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Published online by Cambridge University Press: 05 April 2021
Parties find it difficult to determine which Nigerian High Court should intervene in the appointment of arbitrators due to conflicting judicial precedents. This perennial challenge has defied any legal solution. Considering relevant case law, this article examines the Arbitration and Conciliation Act (ACA) vis-à-vis the Nigerian Constitution. The main argument is that the Nigerian Constitution read alongside the ACA confers the Federal High Court with additional jurisdiction to appoint arbitrators regardless of which court has jurisdiction concerning the underlying dispute. There are also uncertainties regarding the intervention jurisdiction of Nigeria's National Industrial Court to appoint arbitrators. Currently, no other court can exercise intervention jurisdiction in employment disputes. This article analyses recent decisions of the National Industrial Court and argues that this Court can only intervene to appoint arbitrators where both parties request the appointment in a pending action before the Court. It is also argued that decisions concerning the appointment of arbitrators through judicial intervention can be appealed.
Doctoral researcher, Faculty of Law, University of Nigeria.
Lecturer in law, University of Stirling, Scotland.
1 Born, G International Commercial Arbitration (2nd ed, 2014, Kluwer Law International)Google Scholar at 1.
2 Id at 2. See further, Robine, E “What companies expect of international commercial arbitration” (1992) 9/2 Journal of International Arbitration 31Google Scholar.
4 See the memo (“Re: arbitration clause in commercial contracts”) from the Chief Justice of Nigeria to all courts dated 26 November 2017. On delays and complexities of courts, see Candide-Johnson, CA and Shasore, O Commercial Arbitration Law and International Practice in Nigeria (2012, LexisNexis)Google Scholar at 7–10.
5 Nigel and Partasides argued that “arbitration is now the principal method of resolving international disputes involving states, individuals and corporations”. See Nigel and Partasides Redfern and Hunter, above at note 3 at 1.
6 Constitution of the Federal Republic of Nigeria 1999 (as amended by the 3rd Alteration Amendment Act 2010) (hereafter Constitution), sec 270(1).
7 Id, sec 255(1). For the purposes of this article, “State High Courts” include the High Court of the FCT except where otherwise stated.
8 Id, sec 249(1).
9 NUT Niger State v COSST, Niger State  10 NWLR (pt 1307) 89 at 109.
10 Abiri CJ argued that: “The conflict of jurisdiction between the Federal and State High Courts mocks the efficiency of the judicial system in Nigeria. Statutes that confer jurisdiction on the courts are of no use if the ambits of such jurisdiction are not clearly delimited and unambiguous”. See K Abiri “Identifying and delineating the frontiers of the jurisdiction of the State High Court vis-à-vis other courts of coordinate jurisdiction” (paper presented at the induction course for newly appointed judges and khadis organized by the National Judicial Institute from 15 to 23 June 2015) 28. A decade earlier, the Supreme Court had observed that the jurisdictional struggle between the Federal High Court and the State High Courts was perennial and no easy resolution was in sight. See Onuorah v Kaduna Refining & Petrochemical Co Ltd  16 WRN 1 at 14–15.
11 Abiri “Identifying and delineating the frontiers”, above at note 10 at 28.
12  5 SC (pt 1) 32.
13  12 NWLR (pt 1156) 563.
14 Ibid, per CC Nweze JCA. See also, WEMA Securities & Finance Plc v Nigeria Agricultural Insurance Corp (2015) LPELR-24833 (SC). See further on jurisdictional conflicts amongst the Federal and States High Courts in Nigeria: CC Nweze “Jurisdiction of the State High Court” in E Azinqe (ed) Jurisprudence of Jurisdiction (2005, Oliz Publishers) 85 at 90; AG Karibi-Whyte The Federal High Court: Law and Practice (1986, FDP); Emiola, A “Implication and complications of Federal High Court (Amendment) Decree 1991” (1992) 3/8–9 Justice 1Google Scholar; Fashakin, Y “Jurisdictional limitation of the Federal High Court in banker/customer relationship” (2003) 7/1–2 Modern Practice Journal of Finance and Investment Law 231Google Scholar at 234; Okorie, PC “Extent of the jurisdiction of the Federal High Court in fundamental human rights cases in Nigeria: A review of the Supreme Court Decision in Grace Jack v University of Agriculture, Makurdi” (2004) 2 Nigerian Bar Journal 241Google Scholar; O Ogbuinya Understanding the Concept of Jurisdiction in the Nigerian Legal System (2008, Snaap Press Ltd) at 290–333; and ST Hon Civil Procedure in Nigeria (vol I, 2008, Pearl Publishers) at 357–84; Okoli, PN and Umeche, CI “Jurisdictional conflicts and individual liberty – the encroaching burden of technicality in Nigeria” (2018) 22/4 The International Journal of Human Rights 473CrossRefGoogle Scholar; Essien, E “The jurisdiction of State High Courts” (2000) 44/2 Journal of African Law 264CrossRefGoogle Scholar.
15 See for instance, SPDCN Ltd v Isaiah  11 NWLR (pt 723) 168; Oni v Cadbury Nigeria Plc (2016) LPELR-26061 (SC).
16 See Robine “What companies expect”, above at note 2.
17  LPELR-42595 (SC).
18 Ie, the jurisdiction conferred by the National Assembly with respect to certain disputes under sec 251 of the Constitution.
19 In summary, where a party fails to appoint an arbitrator within the stipulated time despite having been given due notice to so appoint, the courts can appoint arbitrators when approached by the party who had served notice on the erring party, to ensure the arbitral tribunal is properly constituted to resolve the dispute between the parties. See ACA, sec 7(2)(a)(i)–(ii) and (b) and (3). See further, Royal Exchange Assurance v Bentworth Finance (Nig) Ltd  NSCC 648.
20 ACA, sec 57(1). Such decisions will be examined shortly.
21 The Constitution delineates the jurisdiction of the Federal, FCT and State High Courts. See Constitution, secs 249, 255 and 270. The scholarly views are discussed later, eg at texts to notes 42 and 49.
22 See sec 254C(1) of the Constitution and sec 7 of the National Industrial Court Act 2006 on the exclusive jurisdiction of the National Industrial Court.
23 Ravelli v Digitsteel Integrated Services Ltd suit no NICN/LA/559/2016, Kanyip J (16 February 2018); Prakash v Orleans Invest Holdings suit no NICN/LA/521/2017, Bassi J (5 March 2018); Michael Ajilore v KLM Airlines suit no NICN/LA/617/2017, Bassi J (31 May 2018).
24 Above at note 17.
25 ACA, sec 7(2)(b).
26 Id, sec 7(3)(a).
27 Id, sec 7(3)(b).
28 Id, sec 7(3)(c).
29 See JO Orojo and MA Ajomo Law and Practice of Arbitration and Conciliation in Nigeria (1999, Mbeyi & Associates) at 121.
30  14 NWLR (pt 1480) 511.
31 Campagnie Generale de Geophysique v Etuk  1 NWLR (pt 853) 20 at 49; Fidelity Bank Plc v Jimmy Rose Co Ltd  6 CLRN 82 at 92.
32 City Engineering Ltd v Nigerian Airports Authority  11 NWLR (pt 625) 76 at 86.
33 Kano State Oil and Allied Products Limited v Kofa Trading Company Limited  3 NWLR (pt 436) 244 at 247.
34 See art 6(2) of the Arbitration Rules – made pursuant to ACA, secs 15(1) and 53 and annexed as ACA schedule I. See also sec 7(2)(b). For further insight into the rationale behind such guidelines, see PO Idornigie Commercial Arbitration Law and Practice in Nigeria (2015, LawLords) at 194–98. On the need to comply with arbitrator qualifications prescribed by the arbitration agreement, see ACA, sec 7(5). See Rahcassi Shipping Company SA v Blue Star Line Ltd  3 All ER 301. In this case, the English High Court decided that the appointment of an arbitrator who lacked qualifications specified in the arbitration agreement was void.
35 Arbitration Rules, arts 7(2)(a)(b), 7(4) and 8(2).
36 G Ezejiofor “Appointment of an arbitrator under the Nigerian law: The procedure and powers of an appointing authority – Nigerian Paper Mills Limited v Pithawalla Engineering GMBH” (1997) 4 The Arbitration and Dispute Resolution Law Journal 349 at 351–52. Nwakoby, however, contended that such a function would be a judicial one because the application for the appointment of arbitrators should be heard in court, see GC Nwakoby The Law and Practice of Commercial Arbitration in Nigeria (2nd ed, 2014, Snaap Press Ltd) at 51. See also, Nwakoby, GC “The constitutionality of section 7(4) and 34 of the Arbitration and Conciliation Act: Chief Felix Ogunwale v Syrian Arab Republic revisited” (2003) 1/3 Nigerian Bar Association Law Journal 345Google Scholar at 353.
37 (2014) LPELR-22430 (CA).
39 ACA, secs 44(2) and 54(2).
40 Id, sec 57(1).
41 Constitution, sec 251 (jurisdiction of the Federal High Court), sec 257 (jurisdiction of the FCT High Court) and sec 272 (jurisdiction of the State High Court).
42 See for instance, Nwakoby The Law and Practice, above at note 36 at 47; Nwakoby “The constitutionality of section 7(4)”, above at note 36 at 5; OO Olatawura “Constitutional foundations of commercial and investment arbitration in Nigerian law and practice” (2014) 40/4 Commonwealth Law Bulletin 657 at 683 and OO Olatawura “Nigeria's appellate courts, arbitration and extra-legal jurisdiction: Facts, problems, and solutions” (2012) 28/1 Arbitration International 63.
43 Nwakoby The Law and Practice, above at note 36 at 48. See also A Rhodes-Vivour Commercial Arbitration Law and Practice in Nigeria (2016, LexisNexis) at 638.
44 See Afocon Nig Ltd v Registered Trustees of Ikoyi Club 1936  FHCLR 371; Imani & Sons Ltd v Bill Construction Co Ltd et seq FHC/L/CP/358/97, Belgore CJ (9 March 1998). See further, Access Bank Plc v Akingbola  3 CLRN 124, where the Lagos State High Court refused to register a decision of the English Courts on the basis that the subject matter was constitutionally within the exclusive jurisdiction of the Federal High Court. For the argument that courts should interpret relevant laws in a manner that promotes legal certainty and predictability, see PN Okoli “Subject matter jurisdiction: The recognition and enforcement of English judgments in Nigeria and the need for a universal standpoint” (2016) 17 Yearbook of Private International Law 507.
45 (2018) LPELR-43519 (CA). According to this Court of Appeal decision, where the Federal High Court lacks jurisdiction over the substantive suit, the Court also lacks the jurisdiction to enforce the arbitration agreement by ordering the parties to proceed to arbitration, save to apply sec 22 of the Federal High Court Act and transfer the matter to an appropriate court.
46 (2018) LPELR-44429 (CA): the Federal High Court has no jurisdiction to enforce an arbitral award on a dispute predicated on a simple contract.
47 See Knight Frank & Rutley v Delta Steel Co Ltd, Suit No: FHC/L/CS/383/95, Belgore CJ (5 August 1995); Tidewater Marine Intl Inc New Orleans (formerly known as Tidex Intl Inc) v Consolidated Oil Ltd Lagos  FHCLR 324; Grinaker-LTS Construction Nig Ltd v UACN Property Development Co Ltd, Suit No: FHC/L/CS/935/10, Idris J (21 February 2011).
48  11 NWLR (pt 936) 239, Katsina-Alu JSC, at 247–53.
49 Nwakoby The Law and Practice, above at note 36 at 46; and Rhodes-Vivour Commercial Arbitration Law and Practice, above at note 43 at 182–84, who cited this case but did not consider its impact on the question. The respondent in Federal University v BMA Ventures, above at note 46, cited Magbagbeola v Sanni, above at note 48, at the Court of Appeal which, however, did not consider the case in its decision that the Federal High Court had no jurisdiction to enforce an arbitral award predicated on simple contract. This is because under sec 251 of the Constitution, matters of simple contract are within the exclusive jurisdiction of the State High Courts. See Adelekan v Ecu-Line NV  12 NWLR (pt 993) 33 at 52; Osun State Government v Dalami (Nig) Ltd  9 NWLR (pt 1038) 66 at 91–92; P & CHS Co. Ltd v Migfo (Nig) Ltd  18 NWLR (pt 1333) 555 at 600; and Onuorah v Kaduna Refinery and Petrochemical Company  6 NWLR (pt 921) 391 at 405.
50 See Oputa JSC, in Adegoke Motors v Adesanya  5 SCNJ 80: “the expression of every judge, including the justices of this court, must be taken with reference to the facts and peculiar circumstances of the case on which he decides otherwise the law will get into extreme confusion. That is why in this judgment, I repeatedly said that the facts frame the issues for decision.” See further, Babatunde v PAS &TA Ltd  13 NWLR (pt 1050) 113 at 157; Albion Construction Ltd v Rao Investment & Properties Ltd  1 NWLR (pt 219) 583 at 598; Audu v AGF  LPELR-19653 (SC); Bhojwani v Bhojwani  6 NWLR (pt 451) 663; Oyeneye v Odugbesan  4 SC 244; Obi-Odu v Duke (No 2)  10 NWLR (pt 932) 120; Bamgboye v Unilorin  10 NWLR (pt 622) 200; Salami v NNN Ltd  13 NWLR (pt 634) 315 at 330 and Abacha v Fawehinmi  4 SC (pt II) 1.
51 ACA, sec 12(2). See also, NNPC v Klifco Nig Ltd  10 NWLR (pt 1255) 209; Heyman v Drawins Ltd  AC 356 at 374; Stabilini Visinoni Ltd v Mallinson & Partners Ltd  12 NWLR (pt 1420) 134 per Nimpar JCA: “An arbitration agreement generally exists as a clause in a contract agreement and is usually treated separately regardless of what the contract is all about. It is a special clause not affected by the main contract though part of the contract agreement”. See further, G Nwakoby “International commercial arbitration agreement: Issue of autonomy in arbitration practice” (2003) 7 Modern Practice Journal of Finance and Investment Law 310 at 323.
52 See P & CHS v Migfo, above at note 49; Oliver v Dangote Ind Ltd  10 NWLR (pt 1150) 467; KLM Royal Dutch Airlines v Taher  2 NWLR (pt 1393) 137; Adelekan v Ecu-Line NV  12 NWLR (pt 993) 33; NUT Niger State v COSST, Niger State  10 NWLR (pt 1307) 89 at 109; and Onuorah v Kaduna Refinery and Petrochemical Co  6 NWLR (pt 921) 393.
53 This would be subject to the outcome of the intervention jurisdiction of the National Industrial Court considered below.
54 (2018) LPELR-43519 (CA): where the Federal High Court lacks jurisdiction over the substantive suit, the court also lacks the jurisdiction to enforce the arbitration agreement by ordering the parties to proceed to arbitration save to apply the Federal High Court Act, sec 22, and transfer the matter to an appropriate court.
55 Above at note 46: the Federal High Court has no jurisdiction to enforce an arbitral award on a dispute predicated on a simple contract.
56 Constitution, sec 254C(1)(a).
57 See id, sec 254C(1) and National Industrial Court Act 2006, sec 7 on the exclusive jurisdiction of the National Industrial Court generally. See also Constitution, secs 272 (on the Federal High Court) and 251(1) (on the State High Courts). See also, Okoli and Umeche “Jurisdictional conflicts and individual liberty”, above at note 14 at 481.
58 See Constitution, sec 254C(3): the National Industrial Court is empowered to exercise “appellate and supervisory jurisdiction over an arbitral tribunal … in respect of any matter that the National Industrial Court has jurisdiction to entertain.” Under id, sec 254C(4), the National Industrial Court is empowered to “entertain any application for the enforcement of the award, decision, ruling or order made by any arbitral tribunal … connected with, arising from or pertaining to any matter of which the National Industrial Court has the jurisdiction to entertain.”
59 Above at note 23 at 15.
60 See Constitution, sec 254C(1).
61  5 CLRN 176.
62 Id at 178.
63 Above at note 23.
64 Above at note 23.
65 Above at note 23.
66 Above at note 23.
67 Ravelli v Digitsteel, above at note 23, at 13, citing the ACA, sec 57(1): “‘Arbitration’ means a commercial arbitration whether or not administered by a permanent arbitral institution … ‘Commercial’ means all relationships of a commercial nature, including any trade transaction for the supply or exchange of goods or services, distribution agreement, commercial representation or agency, factoring, leasing, construction of works, consulting, engineering, licensing, investment, financing, banking, insurance, exploitation agreement or concession, joint venture and other forms of industrial or business cooperation, carriage of goods or passengers by air, sea, rail or road.” The Court also found the long title to the Act relevant: “An Act to provide a unified framework for the fair and efficient settlement of commercial disputes by arbitration and conciliation”. See further, A Asouzu “Arbitration and judicial powers in Nigeria” (2001) 18/6 Journal of International Arbitration 617 at 627 on the ACA applying only to commercial disputes.
68 Constitution, sec 254(c)(1)(b).
69 Cap T8 LFN 2004, sec 12.
71 Citing Maritime Academy of Nigeria v AQS  All FWLR (pt 406) 1872 at 1890; Compagnie Generale de Geophysique v Etuk  LPELR-5516 (CA).
72 Ravelli v Digitsteel, above at note 23 at 14.
73 Statoil (Nigeria) Ltd v FIRS  LPELR-23144 (CA).
74 Constitution, sec 254(C)(1).
75 Ravelli v Digitsteel, above at note 23 at 15.
76 Above at note 23.
77 Above at note 23.
78 Ajilore v KLM, above at note 23 at 8.
79 This provides: “In any action before the Court, the Court may at any time order the whole cause or matter or any question or issue of facts arising therein to be tried before a special referee, officer of the Court, or arbitrator as agreed by the parties.”
80 See Colvin, AJS “An empirical study of employment arbitration: Case outcomes and processes” (2011) 8/1 Journal of Empirical Legal Studies 1CrossRefGoogle Scholar for results of a study of employment arbitrations demonstrating how arbitration was disadvantageous to employees in the US. Win rates for employees was a mere 21%, far lower than obtained in litigation. In the few cases where the employees won, compensation awarded was far lower when compared to litigation. Gross provides two important supporting arguments here: first (in the context of empirical studies), “repeat-player advantage garnered by parties with superior bargaining power harms those with weaker bargaining power”; second, the “discounting of bargaining endowments weakens both the legitimacy of these settlements and the legitimacy of arbitration as a dispute resolution process”. See Gross, JI “Bargaining in the (murky) shadow of arbitration” (2019) 24 Harvard Negotiation Law Review 185Google Scholar at 189–90.
81 Above at note 23.
82 Compare with the English position in Clyde & Co LLP v Bates Van Winkelhof  EWHC 668 (QB): an employee has a statutory right to approach an employment tribunal for resolution of his complaints. The employer cannot therefore insist that the dispute be submitted to arbitration. See Bamodu, G “Judicial support for arbitration in Nigeria: On interpretation of aspects of Nigeria's Arbitration and Conciliation Act” (2018) 62/2 Journal of African Law 255CrossRefGoogle Scholar at 276.
83 National Industrial Court of Nigeria Rules 2017, order 29(1); Ajilore v KLM, above at note 23 at 8.
84 S Hickox “Ensuring enforceability and fairness in the arbitration of employment disputes” (2010) 16 Widener Law Review 101 at 113. Citing Davis v O'Melveny & Myers, LLC, 485 F 3d 1066, 1074–75 (9th Cir 2007).
85 267 F. Supp 2d 961, 977 (ND Iowa 2003), rev'd, 367 F 3d 1048 (8th Cir 2004).
86 For the argument that “arbitration is not always practical as it is sometimes expensive in relation to the value of the claim”, see PN Okoli Promoting Foreign Judgments: Lessons in Legal Convergence from South Africa and Nigeria (2019, Wolters Kluwer) at 14–15.
87 Hickcox “Ensuring enforceability”, above at note 84 at 107, citing Cole v Burns International Security Services 105 F 3d 1465 at 1476–77 (DC Cir 1997). See further, Gies, TP and Bagley, AW “Mandatory arbitration of employment disputes: What's new and what's next?” (2013) 39/3 Employee Relations Law Journal 22Google Scholar.
88 See Nwakoby, GC “Appointment of arbitrators” (2001) 5/3 Modern Practice Journal of Finance and Investment Law 355Google Scholar and “The constitutionality of section 7(4)”, above at note 36 at 353; Akanbi, MM “Appointment of arbitrators: Law and practice” (2001) 5/1 Nigeria Law and Policy Journal 26Google Scholar; Idornigie, PO “The default procedure in the appointment of arbitrators: Is the decision of the court appealable?” (2002) 68/4 Arbitration: The Journal of the Chartered Institute of Arbitrators 397Google Scholar and “Nigeria's appellate courts, arbitration and extra-legal jurisdiction – facts, problems, and solutions: A rejoinder” (2015) 31 Arbitration International 171 at 174; Ibe, CE “Party autonomy and the constitutionality of Nigerian Arbitration and Conciliation Act 1988, sections 7(4) and 34” (2011) 28/5 Journal of International Arbitration 493Google Scholar; Olatawura “Constitutional foundations”, above at note 42; and Olatawura, OO “Nigeria's appellate courts, arbitration and extra-legal jurisdiction: Facts, problems, and solutions” (2012) 28/1 Arbitration International 63CrossRefGoogle Scholar.
89  9 NWLR (pt 771) 127.
90 See also, Nigerian Agip Oil Company Ltd v Kemmer  NWLR (pt 716) 506 at 525; Bendex Engineering Corporation and Another v Efficient Petroleum Nigeria Ltd  8 NWLR (pt 715) 338.
91 Ibe “Party autonomy”, above at note 88.
92 Orojo and Ajomo Law and Practice, above at note 29 at 121.
93 Above at note 90 at 525–26.
94 Some commentators argue that where decisions of the Court of Appeal conflict, lower courts are free to apply any one of them. See E Essien “Conflicting rationes decidendi: The dilemma of the lower courts in Nigeria” (2000) 12 African Journal of International and Comparative Law 20. Other commentators argue that the later decision prevails. See CO Idahosa “The doctrine of ‘stare-decisis’ and judicial precedent: The need for Lower Courts to be bound by decisions of the Superior Courts of Record” (paper delivered at the Conference of All Nigeria Judges of the Lower Courts held between 21 and 25 November 2016) at 17. See further, Bronik Motors v Wema Bank (1983) 1 SCNLR 296; CBN v Zakari (2018) LPELR-44751 (CA); Osakwe v Federal College of Education (2010) 3 SCNJ 529 at 546.
95 Local Government Service Commission, Ekiti State v Jegede (2013) LPELR-21131; Local Government Service Commission, Ekiti State v Bamisaye (2013) LPELR-20407; Local Government Service Commission, Ekiti State v Olamiju (2013) LPELR-20409; Local Government Service Commission, Ekiti State v Asubiojo (2013) LPELR-20403; Federal Ministry of Health v The Trade Union Members of the Joint Health Sectors Unions (2014) LPELR-2354 (CA).
96 Coca-Cola (Nigeria) Ltd v Akinsanya  18 NWLR (pt 1385) 225; Lagos Sheraton Hotel & Towers v HPSSSA  14 NWLR (pt 1426) 45.
97 Above at note 17.
99 Above at note 90.
100 Above at note 17.
101 Above at note 14.
102 This is considering a combined reading of ACA, sec 57 and Constitution, sec 251(1).
103 Constitution, sec 254C(1)(a)(3) and (4). Salami v NJC (2014) LPELR-22774 (CA): once the main claim is an employment matter, the Federal and State High Courts cannot exercise jurisdiction.
104 Above at note 23.
105 Ogunwole v Syria, above at note 89; and Agip Oil v Kemmer, above at note 90. See further, Bendex v Efficient Petroleum, above at note 90.
106 Above at note 17.
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