Categories: General

The Consensual Nature of Arbitration: Whether a Non-Signatory to a Contract can be Bound by the Arbitral Decisions Stemming from the Contract

CASE TITLE: EMTS LTD v. AFDIN VENTURES LTD & ORS (2026) LPELR-83327 (SC)

JUDGMENT DATE: 6TH MARCH, 2026

PRACTICE AREA: ARBITRATION AND CONCILIATION

LEAD JUDGMENT: TIJJANI ABUBAKAR, J.S.C.

SUMMARY OF JUDGMENT:

INTRODUCTION:

This appeal borders on arbitration.

FACTS:

This is an appeal against the decision of the Court of Appeal, which dismissed the appeal against the judgment of the Federal High Court, delivered on 22/11/2024.

The 1st and 2nd Respondents sought, inter alia, the refund of the sums of USD 13,300,910 and USD 30,030,040, respectively, from the Appellants amongst others.

Pursuant to an arbitration clause and upon the application of one of the Defendants, the trial Court referred the matter for arbitration. The final arbitral award ordered the Appellants alongside others, to refund to the 1st and 2nd Respondents the sums earlier set out.

Following the final arbitral award, the 1st and 2nd Respondents filed before the Federal High Court, Abuja Division, Coram Nyako, J., a motion seeking recognition and enforcement of the Final Award. The Appellant filed a counter-affidavit in opposition to the application.

The trial court granted the application for recognition and enforcement of the arbitral award. Aggrieved by that ruling, the Appellant appealed to the Court of Appeal, which, after considering the arguments of the parties, dismissed the appeal in its entirety and affirmed the decision of the trial Court. The Appellant, therefore, filed this appeal.

ISSUE(S) FOR DETERMINATION:

The Supreme court determined the appeal on:

“Whether the lower court was right in affirming the decision of the trial Court recognising the Arbitral Award against the Appellant when the entire arbitral proceeding was a nullity for want of jurisdiction.”

DECISION/HELD:

The appeal was dismissed.

RATIOS:

APPEAL- APPEAL TO THE SUPREME COURT: The approach of the Supreme Court to terminating an appeal on the recognition and enforcement of arbitral awards where the appellant fails to comply with Order 6 Rule 3(5) of the Supreme Court Rules 2024
ARBITRATION AND CONCILIATION- ARBITRATION: The Consensual nature of arbitration; whether a non-signatory to a contract can be bound by the arbitral decisions stemming from the contract
ARBITRATION AND CONCILIATION- ARBITRATION: Whether parties to a dispute who voluntarily submit an issue in controversy between them to an arbitration will be prohibited or estopped from resiling from the decision made by the Arbitral panel or tribunal
ARBITRATION AND CONCILIATION- ARBITRATION: Whether it is every allegation of fraud that will render a dispute non-arbitrable where the claims and reliefs sought are civil in nature
ARBITRATION AND CONCILIATION- ARBITRATION: Whether a party who has benefited from a contract can evade liability arising from an arbitration decision on the ground that it was not a party to the contract
ARBITRATION AND CONCILIATION- ARBITRAL AWARD: Approach of the Court to an appeal against the findings/awards of an Arbitral Tribunal
EQUITY- DOCTRINE OF EQUITY: Applicability of the equitable doctrine of restitution in compelling repayment of monies retained unconscionably despite privity of contract