How arbitration, ADR can facilitate foreign investments in Nigeria, by Kadiri

Arbitration and alternative dispute resolution (ADR), are becoming popular in resolving commercial and international disputes in many countries, particularly in Europe, America and Asia as litigation is shifting ground to allow ADR take the centre stage. As the practice is growing rapidly, it is helping to free judges’ dockets to allow them focus more on matters that need judicial attention and resolution.Therefore, Nigeria must join other African countries which desire foreign investments to develop domestic legal framework that regulates arbitration, create stronger arbitral institutions, improve capacity of practitioners and lawyers, as well as give adequate judicial and court support for recognition and enforcement of arbitral awards. In this interview with IBE UWALEKE, a London-based Nigerian legal practitioner, arbitrator, trainer and international arbitration facilitator, Momoh Kadiri reiterates these perspectives and agrees that the only way left for the nation to develop its economy is to create an enabling legal environment that will embrace arbitration.

What is the new Arbitration Bill before the National Assembly all about?
Arbitration is evolving and the law regulating practice of arbitration in Nigeria can be no exception. The legal framework of arbitration in Nigeria, that is to say the Arbitration and Conciliation Act, 1988 see Cap18A, Laws of the Federation of Nigeria 2004, is dated and out of touch in many respects with international best practice. Firstly, the law came into operation in 1988 which is nearly three decades ago. Secondly, of significant mention is the fact that the Act afore said, was greatly influenced and hinged on the then UNCITRAL model law 1976. The said UNCITRAL model law has itself, undergone several progressive changes and amendments over the years, in a bid to make it conform to modern, dynamic realities. Therefore, the pending Arbitration Bill before the National Assembly, amongst others, is aimed at reforming and ensuring the extant arbitration law and practice in Nigeria, reflect some of the modern changes and marked development since 1988 to date. I believe that the current state of arbitration law and practice in Nigeria could be better improved through law reform to ensure that it meets present and future expectations in alternative dispute resolution.

How can the recently commissioned Lagos Court of Arbitration be fully utilized?
Lagos Court of Arbitration is laudable initiative. It is a private initiative which draws some semblance from what a modern court of arbitration should aspire to be both in terms of facilitating settlement of disputes and promotion of the use of arbitration and other ADR processes. It would need to appeal to users within and outside Nigeria over some years for one to be able to assess how it compares with other established arbitration centres and institutions in Africa such as Mauritius, Kigali, Cairo. To be fully utilised, it must seek to have global appeal both in terms of number of its users and the quality and value of matters that are brought before it for resolution. The facilities, rules and panel of arbitrators must be in tune with international best practice in order to ensure that it remains popular and responsive to future needs.

What type of training do arbitrators in Nigeria receive?
Generally speaking, quite a number of arbitrators, like my humble self, trained abroad. Some having so trained abroad now also train others in Nigeria. I have also been opportune to train many Nigerian lawyers, Judges and others in London on various aspects of commercial and investment arbitration. We regularly organise the training events in London during the summer every year under the auspices of “Arbitration London” and we focus on emerging trends and sharing our international experiences both as counsel or arbitrators. We also discuss mediation and other less frequently used ADR processes, and how they can effectively be used to facilitate settlement of disputes. I can therefore attest to the fact that some Nigerians go abroad for training, seeking to improve and enhance their knowledge in the practice of arbitration. Having said that, it seems that many trainers of a number of the training bodies in Nigeria also need training and retraining in view of the dynamic jurisprudence in arbitration.

How can Nigeria be made attractive as the seat of arbitration?
Nigeria can make significant improvement in both the number and quantum of inward foreign investment or FDI by embracing and developing arbitration. This requires having a legal framework that is both dynamic and meets international best practices. The judges, lawyers or arbitration practitioners need training and retraining on the importance of arbitration not just to aide FDI, but more importantly to enhance effective dispute resolution and administration of justice. Many civil cases that end up in Nigerian court are matters that can and should be settled via arbitration, mediation and conciliation. Early neutral evaluations do other less known ADR processes. Effective adoption of such methods would free judges’ dockets and allow them focus on matters that need judicial attention and resolution.  We also need to develop existing and more arbitration institutions that have global appeal and capacity to administer diverse commercial and international disputes.

Why do we take Nigerian arbitration cases abroad even when the issues and parties are Nigerian?
First of all, arbitration is consensual and based on party autonomy. Therefore, parties can, by agreement, decide to have their arbitration where they so stipulate. Therefore, for such arbitration to be taken abroad, the seat of the arbitration agreement must so indicate. I think the real question and concern is why Nigerian parties find it convenient to have their disputes resolved under foreign arbitral seats, rules and even at times foreign arbitrators. There are multiplicity of factors that collocate to create the challenge. First, arbitration is largely, although in my humble view, seen as pre-litigation by some lawyers and others involved in the administration of justice in Nigeria.

The pending Arbitration Bill before the National Assembly, amongst others, is aimed at reforming and ensuring the extant arbitration law and practice in Nigeria, reflect some of the modern changes and marked development since 1988 to date. I believe that the current state of arbitration law and practice in Nigeria could be better improved through law reform to ensure that it meets present and future expectations in alternative dispute resolution.

Therefore there is a cultural and perception challenge, which training and better capacity building as the one we organise can help overcome. Secondly, there is the issue of mistrust about effective resolution of disputes in Nigeria, especially delays and other attendant challenges with litigation in Nigeria. Thirdly, where the stakes are very high and the issues require certain desirable expertise, some parties prefer to look outside the shore of Nigeria for both counsel and arbitrators. I think the trend should change given time and better development of arbitration in Nigeria.

How can Nigerian parties seek enforcement of arbitral awards abroad?
Parties seeking to enforce arbitral awards outside Nigeria need to carefully consider any consequential benefits and practical desirability for doing so. Generally, arbitral awards are recognised and enforceable in other jurisdictions pursuant to the New York Convention on Recognition and Enforcement of Awards 1958. Therefore, a successful Nigerian party would have to consider, where the respondent has assets, or carries on business to determine how best to seek enforcement within jurisdiction.
How can the practice of arbitration be developed in Nigeria compared to UK and other jurisdictions?
As stated earlier, we need to develop our domestic legal framework regulating arbitration; develop stronger arbitral institutions; improve capacity of practitioners and lawyers; and improve on judicial and court support for recognition and enforcement of arbitral awards.

What are your thoughts on the initiative of the Nigerian government’s prisoner exchange programme with the UK?
This is one area I think the Jonathan administration was simply misled or not properly advised. There are consequences flowing from Nigerian prisoners who are removed, deported or transferred from the UK to Nigeria, to serve custodial sentences. I seriously doubt the quality, if at all, of any legal advise that was sought or given prior to the Nigerian government going into that arrangement. One must ask how many UK citizens are living in Nigeria that are, or have been so deported or removed from Nigeria in consequence of the bilateral arrangement? It could be that the arrangement is one-sided. Government must endeavour to seek expert opinion on such bilateral matters. Also, government agencies must provide a platform where would-be travellers from Nigeria to the UK and elsewhere, are better informed and educated on how to conduct themselves and how to stay legal and lawful in diaspora.