The background of the research’s
study is not far fetched owing to the ground nature of international commercial
activities in the universe and the need to harmonize the peace and stability
needed among participants in int’l trade activities, through arbitration and
conciliation. The difficulties militating against enforcement of int’l arbitral
award especially in Nigeria would arouse one into thinking that int’l trade is
but a “Lion’s den” traded only by the privileged class.
International arbitration is a
leading method for resoling commercial agreement and other international
relationships. As with arbitration generally, int’l arbitration is a creation
of contract, that is, the parties’ decision to submit disputes to binding
resolution by one or more arbitrators selected by or on behalf of the parries
and applying adjudicating procedures, usually by including a provision for the
arbitration of future dispute in their contract1. The practice of international
arbitration has developed so as to allow parties from deferent legal and
cultural background to resolve their disputes, generally without the
formalities of their respective legal system. Arbitration is particularly
popular as a means of dispute resolution in the commercial sphere (for a
summary of various areas in which arbitration is usually chosen)2 One of the
reasons for doing so is that in international trade, it is often easier to
enforce an arbitration award in a foreign country than it is to enforce a
judgment of the court.
Under the New York Convention 1958,
an award issued in a contracting state, only subject to certain, limited
defenses. Those defenses are:
* A party to
the arbitration agreement was, under the law applicable to him under some
incapacity.
* The
arbitration agreement was not valid under its governing law.
* A party was
not given notice of the appointment of the arbitration or of the arbitration
proceedings, or was otherwise unable to present its
* The award
deals with an issue not contemplated by or not falling within the terms of the
submission to arbitration, or contains matters beyond the scope of the
arbitration (subject to the proviso that an award which contains decisions on
such matters may be enforced to the extent that it contains decisions on maters
submitted to arbitration which can be separated from those matters not
submitted;
* The
composition of the arbitral authority was not in accordance with the agreement
of he parties or failing such agreement, with the law of the place where the
hearing took place (the “Lex Loci arbitri”)3.
* The award has
not yet become binding upon the parties, or has been set aside or suspended by
a competent authority, either in the country where the arbitration took place,
or pursuant to the law of arbitration agreement.
* Enforcement
would be contrary to “public policy”. Etc
Virtually every commercial country
in the world is a party to the convention, but relatively few countries have a
comprehensive network for border enforcement of judgments of the court. Hence
in many countries, particularly in engaging markets, a foreign arbitration
award is much easier to enforce than an award of the court. For example, it is
very difficult to enforce foreign judgments in the former CIS countries, but it
is considerably easier to enforcement of arbitration awards that makes them
appealing to commercial parties is that they are not limited to awards of
damages. Whereas in most countries only monetary judgments are enforceable in
the cross border context, no such restrictions are imposed on arbitration
awards and so it is theoretically possible (although usual in practice) to
obtain an injunction or an order for specific performance in an arbitration
proceeding which could then be enforced in another New York convention
contracting state.4
3. Gaius Ezejiofor, the Law of Arbitration
in Nig. (1st Ed.) Longman (1997)p
4. The New York Convention Recognition and
Enforcement of foreign Arbitral Award 1958. Applicable to Nigeria by virtue of
section 54 of Arbitration and conciliation Act 1990.
Under section 6 of the
Act, 10 the registered award or judgment may be set aside on the application of
the defendant if the court is satisfied on certain conditions to be outlined in
the course of this research.
Ordinarily, this is on fast process
but of limited application due to the requirement that the award must be the
payment of a sum of money and the judgment must have become enforceable as
judgment of a court according to the law of the place where it is made. If the
restriction is challenged the process may became prolonged up to a year or
more.
It is such restrictions and other
challenging facing enforcement of foreign award that have aroused the
researcher into delving in the area. It has be noted that the ease of
enforcement of foreign arbitral award has gradually formed part of the criteria
used in evaluating the extent of arbitration penetration in a country; in
assessing the level of arbitration practice as well as determining whether a
jurisdiction is arbitration friendly or not 11, Nigeria inclusive. Despite
Nigeria’s federal system of government, it has a unified system of enforcement
of foreign arbitral awards.
Questions have arisen as to whether
foreign arbitral awards are enforceable in Nigeria, the time light of its
enforceable and to whether Nigeria is a party to the New York convention. This
questions and more are what the long easy shall try to Justice to. Granted
issues have arisen in the past when the willingness of Nigeria courts to
enforce foreign awards was tasked to the limits; Nevertheless, a careful
perusal of available decided cases relating to enforcement of foreign arbitral
awards in Nigeria would seem to suggest that some information in the public
domain cannot be supported by any empirical evidence. Infect it is a situation
of mixed facets and myth. This long-essay shall among other things examine the
laws and practices relating to the enforcement of international arbitral awards
in Nigeria with a view to separating facts from
10 Foreign judgment (Reciprocal
Enforcement) Act “Cap19, 1990 LFN
11. Emmanuel Dike, “Regional center for
International commercial Arbitration”
October 2012. www. From myth. Also the research shall x-ray the
challenges facing the successful operation of international arbitration and
enforcement as well as the prospects to enforcement of international arbitral
award in Nigeria.
THE STATEMENT OF THE PROBLEMS:
Before delving into the statement of
the research problem, it will be expedient for the researcher to briefly review
the already existing instrument giving effect to the enforcement of
international arbitral awards ion Nigeria, thus will give the researcher the
better ground to identify the vacuum gap which is left to be exploited,
bringing to fore the problem clearly.
The following are the legal regime
(instruments) applicable to the enforcement of foreign arbitral awards in
Nigeria:
1.
Action upon the award
at common law.
2.
Reciprocal
Enforcement of judgments Act, 1922.
3.
Foreign judgments
(Reciprocal Enforcement of foreign Arbitral Awards (New York Convention) 1958;
4.
Arbitration And
conciliation Act, 1988.
5.
International
centre for settlement of investment Dispute (Enforcement of Awards) Act, 1967.
THE LIMITATION LAW
Progressive
development of laws on enforcement of foreign arbitral award in Nigeria can be
gleaned from the early common law position (action upon award at common law)
which requires a party seeking enforcement to sue upon the award. This would
ensile proof of the existence of the arbit-agreement, the proper conduct of the
arbitration in accordance with the agreement and the validity of the award.
In other to ameliorate certain
hardships on the parties seeking enforcement under the common law, the
Reciprocal Enforcement of Judgment Act 1922 was promulgated. This Act improved
on the common law practice, that, is procedure of suing upon the award in the
prescribing simple registration of the award in the high court by the
successful party seeking enforcement13 . Under the Act no judgment or ward
shall be registered. If the court lacks jurisdiction 14, the judgment is
obtained by fraud; an appeal is pending on the judgment or it is contrary to he
publicly of Nigeria. 15.
However, it is of limited
application in that it is restricted reciprocal enforcement to the United
Kingdom and other parts of Her Majesty’s Dominions and Terri tones under her
protection. The limited application of the promulgation of Foreign Judgment
(Reciprocal Enforcement) Act, 1961. this Act extended the benefit of
enforcement to countries other than united kingdom and its dominions and
territories (common wealth countries); as well as extended the limitation
period of registration of award from 12 months to six (6) years.16 However, the Act created a restriction to its
benefit to wit; that only countries accord reciprocal treatment to judgment
given by the superior court in Nigeria.
Furthermore, more support for
enforcement of foreign arbitral awards in Nigeria was given to Nigeria’s effort
at creating enabling environment for the enforcement of foreign arbitral award,
Nigeria became a party to the New York convention in 1970, which was
domesticated in Nigeria in 1988 through a local legislation. This convention
was tested in Nigeria court in 1974 17.
13. Marine and Cuneral Assurance U. Overseas
Union & yors (2006 LPELR.Sc 208/2001 or (2006) 4 NWLR; Macaulay U RZB
Austria (2003) 18 NWLR (pt. 852) 282.
14. SECTION 2 of the Reciprocal Enforcement
of judgment Act 1992.
15. Ibid
16. SECTION 4 Foreign judgment (Reciprocal
Enforcement) Act, 1961, Cap 152, LFN 1990 2004 Cap A18
The convention appears
to be most rudely accepted piece of legislation in the area enforcement of
foreign arbitral award globally.
Due to the compelling influence of
the UNGTRAL model law 1985 and UNGTRAL model Rule 1976 in the field of
international arbitration, Nigeria created another window in the enforcement of
foreign arbitral awards in the Arbitration And conciliation Act 1988. the 1988
Act allows for the enforcement of award under the 1988 Act does not depend on
reciprocity.
In the face of it, it appears that
the 1988 Act has ameliorated the restrictions imposed on enforcement of foreign
award via reciprocal treatment required by the Reciprocal Enforcement Act.
However, parties seeking enforcement of foreign arbitral award in Nig. Should
not only be mindful of the relevant enforcement of arbitral award law, but also
the limitation laws of the relevant state of enforcement in Nigeria. The
question is how can this laws be found. Finding the comprehensive laws poses
problems to seeking enforcement of foreign arbitral award Nigeria.
It is noting with that these
relevant enforcement of arbitral awards laws are found in patches from accessed
internet, business funerals and other professional publications, and at times
not comprehensive enough to guide participants in international trade the
opportunities to be abreast with the relevant enforcement of arbitral award
laws and the limitations laws of relevant state of enforcement in Nigeria.
Furthermore the need arises to cross
check in a comprehensive maner and to compil the various information on
enforcement of arbitration award accessed from the internet, business formals
and other professional arbitration in Nigeria. These above issues poses the
statement of the problem to which the research intend to back on ensuring.
17. MarMansk state steamship line U. Kano Oil
Miller Limited (1974)LPE LR-SC. 252/74 or (1974) All N.L.R 893
With the advent of
increasing nature of international commercial activates, commercial arbitration
has became a major attraction in international transactions owing to its speed
and effectiveness in resolving commercial disputes international commercial
arbitration has been in the past acclaimed the most effective method of
international dispute resolution, though it has its own disadvantages. It is
very fast easy and cheap, it has grown forward by becoming more redefined; it
has equally grown backward by introducing features that have in very radical
way robbed it off or heavily affected the very advantages it had over other
forms of international dispute resolution. Some of these features have been as
a result of increasing complexity, conflict of municipal and international
arbitral enforcement laws, and from the inability of arbitration law to grown
at the some pace with development in commercial world5. Also in the bid to make
their legal environment very conducive for international commercial
arbitration, some countries have unwittly turned arbitration in their
territories into a potential or actual tool for illegality and unconsciousness
able ness in the hands of crime-disposed parties6.
Having obtained the award in
international arbitration, the successful party would have to enforce the award
against his adversary. In Nigeria, the willingness of Nigeria courts to enforce
foreign arbitration award and the ease or difficulty of doing so and the likely
timescale of the process of enforcement are issues of immense concern to any
foreign person wishing to enforce an arbitral award in Nigeria. Enforcement of
International Commercial arbitration in Nigeria involves the different method
of giving effect to the international arbitral award as are given by the
arbitral panel(s) who sat to decide disputes over international commercial
arbitration agreement between parties. Foreign arbitral awards can be enforced
in Nigeria through several ways which the researcher shall identify briefly
here, to be discussed fully in his research work as we progress.
a. By an Action
upon the award: In Nigeria foreign (international) arbitral award could be enforced
by suing upon the award even where there is no reciprocal treatment in the
country where the award was obtained7 provided that the plaintiff proofs
necessary ingredient examples; the existence of the arbitration agreement, the
proper conduct of the arbitration in accordance with the agreement, and the
validity of the award.
b. Enforcement
under the New York Convention on the Recognition and Enforcement of Foreign
Arbitral Award 1958. The provisions of the convention on enforcement of
international Arbitral award is applicable to Nigeria too8. Nigeria has made
reciprocity reservation and so only awards made in contracting states that
undertakes to recognize and enforce awards made in other contracting states,
including Nigeria, will be recognized and enforced in Nigeria.
c. Enforcement
under the International Centre for settlement of investment disputes (ICSID):
Nigeria ratified the ICSID convention on 23 of August, 1965. In pursuance of
its commitment to domesticate the ICSID convention, the convention was renacted
as a local legislation under the International Centre for Settlement of
Investment Dispute (Enforcement of Awards) Act, Cap 19 LFN 1990.
d. Enforcement
Under the Arbitration and Conciliation Act 19909.
e. By virtue of
registration under the foreign judgement (Reciprocal Enforcement) Act 1990. A
judgement or award obtained in a foreign country may be enforced in Nigeria
within six years of the judgement or award. The judgement or award have to be
registered first in Nigeria court with jurisdiction to hear the dispute.