*Gas processing contract was obtained by fraud, court rules in favour of Nigeira
Nigeria received a great relief Monday as a UK court set the country from its entanglement in an $11bn Judgement debt earlier awarded in favour of Process & Industrial Developments (P&ID) Limited.
In a judgement delivered by Justice Robin Knowles of the Commercial Courts of England and Wales,,in the case between the Federal Government of Nigeria and Process & Industrial Developments (P&ID) Limited, the court upheld Nigeria’s prayer that the gas processing contract was obtained by fraud.
In the judgement delivered after five years of legal battle, Judge Knowles said: “In the circumstances and 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 awards were and the way in which they were procured was contrary to public policy.
“What happened in this case is very serious indeed, and it is important that Section 68 has been available to maintain the rule of law.
Citing Section 68 (3), Judge Knowles said: “ ‘(3) If there is shown to be serious irregularity affecting the tribunal, the proceedings or the award, the court may – (a) remit the award to the tribunal, in whole or in part, or (c) declare the award to be of no effect, in the whole or in part. The court shall not exercise its power to set aside or to declare an award to be of no effect, in whole or in part, unless it is satisfied that it would be inappropriate to remit the matters in question to the tribunal for reconsideration.’
“I was asked by Lord Wolfson KC in closing that should my judgement conclude in favour of Nigeria, as it does, to leave over the question of the order the court should make so that the parties have the opportunity to present argument once they have considered the judgement. I respect and will hear that argument as soon as that can be arranged.”
Recall that P&ID had agreed with Nigeria in 2010 to build a gas processing plant in Calabar, Cross River State, but the company said the deal collapsed because the Nigerian government did not fulfil its end of the bargain.
Claiming Nigeria breached the terms of the contract, P&ID took a legal recourse and secured an arbitral award against the country.
On January 31, 2017, a tribunal ruled that Nigeria should pay P&ID $6.6 billion as damages, as well as pre-and post-judgment interest at seven per cent.
Following the judgment, Nigeria applied for an extension of time and relief from sanctions.
The application was granted by Ross Cranston, a judge of the Business and Property Courts of England and Wales, in September 2020, thereby returning the case to arbitration.
Nigeria had alleged that the gas deal was a scam conceived to defraud the country.
Lawyers representing the federal government told the court that P&ID officials paid bribes to secure the contract.
But P&ID denied the allegation and accused the Nigerian government of “false allegations and wild conspiracy theories”.
In a March trial at the court, Nigeria alleged that the contract was secured through dishonest means that included bribery and perjury and that the arbitration award, which has now risen to $11 billion because of interests, should be quashed.
More details later