FG Denies $6.59bn Default Judgment against Nigeria

Alex Enumah in Abuja

The federal government on Tuesday denied a media report that a United States District Court had entered a $6.59 billion default judgment against Nigeria, in favour of Process and Industrial Development Limited (P&ID), over a dispute that arose between them over a supply of natural gas and processing agreement.

The Attorney General of the Federation (AGF) and Minister of Justice Abubakar Malami (SAN), who dismissed the report at a media briefing in Abuja, however disclosed that the federal government through its foreign solicitor, Messrs Curtis, Maller- Prevost, Colt & Mosle LLP, has already filed processes in a US District Court challenging and defending the enforcement proceedings against the federal government.

The report had claimed that the default judgment was entered against Nigeria because the government failed to enter its defence in the matter.

But, the AGF, who spoke through the Solicitor General of the Federation, Dayo Apata, said: “No default judgment was entered against Nigeria in the enforcement proceedings by P & ID.”

He went on to explain that: “What is being taunted as a default judgment was actually a default entry made by the court clerk.”
“Under the Foreign Sovereign Immunities Act (FSIA), a defendant has up to 60 days period to answer to a petition filed against it. Where no response is entered for the defendant, the court clerk upon application by the petitioner, makes a default entry, which in this case was made on 5th June, 2018,” he said.

According to him, under the FSIA, a default judgment cannot be entered against a foreign state like Nigeria unless the presiding judge determines so after the petitioner/claimant must have established its entitlement to a default judgment.

Apata said that the US District Court is still under obligation to determine whether Nigeria is immune from the jurisdiction of the US court under the FSIA or whether the case before it falls within one of the recognised exceptions.

He added that the federal government’s foreign solicitor had on 12th June, 2018 filed necessary application to set aside the clerk’s default entry and to dismiss the entire case on grounds of defective service and lack of personal jurisdiction over Nigeria.

He urged foreign investors who were reported to be sceptical to ignore the report, adding that the federal government is making concerned efforts through legal and diplomatic channels to resolve the issues between the parties in the matter.