Analysts: Will UK Court Allow Apparent Attempt to Defraud Nigeria of $9.6bn?

•Judgment reserved as briefcase company cites desperation

Emmanuel Addeh in Abuja

After a two – day virtual court hearing, a judge of the High Court of the United Kingdom, Sir Ross Cranston, has reserved judgement telling lawyers that he would take time to study their submissions and give a ruling at a later date on the request by the Nigerian government to set aside the enforcement of a $9.6 billion arbitration awarded against it in favour of Process and Industrial Developments (P&ID) Limited, a briefcase company registered in British Virgin Island.

However, the material question at the end of it all, according to analysts, is whether the UK judiciary will allow itself to be an accessory to a grand fraud by a shell company owned by Irish nationals who did noting, invested nothing, employed no one, but took advantage of Nigeria’s weak governance, colluding with Nigerian officials to take control of over a third of Nigeria’s external reserves, and multiples of the nation’s yearly budget for healthcare, education and social services at a time of COVID-19.

Legal analysts, who spoke to THISDAY last night, also wondered if the judge would rule against Nigeria given UK’s firm anti-corruption stance.

The federal government had yesterday continued to marshal evidence before the UK court, to justify its request to set aside the enforcement of decision of Justice Christopher Butcher, a judge of a commercial court in London, to allow P&ID enforce the arbitration award in the United Kingdom.

Nigeria and P&ID have been locked in the legal battle over the disagreement arising from a botched Gas Supply Purchasing Agreement (GSPA) between the country and the firm, under which P&ID was to build gas processing facilities in Cross River State, and the government was to supply wet gas up to 400 million standard cubic feet per day that will be processed to generate electricity.

At the resumed virtual hearing of the case yesterday, lawyer to the Nigerian government, Mr. Mark Howard, told the court that with the emerging facts before the country, it should not be shut out of seeking further redress, saying the company knew that the contract was a sham.

The 2010 gas-supply contract, Howard told the judge, could not be validated by the law since the company kept Nigeria in the dark while it succeeded in bribing senior officials into colluding with it to rip off the country.

However, Cranston, after the over nine-hour session, told the lawyers on both sides that he would take time to study their submissions and give a ruling at a later time.
“I have had enough for me to digest. I will now retire to write my judgment down ultimately,” he said, before closing the court session, which commenced on Monday.

The judge will in his expected pronouncement decide whether any misconduct took place during the entire dealings with the P&ID and whether there is a justification to allow a full hearing on appeal.

Howard continued in his line of argument which he started on Monday that officials of government and other persons were ‘procured’ by the company to scam the country through the purported contract.

He told the court that the huge sums paid to Vera Taiga, the daughter of a former Director in the Legal Department of Nigeria’s petroleum ministry at the time, Mrs. Grace Taiga, when her entire annual salary was only $5,000, were suspicious.

The federal government sought to convince the UK court that P&ID agreed to negotiate after the initial judgment because it knew that the award was unjustifiable.

“P&ID decided to negotiate because they knew that they had no other options. It’s not a situation that you know that there was a fraud, Nigeria was shooting in the dark because P&ID kept them in the dark,” Howard said.

He added that while Nigeria was continuing to find loopholes in the entire process, initially “nobody had an incline that there was a rotten apple, which has made it face the award, thereby putting the government at the receiving end.”

He added that the issue of reasonable diligence cannot arise in a clear case where a party had a hidden agenda, as argued by the P&ID lawyers that it was up to Nigeria to have done due diligence.

He argued: “The court cannot allow these fraudsters to get away. What does reasonable diligence mean as a matter of English law? What P&ID is saying is that you can commit serious fraud and allow them time to run.

“It is likely that the fraud is beyond what we are looking at. A fraudster cannot say one failed to express reasonable diligence in this case. P&ID are fraudsters. At the time, P&ID gave Taiga those monies; she was earning $5,000 a year.

“If a fraudster can get away without consideration of a case, that exactly is a fraudster’s charter and it is nonsensical. P&ID is trying to put procedures against the substance. My lord, there is an overwhelming case of fraud.”

He told the court that there was no satisfactory answer to the issues of perjury and bribery levelled against the company, adding that it will be against justice if Nigeria is permanently shut out.

Howard contended: “If we establish a case of fraud, it will be extraordinary if the court shuts us out.

“P&ID had prejudice against the Nigerian people with that fraudulent $10 billion award. When things are hidden from you as in this case, definitely there is a case of fraud. So, we have a prima facie case because the government has found itself at the receiving end of that award.

“The interest of justice must be served. We ask your lordship for extension of time and relief from sanctions and a short address to determine the direction.”

Earlier, the company’s lawyer had argued that the decision by the Nigerian government to make a case of fraud against P&ID was an afterthought.

He said documents from the Attorney-General of the Federation and Minister of Justice, Mr. Abubakar Malami, indicated that of all the options open to the federal government, approaching the courts to indicate that it was a fraudulent arrangement against the people of Nigeria was not one.

The company told the court that the Nigerian government knew there was no case of fraud against it, the reason it chose the option to negotiate with it after Vice President Yemi Osinbajo, who was then acting president in the absence of President Muhammadu Buhari, endorsed the option.

According to the P&ID lawyer, it was after negotiations failed that Nigeria, out of desperation, decided to set the Economic and Financial Crimes Commission (EFCC) against certain individuals who participated in the deal.

It said it took the EFCC about 14 months and after its officials were eventually harangued by Malami that they started the probe because they knew all along that there was nothing to investigate.

The company said the argument that the deal was fraudulent was not based on any evidence, noting that there was no detail in Nigeria’s submission.

He told the court: “Nigeria asked for a sensible settlement. That was a deliberate decision because they knew everything they needed to know about the case. They knew what they needed to know and chose to pursue settlement.

“Clearly, there was no reason to delay investigation for two to three years. They opted for settlement and it was after it failed that the Nigerian government started investigating. Clearly, it was tactical.”