CALDERWOOD & HARKNESS LLP 45 Moorgate, London EC2R 6AR
PRIVILEGED AND CONFIDENTIAL
ATTORNEY-CLIENT PRIVILEGED / WORK PRODUCT
MEMORANDUM
From: Patrick Gallagher, Working Associate, Calderwood & Harkness LLP
To: Samuel Eklund, Responsible Partner; Hannah Brinkley, Lead Associate
CC: Linda Osei, Billing Partner
Date: 12 February 2025
Re: Sub-Charterer Receivables Owed to Korinthian Maritime Holdings Ltd. and Subsidiaries — Attachment and Recovery Analysis
Matter: Thalassa Shipping & Logistics SA v. Korinthian Maritime Holdings Ltd. — Enforcement of LCIA Award No. 224718
Court References: CL-2024-000487 (England & Wales, Commercial Court); Case 2247/2024 (District Court of Nicosia, Cyprus); OS 872/2024 (High Court of Singapore); Case 1893/2024 (Dubai Courts, UAE)
Our Client: Thalassa Shipping & Logistics SA ("TSL"), 14 Akti Miaouli, 4th Floor, Piraeus 185 35, Greece
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1. Executive Summary
The purpose of this memorandum is to analyze approximately £4,200,000 in receivables owed to Korinthian Maritime Holdings Ltd. ("KMH") and its subsidiaries by four identified sub-charterer debtors and to recommend the most effective legal mechanisms for attachment and recovery of those receivables in the relevant jurisdictions. This analysis forms part of the broader enforcement campaign in respect of LCIA Award No. 224718 (the "Award") and should be read in conjunction with the enforcement strategy memorandum dated 2024-07-22 and the quarterly enforcement status reports circulated to the client.
By way of context, the enforcement campaign arises from LCIA Award No. 224718, dated 28 June 2024, in which the tribunal awarded TSL damages in the principal amount of £96,450,000 and allocated costs in the amount of £12,150,000, yielding a combined Award and Costs figure of £108,600,000. Post-award interest accrues at 5.25% per annum simple on the principal sum of £96,450,000 from 29 June 2024. Through the date of this memorandum, TSL has recovered a total of £96,590,000, representing approximately 88.94% of the combined Award and Costs. Taking into account post-award interest accrued through 15 March 2025 (computed at £3,607,726.03), the total amount owed is £112,207,726.03, leaving an outstanding balance of approximately £15,617,726.03.
The sub-charterer receivables identified in this memorandum represent one of the remaining identifiable and tangible asset pools available for enforcement, alongside the M/V Volga Spirit (last reported at Fujairah anchorage on approximately 5 February 2025) and the continuing post-award interest accrual. It is therefore critical that TSL act promptly to pursue these receivables before they dissipate or are paid over to KMH or its connected parties in potential breach of the worldwide freezing order (the "WFO").
The receivables have been identified through two primary sources: (i) KMH's own asset disclosure affidavits provided pursuant to the WFO granted on 16 July 2024 by Mr. Justice Ashworth in the Commercial Court (CL-2024-000487); and (ii) the forensic asset tracing work carried out by Hartwell Pemberton LLP ("HP"), as set out in their reports dated 15 August 2024, 1 October 2024, and 25 November 2024. A degree of cross-referencing between these two sources has been possible, and the results are set out in Section 4 below.
My recommendation is that TSL pursue attachment of these receivables in the applicable jurisdictions on a priority basis. The recommended priority order, informed by the size of the receivable, the enforceability infrastructure already in place, and the legal complexity involved, is as follows: (1) the two UAE receivables (combined value approximately £1,842,000), for which existing enforcement orders and local counsel are already in place; (2) the Singapore receivable (approximately £1,688,000), for which existing enforcement infrastructure exists but where corporate veil issues add complexity; and (3) the England/Greece receivable (approximately £670,000), which is the smallest amount and involves jurisdictional complications. Each of these is addressed in detail in the sections that follow.
2. Background and Context
2.1 The Underlying Award and Enforcement Campaign
LCIA Award No. 224718 was issued on 28 June 2024 following a hearing on the merits that took place over twelve days in January and February 2024, with post-hearing submissions concluding in April 2024. The Tribunal was constituted as follows:
• Presiding Arbitrator: Sir Malcolm Fenton-Clarke
• Claimant-nominated Arbitrator: Professor Athena Drakopoulos
• Respondent-nominated Arbitrator: Dr. Henrik Dalmqvist
• Tribunal Secretary: Fiona Beckett
The Award arose from charter-party disputes involving three vessels operated by KMH and its subsidiaries under time charter and voyage charter arrangements with TSL. The three vessels in question were:
1. M/V *Aegean Fortuna* — IMO 9784521; Supramax Bulk Carrier; 58,200 DWT; beneficially owned through Dnepr Shipholding Inc.
2. M/V *Crimson Horizon* — IMO 9801334; Handymax Bulk Carrier; 37,500 DWT; beneficially owned through Dnepr Shipholding Inc. (since judicially sold in Singapore on 15 November 2024).
3. M/V *Volga Spirit* — IMO 9756892; Panamax Bulk Carrier; 76,400 DWT; beneficially owned through Dnepr Shipholding Inc.; Cyprus flag; last reported at Fujairah anchorage.
The Tribunal found that KMH had committed repudiatory breaches of the charter-party agreements in respect of all three vessels and awarded TSL damages as follows:
In addition, the Tribunal allocated costs 85% to KMH, resulting in a costs award comprising LCIA institutional costs of £3,240,000 and TSL's legal costs of £8,910,000, for a total costs award of £12,150,000.
Post-award interest accrues at 5.25% per annum simple on the principal sum of £96,450,000 from 29 June 2024 until the date of full payment. Through 15 March 2025 (the target close date for this phase of the enforcement campaign), post-award interest amounts to approximately £3,607,726.03, computed as follows: £96,450,000 × 5.25% × (260 days / 365 days) = £3,607,726.03.
The total amount owed by KMH to TSL as at 15 March 2025 is therefore:
2.2 Current Recovery Position
Following the issuance of the Award, Calderwood & Harkness LLP ("C&H"), on behalf of TSL, launched a coordinated multi-jurisdictional enforcement campaign targeting KMH's assets in England and Wales, Cyprus, Singapore, and the United Arab Emirates. The enforcement campaign has been highly successful to date, achieving the following recoveries:
The outstanding balance is therefore:
£112,207,726.03 − £96,590,000 = £15,617,726.03
The remaining identifiable assets available for enforcement are as follows:
1. Sub-charterer receivables — approximately £4,200,000, as analyzed in this memorandum.
2. M/V *Volga Spirit* — owned by Dnepr Shipholding Inc. (BVI Company No. 2014876), Cyprus flag, last reported at Fujairah anchorage. Arrest and judicial sale of this vessel is being pursued separately and is the subject of a separate memorandum. The vessel's estimated market value, based on comparable sales data and broker assessments obtained by HP, is in the range of USD $18,000,000–$22,000,000 (approximately £14,500,000–£17,700,000), although encumbrances including a first-priority mortgage in favor of Odessa Maritime Finance Ltd. (estimated outstanding balance of approximately USD $12,000,000) would significantly reduce TSL's net recovery.
3. Continuing post-award interest accrual — interest continues to accrue at approximately £13,877 per day (£96,450,000 × 5.25% / 365) on the unpaid principal balance. The accrual of interest increases the total amount owed but does not itself generate a recoverable asset.
2.3 KMH's Corporate Structure Relevant to Receivables
An understanding of KMH's corporate structure is essential to the analysis of the sub-charterer receivables, because several of the receivables are owed not to KMH directly but to its wholly-owned subsidiaries. A corporate structure chart is attached at Appendix D, but the key entities may be summarized as follows.
Korinthian Maritime Holdings Ltd. ("KMH") is a company incorporated in Cyprus under registration number HE 387421, with its registered office at 28 Themistokli Dervi Avenue, Suite 601, Nicosia 1066, Cyprus. KMH is the parent entity and disponent owner of the fleet of vessels that were the subject of the charter-party agreements with TSL. KMH is beneficially owned by Andrei Volkov through a combination of BVI and Cypriot holding structures. The directors of KMH are Sergei Volkov (understood to be Andrei Volkov's brother), Alexei Demidov (Director of Fleet Operations), and Marina Kazakova (who also serves as the company's Chief Financial Officer).
The key subsidiaries relevant to the receivables analysis are:
• Korinthian Bulkers (Singapore) Pte. Ltd. — incorporated in Singapore, with its registered office at 80 Robinson Road, #14-02, Singapore 068898. This entity held the operational proceeds from the M/V Crimson Horizon and maintained accounts at Pinnacle Bank (Singapore) Ltd. that have now been garnished. This entity is not directly relevant to the receivables discussed in this memorandum but forms part of the broader corporate structure.
• Dnepr Shipholding Inc. — a company incorporated in the British Virgin Islands under Company No. 2014876, with its registered agent at Vantage Corporate Services Ltd., Road Town, Tortola, BVI. Dnepr is the special purpose vehicle ("SPV") that holds registered ownership of the M/V Aegean Fortuna and the M/V Volga Spirit. Dnepr is a wholly-owned subsidiary of Oceangate Ventures Ltd., which is in turn wholly owned by KMH. Dnepr is the creditor entity for the Vostok Dry Cargo receivable discussed at Section 4.2 below.
• Korinthian DMCC — a company incorporated in the Dubai Multi Commodities Centre free zone, with its registered office at Unit 3407, Almas Tower, Jumeirah Lake Towers, Dubai, UAE. Korinthian DMCC held operational funds and was used as the vehicle for KMH's Middle Eastern chartering operations. Accounts held by Korinthian DMCC at Emirates Gulf Commercial Bank PJSC have already been subject to execution, yielding AED 53,400,000. Korinthian DMCC is the creditor entity for both the Horizon Bulk Carriers FZE receivable and the Caspian Logistics & Chartering DMCC receivable discussed at Sections 4.3 and 4.5 below.
• Oceangate Ventures Ltd. — incorporated in Cyprus under registration number HE 401293, with its registered office at 28 Themistokli Dervi Avenue, Suite 604, Nicosia 1066, Cyprus. Oceangate is an intermediate holding company for the fleet SPVs, including Dnepr Shipholding Inc. The shares in Oceangate were the subject of a forced sale in the Cypriot enforcement proceedings, which yielded a portion of the £22,350,000 recovered in Cyprus.
KMH and its subsidiaries entered into sub-charter arrangements through which certain vessels were sub-let to third-party charterers, generating hire, freight, and other receivables now owed to KMH entities. The sub-charter arrangements reflect the common practice in the dry bulk shipping industry of "layering" charter arrangements, with a disponent owner such as KMH taking a vessel on time charter from a head owner (or in this case, chartering from TSL) and then sub-letting the vessel to sub-charterers, capturing the differential in hire rates. It is these downstream receivables — amounts owed by sub-charterers to KMH and its subsidiaries — that form the subject of this memorandum.
The key personnel involved in KMH's chartering operations, and who appear to have been responsible for negotiating and managing the sub-charter arrangements, are Alexei Demidov (Director of Fleet Operations), Marina Kazakova (CFO), and Sergei Volkov (Director). HP's analysis indicates that Demidov and Kazakova had signature authority over the chartering accounts at Korinthian DMCC and that Sergei Volkov approved all sub-charter fixtures on behalf of KMH.
3. Sources of Information on Sub-Charterer Receivables
3.1 WFO Asset Disclosure
The worldwide freezing order granted on 16 July 2024 by Mr. Justice Ashworth in the Commercial Court (CL-2024-000487) required KMH to disclose all of its assets worldwide exceeding £25,000 in value, whether held in its own name or through any entity owned or controlled by it, within seven days of service of the order. The WFO was served on KMH through its English solicitors, Harkness Whitford & Co. (Catherine Whitford, partner), 12 Fetter Lane, London EC4A 1JP, on 17 July 2024.
KMH, acting through Harkness Whitford, provided its initial asset disclosure affidavit on 24 July 2024, sworn by Marina Kazakova in her capacity as CFO. A supplemental asset disclosure affidavit was provided on 30 August 2024, also sworn by Kazakova, following correspondence from C&H identifying apparent gaps and deficiencies in the initial disclosure.
The disclosure affidavits listed certain sub-charter agreements and outstanding hire payments owed to KMH and Dnepr Shipholding Inc. by sub-charterers. In particular, the initial affidavit identified the Vostok Dry Cargo receivable (Section 4.2 below) and made reference to certain "outstanding freight claims" owed to Korinthian DMCC. The supplemental affidavit provided additional detail on the Horizon Bulk Carriers FZE receivable (Section 4.3) and the Caspian Logistics receivable (Section 4.5), although in both cases the disclosure was partial and the amounts stated by KMH were lower than those identified through HP's independent analysis.
It is important to note that the adequacy of KMH's disclosure remains the subject of ongoing concern. As discussed at Section 4.4 below, the Balkan Tradewinds Shipping SA receivable was not disclosed in either of KMH's WFO affidavits, despite the fact that it represents an amount of approximately EUR 780,000 owed directly to KMH. This omission constitutes potential non-compliance with the disclosure obligation under the WFO and may form part of the evidence to be deployed in any contempt application. The adequacy of KMH's disclosure is addressed more fully in the dissipation evidence memorandum prepared by Hannah Brinkley and circulated on 5 January 2025.
3.2 Hartwell Pemberton LLP Asset Tracing Reports
Hartwell Pemberton LLP ("HP") was engaged by C&H on behalf of TSL in July 2024 to conduct a comprehensive global asset tracing exercise in relation to KMH and its connected entities and individuals, including Andrei Volkov and his family members. HP is a specialist forensic accounting and asset tracing firm; the engagement is led by Rebecca Saunders (Partner) and Mark Huxley (Director), both of 25 Old Broad Street, London EC2N 1HN.
HP has produced three substantive reports to date:
1. Preliminary Findings Report (15 August 2024): This report identified KMH's global asset structure, including bank accounts, vessel ownership, real property interests, and the existence of sub-charter arrangements. The report was instrumental in shaping the enforcement strategy and identifying the key jurisdictions for enforcement action.
2. Updated Findings Report (1 October 2024): This report provided further detail on specific sub-charter agreements, the amounts outstanding under those agreements, and the identity of the sub-charterer debtors. The report drew on publicly available shipping databases, port records, broker intelligence, and financial analysis of payment flows through bank accounts disclosed by KMH and identified independently by HP. It is this report that first identified the Balkan Tradewinds Shipping SA receivable and provided a more complete picture of the Horizon Bulk Carriers and Caspian Logistics receivables.
3. Post-Award Asset Movement Analysis (25 November 2024): This report tracked payments received by KMH and its subsidiaries from sub-charterers in the period following the issuance of the Award. The analysis revealed that certain payments, particularly from Caspian Logistics & Chartering DMCC, had been diverted to accounts connected to Andrei Volkov rather than being held in the ordinary course of business. These diversions are addressed separately in the dissipation evidence memorandum but are also relevant to the quantum analysis in Section 4.5 below.
Relevant extracts from each of HP's reports are attached at Appendix C.
4. Identified Sub-Charterer Receivables
4.1 Summary Table of Receivables
The following table summarizes the four identified sub-charterer receivables. Each receivable is discussed in detail in Sections 4.2 through 4.5 below.
Exchange rates used for GBP equivalents are approximate and based on prevailing rates as at 10 February 2025 (USD/GBP 0.8038; AED/GBP 0.2125; EUR/GBP 0.8590). Actual amounts recovered will vary with exchange rate fluctuations at the time of recovery.
4.2 Receivable 1 — Vostok Dry Cargo Ltd.
Debtor: Vostok Dry Cargo Ltd. ("Vostok"), a company incorporated in the Republic of the marshall Islands. HP's tracing work indicates that Vostok maintains its operational base in Singapore, where it has office facilities and is believed to maintain bank accounts with one or more Singapore-domiciled financial institutions. Vostok appears to be a mid-size dry bulk operator active in the Indian Ocean and Southeast Asian trades.
Creditor entity: Dnepr Shipholding Inc. ("Dnepr"), as the registered owner of M/V Volga Spirit.
Vessel sub-chartered: M/V Volga Spirit (IMO 9756892, Panamax Bulk Carrier, 76,400 DWT, Cyprus flag). This vessel remains one of the three vessels that were the subject of the TSL charter-party disputes and is currently the most significant remaining vessel asset in the enforcement campaign.
Nature of receivable: Outstanding hire under a sub-time charter dated approximately March 2023. Under the sub-time charter, Vostok was required to pay hire to Dnepr semi-monthly in advance. KMH's WFO disclosure affidavit states that the daily hire rate under the sub-charter was USD $13,500 per day, although HP's analysis suggests the actual rate may have been higher (approximately USD $14,250 per day) based on prevailing market rates at the time the fixture was concluded.
Amount outstanding: Approximately USD $2,100,000, equivalent to approximately £1,688,000 at current exchange rates. This figure represents accumulated unpaid hire for a period of approximately 75-80 days, though the exact period to which the outstanding hire relates has not been confirmed. KMH's WFO disclosure stated the outstanding amount as USD $1,850,000, but HP's updated analysis, taking into account hire that has continued to accrue since the WFO disclosure, estimates the current outstanding balance at approximately USD $2,100,000.
Source of identification: KMH's initial WFO asset disclosure affidavit (24 July 2024) identified the sub-charter arrangement and stated the outstanding hire at that time. HP's preliminary findings report and updated findings report confirmed the existence and approximate quantum of the receivable through analysis of charter fixture records and shipping databases.
Jurisdiction for attachment: Singapore is the preferred jurisdiction for attachment, given Vostok's operational presence there and the likely existence of Vostok bank accounts with Singapore-domiciled financial institutions. Alternatively, the marshall Islands (as the jurisdiction of Vostok's incorporation) could be considered, but the marshall Islands has limited enforcement infrastructure and C&H does not currently have local counsel engaged in that jurisdiction. Singapore is strongly preferred given TSL's existing enforcement infrastructure through Straits Meridian LLP (David Teo Wei Lin, Priya Subramaniam), who have already successfully conducted the garnishee proceedings against Pinnacle Bank and the arrest and judicial sale of the M/V Crimson Horizon in OS 872/2024.
Status: The sub-charter between Dnepr and Vostok is believed to be still running as at the date of this memorandum. The M/V Volga Spirit was last reported at Fujairah anchorage on or about 5 February 2025. If the vessel remains on sub-charter to Vostok, hire obligations continue to accrue, and the outstanding balance may increase further with the passage of time. Conversely, if the vessel has been redelivered to Dnepr (or if the sub-charter has been terminated), the receivable would be crystallized at the amount outstanding as at the date of redelivery or termination. The current status of the sub-charter requires further investigation, and I would recommend that HP be asked to confirm whether the vessel remains on sub-charter to Vostok.
4.3 Receivable 2 — Horizon Bulk Carriers FZE
Debtor: Horizon Bulk Carriers FZE ("Horizon"), a company incorporated in the Sharjah Airport International Free Zone (SAIF Zone), United Arab Emirates. Horizon appears to operate as a regional bulk carrier operator focused on Middle Eastern and East African trades.
Creditor entity: Korinthian DMCC, KMH's UAE-based subsidiary.
Vessel sub-chartered: M/V Aegean Fortuna (IMO 9784521, Supramax Bulk Carrier, 58,200 DWT). The sub-charter to Horizon pre-dates the charter-party disputes between TSL and KMH. Specifically, KMH had sub-chartered the M/V Aegean Fortuna to Horizon under a series of voyage charter arrangements concluded in late 2021 and early 2022, prior to the commencement of the disputes that ultimately led to the arbitration.
Nature of receivable: Outstanding freight and demurrage from voyage charter fixtures concluded in early 2022. According to HP's updated findings report dated 1 October 2024, the outstanding amount comprises two components: (a) unpaid freight balances from two completed voyages (approximately AED 3,100,000); and (b) outstanding demurrage claims arising from delays at discharge ports in East Africa (approximately AED 1,700,000). The total outstanding amount is approximately AED 4,800,000.
Amount outstanding: Approximately AED 4,800,000, equivalent to approximately £1,020,000 at current exchange rates.
Source of identification: HP's updated asset tracing report dated 1 October 2024 was the primary source of identification. KMH's supplemental WFO disclosure affidavit dated 30 August 2024 partially confirmed the existence of the receivable, but disclosed a lower figure (approximately AED 3,200,000) and did not disclose the demurrage component. This discrepancy between KMH's disclosure and HP's independent analysis is noted but has not yet been raised with Harkness Whitford.
Jurisdiction for attachment: The United Arab Emirates is the appropriate jurisdiction for attachment. Horizon is a UAE free zone entity, and the receivable arises from a commercial relationship between Horizon and Korinthian DMCC (also a UAE entity). Al-Rashid Hatem & Associates ("ARH") — Tariq Al-Rashid and Leila Hatem; Office 1802, Emirates Financial Towers (South Tower), DIFC, Dubai — are TSL's existing UAE local counsel and have already obtained the enforcement order in Case No. 1893/2024. ARH can pursue attachment of the Horizon receivable under the existing enforcement framework. Given that Horizon is incorporated in the Sharjah free zone rather than in Dubai, it may be necessary for ARH to advise on whether the Dubai Courts have jurisdiction over a Sharjah-incorporated debtor, or whether a separate application in the Sharjah courts is required. However, given that Korinthian DMCC (the creditor) is a Dubai entity, the receivable may be properly regarded as sited in Dubai.
Status: This is a historical debt relating to voyages completed in 2022. Horizon has disputed a portion of the receivable amounting to approximately AED 1,200,000, relating to a laytime calculation disagreement on one of the discharge port demurrage claims. The dispute appears to concern the applicable laytime allowed and whether certain periods of delay should be treated as excepted from laytime. The balance of approximately AED 3,600,000 appears to be undisputed. HP's analysis indicates that Horizon made partial payments to Korinthian DMCC in 2022 and 2023, reducing the original invoiced amount, but that the remaining AED 4,800,000 has not been paid since mid-2023. It is unclear whether the non-payment reflects a genuine dispute or simply financial difficulties on Horizon's part. Attachment proceedings should proceed in respect of at least the undisputed AED 3,600,000 in the first instance, with the disputed AED 1,200,000 to be pursued once the laytime dispute is resolved or adjudicated.
4.4 Receivable 3 — Balkan Tradewinds Shipping SA
Debtor: Balkan Tradewinds Shipping SA ("Balkan Tradewinds"), a company incorporated in Greece with its registered office in Piraeus. Balkan Tradewinds appears from publicly available records to be a small-to-medium-sized Greek shipping company operating primarily in the Mediterranean and Black Sea dry bulk trades.
Creditor entity: KMH directly (not through a subsidiary).
Vessel sub-chartered: The receivable does not relate to the three vessels that were the subject of the TSL charter-party disputes. Rather, the amounts owed arise from various spot voyage charters covering other KMH fleet vessels (i.e., vessels outside the TSL dispute fleet). HP's analysis indicates that these were short-duration voyage charters for bulk commodity cargoes in the Eastern Mediterranean and Black Sea trades.
Nature of receivable: Accumulated freight balances from three voyage charters completed in Q1 and Q2 2024. According to HP's updated findings report, the three voyages were fixture-confirmed during the period January to May 2024, with the last voyage completing in approximately June 2024. The freight was invoiced by KMH to Balkan Tradewinds in the ordinary course, and partial payments were made, but a balance of approximately EUR 780,000 remains outstanding.
Amount outstanding: Approximately EUR 780,000, equivalent to approximately £670,000 at current exchange rates.
Source of identification: This receivable was identified exclusively through HP's updated asset tracing report dated 1 October 2024. Critically, the Balkan Tradewinds receivable was not disclosed in either of KMH's WFO asset disclosure affidavits. Given that the receivable significantly exceeds the £25,000 disclosure threshold and is owed directly to KMH (the entity subject to the WFO), this omission represents a potential non-compliance with the disclosure obligation under the WFO. This issue is being addressed separately in the context of the contempt/WFO compliance analysis, but the non-disclosure is relevant here insofar as it underscores the need for independent asset tracing and reinforces the urgency of attachment before the receivable is paid to KMH and potentially dissipated.
Jurisdiction for attachment: England or Greece. Because the receivable is owed directly to KMH (the judgment debtor in CL-2024-000487), it constitutes an asset of KMH that is subject to the WFO and is in principle attachable in any jurisdiction where enforcement can be pursued. The two primary options are:
• England: An application for a third-party debt order under CPR Part 72 in CL-2024-000487. This approach has the advantage of procedural efficiency and the existing enforcement judgment. However, as discussed further at Section 5.1, there is a jurisdictional question as to whether the debt is properly sited in England for the purposes of a TPDO.
• Greece: A separate enforcement application in the Greek courts. This approach has the advantage that Balkan Tradewinds is a Greek entity, presumably with bank accounts and assets in Greece, and the debt arises from chartering transactions in the Greek maritime market. However, it would require the engagement of Greek local counsel (not currently instructed) and the commencement of a new enforcement proceeding, unless TSL's General Counsel, Ioanna Christodoulou, can identify a more streamlined path.
Status: The receivable is believed to be undisputed. HP's analysis indicates that Balkan Tradewinds made partial payments to KMH's Meridian Trust Bank account in London in early 2024, reducing the original freight invoices. The remaining balance of approximately EUR 780,000, however, has not been paid since that time. The reasons for the non-payment are unclear; it may reflect a deliberate withholding of payment in response to the WFO notification (if Balkan Tradewinds has been notified), or it may simply reflect slow payment practices in the Greek shipping market. This requires further investigation.
4.5 Receivable 4 — Caspian Logistics & Chartering DMCC
Debtor: Caspian Logistics & Chartering DMCC ("Caspian"), a company incorporated in the Dubai Multi Commodities Centre free zone, UAE. Caspian appears to operate as a chartering intermediary and logistics provider, arranging tonnage for industrial cargo clients in the Arabian Gulf region.
Creditor entity: Korinthian DMCC.
Vessel sub-chartered: The receivable does not relate to a single vessel but rather to miscellaneous vessel tonnage arranged through Korinthian DMCC as an intermediary. Korinthian DMCC acted as a chartering broker and back-to-back charterer, entering into head charter agreements with vessel owners and sub-letting the tonnage to Caspian for specific voyages or short-term time charter periods.
Nature of receivable: The outstanding amount comprises two components: (a) commission and brokerage fees owed by Caspian to Korinthian DMCC under a chartering services agreement, pursuant to which Korinthian DMCC provided chartering and operational services to Caspian in exchange for a percentage commission on freight earned; and (b) outstanding freight differentials from back-to-back charter arrangements in which Korinthian DMCC chartered tonnage from third-party owners and sub-let it to Caspian at a higher rate, with the differential payable by Caspian to Korinthian DMCC. The combined outstanding balance is approximately AED 3,850,000.
Amount outstanding: Approximately AED 3,850,000, equivalent to approximately £822,000 at current exchange rates.
Source of identification: The Caspian receivable was primarily identified through HP's post-award asset movement analysis dated 25 November 2024. HP's analysis tracked payment flows between Caspian and Korinthian DMCC in the period following the issuance of the Award, and in doing so identified both the existence of the receivable and the fact that certain prior payments made by Caspian had been diverted from Korinthian DMCC accounts to accounts connected to Andrei Volkov. The Caspian receivable was partially disclosed in KMH's supplemental WFO disclosure affidavit dated 30 August 2024, but the disclosed amount (approximately AED 2,500,000) was materially lower than the amount identified by HP. This discrepancy further underscores the inadequacy of KMH's WFO disclosure.
Jurisdiction for attachment: The United Arab Emirates. Both the debtor (Caspian) and the creditor (Korinthian DMCC) are DMCC entities incorporated and operating in Dubai. ARH can pursue attachment of the Caspian receivable under the existing enforcement framework in Case No. 1893/2024, using the third-party attachment mechanism available under UAE civil procedure law.
Status: Caspian has made some payments in the post-award period, but HP's analysis identified that approximately AED 2,100,000 of those payments were diverted to a personal account of Andrei Volkov at a financial institution in the UAE, rather than being credited to the enforcement proceedings or held in Korinthian DMCC's accounts for the benefit of TSL as enforcement creditor. This diversion is addressed in the dissipation evidence memorandum and may form the basis for contempt proceedings. Importantly for present purposes, the diversion evidence confirms the existence and quantum of the underlying debt obligation: if Caspian has been making payments (even if those payments were subsequently diverted), it follows that Caspian acknowledges the indebtedness. The remaining AED 3,850,000 is still outstanding and has not been paid.
4.6 Summary of Receivables
The total across all four identified sub-charterer receivables is approximately £4,200,000, computed as the sum of £1,688,000 (Vostok) + £1,020,000 (Horizon) + £670,000 (Balkan Tradewinds) + £822,000 (Caspian).
If fully recovered, these receivables would reduce the outstanding balance from £15,617,726.03 to approximately £11,417,726.03. This would bring the total recovery rate from approximately 88.94% to approximately 93.80% of the combined Award, Costs, and post-award interest (through 15 March 2025).
However, it must be acknowledged that not all receivables may be fully recoverable. The following factors may reduce actual recovery:
• The disputed portion of the Horizon receivable (AED 1,200,000 / approximately £255,000) may not be immediately attachable pending resolution of the laytime dispute.
• Sub-charterer debtors may raise set-off claims, counterclaims, or other defenses that reduce or delay recovery.
• Enforcement costs (estimated in Section 6.1 below) will reduce the net recovery.
• Exchange rate fluctuations between the date of this memorandum and the date of actual recovery may result in GBP equivalents that differ from the estimates set out above.
• Corporate veil issues (discussed in Sections 5.2 and 6.3) may complicate attachment of the Vostok and UAE receivables, which are owed to KMH subsidiaries rather than to KMH directly.
Nevertheless, the receivables represent a meaningful and identifiable asset pool, and the cost-benefit analysis (Section 6.1) supports pursuing attachment.
5. Legal Mechanisms for Attachment of Receivables by Jurisdiction
5.1 England & Wales
Applicable mechanism: Third-party debt order under Part 72 of the Civil Procedure Rules 1998. A third-party debt order ("TPDO") enables a judgment creditor to intercept a debt owed by a third party to the judgment debtor and to have that debt paid directly to the judgment creditor in satisfaction (or part satisfaction) of the judgment. The mechanism operates by directing the third party (in this case, the sub-charterer debtor) to pay the debt to the judgment creditor (TSL) rather than to the judgment debtor (KMH).
Applicable receivable: The Balkan Tradewinds Shipping SA receivable (EUR 780,000 / approximately £670,000). This is the only receivable that is owed directly to KMH (as opposed to a KMH subsidiary) and that may have a sufficient nexus with England to support a TPDO.
Procedure: The application is made without notice in the first instance. TSL would apply for an interim TPDO under CPR r. 72.3, supported by evidence identifying the specific debt, the third party from whom it is due, and confirming that the judgment remains unsatisfied in whole or in part. If the court is satisfied, it will make an interim order prohibiting the third party from making any payment that reduces the debt to less than the amount specified in the order, and will fix a hearing date for consideration of whether to make the order final. At the hearing for a final order, the third party (Balkan Tradewinds) must be given notice and the opportunity to contest the order, for example by showing that the debt is genuinely disputed, that the third party has a cross-claim against the judgment debtor that exceeds the amount of the debt, or that making the order would cause hardship. If no valid objection is raised, a final TPDO will be made, directing Balkan Tradewinds to pay the amount to TSL.
Jurisdictional considerations: The principal complication with pursuing a TPDO in England is the jurisdictional requirement. Under CPR r. 72.2(1), a third-party debt order may be made only in respect of a debt that is "due or accruing due" to the judgment debtor from a third party within the jurisdiction. The question is whether the Balkan Tradewinds debt is properly sited in England for these purposes.
The relevant factors include: (a) where the debt is payable — if the sub-charter agreements provide for payment to a London bank account (such as KMH's Meridian Trust Bank account at 50 Lombard Street, London EC3V 9EA), there is an argument that the debt is sited in England; (b) the governing law and jurisdiction clause of the sub-charter agreements — if the agreements are governed by English law with London arbitration, the English nexus is strengthened; (c) the location of the third party — Balkan Tradewinds is a Greek-incorporated entity and may argue that the debt is sited in Greece. HP's analysis indicates that prior partial payments by Balkan Tradewinds were made to KMH's Meridian Trust Bank account in London, which provides some support for the proposition that the debt is payable in England.
If the debt is governed by a Greek law contract and payable in Greece, an English TPDO may face jurisdictional challenges. The leading authority, Société Eram Shipping Co. Ltd. v. Cie Internationale de Navigation [2003] UKHL 30, establishes that a TPDO should not be made in respect of a debt sited abroad unless the English court is satisfied that the order will be recognized and given effect in the relevant foreign jurisdiction. This is a significant limitation and may counsel in favor of pursuing the Balkan Tradewinds receivable in Greece rather than in England.
Alternative approach — Greece: If the TPDO route is not viable, TSL could pursue the Balkan Tradewinds receivable through Greek enforcement proceedings. This would require the recognition and enforcement of the LCIA Award in Greece (under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958, to which Greece is a party) and a subsequent application for attachment of the receivable in the Greek courts. TSL's in-house General Counsel, Ioanna Christodoulou, who is based in Piraeus and familiar with Greek procedural law, may be able to assist in identifying suitable Greek local counsel and assessing the viability and timeline of Greek enforcement proceedings.
Relationship with the WFO: The worldwide freezing order granted in CL-2024-000487 already encompasses the Balkan Tradewinds receivable as an asset of KMH worldwide. The WFO serves as protective relief — it prohibits KMH from disposing of, dealing with, or diminishing the value of its assets, including this receivable. However, the WFO does not itself effect collection. A TPDO or equivalent execution mechanism is required to convert the frozen receivable into actual recovery. The WFO does, however, provide important interim protection by preventing KMH from collecting the debt from Balkan Tradewinds and dissipating the proceeds, provided that Balkan Tradewinds has been notified of the WFO (see Section 7, Recommendation 4).
5.2 Singapore
Applicable mechanism: Garnishee proceedings under Order 49 of the Rules of Court (or the equivalent provisions under the new Rules of Court 2021, which apply to proceedings commenced on or after 1 April 2022). A garnishee order enables a judgment creditor to attach debts owed to the judgment debtor by third parties and to compel the third party (the "garnishee") to pay the debt to the judgment creditor. The procedure is functionally equivalent to the English TPDO.
Applicable receivable: The Vostok Dry Cargo Ltd. receivable (USD $2,100,000 / approximately £1,688,000), owed to Dnepr Shipholding Inc. under the sub-time charter of M/V Volga Spirit.
Corporate veil complication: The principal difficulty with pursuing this receivable in Singapore is that the direct creditor is Dnepr Shipholding Inc., a BVI-incorporated SPV that is a wholly-owned subsidiary of Oceangate Ventures Ltd., which is in turn wholly owned by KMH. The enforcement judgment in Singapore (OS 872/2024) was entered against KMH, not against Dnepr. Garnishee proceedings in Singapore ordinarily attach debts owed to the judgment debtor; a debt owed to a subsidiary of the judgment debtor is not automatically attachable.
To overcome this difficulty, TSL would need to establish one or more of the following:
(a) Piercing the corporate veil: Demonstrating that the separate corporate personality of Dnepr should be disregarded, so that debts owed to Dnepr are treated as debts owed to KMH. Under Singapore law, veil-piercing is available in cases of fraud, improper purpose, or where the subsidiary is a mere façade or sham concealing the true facts: Alwie Handoyo v. Tjong Very Sumito [2013] 4 SLR 308. The evidence that Dnepr was used as a single-purpose vehicle to hold vessels ultimately controlled by Andrei Volkov through KMH, with no independent management or commercial purpose apart from vessel ownership, may support a veil-piercing argument.
(b) Alter ego doctrine: Demonstrating that Dnepr is the alter ego of KMH, with no separate existence, mind, or will. This is closely related to veil-piercing but is sometimes articulated as a distinct ground. The facts that Dnepr shares directors, offices, and management with KMH and its affiliates, and that KMH exercises complete dominion and control over Dnepr, would be relevant.
(c) Fresh enforcement action: Obtaining a separate enforcement judgment in Singapore naming Dnepr directly as a party liable to satisfy the Award. This could be pursued through a fresh originating summons under the International Arbitration Act (Cap. 143A), although it would require establishing a basis for enforcing the Award against Dnepr notwithstanding that Dnepr was not a named respondent in the arbitration. This is a more complex route and may not succeed absent a finding that Dnepr is bound by the arbitration agreement as an alter ego or agent of KMH.
Straits Meridian LLP has already demonstrated the beneficial ownership chain from Dnepr through Oceangate to KMH in the M/V Crimson Horizon arrest proceedings, where the associated ship doctrine under Section 4(4) of the Singapore High Court (Admiralty Jurisdiction) Act (Cap. 123) was invoked to support the arrest of a vessel owned by Dnepr in proceedings against KMH. The Singapore court accepted the ownership analysis and permitted the arrest. However, the associated ship doctrine is specific to admiralty jurisdiction and has not been tested in the context of garnishee proceedings for receivable attachment. It remains to be seen whether the Singapore court would extend the same analysis to permit garnishment of a debt owed to Dnepr in enforcement of a judgment against KMH.
Practical considerations: If Vostok Dry Cargo Ltd. maintains bank accounts in Singapore (which is likely given its operational base there), an alternative approach would be to seek a garnishee order directed at Vostok's Singapore bank, attaching the funds standing to Vostok's credit, rather than attaching the sub-charter hire receivable itself. However, this approach would require identifying Vostok's bank and account details, and the garnishee order would still need to be predicated on a debt owed by Vostok to the judgment debtor (or its alter ego).
Recommended approach: Instruct Straits Meridian LLP to assess the viability of garnishee proceedings against Vostok's Singapore bank and/or direct attachment of the sub-charter hire receivable. Straits Meridian should be asked to advise specifically on (a) the strength of the veil-piercing/alter ego arguments in the garnishee context, (b) whether a supplementary enforcement application naming Dnepr is required and, if so, the prospects of success, and (c) the estimated costs and timeline for pursuing the receivable through Singapore garnishee proceedings.
5.3 UAE
Applicable mechanism: Third-party attachment under the UAE Civil Procedure Law (Federal Law No. 11 of 1992, as amended by Federal Decree-Law No. 42 of 2022). The third-party attachment mechanism (known in Arabic as hajz ma lada al-ghair) enables a judgment creditor to attach debts or movable property held by a third party on behalf of, or owed to, the judgment debtor. The mechanism is supplemented by the enforcement order already obtained in Case No. 1893/2024 in the Dubai Courts.
Applicable receivables:
• Horizon Bulk Carriers FZE: AED 4,800,000 (approximately £1,020,000), owed to Korinthian DMCC.
• Caspian Logistics & Chartering DMCC: AED 3,850,000 (approximately £822,000), owed to Korinthian DMCC.
• Combined UAE receivables: Approximately AED 8,650,000 (approximately £1,842,000).
Procedure: TSL, through ARH, would apply to the execution judge in Case No. 1893/2024 for a third-party attachment order. The application would identify each sub-charterer debtor and the specific amount owed by that debtor to Korinthian DMCC, and would request an order directing each debtor to pay the amounts owed directly to TSL (or into the court's account) in partial satisfaction of the enforcement order. Upon issuance of the attachment order, the court would notify each third-party debtor, who would then have an opportunity to respond. The third-party debtor may acknowledge the debt (in which case the court will order direct payment to TSL), deny the debt (in which case the court will conduct a hearing to determine whether the debt exists and is payable), or remain silent (in which case the court may deem the debt acknowledged).
Existing enforcement framework: The precautionary attachment over Korinthian DMCC's accounts at Emirates Gulf Commercial Bank PJSC was converted to an execution attachment following the enforcement order of 20 November 2024. The execution of that attachment has already yielded AED 53,400,000 (approximately £11,340,000). The same enforcement framework supports the attachment of receivables owed to Korinthian DMCC by third parties. ARH has confirmed in prior correspondence that the UAE execution judge has jurisdiction to issue third-party attachment orders against entities that owe debts to Korinthian DMCC, provided that the judgment creditor can establish the existence and quantum of the debt.
Horizon Bulk Carriers FZE — specific issues: As noted above, Horizon has disputed a portion of the receivable amounting to approximately AED 1,200,000, relating to a laytime calculation disagreement. Under UAE procedural law, the execution judge may decline to order payment of a disputed amount and may instead limit the attachment to the undisputed portion. Accordingly, the recommended approach is to seek attachment of the undisputed AED 3,600,000 in the first instance, while reserving TSL's right to pursue the disputed AED 1,200,000 once the laytime dispute is resolved. If Horizon contests the attachment, the execution judge may refer the dispute to the competent court for determination. An additional consideration is that Horizon is incorporated in the Sharjah Airport International Free Zone rather than in Dubai. ARH should be asked to confirm whether the Dubai execution judge has jurisdiction to issue a third-party attachment order against a Sharjah-incorporated entity, or whether a separate application in the Sharjah courts is required.
Caspian Logistics & Chartering DMCC — specific issues: HP's analysis indicates that Caspian has historically acknowledged its indebtedness to Korinthian DMCC by making payments (even though certain of those payments were subsequently diverted to Andrei Volkov's personal account in breach of the WFO). The fact that Caspian has made payments against the same obligation in the recent past strengthens TSL's position in establishing the existence and quantum of the debt. Caspian is unlikely to be able to credibly deny the indebtedness given the payment history. The diversion of approximately AED 2,100,000 to Volkov's personal account is relevant to the contempt proceedings but also demonstrates that the underlying debt obligation is real and acknowledged.
Corporate veil considerations: The enforcement order in Case No. 1893/2024 was granted against KMH. Korinthian DMCC is a wholly-owned subsidiary of KMH, not the judgment debtor itself. However, the prior execution against Korinthian DMCC's bank accounts at EGCB (yielding AED 53,400,000) was conducted on the basis that Korinthian DMCC's assets were available to satisfy KMH's debts. ARH obtained the execution against Korinthian DMCC's accounts by demonstrating to the execution judge that Korinthian DMCC was wholly owned and controlled by KMH and that its assets should be treated as assets of the judgment debtor. This precedent strongly supports the extension of the same analysis to receivables owed to Korinthian DMCC by third parties. Nevertheless, ARH should be asked to confirm that the execution judge's jurisdiction extends to receivables (as opposed to bank deposits) and to advise on any additional procedural steps that may be required.
Local counsel: Al-Rashid Hatem & Associates (Tariq Al-Rashid, Leila Hatem; Office 1802, Emirates Financial Towers (South Tower), DIFC, Dubai) are TSL's existing UAE local counsel and are fully familiar with the enforcement proceedings in Case No. 1893/2024. ARH should be instructed to prepare and file the necessary third-party attachment applications promptly.
5.4 Cyprus
No identified sub-charterer receivables are directly payable in Cyprus. However, KMH's registered office is in Cyprus, and any receivables owed to KMH directly could in theory be attached through the Cyprus enforcement proceedings in Case 2247/2024. The Balkan Tradewinds receivable, which is owed directly to KMH, might be pursued through Cypriot garnishment proceedings if the debtor has Cyprus-connected assets or if the debt is deemed to be sited in Cyprus by reason of KMH's domicile there.
This analysis, however, is speculative. There is no indication that Balkan Tradewinds has any assets, operations, or banking relationships in Cyprus, and the sub-charter agreements between KMH and Balkan Tradewinds are more likely to be governed by English or Greek law (given the maritime context) than by Cypriot law. Accordingly, Cyprus is a secondary option at best for the Balkan Tradewinds receivable, and England or Greece remains the preferred jurisdiction for attachment of that debt.
Should the position change, or should additional information emerge suggesting a Cyprus nexus for any of the identified receivables, Kyprianos Makrides & Partners (Andreas Kyprianos, Nadia Makrides; 15 Grivas Digenis Avenue, Nicosia 1066, Cyprus) can advise on the feasibility and procedure for garnishment proceedings in the Cypriot courts. Kyprianos Makrides acted for TSL in the Cypriot enforcement proceedings and is well-positioned to assess any Cyprus-related attachment opportunity.
6. Practical Considerations and Risks
6.1 Cost-Benefit Analysis
The total estimated value of the four identified sub-charterer receivables is approximately £4,200,000. Against this, the estimated incremental costs of pursuing attachment across the relevant jurisdictions are as follows:
C&H fees: The attachment analysis, strategy, and coordination work falls within the scope of the enforcement engagement. The current fee cap for the enforcement matter is £4,200,000, of which approximately £3,870,000 has been billed to date, leaving remaining headroom of approximately £330,000. The additional C&H time required to coordinate receivable attachment proceedings across Singapore and the UAE, and to analyze the English/Greek options for the Balkan Tradewinds receivable, is estimated at approximately £120,000–£180,000 (including partner, lead associate, and working associate time). This would consume a significant portion of the remaining cap headroom but would not necessarily exceed it, depending on the complexity of the proceedings and the level of court involvement required. However, if the matter is extended beyond the target close date of 15 March 2025 (as will almost certainly be necessary), a discussion with the client regarding the fee cap and any extension or re-scoping will be required.
Local counsel fees:
Net recovery potential: After deducting estimated C&H fees (£120,000–£180,000) and local counsel fees (£53,000–£73,500), the net recovery potential is approximately £3,950,000–£4,030,000, assuming full recovery of all receivables. On a more conservative basis, assuming (a) the Horizon disputed portion (approximately £255,000) is not recoverable, (b) a 10% reduction across other receivables to account for debtor defenses and enforcement friction, and (c) full cost recovery, the net recovery potential is approximately £3,300,000–£3,500,000.
Recommendation: The cost-benefit analysis supports pursuing the receivable attachment. Even on the most conservative recovery assumptions, the expected net recovery (approximately £3,300,000) significantly exceeds the estimated costs (approximately £175,000–£255,000), yielding a recovery-to-cost ratio of approximately 13:1 to 19:1. Given the limited alternative asset pools available for enforcement (the M/V Volga Spirit being subject to significant encumbrances and the ongoing interest accrual being a theoretical rather than practical recovery mechanism), the sub-charterer receivables represent the most cost-effective near-term enforcement opportunity.
6.2 Risk of Debtor Defenses
Sub-charterer debtors may raise range defenses in response to attachment proceedings, including:
• Set-off claims: A sub-charterer debtor may assert that it is owed amounts by KMH or its subsidiary (e.g., for off-hire deductions, bunker claims, or other charter-party adjustments) that reduce or extinguish the receivable. Under most legal systems, a bona fide set-off claim may be raised as a defense to a garnishee or third-party attachment order.
• Disputes over quantum: As discussed in respect of Horizon Bulk Carriers FZE (Section 4.3), a debtor may dispute the amount owed. Where a genuine dispute exists, the court may limit attachment to the undisputed portion or may refer the dispute for determination.
• Counterclaims against KMH/subsidiaries: Sub-charterer debtors may assert counterclaims against KMH or its subsidiaries that, if valid, could reduce the amount available for attachment. For example, Vostok Dry Cargo could assert that hire payments are subject to deductions for speed and performance claims under the sub-time charter, or that the sub-charter has been terminated (whether by KMH or by Vostok) and that Vostok has a counterclaim for wrongful termination or redelivery issues.
• Assertion that the sub-charter has been terminated: If the sub-charter between Dnepr and Vostok has been terminated, the receivable may be crystallized at a lower amount than currently estimated, and Vostok may assert that no further hire is owed.
• Challenge to TSL's standing: Sub-charterer debtors may challenge TSL's standing to attach debts owed to KMH subsidiaries (as opposed to KMH directly), raising the corporate veil issues discussed at Section 6.3 below.
These potential defenses do not prevent TSL from initiating attachment proceedings. However, they may delay or reduce ultimate recovery. The recommended approach is to proceed with attachment applications promptly, noting that the burden is on the sub-charterer debtors to raise and substantiate any defenses, and that many of these defenses (particularly set-off claims and quantum disputes) can be resolved through the attachment proceedings without the need for separate litigation.
6.3 Corporate Veil and Subsidiary Issues
Two of the four receivables — the Vostok receivable (Section 4.2) and the two UAE receivables (Sections 4.3 and 4.5) — are owed to KMH subsidiaries (Dnepr Shipholding Inc. and Korinthian DMCC respectively) rather than to KMH directly. Because the enforcement judgments in Singapore and the UAE were entered against KMH, attachment of debts owed to KMH's subsidiaries requires additional legal analysis.
The legal basis for treating subsidiary receivables as available for enforcement against the parent depends on the applicable law and procedural framework in each jurisdiction:
Singapore: The associated ship doctrine under Section 4(4) of the High Court (Admiralty Jurisdiction) Act was successfully invoked in the vessel arrest context to demonstrate that KMH had beneficial ownership of vessels registered in the name of Dnepr. However, the associated ship doctrine is a creature of admiralty law and does not directly apply to garnishee proceedings. To attach the Vostok receivable through garnishee proceedings, TSL would need to establish either that the corporate veil of Dnepr should be pierced (on the grounds that Dnepr is a sham, façade, or alter ego of KMH) or that a separate enforcement judgment against Dnepr is warranted. The evidence supporting veil-piercing includes: (a) Dnepr has no independent management, operations, or employees; (b) Dnepr's sole function is to hold legal title to vessels beneficially owned by KMH; (c) Dnepr shares its registered agent, directors, and decision-making authority with KMH; and (d) Dnepr was used as a vehicle to distance KMH from its asset base, arguably for the improper purpose of frustrating enforcement. Whether this evidence is sufficient for veil-piercing in the garnishee context is a question for Straits Meridian to assess under Singapore law.
UAE: The precedent established in the existing enforcement proceedings, where the execution judge permitted execution against Korinthian DMCC's bank accounts in satisfaction of a judgment against KMH, provides strong support for extending the same analysis to receivables owed to Korinthian DMCC. ARH persuaded the execution judge that Korinthian DMCC was wholly owned and controlled by KMH and that its assets should be treated as assets available for enforcement. The execution against bank deposits was not challenged by KMH on corporate separateness grounds (although KMH did challenge the enforcement order on other grounds, which challenges were rejected). There is no reason in principle why the same analysis should not apply to receivables, and ARH should be instructed to proceed on this basis. However, if the execution judge takes a different view in respect of receivables (as opposed to bank deposits), a supplementary enforcement application naming Korinthian DMCC directly may be required.
General observation: The corporate veil issue is less acute in respect of the Balkan Tradewinds receivable (Section 4.4), which is owed directly to KMH and can be attached without any veil-piercing analysis.
6.4 WFO Compliance and Contempt Issues
HP's post-award asset movement analysis dated 25 November 2024 identified that certain sub-charter payments, specifically approximately AED 2,100,000 received from Caspian Logistics, were diverted to a personal account of Andrei Volkov at a financial institution in the UAE in the period following the grant of the WFO. This diversion constitutes a prima facie breach of the worldwide freezing order, which prohibits KMH from "removing from England and Wales any of its assets" and from "in any way disposing of, dealing with, or diminishing the value of any of its assets whether they are in or outside England and Wales."
The contempt implications of this diversion are addressed separately in the dissipation evidence memorandum. For the purposes of this receivable analysis, the diversion evidence is relevant in two respects:
First, it strengthens TSL's position in arguing that KMH has been systematically dissipating assets and that aggressive receivable attachment is necessary to prevent further loss. This argument supports the urgency of the attachment applications and may be relevant if TSL needs to seek expedited or ex parte relief in any jurisdiction.
Second, the existence of the WFO means that sub-charterer debtors who have been notified of the freezing order may themselves be at risk of contempt if they make payments to KMH or its subsidiaries in circumstances that facilitate a breach of the order. Under the principle established in Z Ltd. v. A-Z and AA-LL [1982] QB 558, a third party who is notified of a freezing order and who knowingly assists in a breach of that order may be liable for contempt. This creates a significant incentive for sub-charterer debtors to cooperate with TSL's attachment proceedings, rather than risk paying the debt to K