A Business and Property Court in London presided over by Justice Robin Knowles of the Commercial Courts of England and Wales has quashed the 11 billion dollars awarded against Nigeria in a case filed by the Process and Industrial Developments Company, (P&ID).
Judge Knowles held that the award was obtained by fraud and that what had happened in the case was contrary to public policy.
The court also declared that it did not find any merit in the charges of bribery levelled against a former Attorney-General of Lagos State, Mr Olasupo Shasore, SAN, who represented Nigeria in the arbitration.
The News Agency of Nigeria (NAN) reports that in the case marked: CL-2019-000752, the Federal Government sought to overturn $6.6 billion arbitration awarded in favour of P&ID in 2017.
The award had continued to accrue interest since then, rising to approximately $11 billion before the judgment.
The dispute dated to 2010 when P&ID Limited entered into a gas supply and processing agreement with Nigeria, with plans to establish an Accelerated Gas Development project in Cross River State.
The project never materialised, and P&ID subsequently accused Nigeria of breaching the contract terms.
P&ID claimed Nigeria violated terms of its agreement by failing to provide gas for the power plant it wanted to build for the country.
In 2015, P&ID won a judgment for a $10 billion compensation.
This frustrated the construction of the Gas Project agreed to during the government of former president Umaru Yar’Adua and deprived P&ID the potential benefits expected from 20 years’ worth of gas supplies with “anticipated profits of $5 to $6 billion.”
The arbitral tribunal unanimously decided that the Federal Government had repudiated the GSPA by failure to perform its obligations under the GSPA and ruled that P&ID was entitled to $6.6 billion in 2017.
The fine, along with the interest, subsequently rose to $11.5 billion.
Former President Goodluck Jonathan government reached an out-of-tribunal agreement for the payment of $850 million and passed on the disbursement to the administration of President Muhammadu Buhari.
But Buhari refused to pay the negotiated sum, set aside the settlement agreement and challenged the enforcement of the award before the English Commercial Court.
However, the London court added $2.4 billion in interest making it $9 billion.
Also, Shasore was accused of obstructing Nigeria’s legal proceedings against the British Virgin Islands-based company.
Shasore was charged with allegations of negligence and inadequate due diligence in handling the case.
In his defense, the ex-Lagos A-G maintained that he had done everything within his power to secure the best outcome for the country.
Delivering the judgement, Justice Knowles ruled that the award was obtained by fraud.
Knowles, in his verdict, stated, “As far as I am aware, Mr. Shasore, SAN, has not, in my judgment, been shown to be corrupt.
“His actions are inconsistent with Nigeria’s theory that he was.
“I add that in my view, Nigeria (and specifically Mr Abubakar Malami SAN, the former Attorney-General of the Federation) did not in truth believe Mr Shasore, SAN was corrupt.
“On 21st November, 2017, Shasore, SAN was engaged by Nigeria to represent the Ministry of Power in a $2.4bn arbitration claim by Sunrise Power and Transmission Co.
“His appointment was approved by Malami, SAN, on 6th March, 2018, and formally confirmed by Mr Malami, SAN, on 18th March, 2018,” he said.
The judge cited several reasons for his decision, highlighting Shasore’s sound advice to Nigeria to investigate and obtain expert evidence, his assistance in succeeding in Nigerian court applications, his contribution to reducing settlement figures, and his vigorous challenges against P&ID during the liability hearing.