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Nigeria government in last-ditch attempt to overturn £8 billion compensation payout


The High Court in London heard Friday that lawyers fighting for compensation of PS8 billion from the Nigerian government were subject to ‘interference’. The award was won by Process and Industrial Developments Ltd (P&ID), five years ago, following the illegal cancellation of a contract for gas processing. This was the largest claim ever made against Nigeria’s government, which is plagued by corruption allegations and nepotism.

The Nigerian government appealed against the decision in what many consider a desperate attempt to reverse the decision.

Nigerian officials have made a series of regrettable comments about the judges who ruled in favor of P&ID.

On Friday, Justice Robin Knowles tried to establish a timetable for a January eight-week trial at the High Court.

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Mark Howard, KC representing the Nigerian government, stated that solicitors from both parties should be sent to Abuja to supervise two witnesses giving evidence over the internet.

He stated that there are security concerns in Nigeria that are well-known.

It is quite dangerous, but it is possible to go to a five-star hotel and then the aberration center.


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“P&ID” said that it was dangerous to send their solicitor. We are willing to send solicitors and we don’t see why they shouldn’t.

Lord David Wolfson, KC representing P&ID said: ‘Our concern is that lawyers in this matter have already been subjected to interference. It is not a matter of whether Nigeria is secure in general.

“We are on the side of the government and are concerned about the history of the case regarding people going to Nigeria.

Howard asked that officials from Nigeria’s government be allowed to observe proceedings from Nigeria.

Lord Wolfson stated that there have been statements made by the Nigerian Government about judges in past cases. This has been regrettable. The Nigerian Government also runs its own website, where they offer commentary on this case.

“We don’t want it turning into a bit circus in Nigeria beyond what the court can control.”

“If the Attorney General wants to attend, he’s been to London before so it’s not surprising that he wouldn’t be able to pitch up.

Abubakar Malami is the Attorney General who directs the government’s approach in the case. He is also the son-in law of the president. There are allegations of corruption as well as improper behaviour.

Howard stated that names of people who wish to attend would be provided seven days in advance. They were not asking for blanket permission for everyone in Nigeria.

There was some disagreement among the parties about whether the eight-week time limit that had been established was to include the week’s rest near the end for closing statements preparation.

Howard claimed that the time estimate didn’t include the week’s vacation.

He stated that he believed we were trying to prolong the trial and taking too much time for cross-examination.

“In terms of scheduling, our position is that the 32-day rule should be used.

“We are concerned that P&ID is trying obstruct the federal republic of Nigeria in properly putting this case.

“This case is of high value even according to the standards of the court. It has issues that are fundamental to how arbitration is conducted as well as the proceedings of the court.

“There are also concerns regarding witnesses heath, which could lead to additional breaks being required.”

“I don’t want to prolong the process more than it is necessary.”

Lord Wolfson stated: “When we talk about trial lengths, that includes the break if it is going to be one. My friend, a learned man, said that his timetable would take him eight weeks. However it actually takes nine to 10 weeks without a break.

“It is very rare for any witness in the court to be cross-examined for more than one week.

“My Lord must look at this in the round, and make a decision on how long cross examination should take.

“We are concerned about my Lord being lead down highways, byways- they are saying that you were doing something wrong there so it must have been wrong over here.

“We submit that it is excessive. A timetable more similar to ours would be better.

Howard replied, “I have never seen a situation in which you claim you have 32 days worth of evidence. And anyone who says that it includes the time the judge is not sitting down or reading the documents can say that they have 32 days.”

Justice Knowles stated that the eight weeks would include the week’s holiday and that a total 14 days would be allowed for cross-examination. This was not the 17 days Howard requested.

Howard argued that the trial should be heard from experts in Nigerian legal.

He stated that the only reason for the payment was P&ID.

“Your Lordship will need to evaluate that fact. This does not fall under customary gifts, and gifts for bribery were never allowed.

“This idea of customary presents does not have an equivalent under English law, and it is only right that we hear from Nigerian experts.”

Lord Wolfson stated that the main question isn’t whether something is legal or not in Nigerian law. The central question is whether there were any acts of dishonesty.

“Nigerian law does not test that.”

Justice Knowles stated that he believed it was appropriate to include Nigerian lawyers experts in this case.

“In this case, it is important that the court listens carefully to Nigerian law sources in order to respect the legal system.

Howard stated that he was puzzled by the contentiousness of a chronology document, and added that it wasn’t a lengthy document.

He stated that he was able to read the book while watching football last night, and it wasn’t too taxing.

Lord Wolfson stated that there are a lot of problems with the chronology. There has never been any attempt to create a neutral document.

“They put two and two together, sometimes creating four and five, and sometimes making 132.

Justice Knowles stated that it was disappointing that the two sides were so different on chronology. He directed each junior barrister to meet with him to reach an agreement.

Lord Wolfson stated to the judge that his opening statement might need to be 400 pages.

Justice Knowles responded: “That’s the length I find unhelpful. I’d rather have 250 pages to command than 400.”

Because the government has submitted a statement, he set a page limit for P&ID at 300 pages and 250 for Nigeria’s government.

In principle, the parties agreed that a document showing payments between them was accurate because it showed genuine payments.

Nigeria’s government filed a $1.7B claim against JP Morgan earlier in the year. They claimed that JP Morgan was negligent for transferring $1.1B to Malabu as part of a 2011 oilfield deal.

Ibrahim Magu, former head of Nigeria’s Economic and Financial Crimes Commission stated that the UK judge and court should be investigated in relation to previous judgments against Nigeria.

Buhari’s technical adviser on media called the British legal document ‘tainted’, and called on Nigeria to stand up to it’.

Obadiah Mailafia is a former presidential candidate, and deputy governor at the Central Bank. He suggested that in 2019, the original award to P&ID was intended to impose a “punitive” judgement on Nigeria.

The trial of eight weeks will start on 16 January.

TIMELINE FOR DISPUTE

  • January 2010, Nigerian Ministry of Petroleum Resources signed an agreement for construction and operation of a gas processing plant.
  • August 2012: P&ID initiated arbitration claiming that Nigeria had repudiated its contract and that the project was doomed due to Nigeria’s inability to fulfill its end of the deal
  • July 2015: After a change in government in Nigeria, the arbitration was brought to public attention.
  • January 2017, $6.6bn final award by the Arbitration Tribunal. A pre- and/or post-judgment interest rate is attached at 7%
  • January 2018, Nigeria asks for fraud investigation by Economic and Financial Crimes Commission to investigate the P&ID deal
  • March 2018, P&ID files a petition to the English High Court in order to enforce the final award. The parallel process is initiated in the USA
  • August 2019, UK Court: P&ID may take over assets in Nigeria worth $9.6 Billion for breaching the agreement between them
  • September 2019, English High Court grants P&ID permission to enforce the award, but Nigeria is allowed to appeal the decision. The judge ruled that the company could not seize state assets and stated that the company cannot begin to take them.
  • January 2020: Nigeria asks for a hearing to show what it claims is fraud evidence
  • September 2020: Nigeria was granted an extension by a high court judge to contest the award. He concluded that there was evidence that the contract was procured through bribery, and that the arbitration proceedings were corrupted.
  • August 2022: Nigerian government files new fraud claims against P&ID. This indicates that they intend to show the court that P&ID failed to disclose all information to them in the earlier stages of the case.
  • December 2022: Hearing for Pre Trial Review
  • January 2023: Nigerian government to start trial seeking to overturn arbitration award

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