A London court on Thursday gave Nigeria final victory as it refused to grant an application by Process & Industrial Development (P&ID) seeking to appeal the judgment halting the enforcement of its $11 billion award against Nigeria.
The court in the judgment delivered by the presiding judge, Robin Knowles, ruled that the award against Nigeria should be thrown out immediately.
Recall that the Business and Property Court in London had in October halted the enforcement of the P&ID $11bn award against Nigeria in a case marked CL-2019-000752.
The court in the judgment delivered by Justice Robert Knowles, held that the process through which P&ID secured a 2010 contract to build a gas processing plant in Calabar, Cross River State, was fraudulent.
The arbitration court had awarded $6bn against Nigeria in January 2017 over the failed gas processing contract but the fine had accumulated to $11bn before the verdict was delivered on account of the seven per cent interest rate.
Delivering the ruling in the case, Knowles stated that “In the circumstances and for the reasons I have sought to describe and explain, Nigeria succeeds on its challenge under Section 68. I have not accepted all of Nigeria’s allegations but the awards were obtained by fraud and the way in which they were procured was contrary to public policy.”
Recall that P&ID had claimed Nigeria violated the terms of its agreement by failing to provide gas for the power plant it wanted to build for the country.
The global firm has insisted that the alleged violation frustrated the construction of the gas project agreed to by the government of the late former President Umaru Yar’Adua and deprived P&ID of the potential benefits expected from 20 years’ worth of gas supplies with “anticipated profits of $5 to $6bn.”
The arbitral tribunal unanimously decided that the Nigerian government had repudiated the Gas Supply and Processing Agreement by its failure to perform its obligations under the agreement awarded to the P&ID in 2017.
An initial out-of-tribunal agreement for the payment of $850m was reached by a previous administration and the disbursement was passed on to the administration of former President Muhammadu Buhari.
However, Buhari rejected the idea of paying the negotiated sum and challenged the enforcement of the award before the English Commercial Court.
The judge granted Nigeria’s request for a stay on any asset seizures while its legal challenge was pending, but ordered it to pay $200million to the court within 60 days to ensure the stay, including some court costs to P&ID within 14 days.
Knowles had in the October ruling held that, “Notwithstanding Nigeria’s allegations, I have not found Nigeria’s lawyers in the arbitration to be corrupt.
However, the case has shown examples where legal representatives did not do their work to the standard needed, where experts failed to do their work, and where politicians and civil servants failed to ensure that Nigeria as a state participated properly in the arbitration.
“The result was that the tribunal did not have the assistance that it was entitled to expect, which makes the arbitration process work. And Nigeria did not in the event properly consider, select and attempt admittedly difficult legal and factual arguments that the circumstances likely required. Even without the dishonest behaviour of P&ID, Nigeria was compromised.”