IPCO (Nigeria) LTD v Nigerian National Petroleum Corporation

When enforcement of a New York Convention award has been adjourned under section 103(5) of the Arbitration Act 1996, a later application to reconsider enforcement requires a significant change of circumstances causatively linked to the variation sought. The court should not ordinarily reopen the earlier assessment of the underlying challenge or permit a second attempt to argue matters already available.

Where the parties have agreed to adjourn enforcement because the challenge in the supervisory court presents a prima facie case, reconsideration will generally require a showing that the challenge has become hopeless or is not bona fide. A substantial prima facie case of fraud, together with considerations of curial scrutiny, comity and security, may justify continued adjournment despite substantial delay.

IPCO applied under section 101(2) of the Arbitration Act 1996 to enforce a 2004 Nigerian arbitral award against NNPC. Earlier English orders had adjourned enforcement under section 103(5), while requiring partial payment and security. A 2009 consent order further adjourned enforcement after NNPC advanced a prima facie case that the award had been procured by fraud and forgery.

IPCO relied on subsequent developments, including changes in witness evidence, withdrawal and revival of criminal charges, prosecutorial correspondence and delay in the Nigerian proceedings. The central question was whether those developments justified reconsidering the consent order and enforcing all or part of the award.

1. Application dismissed. IPCO had not established a significant change of circumstances causatively linked to the variation sought. The order made by consent therefore remained undisturbed.
2. The consent order was made on the basis that NNPC’s pleaded fraud case, supported by the particulars, documents and witness evidence, amounted to an arguable challenge requiring adjournment under section 103(5) of the Arbitration Act 1996. Reconsideration would therefore require circumstances showing that the fraud challenge was hopeless, not bona fide or otherwise materially undermined.
3. The changes concerning the seven creditors, criminal charges, lobbying of the Nigerian Attorney-General, the Deputy Director of Public Prosecutions’ assessment and Mr Wogu’s corrective evidence did not meet that threshold. They did not materially undermine the documentary case or establish bad faith.
4. The Nigerian Court of Appeal’s procedural decision also did not justify reconsideration. IPCO had accepted the risk of further delay when it agreed that the fraud allegations should be determined in Nigeria, and the relevant delay was substantially connected with errors by IPCO’s lawyers.
5. Alternatively, if the discretion under section 103(5) had been reconsidered afresh, enforcement would still have been adjourned. NNPC had a good prima facie case that substantial parts of the award had been fraudulently procured. Applying the approach in Soleh Boneh v Uganda Government [1993] 2 Lloyd’s Rep 208, the likely fuller scrutiny in Nigeria, Nigerian law as the governing law, comity, Nigerian assets and the existing US$80 million security favoured adjournment.
6. The court regarded the principle that fraud may vitiate the whole award as realistically arguable, referring to HIH Casualty and General Insurance Ltd v Chase Manhattan Bank [2003] UKHL 6 at [15]. The enforceability of the award had to be determined in Nigeria.

First-instance decision. The judgment records earlier decisions in the same litigation, including orders by Gross J and Tomlinson J and a decision of the Court of Appeal, but those decisions are not separately modelled as cited authorities.