Court Of Appeal Creates Exception: Federal High Court Has Jurisdiction Over Contracts With Statutory Flavour
Federal High Court has Jurisdiction over contracts with statutory flavuor, so held the Court of Appeal as Justice Okon Abang makes path-marking pronouncements, chastises the CBN for desecrating the law.
In what apparently indicates a bold move to further deepen the jurisprudence of jurisdiction in Nigeria, the Court of Appeal, Abuja Judicial Division, on the 25th day of April, 2025 in Appeal No. CA/ABJ/CV/1300/2023 delivered a ground-breaking judgment between the Central Bank of Nigeria v. Adani Mega System Ltd on the jurisdictional parameters of the Federal High Court in the sphere of contract. In the lead judgment ably anchored by the Honourable Justice Okon Abang, the Court brilliantly created an exception to the age-long position of the law to the effect that jurisdiction in contractual matters is bestowed on state and FCT High Courts only to the exclusion of the Federal High Court. However, the Court of Appeal has introduced an exception to that which is that the Federal High Court now has jurisdiction in matters of statutory contracts or contracts with statutory flavour. The Court arrived at this view when it was invited by the Central Bank of Nigeria (as the Appellant) to interpret, among others, the provisions of Section 251 of the amended 1999 Constitution of the Federal Republic of Nigeria, Pre-Shipment Inspection of Import Act Cap 26 Laws of the Federation and Pre-Shipment Inspection of Export Act Cap 25 Laws of the Federation of Nigeria 2004 in relation to whether or not the Federal High Court has jurisdiction over simple contracts.
At the trial Federal High Court presided over by the Hon. Justice Mohammed, J. (as he then was, now JCA), the facts were that the Respondent by virtue of a project engagement mandate from the appellant dated the 16/2/2017 and a build, operate and own agreement dated the 20/3/2017 holds a valid and duly executed contract with the technical committee of the Comprehensive Import Supervision Scheme ( CISS) of the Appellant on behalf of Federal Government of Nigeria as the service provider/vendor for the enterprise screening platform for the inspection of all in bound and out bound cargo as prescribed by Nigerian Law. In compliance with the relevant due process laws of Nigeria, the appeal ant sought and obtained a letter of no objection from the Bureau of Public Procurement with regard to the contract between the Respondent and Federal Governing of Nigeria through the appellant’s Technical Committee of the Comprehensive Import Supervision Scheme (CISS). After the certificate of no objection was obtained, the Respondent set to work by expanding its capital, inclusive of borrowed capital running into millions of United States dollars in concluding extensive work on the project. It is alleged by the Respondent that the appellant without any reasonable ground subsequently suspended its contract which was concluded. Subsequently, after the above suspension, the technical committee on Comprehensive Import Supervision Scheme through the appellant in a letter dated the 18/9/2017 terminated the Respondent’s contract. Aggrieved, the Respondent challenged the unlawful termination at the Federal High Court, Abuja relying on, among others, the provisions of Pre-Shipment Inspection of Import Act Cap 26 Laws of the Federation and Pre-Shipment Inspection of Export Act Cap 25 Laws of the Federation of Nigeria 2004. The trial Federal High Court found for the Respondent (as the Plaintiff thereat) prompting the Appellant [the Central Bank of Nigeria] to appeal to the Court of Appeal.
At the Court of Appeal, the Appellant raised eight (8) issues in its brief for the resolution of the Court part of which is:
Whether the trial court lacked the competence and jurisdiction to hear and determine the Respondent’s suit which was based on a simple contract
The Court undertook a community interpretation of Section 251 of the amended 1999 Constitution, Section 7 of the Federal High Court Act, Section and 20(3) of Pre-Shipment Inspection of Export Act Cap 25 laws of the Federation 2004. In an uncommon display of judicial activism, Justice Abang, JCA, made far-reaching and path-marking pronouncements in expansively interpreting the jurisdiction of the Federal High Court in these flowery words:
My Lords upon a calm and due consideration of the facts of this case, reliefs sought by the Respondent and the interpretation of various statutory provisions cited by the parties, it is my humble but firm view that having regard to the agreement of the parties that led to the execution of exhibit PL3 (build, operate and own agreement) for the provisions of the scanning services infrastructure required for Pre-Shipment Inspection of all in bound and out bound cargo as prescribed by Nigerian law, the contract is not an ordinary simple contract. It is a contract that has statutory flavour. In other words, it is a contract regulated by statute. That is regulated by the provisions of Pre-Shipment Inspection of Import Act Cap 25 Laws of the Federation of Nigeria 2004 and Pre-Shipment Inspection of Export Act Cap 26 Laws of the Federation of Nigeria. Therefore where there is a dispute arising from the said contract regulated by statute, it is the statute itself that will determine the forum where the aggrieved party will ventilate its greviance.
His Lordship referenced Section and 20(3) of Pre-Shipment Inspection of Export Act Cap 25 laws of the Federation 2004 providing that:
“Every proceeding under this Act shall subject to the applicable procedure be commenced at the Federal High Court and any reference to this Act to Court shall be construed accordingly”
To give the judgment a clinical bend, His Lordship, who is known for exceptionally communicating law in an elevated language, systematically reviewed eight Supreme Court judgments on the jurisdiction of the Federal High Court and scholarly distinguished them from the case presented to the Court in the instance. The Court unanimously found the appeal unmeritorious and dismissed same. In his own concurring judgment, Hon. Justice Okorowo, JCA, after referencing the Legislations under which the matter was instituted effulgently declared that “the Court below was right to proceed with the trial of the matter ignoring the argument of the Appellant that the action was founded on simple contract, having been provided for by Acts of National Assembly”
