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$9.6 billion award. My displeasure letter to AGF Malami

By Hameed Ajibola Jimoh

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The Honourable, the Attorney-General of the Federation

And the Honourable, the Minister for Justice of the Federation,

Office of the Honourable, the Attorney-General of the Federation,

Federal Republic of Nigeria,

Federal Ministry of Justice,

Federal Capital Territory- Abuja.

Your Excellency,

RE: CASE NO: CL-2018-000182, BETWEEN: PROCESS & INDUSTRIAL DEVELOPMENTS LIMITED V THE FEDERAL REPUBLIC OF NIGERIA

LETTER OF DISPLEASURE AT THE CIRCUMSTANCES SURROUNDING THE ARBITRAL AWARD OF $9.6 BILLION (EQUIVALENT TO ABOUT N3.2. TRILLION) BY THE ENGLISH COURT AGAINST THE FEDERAL REPUBLIC OF NIGERIA IN FAVOUR OF PROCESS AND INDUSTRIAL DEVELOPMENTS LIMITED ON THE 16TH DAY OF AUGUST, 2019 AND A RECOMMENDATION FOR A THOROUGH INVESTIGATION OF ALL FEDERAL AGENCIES AND PUBLIC OFFICIALS INVOLVED IN THE PRE-CONTRACT, CONTRACT AND POST-CONTRACT AFFAIRS LEADING TO THE SAID ARBITRAL AWARD AND LITIGATION AND A HUMBLE REQUEST FOR FEED BACK ON THE PROGRESS OF THE INVESTIGATION AND NECESSARY ACTIONS TAKEN BY THE FEDERAL GOVERNMENT OR YOUR EXCELLENCY ON THE OUTCOME OF THE INVESTIGATION

The author, Hameed Ajibola Jimoh

I am a legal practitioner, a human and socio-economic rights activist and a patriotic Nigerian citizen. The media has been recently awash by the Arbitral Award of the sum of $9.6 billion (equivalent to about N3.2 trillion) by the English Court situate in England in the above referenced suit against the Federal Republic of Nigeria but in favour of Process and Industrial Developments Limited-herein after referred to as the P&ID Limited- on the 16th day of August, 2019. Much more so that the accruing interest daily is 7% of the arbitral award earlier awarded by the Arbitral Tribunal which is about $1.2 million daily. I was able to read through the said Judgment available in social media’s circulation and after proof-reading the said Judgment as a legal practitioner and a human and socio-economic rights activist, nevertheless the purported steps of application for a stay of the execution of the judgment and an appeal of the said judgment by the Federal Government, I felt so displeased at the manner through which the concerned Ministries and public officials who participated in the pre-contract, contract and post-contract of the said Gas Supply and Processing Agreement-herein after referred to as the GSPA- handled the transactions and the litigation emanating from the said award until the said Arbitral award awarded by the Arbitration Tribunal was confirmed by the English Court on the 16th day of August, 2019 in favour of the P&ID. I was also displeased at the reckless and careless draft of some of the terms of the said contract to such extent that I queried whether the Office of the Honourable, the Attorney-General of the Federation was actually consulted and or involved in the entire transactions as the Chief Law Officer of the Federation and the Honourable, the Minister for Justice of the Federation?! I observed some gross negligence in the manner of the contract and the litigation emanating from the said arbitral award, considering the facts and reasoning of the Presiding Justice of the English Court (though, I was not afforded the opportunity of reading the said agreement). Having read through the accounts expressed by the Honourable, the Presiding Justice of the English Court, Mr Justice Butcher, I suspected that something must definitely or is likely to be wrong somewhere, hence this my letter of displeasure.

Your Excellency, First and foremost, with due respect, it must be pointed out that contracts and or agreements of this nature are of three stages vis-à-vis: the pre-contract; the contract and the post contract stages respectively. In my humble view, it is expected that necessary synergy and steps would be taken by the Federal Government of Nigeria-herein after referred to as the FGN- to ensure that various necessary government’s agencies participated in the draft of the agreement most importantly because of its likely consequences on the nation and its economy. I would have expected, with due respect to the FGN, that the Federal Ministry of Justice or the Office of the Attorney-General of the Federation (who is the Chief Law/Legal Officer of the Federation with pools of trained and experienced lawyers) would have been involved in the drafting, proof reading, study, analyses, etc. of the draft agreement before its execution to avoid the situation such as the one that we have found ourselves in as a country, because, I found it very unbelievable that any lawyer or the Office of the Attorney-General of the Federation actually participated or carried out these suggested recommendations before the agreement was finally executed by the parties to the agreement! Then, at the contract stage, I would have expected that feasibility test as done at the pre-contract stage would also be put in place at this stage wherein the contract was finally agreed to by the parties to the agreement. Then, at the post-contract agreement, it was for the FGN to carry out its voluntarily agreed obligations to the contracting foreign company. Also, I would have expected that a copy of such agreement is also handled by the Office of the Attorney-General of the Federation-herein after referred to as the AGF! Whether these tests were carried out became another issue!

Now, from the Judgment which I read and analysed, there was nothing which indicated that the FGN actually has any term in the agreement that it could withdraw from the said agreement after its execution (like I said, I have not been able to lay my hands on the said agreement but I am relying on the analysis made the Presiding Judge of the English Court in the Judgment), yet, the FGN withdrew! Why?!. The question also is: ‘why did the FGN fail to include this important term in the agreement?!’ In drafting an agreement, it is usual for parties to include that either of the parties can withdraw from the agreement since more so that ‘consideration’ (i.e. money or material) has not been transferred from one party to the other at that stage. Even in a tenancy agreement, it is typical and usual to have such a term. Why then did the representing officials fail to consider this clause of right to withdraw or repudiate?! This raises a suspicion in my mind (with due respect) that something must be wrong somewhere! What was the qualification, trainings, expertise and experiences of those who drafted or prepared the agreement?! Was the AGF too given the opportunity to make his contributions into the agreement as the Chief Law/Legal Officer of the Federation?! These were some questions that crossed my mind!

Furthermore, in my humble view, with due respect to the FGN, I view that the award (which is somehow punitive to the Nigerian generations of present and those to come) was a self-inflicted harm coupled with avoidable gross negligence on the part of the Ministry of government and officials who were in charge as at the contracting stages, especially the Federal Ministry of Petroleum Resources and those legal counsel engaged to defend the suit at both the arbitration tribunal and the various courts-both Nigerian and English Courts. This is because, the agreement in my humble view, was a careless and reckless one which is likely to collapse the nation. I must also point out here that Clause 20 of the said agreement provides that ‘The Arbitration award shall be final and binding upon the parties’. Can one imagine?! So, if the Arbitration award (such as it is in this case) is final and binding, then, why is the FGN complaining about the award?! Also, the case in the English Court could not have been able to succeed if the FGN were to challenge the Arbitral award but the FGN failed, with due respect, to also consider thoughtfully that the award is not only the money rather the entire decision of the Arbitration Tribunal. So, why did the FGN carelessly agree to such final and binding decision in its agreement initially without a condition or a saving clause?!

Furthermore, I observed that FGN’s objections in the whole Arbitration and the suit where based on technicalities and not on the substance of the claims, much more so that it was self-inflicted by the FGN, with due respect. The first of it was that the initial contract was repudiated by the FGN as alleged by the foreign company/claimant. Also, I beg to disagree with those who hold the view that the award was as a result of a ‘lacuna’ which is contained in the agreement! The reason for my disagreement was because the FGN through its representatives, with due respect, was grossly negligent in the whole transactions. Some of these gross negligent conducts are:

The lack of diligently prosecuting the suit that it instituted in Nigerian Court in Lagos, on the 9th day of May, 2016, challenging misconduct on the part of the Arbitration Tribunal, which was later struck out by the Nigerian Court for lack of diligent prosecution;

The FGN never applied to set aside the Final Award of the Arbitration Tribunal decided on the 31st day of January, 2017, which in law, will mean that the FGN was or is not objecting to the Final Award. And the FGN never took such step or file any process to challenge and or set aside the said Arbitration Award in any court even since the said 31st day of January, 2017 till the 16th day of August, 2019, when the English Court delivered its Judgment confirming the Award with accruing interests (which was about two (2) years since the Arbitral award was made).

Apart from the agreed terms in the agreement, Clause 20 of the GSPA, provides that ‘The Arbitration award shall be final and binding on all the parties…’.

Therefore, I humbly disagree and submit, with due respect, that the Judgment of the English Court’s Judgment was not as a result of any legal lacuna whatsoever rather, it was much more strengthened by the gross negligence of the FGN and its representing officials. More so, the Arbitral Award issue was resolved before the Arbitration Tribunal and not the English Court. The said award was not challenged for good two (2) years by the FGN and the issue before the English Court was for leave to enforce the said Arbitral Award. It is only unfortunate that there are several monetary judgments by the Nigerian courts against the FGN or its Ministries, Departments and Agencies which the government has made very difficult to enforce but just a foreigner will be able to enforce more than 3 trillion naira of the Nigerian money!

I have also considered the reasoning of the  English Court at page: 18, paragraphs: 65 and 67 and page: 18, paragraph 87 of the soft copy of the Judgment which I was able to lay my hands on and perused, which was about 28 pages in all.

Finally, I therefore in all, suspect that something must definitely be wrong somewhere and I therefore recommend as follows:

a thorough investigation of all Federal Agencies and public officials involved in the pre-contract, contract and post-contract affairs leading to the said arbitral award and to bring anyone found culpable to book in the interest of this nation and to deter such further act in the nearest future!

Effective Coordination and supervision of all the Federal Government’s Ministries’, Departments’ and Agencies’ activities by the Honourable, Attorney-General of the Federation.

Passing of circular(s)/directive for submission of all contracts embarked upon or pending before the Ministries, Departments and Agencies of the Federal Government henceforth to Your Excellency, for a thorough legal scrutiny and advisory by the Honourable, the Attorney-General of the Federation, in order to forestall any of such unfortunate circumstance in the nearest future;

Negotiation (if possible) with the P&ID Limited on the Arbitral Award’s payment and or likely consideration for reduction in the award;

I also humbly request for feedback on the progress of the investigation and necessary actions taken by the Federal Government or Your Excellency on the outcome of the investigation by virtue of Your Excellency’s Office as the Chief Law Officer and the Minister for Justice of the Federation having the coordination and supervisory functions over all activities of the Federal Government’s Ministries, Departments and Agencies and all public servants in the service of the Federation.

While I anticipate that this petition would be given due but favourable consideration, please accept the assurances of my warm professional regards!

Yours faithfully,

Hameed Ajibola Jimoh Esq.

Sole Practitioner/Principal Counsel/ Human and Socio-economic Rights Activist

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