By Mustapha Toheeb.
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Name of Case: Central Bank of Nigeria v. Adani Mega System Limited (CA/ABJ/CV/1300/2023) [Delivered on 25th April 2025]
BRIEF FACTS:
Adani Mega System Limited (Respondent) entered into a “Build, Operate and Own” Agreement with the Central Bank of Nigeria (Appellant) for the provision of scanning services infrastructure for pre-shipment inspection of imports and exports, as mandated under Nigerian law. The Respondent claimed that it had substantially fulfilled its obligations, but the CBN terminated the contract unjustly. The CBN contended that Adani breached the agreement by subcontracting core aspects of the project to third-party entities in the UK, contrary to the exclusive terms of the contract. Acting on credible intelligence, the CBN first suspended the contract on 13th July 2017 and later cancelled it entirely on 18th September 2018. The trial court ruled partially in favour of Adani. Dissatisfied, the CBN appealed, arguing that the case was one of a simple contract and therefore outside the jurisdiction of the Federal High Court.
DECISION OF THE COURT:
The Court of Appeal dismissed the jurisdictional objection raised by the CBN and held that the agreement in question was not a mere simple contract, but one with statutory flavour. It emphasized that the contract was governed by the Pre-Shipment Inspection of Import Act (Cap 25) and Pre-Shipment Inspection of Export Act (Cap 26), Laws of the Federation of Nigeria 2004. As such, any dispute arising from the contract is to be adjudicated within the framework of these statutes. The Court held that the Federal High Court had the proper jurisdiction, by virtue of Section 20(3) of the Pre-Shipment Acts and Section 251(1) of the 1999 Constitution (as amended). The Court stressed that where the facts show the application or breach of a statute, it is the statute itself that determines the appropriate forum, not the classification of the claim as a “simple contract”. The court categorically stated that:
“My Lords, upon a calm and due consideration of the facts of this case, reliefs sought by the Respondent and the interpretation of various statutory provisions cited by the parties, it is my humble but firm view that having regard to the agreement of the parties that led to the execution of exhibit PL3 (build, operate and own agreement) for the provisions of the scanning services infrastructure required for Pre-Shipment Inspection of all in bound and out bound cargo as prescribed by Nigerian law, the contract is not an ordinary simple contract. It is a contract that has statutory flavour. In other words, it is a contract that has statutory flavour. In other words, it is a contract regulated by statute. That is regulated by the provisions of Pre-Shipment Inspection of Import Act Cap 25 Laws of the Federation of Nigeria 2004 and Pre-Shipment Inspection of Export Act Cap 26 Laws of the Federation of Nigeria. Therefore where there is a dispute arising from the said contract regulated by statute, it is the statute itself that will determine the forum where the aggrieved party will ventilate its greviance.” (Emphasis mine)
The court went further to state that:
“My Lords, contrary to the submissions of Appellant’s Counsel, the entire amended statement of claim of the Respondent of 32 paragraphs which is the process that will be considered to determine the jurisdiction of the trial court to entertain the suit, bordered on compliance and violation of the provisions of Pre-Shipment Inspection Act by the Appellant and Respondent. The entire agreement exhibit PL3 in evidence which governs parties’ relationship that copious reference was made to in the amended statement of claim, is predicated on the provisions of Pre-Shipment Inspection of Import and Export Act Caps 25 & 26 Laws of Federation 2004. The Respondent need not in each paragraph of its amended statement of claim and witness written statement on oath mention expressly Pre-Shipment Inspection of Export and Import Acts provided facts are pleaded in the amended statement of claim which show compliance or violation of the provisions of Act. Therefore my Lords where there is a dispute arising from the contract, it is the law or the statute that will be considered to determine the forum where such complaint could be filed. In this case, it is the Pre-Shipment Inspection Export Act Cap 25 laws of the Federation and Pre-Shipment Inspection of Import Act Cap 26 laws of the Federation 2004 that conferred jurisdiction on the trial court being the Federal High Court to entertain this suit.” (Emphasis Mine)
BRIEF COMMENTS:
In this landmark decision, the Court of Appeal created a significant exception to the age-long position of law that jurisdiction in contractual matters lies exclusively with State and FCT High Courts. The Court held that where a contract has statutory flavour, that is, where it is entered into pursuant to or regulated by statute jurisdiction is no longer determined by the general law on contracts, but by the statute governing the subject matter of the agreement. Consequently, the Federal High Court is clothed with jurisdiction where the dispute arises from such a statutory contract.
This decision introduces a refined jurisprudence on the doctrine of jurisdiction, affirming that an Act of the National Assembly can confer additional jurisdiction on the Federal High Court outside of Section 251(1) of the Constitution. It stands as a precedent-setting judgment on contracts with public law implications, especially where regulatory frameworks such as pre-shipment inspection, oil and gas, or infrastructure contracts are involved. Going forward, parties and courts alike must look beyond the surface classification of a contract and evaluate its statutory nature in determining proper jurisdiction.
ABOUT THE AUTHOR
Mustapha Toheeb is the founder of Lex Updates Publications and a recent law school graduate. He is interested in advocacy, academic writing, legal writing/history, activism, and a plethora of positivism. To reach him, email: toheebmustapha15@gmail.com or contact/WhatsApp: 08106244073.
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