A UK Commercial Court handling legal battle between Process & Industrial Developments Limited (P&ID) and the Nigerian government has awarded Nigeria £20 million in damages and compensation to be paid within 28 days.
This ruling follows Nigeria’s historic victory in October 2023, which saw the court quash the fraudulent $11 billion arbitration award which was in favor of P&ID.
After Nigeria’s victory, the legal team of Nigeria sought at least £20 million back from P&ID as compensation to cover for damages and legal fees expended in the case. The P&ID lawyers fought to reduce the amount it would pay to Nigeria as damages as well as trying to see if it would be paid in Naira. However, the court ruled that P&ID must pay £20 million to Nigeria within the next 28 days.
P&ID tried to appeal the ruling to allow them pay in Naira. Their request for an appeal on the currency of payment was also denied.
Meanwhile, P&ID filed for fresh arbitration to revive their claims against Nigeria for alleged breach of a 2010 gas supply agreement. Unfortunately for P&ID, the High Court in London ruled that the arbitration could not proceed as long as the 2023 judgment remained in place.
It will be recalled that on October 23, 2023, Justice Robin Knowles of the Commercial Courts of England and Wales halted the $11 billion award enforcement by upholding Nigeria’s prayer that it was obtained by fraud and in violation of section 68 of the English Arbitration Act 1996.
The judge found that P&ID had paid bribes to Nigerian officials involved in the drafting of the gas supply and processing agreement (GSPA) in 2010. He also found that P&ID illegally possessed Nigeria’s privileged legal documents during the arbitration hearings.
However, Knowles said he still had to choose from three options after making his determination: (a) to remit the award to the tribunal, in whole or in part, for reconsideration, (b) to set the award aside in whole or in part, or (c) to declare the award to be of no effect, in whole or in part.
Nigeria had argued that the award should be set aside, invoking the common law principle that “fraud unravels all”. In his final pronouncement on Friday, Justice Knowles said he had decided against sending the award back to the arbitration tribunal and crushed the award in its entirety.
P&ID is now seeking Knowles’ permission to appeal the October 2023 judgment. They argued that the judge failed to apply a “causation” requirement which would have shown if the arbitration award would still have been made if bribes had not been paid by P&ID to government officials.
The judge has reserved judgment on a date to be communicated later.