Nigeria Risks Losing $21m of Its Foreign Assets over Alleged Judgment Debt

Barring any last minute intervention, Nigeria is set to lose up to $21 million  foreign assets with international financial giant, JP Morgan.

This is following the filing of a notice for the withdrawal of the said sum in a United Kingdom (UK) judgment debt from Nigeria’s account with JP Morgan.

The withdrawal notice was sequel to a rejection of Nigeria’s appeal against the judgment of a British Court, permitting the seizure of the assets from Nigeria’s account with JP Morgan, to offset the judgment entered against Nigeria about five years ago.

Meanwhile, the law firm of Brown Gavalas & Fromm LLP and other lawyers hired by the government of President Bola Tinubu are currently challenging the withdrawal on procedural grounds.

It was learnt that all parties have concluded their filings ahead of a decision to be made any time from now by the court.

Recall that a British-Nigerian citizen, Emovbira Williams had dragged the federal government before a UK Court, over alleged fraud and abuse allegedly suffered at the hands of Nigerian authorities, State Security Service (SSS), following a business deal that fell through.

The court presided by Justice Mary Clare Moulder, had in a ruling delivered on November 9, 2018, delivered judgment in favour of Williams and ordered Nigeria to pay him the sum of $6.5 million, which had accrued a 9 percent interest in the last five years.

Also delivering ruling in Nigeria’s appeal against the judgment debt, a British court on December 19, last year held that the appeal was incompetent and lacking in merit

Justice Robert Bright, subsequently dismissed it and upheld the ruling of Justice Mary Clare Moulder, who earlier authorised the plaintiff/ applicant to take $21 million and approximately £20,000 out of Nigeria’s central bank account with JP Morgan.

“The application of the defendants is dismissed and the default judgment granted by Moulder J on 9 November 2018 remains in effect,” the judge said.

Bright described as weak, Nigeria’s plea of immunity as ground to set aside the judgment debt.

Nigeria’s woes started in the late 1980s when a business deal with the plaintiff failed and subsequently resulted in his incarceration.

According to Williams, he had guaranteed the payment of $6.5 million in 1986 for the importation of foodstuff to Nigeria from England into the account of a UK trustee, on the instructions of the Nigerian government.

He stated that the deal went sour after FG refused to fulfil part of the bargain by failing to refund him.

The plaintiff disclosed that upon travelling to Nigeria, he was arrested, tried by a military tribunal for economic sabotage charges and sentenced to 10 years imprisonment in 1986.

He however escaped from Nigerian prison in 1989, three years after his sentence and fled to London.

Plaintiff further disclosed that in August 1993, then-military Head of State, Ibrahim Babangida gave him a presidential pardon absolving him of all the charges and ordered that he be fully compensated for the funds.

However, the Central Bank of Nigeria (CBN), was said to have withheld the payment of the money for several years, despite the transition to a democratic government in 1999.

The refusal to pay necessitated the filing of a suit against Nigeria at the Queen’s Bench Division of the High Court of Justice, where the court ordered him to withdraw the funds from Nigeria’s savings account with JP Morgan in the United States.

Responding, Nigeria through the CBN countered the ruling claiming that Nigeria as a sovereign state was not subject to the orders of other nations.

However, delivering ruling last month, the judge ruled out Nigeria’s immunity plea as too weak to stand, asserting that Williams’ business deal with the Nigerian government involved funds that got transferred to a trustee who is a UK citizen in a UK bank.

“Given the terms of the trust agreement that is central to Dr Williams’ complaint – i.e., that the funds guaranteed by him were to be held on trust by a trustee in England, acting on behalf of the Federal Government of Nigeria – it also seems to me to fall within section 3(1)(b),” Mr Bright of the High Court of Justice, King’s Bench Division, ruled on December 19, 2023.

“Accordingly, the Federal Government of Nigeria does not have immunity from the proceedings in this action,” he added.

Following the latest ruling, the plaintiff can now present a stronger case before the U.S. District Court for the Southern District of New York in Manhattan, where his lawyers have filed a notice to withdraw the $21 million in UK judgment money from Nigeria’s account with JP Morgan.

Alex Enumah

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