In a landmark decision that reverberates through international business circles, a London court has nullified the $11 billion damages sought by Process & Industrial Developments (P&ID) Limited against Nigeria. The ruling comes as a culmination of a protracted legal battle over a failed gas processing project in Cross River, Nigeria.
Judge Robin Knowles, presiding over the case, delivered a damning judgment, pointing to the procurement of the gas processing project through bribery involving Nigeria’s oil ministry officials. The court found that P&ID had failed to disclose these corrupt practices during the arbitration against Nigeria.
“Today’s judgment unequivocally declares the damages null and void without delay,” emphasized Judge Robin Knowles, rejecting P&ID’s plea to revert the case to arbitration.
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This decision follows a prior ruling in October, where the High Court deemed the contract obtained by P&ID as a product of bribery and fraud. Judge Knowles, in a separate judgment earlier this month, ordered P&ID to pay £20 million in damages and compensation to the Nigerian government.
P&ID’s attempts to revive their claims against Nigeria through fresh arbitration hit a roadblock as the court insisted that proceedings couldn’t proceed with the 2023 judgment standing firm.
The crux of the matter lies in the allegations that P&ID had paid bribes to Nigerian officials involved in drafting the gas supply and processing agreement (GSPA) back in 2010. This revelation has cast a shadow of doubt over the legitimacy of the entire agreement.
The long-drawn legal battle traces its origins to a 2017 tribunal ruling that demanded Nigeria to compensate P&ID with $6.6 billion in damages, along with substantial interest rates. Subsequently, in September 2020, Judge Ross Cranston approved this application.
However, Nigeria’s legal representatives countered these claims, alleging P&ID’s involvement in bribery to secure the contract. P&ID vehemently denied these accusations, countering them as baseless conspiracy theories.
Throughout the legal proceedings, Nigeria consistently argued that the contract was procured through deceitful means, including bribery and perjury. They contended that the ballooning arbitration award, now reaching $11 billion due to accrued interest, should be invalidated.
Judge Robin Knowles sided with Nigeria, delivering a resounding victory in court by affirming the invalidation of the claimed damages.
“I have not accepted all of Nigeria’s allegations,” the judge said. “However, the arbitration awards were obtained by fraud and the awards were, and the way in which they were procured was, contrary to public policy”.