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TERRITORIAL JURISDICTION FOR THE ENFORCEMENT OF ARBITRAL AWARDS.

¬¬ 1. INTRODUCTION
Territorial jurisdiction refers to the jurisdiction of courts over cases arising in or involving persons residing within a defined territory. In the context of enforcing arbitral awards, "territorial jurisdiction" refers to the specific court within a country that has the legal authority to recognize and enforce an arbitral award.

This article seeks to explore the territorial jurisdiction of Nigerian Courts in enforcing arbitral awards, shedding light on the legal framework and jurisdictional boundaries that govern this process.

Enforcement Proceedings.
Before delving into the substance of this paper, it is essential to first understand the concept and necessity of enforcement of arbitral awards. This refers to the legal process by which a binding decision issued by an arbitrator or arbitral tribunal is formally recognized and implemented by a court of law. While arbitration is largely party-driven and results in binding decisions, its consensual nature creates a paradox—parties dissatisfied with an award may refuse to comply voluntarily. This presents a significant risk of non-compliance, potentially rendering even the most well-reasoned arbitral decision a hollow victory.

Given this challenge, enforcement proceedings before courts of competent jurisdiction become necessary. Arbitral jurisprudence and relevant laws recognize this need, providing a legal framework for courts to ensure compliance with arbitral awards.

2. LEGAL FRAMEWORK.
The Arbitration and Mediation Act, 2023.
The Arbitration and Mediation Act, 2023 repealed the Arbitration and Conciliation Act, 2004. This is the enabling law regarding arbitral proceedings and it confers jurisdiction on High Courts in Nigeria for enforcement, recognition and setting aside of arbitral awards by virtue of the provisions of sections 55, 57, 58 and 91 of the Act.

Section 55 of the Act provides thus:
“recourse to a court against an arbitral tribunal may be made only by an application for setting aside in accordance with subsections (3) and (4)...... ... (3) The court may set aside an arbitral award where….”

Section 57 provides for recognition and enforcement of awards thus: “An arbitral award shall, irrespective of the country or state in which it is made, be recognised as binding, and on application in writing to the Court, be enforced by the Court subject to the provisions of this section and section 58 of this Act.”

Section 58 further provides thus:
“A party to an arbitration agreement may request the court to refuse recognition or enforcement of the award.”
Section 91 being the Interpretation section defines court thus:

"Court" means the High Court of a State, the High Court of the Federal Capital Territory, Abuja or the Federal High Court, unless the parties otherwise agree and except for the purpose of appointment of an arbitrator (including an emergency arbitrator) "Court" means the Chief Judge of any of the Courts referred to in this provision, sitting as a Judge in Chambers;”

Based on the foregoing sections, it is evident that the Act grants Courts wide range of powers over the post-award proceedings albeit within the limited scope for challenge of arbitral award as provided under the Act. The Act prohibits attempts to appeal against the award, hence does not delve into the substance/merits of the case already decided by the Arbitrator.

The Act in Section 91 defines Court to include High Courts of states and the Federal High Court. The Act by virtue of Section 57 goes further to define the extent of the jurisdiction of the Courts to enforce awards by utilizing the words “irrespective of the country or state”. This implies that there is no limit whatsoever on the Court’s territorial jurisdiction to enforce an arbitral award.

Judicial Interpretation.
Nigeria’s jurisprudence has amply interpreted the court’s jurisdiction in the enforcement of arbitral awards.

In the case of NIGERIA NATIONAL PETROLEUM CORPERATION (NNPC) V. FUNG TAI ENG. CO. LTD. [2023] , the Supreme Court of Nigeria, buttressed the point that the Arbitrator’s jurisdiction is limited to setting aside on the grounds stipulated by the Act and not determining the merit or sitting on appeal over the reference. The court went further to give the court’s enormous jurisdiction in terms of its geographic and subject matter scope.

The court re-emphasized that the Federal High Court had the requisite jurisdiction to enforce the award, regardless of the subject matter or location, on the premise that the court by virtue of the Arbitration and Conciliation Act, is not called upon to determine the merits but simply to enforce the already determined award. This speaks to the fact that the subject matter is not a vitiating factor of the court’s jurisdiction to enforce arbitral awards, hence any court in the land can enforce an arbitral award.

Broad Powers Of The Court To Enforce Arbitral Awards.
In the case of EMERALD ENERGY RESOURCES LTD V. SIGNET ADVISORS LTD (2020) the Court broadened the scope of the courts in enforcing arbitral awards not only in local arbitrations but also in international arbitration. Similarly in the case of LIMAK YATIRIM, ENERJI URETIM ISLETME HIZMETLERI VE INSAAT A.S. & ORS V. SAHELIAN ENERGY & INTEGRATED SERVICES LTD (2021) the court buttressed the power of the High Court to set aside awards, regardless of the territorial jurisdiction of the arbitral award itself.

In summary, the powers of Nigerian High Courts (Federal High Court and State High Courts) to enforce arbitral awards has been given judicial backing in a plethora of cases to the extent that the court’s jurisdiction to enforce awards nationwide is unlimited and awards can be enforced in any court in Nigeria.

Juxtaposition Of Territorial Jurisdiction Of Courts To Determine Substantive Suits and To Enforce Arbitral Awards.
In Nigeria, most Rules of Court prescribe a jurisdictional guide as to where a suit bordering on contract should be instituted. The High Court of the Federal Capital Territory, Abuja (Civil Procedure) Rules 2018 provides thus:

“All suit relating to land or any mortgage or charge on land or any interest in land, or any inquiry or damage to land and actions relating to personal property distrained or seized for any cause, may be commenced and determined in the judicial division in which the land is situated, or the distraint or seizure took place……

….All suits for the specific performance, or upon the breach of any contract, may be commenced and determined in the judicial division in which such contract ought to have been performed or in which the defendant resides or carries on business.

All other suits may be commenced and determined in the judicial division in which the defendant resides or carries on business.

Where there are several defendants who reside or carry on business in different judicial divisions, the suit may be commenced in any one of those judicial divisions subject to any order or direction the court may make or gives as to the most convenient venue for trial of the suit.

The pertinent poser is; if such provisions pertaining to arbitration emanating from contracts should be considered in the determining territorial jurisdiction in enforcement proceedings. If this is answered in the affirmative, the jurisdiction of a high court in a state to enforce an award will depend on the following:
1) Where the defendant resides or
2) Where the transaction was performed in most cases and
3) Where the land is situated in land transactions.

Logically, this should be acceptable as it may aid the ease of enforcement of the award, however, it does not in any way affect or bind the enforcement jurisdiction of Courts in Nigeria.

The case of AG BAYELSA STATE V. ODOK (2024) LPELR-63035.
More recently, in the case of Bayelsa State V. Odok, the Supreme Court dismissed a challenge on territorial jurisdiction. The enforcement proceedings which took place in the High Court of the Federal Capital Territory was challenged by the Appellant on the basis that the Appellant’s (defendants/Respondents) address on record was in a different jurisdiction, Bayelsa state. The Supreme Court in dismissing this contention held thus:

“it is also well settled that Courts of law are creations of statutes be it constitutional or otherwise and their jurisdictions are specified by legislation.

Thus, jurisdiction may be extended not by the Courts but by legislation..........the Act did not exclude any High Court in Nigeria from entertaining an application for enforcement of an arbitral award. Thus, the territorial jurisdiction of a High Court to enforce an arbitral award, does not arise in the instant case. From the facts on record, the contract was performed in Abuja, which was why the parties chose the Chief Judge of the Federal Capital Territory to appoint the arbitrator. The parties agreed that the arbitration be conducted in Abuja and participated fully in the arbitration with their eyes wide open. Learned counsel must be aware that arbitration proceedings are sui generis and instituting an action for breach of contract before the trial Court is not the same as instituting an action for the enforcement and recognition of an arbitral award.”

The Court reiterated the point that there is a clear distinction between instituting an action before the High Court’s on the merit of the case, which would affect the territorial jurisdiction of the Court and the territorial jurisdiction of the Court to enforce arbitral awards which is unlimited.

From the forgoing, it is clear that there is no limitation on the powers of the High Court of a state or the Federal High Court to enforce an Arbitral award no matter the seat of the arbitration, even though same is a key consideration for enforcement.

3. FACTORS TO CONSIDER IN ENFORCING ARBITRAL AWARDS.
The whole essence of enforcement is to get result and to yield the fruit of the award, hence certain factors have to be considered in determining the appropriate forum to institute enforcement proceedings to wit:

• The Arbitration clause
• Seat of the Arbitration
• Ease of enforcement.
• Location of Land in relation to landed property.
• Location of business of the Respondents

The Arbitration Clause.
An arbitration clause in a contract is what confers jurisdiction on an arbitral Tribunal to determine the claim. It usually goes further to determine the seat of the arbitration and can also provide for a place for enforcement of the award. In the event that the arbitration clause provides for the court for determination of the award and/or the enforcement of the award, the parties and Courts are bound by same, regardless of the proximity to the parties, unless the parties themselves subsequently agree otherwise.

.Seat of the Arbitration. .
Seat of arbitration is one of the key aspects usually covered by an arbitration clause. The seat of arbitration influences the determination of the law which governs the arbitration, it also guides the supervisory and supportive powers of the Courts in relation to the arbitration, and extends to enforcement and challenge to such arbitral award. Ideally, when a party wants to challenge the award, he approaches the courts of the jurisdiction where the seat of arbitration is located. This is the globally recognized approach for enforcement of arbitral awards.

In the case of INDUS MOBILE DISTRIBUTION PVT. VS. DATA WIND INNOVATIONS PVT. LTD. AIR 2017 (7) SUPREME COURT 2105 (7) SCC 678, the Indian supreme court held that once a seat of arbitration is determined, it further gives exclusive jurisdiction for purposes of regulating arbitral proceedings arising out of the agreement between the parties to the Courts within the seat.

Similarly, in the case of HISCOX v OUTHWAITE (NO. 1) (1991) 3 641, HL, the House of Lords held that the English Court was the appropriate court for the enforcement of the award owing to the fact that it was the seat of the arbitration and governed by English Laws.

Ease of Enforcement.

Ease of enforcement is a key factor to be considered, owing to the fact that the primary aim is to enforce the already determined award. In ease of enforcement, consideration has to be given to the location of land if it relates to a dispute bordering on land and the location of business of the Respondents in contractual dispute as provided by most rules of Court which are drafted with convenience in view. As opposed to determining substantive disputes, forum shopping in enforcement of arbitral awards is encouraged, owing to the fact that the winning party would require a forum which would make the enforcement proceeding seamless.

4. CONCLUSION.

The enforcement of arbitral awards ultimately hinges on the arbitration agreement. When an arbitration agreement explicitly designates a forum for enforcement, this provision is binding and leaves little room for dispute, as the arbitration agreement or clause is the alpha and omega with regards to the entire arbitration and/or dispute resolution process.

Where there is no specific provision for same, factors such as the seat of arbitration become crucial in determining the appropriate enforcing court. However, under the Arbitration and Mediation Act, 2023, and as reinforced by the recent Supreme Court decision in Bayelsa State v Odok, there are no territorial limitations on the jurisdiction of Nigerian courts to enforce arbitral awards. This means that the Court’s territorial jurisdiction to enforce an arbitral award cannot be challenged regardless of where the arbitration was conducted.



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