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WHAT IS AN ARBITRATION AGREEMENT?

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Arbitration is a procedure for the settlement of disputes, under which the parties agree to be bound by the decision of an arbitrator whose decision is, in general, final and legally binding on both parties. The process derives its force principally from the agreement of the parties and, in addition, from the State as a supervisor and enforcer of the legal process. So where two or more persons agree that a dispute or potential dispute between them shall be decided in a legally binding way by one or more impartial persons of their choice, in a judicial manner, the agreement is called an arbitration agreement. Common law, lex non scripta and statute are the two sources of arbitration law in Nigeria. The statutory source did not codify arbitration law to the exclusion of common law. See B. J. EXPORT & CHEMICAL CO. LTD v. KADUNA PETRO-CHEMICAL CO. LTD. (2003) FWLR Pt. 165 Pg. 445 at 469 C.A.

— H.M. Ogunwumiju, JSC. UBA v Triedent Consulting Ltd. (SC.CV/405/2013, July 07, 2023)

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HIGH COURT DOES NOT SIT ON APPELLATE FUNCTION OVER ARBITRAL PANEL

In the case of Baker Marine Nigeria Limited v. Chevron Nigeria Limited (2000) 3 NWLR (Pt. 681) 939 @ 410, it was held that an application to set aside an arbitral award: “The lower Court was not sitting as an appellate Court over the award of the arbitrators. The lower Court was not therefore empowered to determine whether or not the findings of the arbitrators and their conclusions were wrong in law. What the lower Court had to do was to look at the award and determine whether on the state of law as understood by them and stated on the face of the award, the arbitrators complied with the law as they themselves rightly or wrongly perceived it. The approach here is subjective. The Court places itself in the position of the arbitrators, not above them, and then determines on that hypothesis whether the arbitrators followed the law as they understood and expressed it.”

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CRIMINAL MATTERS & FRAUD ARE NOT ARBITRABLE

Disputes which are subject of an arbitration agreement must be arbitrable. Matters like criminal matters or where fraud is alleged and raised as a matter of public policy are not to be settled privately by arbitration. See B. J. EXPORT & CHEMICAL CO. LTD v. KADUNA PETRO-CHEMICAL CO. LTD. (Supra).

— H.M. Ogunwumiju, JSC. UBA v Triedent Consulting Ltd. (SC.CV/405/2013, July 07, 2023)

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PARTY CAN APPLY TO COURT TO SET ASIDE AN ARBITRATION AWARD

The provisions simply provide any of the parties to an arbitration award a discretionary right to request, pray for or seek from a Court of law, an order refusing or declining to accord judicial recognition or enforcement of the arbitral award between them. By dint of the provisions, a party to an arbitral agreement is vested with and possesses the unfettered right to approach a Court of law to request that the arbitration award between the parties, should not be recognized and enforced by the Court. The provisions merely provide a right of access to a Court of law for the sole purpose of requesting for or seeking an order that would refuse to recognize and/or enforce an arbitral award the parties thereto, to any one of them.

– Garba, JCA. Dunlop v. Gaslink (2018)

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ARBITRATION PANELS ARE SPECIAL QUASI-JUDICIAL PROCEEDINGS

As a foundation, I would state that Arbitration proceedings are special quasi-judicial proceedings which are specifically provided for, regulated and governed by the Arbitration and Conciliation Act as well as the Arbitration Rules provided for in the schedule to the Act. The proceedings are not the same as the usual judicial proceedings in the determination of disputes which are also governed and regulated by the different Rules of procedure and practice enacted for such Courts.

– Garba, JCA. Dunlop v. Gaslink (2018)

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PARTIES ARE BOUND BY ARBITRAL AWARD

Once parties have consented to arbitration, they have also consented to accept the final award by the arbitrator.

– Nimpar, JCA. Dunlop v. Gaslink (2018)

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PARTY CANNOT RESILE AFTER SUBMISSION TO CUSTOMARY ARBITRATION

On these facts of the customary arbitration by the Abuloma Council of Chiefs before whom the parties herein lead consensually submitted themselves to for the resolution of their dispute and the verdict of which arbitration was acceptable to all of them, it would no longer be open to either of the parties to subsequently back out or resile from the decision or verdict reached and pronounced upon the arbitration. See Oparaji v. Ohanu (1999) 9 NWLR (Pt. 618) 290, (2001) FWLR (Pt. 43) 385. The appellants are now estopped from resiling out of the customary arbitration of the Abuloma Council of Chiefs, which they voluntarily submitted their dispute with the respondents to, and agreed to accept the verdict of. Apart from this specie of estoppel operating as estoppel per rem judicatam; it also operates as estoppel by conduct by virtue of section 150 of the Evidence Act, 1990 (now section 169 of the Evidence Act, 2011). It is, therefore, unconscionable for the appellants, having by their words or conduct made the respondents to believe that they would be bound by the verdict of the Abuloma Council of Chiefs, to resile out of it and set up the suit, the subject of this appeal. See Joe Iga & Ors. v. Ezekiel Amakiri & Ors. (1976) 11 SC 1 at pages 12 – 13.

— Eko JSC. Benjamin v Kalio (2017) – SC/207/2006

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