P & ID Vs. Nigeria; The Culpability Of Alfa Belgore By Confidence Amuda

A dying Irishman went for one last big score in Nigeria. The project failed, but a London tribunal says his company’s owed $9 billion and counting

This is quoted from the article “Is one of the World’s Biggest Lawsuit’s Built on a Sham?” by Kit Chehell, Joe Light and Ruth Olurounbi published on Bloomberg Business week, 4 September 2019 about the record breaking judgment of Process and Industrial Development ltd against Nigeria.

A key legal argument relied on by the London tribunal in support of their award was the legal opinion of Alfa Belgore, Chief Justice of Nigeria from 2006-2008, Member Council of States and Chairperson, Tripartite Committee on Minimum wage, Nigerian National Award Committee and Central Working Group of Nigerian Vision 20:20:20.

There has been uproar in the news and electronic media against the learned Jurist for the expert legal opinion rendered to P&ID which was filed by the company, claimant in the arbitration against Nigeria on 1 May 2015. This work attempts to analyze the act of the learned Jurist against the backdrop of our constitutional provisions.

Process and Industrial Developments Limited (P&ID) is an engineering and project management company incorporated in the British Virgin Islands and led by Michael Quinn and Brendan Cahill.

P&ID conceived a project that would deliver much-needed power generation to millions of Nigerians, and create profitable by-products for sale on the international market.  Under an agreement with Nigeria, P&ID would build a state-of-the-art gas processing plant to refine natural gas “wet gas” into “lean gas” that Nigeria would receive free of charge to power its national electric grid.  The lucrative natural gas liquid by-products (propane, ethane, butane) of this processing would be sold by P&ID on the international market, with expected profits in the billions of dollars. In 2010, P&ID entered into a 20-year Gas Supply and Processing Agreement (GSPA) with the federal government of Nigeria through the Minister of Petroleum Resources to execute this project.

Under the agreement, the Nigerian government was to ensure that all necessary pipelines and related infrastructure were installed and that arrangements were made with agencies and third parties to deliver gas for P&ID to process. However, the Nigerian government failed to meet its commitments, causing the project to flounder. In view of this perceived breach by Nigerian government, P&ID commenced arbitration in 2012 before a tribunal in London.

In July 2015, the tribunal in London unanimously concluded that Nigeria was liable for the government having breached the agreement with P&ID. In January 2017, the tribunal ordered the Nigerian government to pay P&ID $6.6 billion in damages, plus interest that is accruing daily at a rate of over $1.2 million. This award has been recognized by the Business and Property courts of England and Wales, consequently, can be enforced as judgment of court.

In arriving at its conclusion, the arbitral tribunal had to consider certain issues, these issues needed to be resolved in line with Nigerian law as that was the law to govern the contract between parties.

The tribunal decided that Nigerian law should be treated as a question of law and that parties are at liberty to adduce evidence of Nigerian law. In furtherance of this, P&ID sought and obtained the expert legal opinion of Hon Justice (rtd) Alfa Belgore.

Without whipping up sentiments, I will attempt to analyze the culpability or otherwise of the learned Jurist in line with the fifth schedule to the Constitution of Federal Republic of Nigeria 1999 (as amended).

The Fifth schedule borders on the code of conduct for public officers Paragraph 5 provides:

• Retired public officers who have held offices to which this paragraph applies are prohibited from service or employment in foreign companies or foreign enterprises

• This paragraph applies to the office of President, vice president, Chief Justice of Nigeria, Governor and Deputy Governor of a State. [emphasis mine]

The word “service” was defined in Black’s Law Dictionary, (8 Ed.) Bryan A. Garner p. 4267 as

1. The act of doing something useful for a person or company for a fee; or 

2. An intangible commodity in the form of human effort, such as labour, skill or adviceg. contract for services [emphasis mine]

In light of this definition,it begs the question: does the expert opinion of the learned Jurist filed at the tribunal on 1 May 2015 by P&ID constitute a service from the former CJN to P&ID? I will answer in the affirmative. The word “opinion” was defined at page 3466-3467 of Black’s Law Dictionary (supra) as,

A formal expression of judgment or advice based on an expert’s special knowledge; especially a document, usually prepared at a client’s request containing a lawyer’s understanding of the law that applies to a particular case. [Emphasis mine]

The issue to be determined is; does service rendered to P&ID constitute service to a foreign company?

A foreign company or a foreign enterprise was defined in Paragraph 19 of Schedule 5 to Constitution of Federal Republic of Nigeria 1999 (as amended) to mean:

Companies or enterprises in which the controlling shares are owned by persons other than the Government, its agencies or citizens of Nigeria or whose policies are determined by persons or organizations outside Nigeria;

In other to determine the liability or otherwise of the learned Jurist, a prosecutor will have to satisfy the tribunal that the shares of P&ID are owned by persons other than the Nigerian Government, its agencies or its citizens or that the policies of the company are determined by persons or organizations outside Nigeria. In other words, the prosecution will have to look beyond the veil of incorporation of P&ID ltd to determine that owners of majority shares of the company or those in charge of policies of the company are neither the Nigerian government, its agencies, citizens nor any person or organization in Nigeria.

To ascertain the shareholders or management of the company, the prosecutor needs the register of directors or register of members. The difficulty here however is that neither of these documents are public documents in British Virgin Islands as utmost privacy is guaranteed to companies incorporated on the Island.

Section 231(1) British Virgin Islands Business Companies Act, 2004 provides:

A company may elect to file for registration by the registrar a copy of either or both of the following:

1. Its register of members;
2. Its register of directors.

From the above section and other enabling provisions of the BVI Business Companies Act 2004, a company need not share information about officers, directors, owners or shareholders. They are not mandated to file this information with the Registrar. So what if P&ID never filed it?

Therefore, one needs to be cautious before making assertions on the culpability or otherwise of Alfa Belgore for as stated in the earlier quoted article

“The company and its founders remain elusive”.