US Court Orders $6.21m Transfer from Polaris Bank to Danish Shipping Firm Norden

A United States federal court has ordered Standard Chartered Bank in New York to transfer $6.21 million belonging to Polaris Bank Limited to Danish shipping company Norden, following a settlement that brings an extended legal dispute over a 2021 cargo shipment to an end.

The order, issued by the United States District Court for the Southern District of New York on November 5, 2026, directs Standard Chartered Bank to remit exactly $6,214,196.08 from funds belonging to the Nigerian lender that had been placed under judicial attachment.

The payment is to be completed by November 12, 2026, in accordance with the settlement agreement reached between Polaris Bank and Norden after months of litigation over unpaid freight charges, demurrage and other shipping-related expenses.

The court also dismissed the proceedings with prejudice, effectively preventing either party from reopening the same claims through fresh litigation.

However, the order preserved Norden’s right to return to court to enforce the settlement if the agreed payment was not made.

How a 2021 Cargo Shipment Triggered the Legal Dispute

The dispute originated from a shipping transaction involving 27,000 metric tonnes of gypsum transported aboard the vessel Lady Demet from Safi, Morocco, to Lagos, Nigeria, in 2021.

The consignment was supplied by Gypse Expo and purchased by Quattro Marine and Petrochemical Nigeria Limited for onward resale to Lafarge Africa Plc.

Polaris Bank participated in the transaction by providing financing through a letter of credit.

Under a shipping agreement executed on June 28, 2021, the parties agreed on a freight rate of $39.95 per metric tonne. The agreement also provided for demurrage charges of $35,000 per day whenever the vessel remained at port beyond the stipulated period.

However, disagreements subsequently arose over freight obligations and additional charges associated with delays at different ports.

The disagreements resulted in claims that eventually grew substantially beyond the original transportation costs.

London Arbitration Awards Norden Over $1m

Following unsuccessful attempts to resolve the dispute, Norden commenced arbitration proceedings against Polaris Bank in London around May 6, 2022.

The arbitration was conducted under the framework of the London Maritime Arbitrators Association.

On March 30, 2026, the arbitral tribunal issued a final partial award directing Polaris Bank to pay Norden $1,052,692.50 in outstanding freight charges.

The award also attracted interest at an annual rate of five per cent, compounded quarterly, from September 25, 2021, until the outstanding amount was fully settled.

However, subsequent court filings in the United States indicated that the arbitration award remained unpaid when Norden commenced enforcement proceedings in New York.

Beyond the initial freight award, the Danish shipping company maintained additional claims exceeding $4.2 million.

The additional claims included approximately $1.55 million for delays at the loading port, $1.98 million relating to discharge operations in Lagos and $811,586.81 associated with Calabar.

Other disputed charges involved additional freight, war-risk insurance premiums, security-related expenses and compensation for loss of vessel hire.

The overall claims also took account of an earlier payment of $400,000.

US Court Freezes Polaris Bank’s Funds

After efforts to secure payment of the arbitration award proved unsuccessful, Norden approached the Southern District of New York on June 22, 2026, seeking judicial intervention against assets belonging to Polaris Bank within the United States banking system.

The proceedings identified Citibank, Standard Chartered Bank and United Bank for Africa, through their New York operations, as potential holders of assets belonging to the Nigerian financial institution.

Norden sought security for its outstanding claims, including the arbitration award, additional disputed charges, accrued interest and legal expenses.

On June 25, 2026, the court authorised maritime attachment and garnishment proceedings against Polaris Bank’s assets.

The order permitted the seizure of funds held through Standard Chartered Bank in New York up to $6.001 million, subject to an overall ceiling of $6.4 million covering associated expenses and interest.

The attached funds were to remain under judicial control pending further directions from the court.

The authorisation also covered qualifying assets and credits held by other financial institutions within the court’s jurisdiction.

The development effectively restricted Polaris Bank’s access to the affected funds while the legal proceedings remained ongoing.

Polaris Bank Obtains Repeated Extensions Without Filing a Defence

Court records also detailed several procedural extensions granted to Polaris Bank following the attachment order.

The Nigerian bank, represented by international law firm Dentons, received additional time to respond to Norden’s complaint on multiple occasions between July and October 2026.

Its final deadline was extended to November 11, 2026.

Despite the extensions, Polaris Bank did not file a formal answer addressing the substantive allegations before the parties reached a settlement.

Standard Chartered Bank, which was named as a garnishee in the proceedings, filed its own response on August 7, 2026.

The absence of a formal defence from Polaris Bank meant that the lender did not enter an answer contesting Norden’s substantive complaint on the New York court record.

However, the dispute was ultimately resolved through negotiations and a settlement agreement between the parties rather than a full trial and judicial determination of the disputed claims.

Settlement Agreement Brings Months of Litigation to an End

The proceedings moved towards resolution in October 2026 after the court was informed that Norden and Polaris Bank had reached an agreement in principle.

On October 27, the court discontinued the proceedings while allowing a 30-day period within which the case could be reinstated if the settlement encountered difficulties.

Both parties subsequently filed a joint application on October 28, requesting that the proceedings be reopened for the limited purpose of implementing their settlement agreement and releasing the attached funds.

The application was granted, paving the way for the November 5 order.

Under the settlement terms, Standard Chartered Bank was directed to transfer exactly $6,214,196.08 into an account designated by Norden.

Upon completion of the payment, the judicial restrictions affecting Polaris Bank’s assets held by Standard Chartered Bank and the other garnishee institutions were to be discharged.

The court also directed that Standard Chartered Bank be released from its obligations as garnishee, with each party responsible for its own legal expenses.

Although the proceedings were dismissed with prejudice, Norden retained the right to return to court to enforce the settlement agreement if Polaris Bank failed to fulfil its payment obligations.

Such enforcement measures could include renewed attachment proceedings against the Nigerian bank’s assets.

Settlement Amount Exceeds Original Arbitration Award by More Than $5m

The final settlement figure represents a substantial increase over the initial arbitration award secured by Norden in London.

While the arbitral tribunal awarded the Danish shipping company $1,052,692.50 in outstanding freight charges, the amount authorised for transfer by the United States court reached $6,214,196.08.

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The difference exceeds $5.16 million, reflecting the significantly larger financial exposure that emerged as the dispute expanded beyond the original freight obligation to include additional shipping-related claims and associated costs.

The settlement therefore brings to a close a dispute that began with a 2021 cargo shipment involving a Nigerian importer, a Danish shipping company and Polaris Bank’s financing arrangement.

The November 5 order provides the legal framework for releasing the attached funds and implementing the agreement reached by the parties, subject to the completion of the stipulated payment.