Federal courts have jurisdiction over statutory contracts, appeal court rules

The court of appeal in Abuja has ruled that the federal high courts have jurisdiction to entertain matters involving statutory contracts in Nigeria.

The appellate court, in a unanimous judgment, delivered the ruling in an appeal filed by the Central Bank of Nigeria (CBN) against Adani Mega System Ltd.

The lead judgment was read by Okon Abang. Other judges include Abba  Mohammed and Donatus Okorowo.

THE CASE

In March 2017, the comprehensive import supervision scheme (CISS) of the CBN had a contract agreement with Adani Mega System for the “provisions of the scanning services infrastructure required for inspection of all inbound and outbound cargo as required by law in Nigeria”.

The contract agreement entailed that the company served as “service provider/vendor for the enterprise screening platform for the inspection of all inbound and outbound cargo as prescribed by Nigerian Law”.

In September 2017, the CBN committee terminated the contract agreement over allegations that the company outsourced the project without authorisation of the apex bank.

Displeased with the termination of the contract, the company approached the federal high court in Abuja to seek redress.

The company had told the court that it was “unlawful” for the CBN committee to terminate a contract which it had executed with “millions of dollar expended”.

The company anchored its legal suit on provisions of the Pre-Shipment Inspection of Import Act Cap 26, Laws of the Federation, and the Pre-Shipment Inspection of Export Act Cap 25, Laws of the Federation of Nigeria 2004.

Amid the legal tussle, the federal executive council (FEC) in September 2020 approved a similar contract — e-Customs project — to some companies.

The legal tussle between the CBN and the company delayed the implementation of the awarded project.

In February 2023, a federal high court in Abuja ruled against the apex bank and ordered that the company should be paid entitlements and monies accured from the contract.

Not satisfied with the judgment, the apex bank approached the appeal court with eight-ground of appeal challenging the verdict of the lower court.

The CBN, through its legal team, had argued that the trial court erred by assuming jurisdiction on a contract case.

The apex bank argued that cases of simple contracts can only be entertained by state high courts or FCT high court.

The CBN also told the lower court did not recognise the principles of fair hearing.

THE APPEAL COURT JUDGMENT

In the certified true copies of the judgment delivered on April 25, 2025, and seen by TheCable, Abang, the lead judge, ruled that the case in question is not an “ordinary simple contract” but a contract with “statutory flavour”.

The judge held that the contract in question is regulated by the statute that will determine how disputes pertaining to the contract will be settled.

The judge ruled that the contract in question is regulated by the Pre-Shipment Inspection of Import Act and the Pre-Shipment Inspection of Export Act.

Abang held that the agreement between CBN and the company was premised on provisions of the aforementioned laws.

The judge held that section 20(3) of the law provides that every proceedings under the act shall be undertaken by the federal high court.

The judge ruled that the aforementioned laws, which are acts of national assembly, confer on the federal high court additional jurisdiction to entertain cases of contracts by statute.

“Apart from the provisions of section 251(1) of 1999 Constitution as amended that confers exclusive jurisdiction on the Federal High Court on the eighteen (18) items mentioned therein, section 20(3) of Pre-shipment Inspection of Export Act Cap 25 and section 9(2) of Pre-Shipment Inspection of Import Act Cap 26 Laws of the Federation 2004 are Acts of National Assembly that confered additional jurisdiction on the Federal High Court to entertain dispute arising from contract. regulated by statute,” the part of the judgment reads

“In this case, the reliefs endorsed on the Respondent’s writ of summons and facts pleaded in its amended statement of claim relate to an infraction of the provisions of Pre-Shipment Inspection of Import and Export Act Caps 25 and 26 Laws of the Federation 2004.

“I have no doubt in my mind that the trial court was right when it held that the court that has jurisdiction to entertain the suit by virtue of section 20(3) of the Act, is the Federal High Court.”

The judgment resolved the other seven issues against the appellant, the CBN, in favour of the company.