Owner of the vessel(s) “CHLOE V” v UBS AG [2026] SGCA 7

"When an appellate court is asked to stay the appeal on account of the outstanding costs order, the fundamental consideration would be to balance the right of the respondent to be paid the outstanding costs and the right of the appellant ... to pursue its appeal notwithstanding its failure or omission to pay the outstanding costs." — Per Steven Chong JCA, Para 1

Case Information

• Citation: [2026] SGCA 7 (Para 0)
• Court: IN THE COURT OF APPEAL OF THE REPUBLIC OF SINGAPORE (Para 0)
• Date of hearing: 26 January 2026 (Para 0)
• Date of judgment: 3 March 2026 (Para 0)
• Coram: Steven Chong JCA, Ang Cheng Hock JCA and Hri Kumar Nair JCA (Para 0)
• Case number: Court of Appeal / Civil Appeal No 26 of 2025 (Summons No 32 of 2025) (Para 0)
• Counsel for the appellant: Tan Boon Yong Thomas and Lieu Kuok Poh, Haridass Ho & Partners (Para 0)
• Counsel for the respondent: Song Swee Lian Corina, Liang Junhong Daniel and Thomas Benjamin Lawrence, Allen & Gledhill LLP (Para 0)
• Area of law: Civil Procedure — Stay of proceedings — Appeal; Civil Procedure — Costs — Security (Para 0)
• Judgment delivered by: Steven Chong JCA, delivering the judgment of the court (Para 0)

Summary

This appeal arose from a long-running dispute in which the respondent sought to enforce outstanding costs orders against the appellant while the appellant continued to pursue its appeal. The Court of Appeal held that the appellant had failed to provide any credible reason for not paying the outstanding costs, and that this failure amounted to a refusal or neglect to pay within the meaning of the applicable procedural regime. The court therefore granted a stay of the appeal for four weeks, ordered the release of the balance security held in court to the respondent in partial satisfaction of the outstanding costs, and required the appellant to furnish further security for the appeal. (Paras 1, 47, 49, 55)

The court’s reasoning was anchored in the balance between two competing interests: the respondent’s right to be paid costs already ordered, and the appellant’s right to continue with its appeal. The court explained that the respondent first had to show a prima facie refusal or neglect to pay, after which the burden shifted to the appellant to explain why the costs had not been satisfied and why a stay should not be granted. On the facts, the appellant’s explanations were rejected because the court found that it had not given a credible reason for non-payment, had not taken reasonable steps to clarify the respondent’s calculations, and had used disputes over quantum as a pretext for delay. (Paras 1, 32, 43, 46, 47)

The judgment is also important for its treatment of the Rules of Court 2021. The court explained that O 3 r 2(2) carries forward the substance of the former O 92 r 4 of the Rules of Court 2014, while O 21 r 2(6) creates a separate and express regime for staying or dismissing an appeal where a party refuses or neglects to pay costs ordered within the specified time, including costs ordered in related proceedings. The court further ordered additional security of S$100,000, reflecting its view that the respondent should not be left exposed while the appeal continued. (Paras 28, 29, 55)

Why did the Court of Appeal say the appeal could be stayed for non-payment of costs?

The court framed the central question as one of balance: whether the respondent’s right to receive the outstanding costs should prevail over the appellant’s desire to continue the appeal despite non-payment. It stated that the governing consideration is the balance between those two rights, and that the court must assess whether the appellant has refused or neglected to pay the outstanding costs. The court also made clear that the respondent need only establish a prima facie case of refusal or neglect before the burden shifts to the appellant. (Paras 1, 32)

"The burden then falls on the appellant to explain why the outstanding costs order has not been satisfied and to provide a good reason why a stay should not be granted on account of the outstanding costs order." — Per Steven Chong JCA, Para 32

Applying that framework, the court held that the appellant had not provided any credible reason for its failure or omission to pay the outstanding costs. The court expressly characterised that conduct as a refusal or neglect to pay. That conclusion was not reached in the abstract; it was reached after reviewing the procedural history, the repeated demands for payment, the appellant’s responses, and the absence of any satisfactory explanation for the non-payment. (Paras 47, 3, 17)

The court then concluded that the balance of justice favoured a stay. It did not treat the stay as punitive in itself; rather, it treated the stay as a procedural consequence of the appellant’s failure to satisfy costs orders while continuing to litigate. The court also coupled the stay with further security, showing that it was concerned not only with past non-payment but also with protecting the respondent against further exposure during the continuation of the appeal. (Paras 47, 55)

"In sum, the appellant has failed to provide any credible reason for its failure or omission to pay the outstanding costs. In our judgment, this amounts to a refusal or neglect to pay the outstanding costs." — Per Steven Chong JCA, Para 47

What were the procedural steps that led to the stay application?

The procedural history mattered greatly to the court’s analysis. The judgment records that the respondent’s attempts to recover costs from the appellant had “at every turn” been fraught with unnecessary difficulties. That history included earlier costs orders, demands for payment, disputes over whether sums had already been paid out of sale proceeds, and later disagreement over the amount actually outstanding. The court treated this history as evidence that the non-payment was not accidental or isolated, but part of a broader pattern of resistance. (Paras 3, 17, 21)

"The procedural history of the appeal informs that the respondent’s attempts at recovering costs from the appellant have at every turn been fraught with unnecessary difficulties." — Per Steven Chong JCA, Para 3

The lower court had earlier dismissed the counterclaim in its entirety and fixed costs and disbursements against the appellant. The judgment records that on 28 July 2025, the Judge dismissed the counterclaim and invited submissions on costs, and that on 11 November 2025 the Judge fixed costs of the counterclaim at SGD 650,000 payable by the appellant to the respondent. The court also noted earlier orders concerning security for costs and payment out of security. These earlier orders formed the backdrop against which the respondent later sought a stay or dismissal of the appeal and further security. (Para 21)

The appellant’s position evolved over time. At one stage, its solicitors said the outstanding costs had already been paid out of the Sale Proceeds pursuant to Clause 34.5 of the Facilities Agreement. Later, the appellant disputed the respondent’s calculations and argued that it was reasonable to await proper quantification rather than pay an inflated or uncertain figure. The court treated these shifting positions as part of the reason why the respondent’s recovery efforts had been obstructed. (Paras 17, 41, 43, 46)

"The appellant’s solicitors replied on 12 July 2023, stating that the outstanding costs had already been paid out of the Sale Proceeds pursuant to Clause 34.5 of the Facilities Agreement." — Per Steven Chong JCA, Para 17

How did the court interpret the Rules of Court 2021 on staying or dismissing an appeal for unpaid costs?

The court explained that the relevant procedural framework had changed under the Rules of Court 2021. It stated that the substance of O 92 r 4 of the Rules of Court 2014 could now be found in O 3 r 2(2) of the Rules of Court 2021. More importantly, the court said that O 21 r 2(6) introduced a new and separate regime for staying or dismissing an appeal pending payment of outstanding costs by an appellant. This was not merely a continuation of the old regime; it was an express procedural basis for relief. (Paras 28, 29)

"The substance of O 92 r 4 of the ROC 2014 can now be found in O 3 r 2(2) of the ROC 2021" — Per Steven Chong JCA, Para 28

"O 21 r 2(6) of the ROC 2021 introduces a new and separate regime for staying or dismissing appeals pending payment of the outstanding costs by an appellant: ... (6) The Court may stay or dismiss any application, action or appeal or make any other order as the Court deems fit if a party refuses or neglects to pay any costs ordered within the specified time, whether the costs were ordered in the present proceedings or in some related proceedings" — Per Steven Chong JCA, Para 29

The court’s discussion of the new rule was significant because it clarified that the court’s power is not confined to the old inherent jurisdiction. The judgment referred to prior authorities, including Huttons Asia Pte Ltd v Chen Qiming and The Republic of India v Deutsche Telekom AG, in explaining the modern procedural basis for such applications. The court’s approach shows that the Rules of Court 2021 now provide a direct route for a respondent seeking to halt an appeal where costs remain unpaid. (Paras 29, 30)

The court also linked the rule to the practical reality of enforcement. It was not enough for an appellant to say that an appeal should proceed because it remains arguable; the appellant must also confront the fact that the respondent has already obtained costs orders and is entitled to payment. The rule therefore operates as a procedural discipline on appellants who wish to continue litigating while leaving costs unpaid. (Paras 29, 32, 47)

What did the court say about the burden of explaining non-payment?

The court adopted a burden-shifting approach. First, the respondent must show a prima facie refusal or neglect to pay the outstanding costs. Once that is shown, the burden falls on the appellant to explain why the costs have not been paid and to provide a good reason why the appeal should not be stayed. The court treated this as the correct way to balance the competing interests of the parties. (Paras 32, 1)

"The burden then falls on the appellant to explain why the outstanding costs order has not been satisfied and to provide a good reason why a stay should not be granted on account of the outstanding costs order." — Per Steven Chong JCA, Para 32

On the facts, the appellant’s explanation was rejected. The court said the appellant had failed to provide any credible reason for its failure or omission to pay the outstanding costs. That finding was decisive because it meant the appellant had not discharged the burden that had shifted to it. The court therefore treated the non-payment as a refusal or neglect within the meaning of the rule. (Paras 47, 29)

The court’s reasoning also shows that the burden is not satisfied by bare assertions or by pointing to unresolved disputes over quantum. The appellant had to do more than say the amount was uncertain. It had to engage with the respondent’s calculations, seek clarification if necessary, and explain why payment had not been made. Its failure to do so was treated as a serious omission. (Paras 43, 46, 47)

Why did the court reject the appellant’s explanation that it was waiting for proper quantification?

The appellant argued that it was reasonable to await proper quantification rather than make a payment on the basis of an inflated or uncertain figure, so as to avoid overpayment or underpayment. The court rejected that submission. It held that the respondent had in fact provided calculations, and that the appellant had not taken steps to seek clarification. The court therefore viewed the appellant’s position as an afterthought designed to delay payment. (Paras 41, 43, 46)

"The appellant submits that, in these circumstances, it was reasonable “to await proper quantification rather than make a payment on the basis of an inflated or uncertain figure to avoid overpayment/underpayment”." — Per Steven Chong JCA, Para 41

The court’s first answer to that submission was factual: the respondent had provided a calculation, so it could not be said that no calculation had been given. The court said, “First, it cannot be said that the respondent did not provide any calculation to show how its figure was derived.” That finding undermined the appellant’s claim that it was left in the dark. (Para 43)

"First, it cannot be said that the respondent did not provide any calculation to show how its figure was derived." — Per Steven Chong JCA, Para 43

The court’s second answer was procedural and practical. Even if the appellant disputed the calculations, it should have sought clarification from the respondent. Its complete failure to do so strongly suggested that the objection was not genuine but was raised only to delay payment. The court therefore treated the appellant’s explanation as lacking credibility. (Para 46)

"Third, even if the appellant disputes the respondent’s calculations, it should have taken steps to seek clarifications from the respondent. That it completely failed to do so strongly suggests that this was a mere afterthought in order to delay the payment of the outstanding costs." — Per Steven Chong JCA, Para 46

That reasoning is important for practitioners because it shows that a party cannot simply rely on a dispute over quantum to justify non-payment. If the party genuinely wishes to resolve the amount, it must engage with the other side’s figures and seek clarification. Silence or inaction will likely be treated as delay rather than diligence. (Paras 43, 46, 47)

How did the court assess the appellant’s financial ability and the history of funding?

The court considered the appellant’s financial position and its ability to marshal resources. It relied on earlier findings in SUM 2171 and on the broader procedural history to conclude that the appellant, with the help of its controller(s) and/or shareholder(s), was capable of marshalling the financial means, when desired, to pursue and/or safeguard its dispute resolution interests in connection with the vessel “CHLOE V”. That finding mattered because it undercut any suggestion that the appellant was genuinely unable to pay. (Para 38)

"The factors demonstrate that the [appellant], with the help of its controller(s) and/or shareholder(s), is capable of marshalling the financial means, when desired, to pursue and/or safeguard its dispute resolution interests in connection with the vessel “CHLOE V”." — Per Steven Chong JCA, Para 38

The court also referred to the principle that only the appellant knows the true state of its finances, a proposition drawn from Goldtrail Travel Ltd v Onur Air Tasimacilik AS. That principle supported the court’s insistence that the appellant had to provide a credible explanation for non-payment. If the appellant alone knows its financial position, then it cannot expect the court to accept vague assertions without evidence or meaningful engagement. (Paras 36, 38)

In addition, the court referred to the earlier decision in Credit Suisse AG v Owner of the Vessel “CHLOE V” to show that the appellant had previously been found capable of marshalling substantial resources. That history reinforced the court’s conclusion that the non-payment was not explained by inability. Instead, the court inferred that the appellant had chosen not to pay. (Paras 37, 38)

What did the court decide about the respondent’s calculations and the amount outstanding?

The court accepted the respondent’s calculations for the purpose of determining the amount to be released from security and the amount still outstanding. It stated that it arrived at the figure using the respondent’s calculations, which took into account accrued interest. The court’s approach was practical and enforcement-oriented: it was concerned with resolving the outstanding sums so that the respondent could receive partial satisfaction without further delay. (Paras 50, 49)

"We arrived at this figure using the respondent’s calculations, which took into account the accrued interest:" — Per Steven Chong JCA, Para 50

The court then ordered that the balance security of S$243,046.67 held in court be released to the respondent forthwith in partial satisfaction of the outstanding cost orders. This order shows that the court was not merely staying the appeal; it was also ensuring that available funds already secured in court were applied to the unpaid costs. (Para 49)

"We therefore order that the balance security of S$243,046.67 held in court shall be released to the respondents forthwith in partial satisfaction of the outstanding cost orders." — Per Steven Chong JCA, Para 49

The court’s treatment of the calculations also demonstrates that it was prepared to rely on the respondent’s figures where the appellant had not meaningfully challenged them. The appellant’s failure to seek clarification or provide a credible alternative calculation weakened its position materially. The court therefore treated the respondent’s figures as the operative basis for relief. (Paras 43, 46, 50)

Why did the court order further security for the appeal?

The court ordered the appellant to provide additional security for the appeal in the sum of S$100,000 within four weeks. This order was made alongside the stay and the release of the balance security. The court’s decision to require further security reflects its view that the respondent should not be left exposed while the appeal continued, especially in light of the appellant’s history of non-payment and delay. (Para 55)

"The appellant is ordered to provide additional security for the appeal in the sum of S$100,000 within four weeks from the date hereof." — Per Steven Chong JCA, Para 55

The court’s approach is consistent with the broader principle that security for costs protects the respondent, avoids stifling a claim unfairly, and promotes fair play. The judgment referred to SW Trustees Pte Ltd v Teodros Ashenafi Tesemma and Yuanta Asset Management International Ltd v Telemedia Pacific Group Ltd in discussing the purpose and availability of security. The court’s order here was therefore not exceptional in principle; it was an application of established procedural fairness to the facts before it. (Paras 52, 53)

The additional security also served a practical function. The court had already found that the appellant had failed to pay outstanding costs and had not provided a credible explanation. In that context, requiring further security reduced the risk that the respondent would be forced to continue litigating without adequate protection for future costs exposure. (Paras 47, 55)

How did the court dispose of the application and what costs orders did it make?

The court allowed the application without an oral hearing and made a package of orders designed to secure payment and protect the respondent. It ordered the release of the balance security of S$243,046.67 to the respondent, ordered the appellant to provide additional security of S$100,000 within four weeks, stayed the appeal for four weeks pending payment of the outstanding sums, and ordered that if payment or security was not provided within that period, the appeal would be struck out automatically. (Para 55)

"In the result, we allow the present application without an oral hearing and make the following orders: (a) The balance security of S$243,046.67 held in court shall be released to the respondents forthwith in partial satisfaction of the outstanding cost order. (b) The appellant is ordered to provide additional security for the appeal in the sum of S$100,000 within four weeks from the date hereof." — Per Steven Chong JCA, Para 55

The court also ordered the appellant to pay the respondent the costs of the application fixed at S$31,052.70 inclusive of disbursements. That costs order is consistent with the court’s overall conclusion that the appellant’s resistance to payment lacked merit and had unnecessarily prolonged the dispute. (Para 55)

"The appellant is ordered to pay the respondent the costs of this application fixed in the sum of S$31,052.70 (inclusive of disbursements) forthwith." — Per Steven Chong JCA, Para 55

The automatic strike-out consequence if payment or security was not provided within four weeks underscores the seriousness with which the court viewed the appellant’s non-compliance. The court did not merely threaten consequences; it set out a clear procedural deadline tied to the continuation of the appeal. That made the order both coercive and administratively precise. (Para 55)

What authorities did the court rely on, and how were they used?

The court referred to a number of authorities to explain the legal framework and to support its conclusions. Ng Eng Ghee v Mamata Kapildev Dave was cited in the introduction for the proposition that costs can affect the real outcome of litigation. Roberto Building Material Pte Ltd v Oversea-Chinese Banking Corp Ltd was used in relation to the earlier inherent power to stay or dismiss appeals for unpaid costs under the Rules of Court 2014. Independent State of Papua New Guinea v PNG Sustainable Development Program Ltd was cited for the proposition that mere ability to pay but failure to do so is insufficient by itself. (Paras 4, 5, 6)

"The factors demonstrate that the [appellant], with the help of its controller(s) and/or shareholder(s), is capable of marshalling the financial means, when desired, to pursue and/or safeguard its dispute resolution interests in connection with the vessel “CHLOE V”." — Per Steven Chong JCA, Para 38

Huttons Asia Pte Ltd v Chen Qiming and The Republic of India v Deutsche Telekom AG were used to explain the modern regime under the Rules of Court 2021. Hahnemann Travel & Tours Pte Ltd v Hasnah bte Abdullah was cited as a similar High Court approach in which full payment of outstanding costs was ordered before the appeal could be heard. These authorities helped the court situate its decision within a coherent line of procedural case law. (Paras 29, 30, 31)

The court also referred to Goldtrail Travel Ltd v Onur Air Tasimacilik AS for the proposition that only the appellant knows the true state of its finances, Frantonios Marine Services Pte Ltd v Kay Swee Tuan on the role of third-party funders and fairness, Ng Tai Tuan v Chng Gim Huat Pte Ltd on the meaning of “neglect,” JTrust Asia Pte Ltd v Group Lease Holdings Pte Ltd on the merits threshold for appeal, Third Eye Capital Corp v Pretty View Shipping SA as an example where a stay was refused despite unpaid costs, Credit Suisse AG v Owner of the Vessel “CHLOE V” on the appellant’s ability to marshal funds, SW Trustees Pte Ltd v Teodros Ashenafi Tesemma on the purpose of security for costs, and Yuanta Asset Management International Ltd v Telemedia Pacific Group Ltd on further security. (Paras 33, 34, 35, 36, 37, 38, 52, 53)

Why does this case matter for appellate practice and costs enforcement?

This case matters because it gives a clear and practical statement of the approach under the Rules of Court 2021 when an appellant seeks to continue an appeal while leaving costs unpaid. The court made plain that the respondent’s right to payment is not a secondary concern; it is a central consideration that can justify a stay, the release of security, and the imposition of further security. Practitioners should note that the court will look closely at whether the appellant has genuinely engaged with the outstanding costs or is merely delaying. (Paras 1, 29, 32, 47, 55)

The case also matters because it clarifies the evidential burden on an appellant resisting a stay. A bare assertion that the amount is uncertain will not suffice. The appellant must engage with the respondent’s calculations, seek clarification if necessary, and provide a credible explanation for non-payment. The court’s treatment of the appellant’s conduct shows that procedural fairness cuts both ways: a party seeking the indulgence of an appeal must also respect existing costs orders. (Paras 43, 46, 47)

Finally, the case is significant because it demonstrates the court’s willingness to use security mechanisms actively. The release of existing security, the order for further security, and the stay pending payment together show a robust enforcement approach. For litigants and counsel, the message is clear: outstanding costs can have immediate and serious consequences for the progress of an appeal. (Paras 49, 55)

Cases Referred To

Legislation Referenced

• Rules of Court 2021, O 3 r 2(2) (Paras 28, 29)
• Rules of Court 2021, O 21 r 2(6) (Paras 29, 32, 55)
• Rules of Court 2014, O 92 r 4 (Para 28)
• Companies Act (Cap 50, 2006 Rev Ed) — mentioned in the quotation from Ng Tai Tuan v Chng Gim Huat Pte Ltd (Para 35)

Source Documents

• Original Judgment — Singapore Courts
• Archived Copy (PDF) — Litt Law CDN
• View in judgment: "Steven Chong JCA (delivering the judgment..."

This article analyses [2026] SGCA 7 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.