ICT Africa Headline News

Court Orders Airtel Nigeria to Pay Telecoms Firm N1.17 Billion

30 January, 2014
This Day

A Lagos High Court in Ikeja has ordered Airtel Nigeria to pay a telecoms firm, Procomtel Limited, the sum of N1.17billion. The amount represents awards made by an arbitrator on June 27, 2007 and August 24, 2007, in a dispute between them.

Justice Lateef Lawal-Akapo said: "An order of specific performance be and is hereby made for the amounts contained in the final award dated 27th June, 2007 and additional award dated 24th August, 2007 made under the hand of Mr. Olumuyiwa Ajibola in the matter of arbitration between Procomtel Limited and Celtel Nigeria Limited pursuant to the Arbitration and Conciliation Act, Cap A18, Laws of the Federation of Nigeria."

The judge also awarded N25million damages in the claimant's favour "for breach occasioned by non-perfomance of the awards." He held that the claimant is entitled to damages, having been deprived of the awards by the defendant. "I am of the view that the claimant is entitled to be compensated in damages which may be likened to award of interest.

"Once there is a breach for the performance of a contract, the injured party is entitled to compensation in damages," the judge said.

Procomtel and Airtel entered a contract for the construction of 28 cell sites in 2001, but the contract was terminated on March 5, 2003. The claimant said it successfully executed the contract, and that it expected additional payment from the defendant.

However, a dispute arose as to whether or not the contract was properly executed, and parties agreed to use a sole arbitrator,, who made awards in the plaintiff's favour. Procomtel, through its counsel, Oladipo Okpeseyi (SAN) had approached the court for the awards' enforcement.

It claimed the defendant's failure to pay the awards had adversely affected and almost paralysed its business. The firm said the fact it had been unjustifiably deprived from using the money since 2007 entitles it to N95million damages and N25million as cost of the suit.

Objecting the suit, Airtel, through its counsel Mr. Abiodun Olalere argued that enforcement of an arbitral award must be by way of an application to the court and not by writ of summons.

The defendant also filed a motion seeking to set aside the award, and did not pay the money because of the pending of the suit. Olalere further argued that the suit was statute-barred with regard to Section 8 (d) of the Limitation Law, Cap 118, Laws of Lagos State, 1994.

But Justice Lawal-Akapo ordered enforcement of specific performance of the arbitral award in favour of Procomtel. He said: "Once parties have chosen and submitted themselves to arbitration, no one of such party is allowed to subsequently back out of the decision of the arbitrator.

"He is estopped from objecting to the final decision of the arbitrator when the award is good on its face even if the award does not favour him.

"Both parties attended the arbitration proceedings which made an original award and a further award in favour of the claimant and the same published on 27th day of June 2007 and 24th day of August 2007."

The judge, however, refused the claimant's prayer for N25million as cost of action, saying there was no evidence as to the claim. On January 21, the court dismissed Airtel's application for stay of execution.

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