale of KMH's shares in Oceangate Ventures Ltd., conducted through the Cypriot court-supervised execution process, with the shares being valued by an independent court-appointed valuer and ultimately sold to a third-party purchaser (Poseidon Maritime Capital Ltd., a Limassol-based shipping investment vehicle) following a competitive tender process; and
(ii) direct execution against the funds held in KMH's bank accounts at Brightmoor Trust Bank and Marlowe National Bank.
The recovery process commenced on 22 October 2024 and was completed on 8 November 2024, at which point the aggregate proceeds were converted to sterling and remitted to TSL's recovery account.
4.2.3 Cyprus Recovery Summary
The total recovery achieved in Cyprus was £22,350,000 (GBP equivalent, converted from euros at the prevailing exchange rates on the respective dates of receipt). This recovery comprised the proceeds of the forced sale of the Oceangate Ventures shares together with the funds garnished from KMH's Cypriot bank accounts.
4.3 Singapore
4.3.1 Enforcement Application
Singapore was identified as a key enforcement jurisdiction due to the presence of KMH's operational subsidiary, Korinthian Bulkers (Singapore) Pte. Ltd. (80 Robinson Road, #14-02, Singapore 068898), which managed the commercial operations of several of KMH's vessels in the Asia-Pacific region, and due to the anticipated arrival of M/V Crimson Horizon in Singapore waters.
On 14 August 2024, C&H, through its Singapore local counsel Straits Meridian LLP (Mr. David Teo Wei Lin, Partner; Ms. Priya Subramaniam, Senior Associate), filed an application for leave to enforce the Award as a judgment of the Singapore High Court in Originating Summons No. 872/2024, pursuant to Section 19 of the International Arbitration Act (Cap. 143A) and Order 69A of the Rules of Court.
Leave to enforce was granted by the Singapore High Court (General Division) on 6 September 2024. KMH's Singapore subsidiary was served with the enforcement order but did not apply to set it aside within the permitted time.
4.3.2 Garnishee Proceedings — Pinnacle Bank (Singapore) Ltd.
Following the grant of leave, Straits Meridian commenced garnishee proceedings (the Singapore equivalent of the English TPDO) against Pinnacle Bank (Singapore) Ltd. (6 Battery Road, #20-01, Singapore 049909) in respect of accounts held by Korinthian Bulkers (Singapore) Pte. Ltd. at that institution. The garnishee proceedings were brought on the basis that the subsidiary held funds representing operational revenues from KMH's fleet activities, and that those funds were subject to enforcement by virtue of KMH's liability under the Award and the corporate relationship between KMH and its subsidiary (which had been established through corporate chain analysis conducted by HP and confirmed through documentary evidence obtained via the English WFO disclosure).
A garnishee order to show cause was issued on 23 September 2024, and a garnishee order absolute was granted on 18 October 2024, directing Pinnacle Bank to pay the sum of SGD $31,200,000 (approximately £18,450,000 at the exchange rate prevailing on the date of payment) to TSL. The funds were received by Straits Meridian's client account and subsequently remitted to TSL.
4.3.3 Arrest and Judicial Sale of M/V *Crimson Horizon*
In parallel with the garnishee proceedings, and in what proved to be one of the most significant enforcement steps in the campaign, C&H and Straits Meridian arranged for the arrest of M/V Crimson Horizon (IMO 9801334, Handymax Bulk Carrier, 37,500 DWT, Liberian flag) in Singapore waters.
The vessel was registered in the name of Korinthian Bulkers (Singapore) Pte. Ltd., a wholly-owned subsidiary of KMH. The beneficial ownership chain was established through corporate analysis conducted by C&H with input from HP, which traced the ownership through KMH's corporate structure and confirmed that Korinthian Bulkers (Singapore) Pte. Ltd. was a single-purpose entity whose sole significant asset was M/V Crimson Horizon. This analysis was critical in establishing the jurisdictional basis for arrest under the High Court (Admiralty Jurisdiction) Act (Cap. 123).
An arrest warrant was issued by the Sheriff of the Supreme Court of Singapore on 20 August 2024, and M/V Crimson Horizon was arrested while at anchorage in Singapore waters on the same date. The arrest was effected without incident, and the vessel was placed under the custody of the Sheriff pending further order.
KMH was given the opportunity to furnish security in exchange for the release of the vessel but failed to do so, nor did KMH make any application to set aside the arrest. In the absence of security or settlement, Straits Meridian applied for an order for the appraisement and sale of the vessel by the Sheriff. The Court ordered an independent valuation, which was conducted by Northcape Maritime Advisory Ltd. (Captain Ian Forsyth, Managing Director), a respected London-based firm of independent ship valuers and marine consultants. Northcape assessed the fair market value of M/V Crimson Horizon at approximately USD $23,500,000, taking into account the vessel's age, condition (based on the most recent class survey and condition of class), and prevailing market conditions for Handymax bulk carriers.
The judicial sale was conducted on 15 November 2024 through a process supervised by the Sheriff of the Supreme Court. The vessel was sold to the highest bidder, an entity associated with a major South Korean shipowner, at a price of USD $22,800,000 (approximately £18,330,000 at the exchange rate prevailing on the date of receipt of proceeds). The sale price represented approximately 97% of Northcape's assessed fair market value, reflecting a competitive bidding process. The net proceeds, after deduction of Sheriff's fees, port charges, and crew-related costs, were received by Straits Meridian on 2 December 2024 and remitted to TSL.
4.3.4 Singapore Recovery Summary
The total recovery achieved in Singapore was £36,780,000, comprising £18,450,000 from the garnishee order against Pinnacle Bank and £18,330,000 from the judicial sale of M/V Crimson Horizon. Singapore was thus the single most productive enforcement jurisdiction, accounting for approximately 38% of total recoveries.
4.4 United Arab Emirates
4.4.1 Enforcement Application
The UAE was identified as an enforcement jurisdiction due to the presence of Korinthian DMCC, a KMH subsidiary incorporated in the Dubai Multi Commodities Centre (Unit 3407, Almas Tower, JLT, Dubai), which managed KMH's trade finance and chartering operations in the Middle East and Indian subcontinent region. In addition, KMH maintained banking relationships in the UAE, and certain of KMH's vessels were known to call at UAE ports, including the anchorage at Fujairah.
On 22 August 2024, C&H's UAE local counsel, Al-Rashid Hatem & Associates (Mr. Tariq Al-Rashid, Managing Partner; Ms. Leila Hatem, Partner, with offices at Office 1802, Emirates Financial Towers (South Tower), DIFC, Dubai), filed an application for enforcement of the Award in the Dubai Court of First Instance (Case No. 1893/2024).
The application was brought pursuant to the provisions of UAE Federal Law No. 6 of 2018 (the UAE Arbitration Law) and the New York Convention, to which the UAE is a signatory. The application required the preparation and submission of certified Arabic translations of the Award, the arbitration agreements, and all supporting documents, each legalized through the UK Foreign, Commonwealth & Development Office (FCDO) Apostille service and subsequently authenticated by the UAE Embassy in London. This documentation process, while routine, required careful coordination and added approximately six weeks to the enforcement timeline in the UAE.
The Dubai Court of First Instance reviewed the application and, after a hearing at which KMH's UAE counsel appeared and raised procedural objections (which were overruled), issued an enforcement order on 20 November 2024, granting full recognition and enforcement of the Award in the UAE.
4.4.2 Precautionary Attachment and Execution
In advance of the enforcement order, Al-Rashid Hatem had obtained a precautionary attachment order from the Dubai Court on 28 August 2024, attaching the accounts of Korinthian DMCC held at Emirates Gulf Commercial Bank PJSC (Gate Village 3, DIFC, Dubai). The precautionary attachment, functionally equivalent to a freezing injunction under English law, prevented KMH's subsidiary from dealing with the attached funds pending the outcome of the enforcement application.
Following the grant of the enforcement order on 20 November 2024, the precautionary attachment was converted to an execution attachment, and Al-Rashid Hatem initiated the formal execution process through the Dubai Court's Execution Department. The execution extended to Korinthian DMCC's bank accounts and to certain attachable receivables (principally trade receivables from sub-charterers and commodity traders in the Gulf region).
The recovery process commenced on 10 December 2024 and was completed on 14 January 2025, by which date all attachable funds and receivables had been collected and converted to sterling.
4.4.3 UAE Recovery Summary
The total recovery achieved in the UAE was AED 53,400,000 (approximately £11,340,000 at the prevailing exchange rates). While this was the smallest recovery among the four enforcement jurisdictions in absolute terms, it nevertheless represented a material contribution to the overall campaign and was achieved in a jurisdiction that is sometimes perceived as challenging for award enforcement.
4.5 Voluntary Payment by KMH
On 3 February 2025, following the completion of enforcement in the UAE and in the context of the aggregate pressure exerted by the multi-jurisdictional campaign, KMH made a voluntary payment of £7,400,000 directly to TSL's recovery account. The payment was made by wire transfer from an account at Ashgrove Securities, Athens, held in the name of Volkov Maritime Investments Ltd. (HE 392106, Cyprus), one of the Volkov family's Cypriot holding companies.
C&H acknowledged receipt of the payment on behalf of TSL and, by letter to Harkness Whitford & Co. dated 5 February 2025, confirmed that the payment had been applied towards the outstanding balance but expressly reserved all of TSL's rights in respect of the remaining sums due, including the continuing accrual of post-award interest. The letter made clear that neither the acceptance of the payment nor any communication in connection therewith constituted a waiver of any of TSL's enforcement rights or remedies.
5. Recovery Summary Table
The following table summarizes the recoveries achieved across all jurisdictions and enforcement mechanisms:
All recovery amounts in foreign currencies have been converted to sterling at the exchange rates prevailing on the respective dates of receipt by TSL. Minor rounding differences may arise in the aggregate figure due to the use of multiple conversion dates.
6. Outstanding Balance Analysis
We set out below a detailed reconciliation of the amounts owed under the Award against the total recoveries achieved, in order to identify the outstanding balance as of 15 March 2025.
Award (principal and pre-award interest): £96,450,000
Costs (85% allocated to KMH): £12,150,000
Award plus Costs: £108,600,000
Post-award interest (5.25% per annum simple on £96,450,000 from 29 June 2024 through 15 March 2025, i.e., 260 days):
£96,450,000 × 0.0525 × (260 ÷ 365) = £3,607,726.03
Grand Total Owed as of 15 March 2025: £112,207,726.03
Less: Total Recovered: (£96,590,000)
Outstanding Balance: £15,617,726.03
For the avoidance of doubt, we note the following:
(a) Post-award interest continues to accrue on the unpaid portion of the Award at a rate of 5.25% per annum simple. On the full principal of £96,450,000, this equates to approximately £13,876 per day (calculated as £96,450,000 × 0.0525 ÷ 365). As recoveries have reduced the unpaid principal, the daily interest accrual will reduce proportionately once the allocation of recoveries between principal, costs, and interest is finalised. The precise allocation will be set out in the Final Recovery and Interest Reconciliation spreadsheet enclosed with this letter.
(b) The recovery percentage against the Award plus Costs (excluding post-award interest) is 88.94% (£96,590,000 ÷ £108,600,000), or approximately 89%.
(c) The outstanding balance of £15,617,726.03 comprises principally: (i) the unrecovered portion of the costs award; (ii) the full post-award interest accrual from 29 June 2024 to 15 March 2025; and (iii) a residual portion of the original Award amount. The precise breakdown among these components is set out in the enclosed reconciliation.
7. Remaining Enforcement Opportunities
While the active enforcement campaign has now been substantially concluded, several opportunities remain for recovery of the outstanding balance. We summarize these below.
7.1 M/V *Volga Spirit*
M/V Volga Spirit (IMO 9756892, Panamax Bulk Carrier, 76,400 DWT, Cyprus flag) remains in operation and represents the most significant remaining enforcement target. The vessel is registered in the name of Dnepr Shipholding Inc. (BVI Company No. 2014876), a fleet SPV that was, prior to the forced sale of the Oceangate Ventures shares, controlled by KMH through its 100% shareholding in Oceangate Ventures Ltd. Following the forced sale of those shares, the corporate chain of ownership has changed, and the current beneficial ownership structure will need to be re-analysed to determine whether the vessel remains subject to enforcement in respect of KMH's liabilities.
However, our preliminary analysis indicates that there are strong arguments for pursuing arrest of M/V Volga Spirit on the basis of the beneficial ownership that existed at the time the cause of action arose and the Award was rendered, and potentially on the basis of the vessel's connection to the underlying disputes (M/V Volga Spirit being one of the three vessels that was the subject of the arbitration). The availability and scope of arrest will depend on the law of the jurisdiction in which the arrest is sought.
M/V Volga Spirit was last reported at Fujairah anchorage (UAE) as of 6 March 2025, based on AIS tracking data. The vessel trades primarily in the Middle East and Indian Ocean region. We note that the vessel's presence in UAE waters presents a potential arrest opportunity through Al-Rashid Hatem & Associates, who are already familiar with the matter and have established the enforcement framework in the UAE.
Northcape Maritime Advisory Ltd. has previously provided valuations on similar Panamax tonnage in the 76,000–78,000 DWT range. Based on current market conditions, a Panamax bulk carrier of M/V Volga Spirit's specifications and age profile would be valued in the range of USD $20–25 million. A current, vessel-specific valuation would be required before any arrest application is made, to establish the proportionality and value of the arrest.
Recommendation: We recommend that TSL maintain continuous vessel tracking (through Halcyon Health IT or a comparable service) and that standing arrest instructions be provided to Al-Rashid Hatem & Associates (for UAE arrest) and to other local counsel in jurisdictions where M/V Volga Spirit is likely to call. The cost of maintaining this monitoring capability is minimal (estimated at £2,000–3,000 per month for vessel tracking services, plus nominal standing retainer fees for local counsel), and the potential recovery is significant.
7.2 Sub-Charterer Receivables
HP's asset tracing identified approximately £4,200,000 in receivables owed to KMH and its subsidiaries by various sub-charterers and trading counterparties. These receivables were disclosed through the WFO ancillary disclosure provisions (as supplemented by further information obtained through HP's forensic analysis of KMH's banking records and commercial correspondence).
The identified receivables include:
(a) approximately £1,800,000 owed by Caspian Grain Trading SA (Geneva) to Korinthian Bulkers (Singapore) Pte. Ltd. under sub-charter-parties for grain shipments from the Black Sea to Southeast Asia;
(b) approximately £1,400,000 owed by Indus Commodities DMCC (Dubai) to Korinthian DMCC under voyage charter arrangements for iron ore cargoes; and
(c) approximately £1,000,000 owed by various smaller counterparties in scattered amounts.
Attachment proceedings can be pursued in the relevant jurisdictions (Switzerland for the Caspian Grain receivable; the UAE for the Indus Commodities receivable; and various other jurisdictions for the smaller amounts). The legal work required to pursue these attachments is substantially leveraged from the existing proceedings, as the enforcement orders are already in place in the relevant jurisdictions.
Recommendation: We recommend pursuing attachment of the identified receivables on a reduced-scope, cost-effective basis, prioritising the two largest receivables (Caspian Grain Trading and Indus Commodities) where the amounts involved justify the costs of attachment proceedings.
7.3 Continuing Post-Award Interest Accrual
As noted above, post-award interest continues to accrue at 5.25% per annum simple on the unpaid portion of the Award. This ongoing accrual serves as a continuing incentive for KMH to negotiate a settlement of the remaining balance, as the total amount owed increases by approximately £13,876 for each day that payment is not made. This leverage should be explicitly referenced in any settlement communications with KMH.
7.4 Additional Identified but Unexecuted Assets
Through the WFO ancillary disclosure process and HP's asset-tracing work, a number of additional assets have been identified that are subject to the WFO but have not yet been the subject of execution proceedings. These include:
(a) KMH's interest in a joint venture arrangement with Black Sea Bulk Terminal JSC (Novorossiysk, Russia), valued at approximately USD $3,200,000, which is currently impractical to execute against due to the sanctions environment and the difficulties of enforcement in the Russian Federation;
(b) A residential property in Limassol, Cyprus (47 Amathountos Avenue, Apt. 12A, Limassol 4533), registered in the name of Sergei Volkov personally, which may be subject to enforcement if it can be established that the property was acquired with funds traceable to KMH (HP has indicated that further analysis would be required); and
(c) Various smaller items of movable property and equipment in Cyprus and the BVI, the aggregate value of which is estimated at less than £500,000.
While these assets are noted for completeness, the cost-benefit analysis of pursuing execution against them is not presently favourable, with the possible exception of the Limassol property if the tracing analysis supports it. We do not recommend active pursuit of these assets at this stage but recommend that they remain subject to the WFO so that they are preserved in the event that circumstances change.
8. Recommendations
Drawing on the foregoing analysis, C&H makes the following recommendations for the residual monitoring and collection phase.
8.1 Partial Discharge of the Worldwide Freezing Order
We recommend that TSL file an application in the Commercial Court (Claim No. CL-2024-000487) for a partial discharge of the WFO to reduce the maximum restrained amount from £108,600,000 to the current outstanding balance of approximately £15,617,726.03 (plus accruing interest, to be calculated as at the date of the application). The reduction of the WFO to the outstanding balance is appropriate given that TSL has recovered £96,590,000 and no longer requires the WFO at its original level. Maintaining the WFO at a reduced level, however, is essential to preserve the asset-freezing framework for the remaining enforcement.
A draft consent order has been prepared by C&H for this purpose and is enclosed with this letter for TSL's review. If KMH (through Harkness Whitford & Co.) is prepared to consent to the partial discharge on agreed terms, the application can be dealt with by the Court on paper without the need for a hearing, thereby minimising costs. If KMH does not consent, C&H will proceed with a contested application, which we would expect to succeed on the merits.
8.2 Continued Monitoring — M/V *Volga Spirit*
As discussed at Section 7.1 above, we recommend that TSL maintain vessel tracking for M/V Volga Spirit and provide standing arrest instructions to Al-Rashid Hatem & Associates (for the UAE) and to selected local counsel in other jurisdictions where the vessel is likely to call (particularly India, Singapore, and South Africa). The cost of this monitoring is minimal, estimated at £2,000–3,000 per month for the vessel tracking service and nominal retainer fees for local counsel preparedness. The potential recovery, should an arrest opportunity arise, is in the range of USD $20–25 million (subject to updated valuation), which would substantially exceed the entire outstanding balance.
8.3 Pursuit of Sub-Charterer Receivables
We recommend that C&H, in coordination with the relevant local counsel, pursue attachment of the identified sub-charterer receivables totalling approximately £4,200,000. The priority targets are the Caspian Grain Trading receivable (approximately £1,800,000) and the Indus Commodities receivable (approximately £1,400,000). The cost-benefit analysis is favourable, as the legal infrastructure for enforcement is already in place in the relevant jurisdictions and the incremental costs of attachment proceedings are estimated at £80,000–120,000 across all jurisdictions, against potential recoveries of up to £4,200,000.
8.4 Transition to Reduced-Scope Engagement
We recommend transitioning the C&H engagement from the current active enforcement phase to a monitoring and residual collection phase. Under the reduced-scope engagement:
(a) The C&H team will be reduced to Hannah Brinkley (Lead Associate) and Patrick Gallagher (Junior Associate), with Samuel Eklund and Linda Osei available for partner-level oversight on an as-needed basis;
(b) Reporting will transition from bi-weekly to monthly, with ad hoc reporting on significant developments;
(c) No further significant expenditure is anticipated unless an arrest opportunity arises for M/V Volga Spirit or a settlement negotiation requires senior partner involvement; and
(d) The reduced-scope engagement will be governed by a supplemental engagement letter, which C&H will prepare and submit for TSL's approval.
8.5 Settlement Discussions
Finally, TSL may wish to consider a without-prejudice approach to KMH (through Harkness Whitford & Co.) for a negotiated lump-sum payment of the remaining balance in exchange for:
(a) discharge of the WFO in its entirety;
(b) discontinuance of all residual enforcement proceedings across all jurisdictions; and
(c) release of any further claims by TSL in connection with the Award.
The continuing accrual of post-award interest (at approximately £13,876 per day), the risk of arrest of M/V Volga Spirit (which would disrupt KMH's commercial operations and impose significant additional costs), and the prospect of attachment of sub-charterer receivables provide substantial leverage for such discussions. A settlement in the range of £12–14 million, representing a modest discount to the full outstanding balance, may be achievable and would deliver certainty of recovery while avoiding the costs and uncertainties of continued enforcement.
C&H is prepared to conduct such discussions on TSL's behalf, subject to TSL's instructions as to the parameters of any acceptable settlement. Any settlement communication would be made expressly without prejudice and subject to contract, preserving TSL's enforcement rights in full pending agreement on definitive terms.
9. Fee Summary
We set out below a summary of the professional fees and costs incurred in connection with the enforcement campaign, for TSL's review and internal accounting purposes.