The Federal Government has won a long-standing dispute over a contract awarded in 1981 for the construction of civil works at the Ajaokuta Iron and Steel Complex. The contract, executed as a joint venture between Fougerolle Nigeria Ltd and Fougerolle SA, a French company, was awarded when Kogi was still part of Kwara State.
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The Attorney General of the Federation and Minister of Justice, Prince Lateef Fagbemi, SAN, in a statement on Friday, confirmed that Nigeria secured a favourable final arbitral award on November 11 from a tribunal constituted under the Alternative Dispute Resolution Centre of the Federal High Court.
He explained that the claimant, Fougerolle, initiated the arbitration through a Notice of Arbitration dated December 12, 2022 — about 18 years after the company terminated the contract on January 30, 2004.
According to a statement signed by his media aide, Mr. Kamarudeen Ogundele, the AGF said the company sought to compel Nigeria to pay N4 billion and €185 million through the tribunal.
He stated: “Contrary to contract terms and Fougerolle’s undertaking, Fougerolle moved the tribunal to compel additional payment of unverified and uncertified sums of N3,846,098,403.00 and €185,733,496.00.
“Previously, the Federal Government engaged Messrs Price WaterhouseCoopers to verify any indebtedness due to Fougerolle after terminating the contract. This led to the payment of N3,894,600,000.00 to Fougerolle via FGN Bonds on September 11, 2006. Fougerolle signed an indemnity on September 8, 2006, accepting the sum as full and final settlement. However, over 16 years later, Fougerolle brought the instant claim.”
He added that the tribunal upheld the Federal Government’s preliminary objection, challenging the competence of Fougerolle’s claims on the grounds that they were statute-barred, disclosed no reasonable cause of action, and that the indemnity signed by the company extinguished any further debt. The tribunal also held that there was no competent claimant before it.
“Notwithstanding, the tribunal considered Fougerolle’s claim on the merits and held that Fougerolle failed to establish its case and had, indeed, waived all rights to any other claim against the Federal Government because the payment made via FGN Bonds discharged the contractual obligation between the parties. The tribunal rejected Fougerolle’s expropriation claim and the allegation that the indemnity was issued under duress.
“The entire case was dismissed, thereby saving the Federal Government over N4 billion in potential liabilities. The case was defended by officers of the Federal Ministry of Justice in furtherance of the Attorney General’s commitment to boosting the capacity of Ministry officials to handle sensitive litigation and ADR matters.”
The statement added that the decision underscores the current administration’s resolve to challenge predatory and opportunistic claims against Nigeria while promoting the use of alternative dispute resolution mechanisms.
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