The Osun State Government has applied to the Federal High Court in Lagos to reverse an order restricting its bank accounts due to a $13.9 million arbitration award in favor of Gamji Nigeria Company Limited. The award relates to water infrastructure projects in Ilesa West Local Government Area. According to Commissioner of Information and Public Enlightenment, Oluomo Kolapo Alimi, the government filed the application on October 2.
The Osun State Government argues that Gamji Nigeria Company Limited failed to disclose crucial facts when seeking the account restriction. One of the undisclosed facts was that the state had already approached the Lagos State High Court to challenge the arbitration award before Gamji sought the Federal High Court order. The state’s legal team filed the suit to set aside the arbitral award at the Lagos State High Court on September 1.
The dispute arose from two water infrastructure contracts awarded to Gamji Nigeria Company Limited by the Osun State Government in 2017. The projects involved the construction of transmission mains and booster pump stations, as well as water reservoirs in Ilesa West Local Government Area. The contracts were funded through an Islamic Development Bank loan facility facilitated by the Federal Ministry of Finance.
The Federal High Court had ordered commercial banks to place a “Post No Debit” restriction on accounts operated by the state government to preserve $13.9 million and N157.5 million awarded to Gamji. The interim order, issued by Judge Daniel Osiagor, followed an application by Gamji Nigeria Company Limited, seeking to preserve the funds pending the determination of its motion on notice.
The Osun State Government disputes the validity of the award and the manner in which the arbitration was conducted. The state claims it was denied a fair hearing and full participation in the arbitration process. The proceedings and the eventual award were characterised by several irregularities, which the state has now challenged before the Lagos State High Court.
The commissioner disputed the date and existence of an award referenced in the Federal High Court proceedings, saying there was no arbitral award against the state in July 2024 as claimed by Gamji. The only Arbitral Award against the State Government was in July 2026, and the said Award is presently being challenged before the Lagos State High Court by the State Government’s legal team.
The court adjourned the case until October 22. The Osun State Government submitted that the court order was a product of deceit and substantial non-disclosure of material facts to the Court. The state government also stated that the arbitration award it sought to enforce was fraught with several irregularities.
Key points
- The Osun State Government is challenging a $13.9 million arbitration award in favor of Gamji Nigeria Company Limited.
- The state government argues that Gamji failed to disclose crucial facts when seeking the account restriction.
- The case has been adjourned until October 22.
