Nigeria appeals world’s biggest lawsuit in UK
- The award was stated to be a final award made by the majority of a tribunal in arbitration proceedings relating to a dispute between P&ID and the FRN arising out of a Gas Supply and Processing Agreement (the ‘GSPA’) entered into between P&ID and the FRN dated 11 January 2010.
- By 2012 a dispute had arisen in relation to the GSPA, a tribunal was then constituted and found in favour of P&ID by way of part final award (the ‘liability award’).
- The tribunal stated that in light of the procedural order the Nigerian court had no jurisdiction to set aside the award.
- In due course the arbitration proceedings continued leading to a final award according to which the FRN were to pay US$6,597,000,000 to P&ID. The FRN did not pay any part of the final award and did not apply to set it aside in any jurisdiction.
- The country’s finance minister said at a press conference that the size of the award, which has risen above $9 billion with interest, meant all Nigerians would pay a price.
Nigeria’s government is in a London court to ask for more time to appeal a $9.6 billion arbitration award, an amount which surpasses the country’s income from oil last year.
Nigeria wants more time to pursue its accusations that the 2010 gas-supply contract with Process & Industrial Developments Ltd. was a sham. Last year, a British judge upheld the arbitration award P&ID won in 2017.
The dispute comes as the West African nation’s revenue is being disrupted by a collapse in oil prices. It applied to U.S. courts in March seeking documents from 10 banks, including Citigroup Inc. and JPMorgan Chase & Co., in a bid to prove its corruption allegations. P&ID denies any wrongdoing, and argues that Nigeria missed its window to appeal.
In due course the arbitration proceedings continued leading to a final award according to which the FRN were to pay US$6,597,000,000 to P&ID. The FRN did not pay any part of the final award and did not apply to set it aside in any jurisdiction.
“It is very unusual in a fraud case to discover a single smoking gun,” Mark Howard, Nigeria’s lawyer, said Monday on the first morning of a two-day hearing. “By its very nature, fraud is conducted in secret,” which makes it hard to detect and justifies an extension, he said.
Nigeria’s lawyers are seeking another hearing for the judge to decide whether misconduct has taken place, and whether it justifies overturning the contract.
“This case is an affront to decency–on any view this is obviously an eye watering amount of money. The arbitration agreement in the gas sales and purchase agreement was an integral part of the fraud,” Howard said.
Evidence of P&ID’s “highly orchestrated scam” had only recently come to light, Nigerian Attorney General Abubakar Malami said in a statement.
Lawyers to the West African nation say they have uncovered alleged bribes to government officials and their family members dating back to 2009.
“There is good reason to believe that ministers at the highest level were involved in a corrupt scheme to steal money from Nigeria,” Malami said in court filings submitted on March 24.
P&ID, a British Virgin Islands-registered firm, alleges that the Nigerian government invented the fraud allegations to avoid paying its legitimate penalty. P&ID’s spokesmen in London didn’t immediately respond to an e-mail seeking comment.
Nigeria would still have options for appealing should it lose in the London court.