TEMPLARS Dispute Resolution Digest | April 2024



This is the maiden edition of the TEMPLARS Dispute Resolution Digest (the Digest), a quarterly publication focused on the evolving litigation landscapes of Nigeria and Ghana.
Worldwide Litigation, Mediation & Arbitration
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This is the maiden edition of the TEMPLARS Dispute Resolution Digest (the Digest), a quarterly publication focused on the evolving litigation landscapes of Nigeria and Ghana. The Digest offers a curated selection of landmark judgments, legislative updates, and pivotal developments in dispute resolution from the last quarter of 2023 to date.

The Digest is designed to bridge the gap between theory and practice and provide valuable insights into the contemporary issues shaping dispute resolution in both jurisdictions for legal professionals, researchers, and relevant stakeholders.

In this edition, we explore key Nigerian Court decisions such as NNPC v. Fung Tai Co. Ltd (2023) 15 NWLR (Pt. 1906) 117, which clarified the applicability of pre-action notice requirements to government agencies in arbitration proceedings; alongside significant decisions from the Ghanaian Courts such as Republic v High Court (General Jurisdiction 11) Ex parte: Anas Aremeyaw Anas, which provided insightful perspectives on the power of the Chief Justice to transfer cases at the request of one party without prior notice to the other party.

Additionally, we highlight legislative reforms including the introduction of digital notarisation in Nigeria by the new Notaries Public Act, 2023.

We also shed light on Practice Directions and Administrative Guidelines issued by the Chief Justice of Ghana to ensure efficiency, expeditious disposal of cases and to enhance access to justice.

The Digest promises to be an insightful read for all interested in the Nigerian and Ghanian litigation eco-systems.


Pre-Action Notice Requirement Does Not Apply to Arbitral Proceedings:

RE: NNPC v. Fung Tai Co. Ltd (2023) LPELR-59745 (SC)

The Supreme Court, in this landmark case, resolved the vexed issue of whether a pre-action notice must be served on NNPC before commencing arbitration proceedings.

In an action to enforce the arbitral award that was made in favour of Fung Tai Engineering Company Limited ("Fung Tai") against the Nigerian National Petroleum Corporation ("NNPC"), NNPC sought to set aside the arbitral award on the grounds that the Federal High Court lacks the jurisdiction to determine the application for the enforcement of the arbitral award because Fung Tai failed to comply with the then applicable provisions of Sections 12(1) and (2) of the Nigerian National Petroleum Corporation Act 1977, which has been repealed. For context, Sections 12(1) and (2) of the Act provides that suits against NNPC must be commenced within twelve months of the occurrence of the cause of action, and that a one-month pre-action notice must have been issued to the NNPC before such suit is commenced. 

The Supreme Court held that the limitation period and the requirement of pre-action notice do not apply to arbitration because arbitral proceedings are not court proceedings, and an arbitral tribunal is not a court. The Supreme Court also found that the jurisdiction of the Federal High Court to enforce or set aside an arbitral award derives from the provisions of the Arbitration and Conciliation Act 1998 (now repealed) and not the Constitution of the Federal Republic of Nigeria.

The foregoing findings are in alignment with the new Arbitration and Mediation Act, 2023 in that they not only enhance the efficiency and reliability of arbitration as a method of resolving disputes but also reinforce the judiciary's role in ensuring the enforceability of arbitral awards, without resort to mere technical and unnecessary procedural glitches.

Libel Cases are Not Arbitrable:

RE: UBA Plc. v. Triedent Consulting Limited (2023) LPELR-60643 (SC)

In Nigeria, certain types of disputes cannot be settled through arbitration. Such disputes are typically reserved for resolution by national courts due to public policy considerations. Indeed, disputes involving or relating to crime, declaration of title to land, matters which cannot be referred to arbitration, as provided by their enabling law(s), and matters which cannot be settled by accord and satisfaction, have all been held to be incapable of being settled by arbitration by the Nigerian courts. Recently, the Nigerian apex court found, as illustrated in the case of UBA Plc. v. Triedent Consulting Limited (2023) LPELR-60643 (SC), that libel cases are also not arbitrable.

In that case, Triedent Consulting Limited brought an action on 4 February 2009 at the High Court of Lagos State against UBA Plc to recover outstanding payments and damages for libel. UBA Plc sought to stay the proceedings pending arbitration under the old Arbitration and Conciliation Act 1988 but failed to provide evidence of its willingness to arbitrate. Both the High Court of Lagos State and the Court of Appeal dismissed UBA's application. On further appeal, the Supreme Court also upheld the dismissal of UBA's application, emphasizing that libel cases are not arbitrable because libel is a claim at common law, it remains a question of law and can only be effectively determined by a court of law. Further, the Court held that an arbitrator is not imbued with the power to answer legal questions and cannot grant relief for damages arising from the determination of the legal question of whether there has been defamation.

Prior to this case, we are not aware of any case law on the arbitrability of defamation. Therefore, the Supreme Court's ruling that legal issues, such as libel, are better suited for litigation than arbitration, even if the arbitration agreement states that the arbitration covers 'disputes arising from or connected to the contract, including torts', holds significant relevance by clarifying issues that are arbitrable and issues that are not, in a commercial contract. This is especially true, considering the Arbitration and Mediation Act 2023, which allows a party to seek court intervention to set aside an arbitral award in cases where the subject matter of the dispute is not arbitrable.

The Jurisdiction of the Investment and Securities Tribunal:

RE: Ajayi v. S.E.C (2023) LPELR-59729 (SC)

The Nigerian Supreme Court, in this case, settled the controversy surrounding the exclusive jurisdiction of the Investment and Securities Tribunal to hear appeals against the decisions of the Securities and Exchange Commission (SEC).

In this case, Mr. Ajayi, who was the Finance and Accounts Manager of African Petroleum Plc. (African Petroleum), purportedly authorized the issuance of a prospectus dated 30 March 2000. The prospectus relates to an offer of sale of 86,400,000 (Eighty-six Million, Four Hundred Thousand) ordinary shares of 50k (fifty kobo) each at N28.50 (Twenty-eight Naira, fifty kobo) per share. The prospectus, however, contained an inaccurate statement that the total indebtedness of African Petroleum as of 30 June 1999 was N10,200,000 (Ten Million, Two Hundred Thousand Naira) whereas subsequent revelations indicated that African Petroleum's indebtedness was over N22,000,000 (Twenty-two Million Naira).

This act was reported to SEC by Sadiq Petroleum Limited, a core investor that subscribed to 30% of the shares of African Petroleum. Mr. Ajayi was served with hearing notice to appear before the Administrative Proceedings Committee (APC) of the SEC, but he failed to appear. He was found liable and accordingly penalized. Mr. Ajayi, however, approached the Federal High Court (FHC) for a judicial review, but the FHC declined jurisdiction and held that the proper adjudicatory panel to determine the matter is the Investment and Securities Tribunal.

Upon further appeal, the Court of Appeal held that Section 284(1) of the Investment and Securities Act confers jurisdiction on the Investment and Securities Tribunal to the exclusion of any other court or tribunal or body, to hear and determine any question of law or dispute involving a decision or determination of the SEC in the operation and application of the Investment and Securities Act. By implication, the Federal High Court has no jurisdiction to determine a dispute within Section 284 of the Investment and Securities Act.

This judgment is a welcomed development as it provides clarity on the hitherto controversial question of the exclusive jurisdiction of the Investment and Securities Tribunal, as exemplified by the earlier conflicting decisions of the Court of Appeal in SEC v Kasunmu (2008) LPELR-4936 (CA), Okeke v SEC (2018) LPELR-44461 (SC), Ajayi v SEC (2007) LPELR-CA 2000; and Nospecto Oil & Gas v Olorunnimbe (2021) LPELR-55630 (SC).

Enforceability of Collective Agreements:

RE: National Union of Hotel and Personnel Service Workers v. Outsourcing Services Limited (2023) LPELR-60683 (CA)

This case borders on the enforceability of collective agreements between an employer and its employees under Nigerian law. The National Union of Hotel and Personnel Service Workers (NUHPSW), a trade union, brought an action at the National Industrial Court on behalf of its members to enforce the provisions of a "collective agreement" executed by NUHPSW and Outsourcing Service Limited (OSL). In defense, OSL contended that the collective agreement was unenforceable and non-justiciable having not been incorporated into its employees' contract of employment. The National Industrial Court of Nigeria agreed with this position.

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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