THE CONSTITUTIONAL
BASIS OF THE REFORM
AND THE LEGISLATIVE
ARRANGEMENTS
By
Paul Obo Idornigie, Ph.D, BL, FCIS,
MCIArb(
General Counsel/Privatization
Adviser
Bureau of Public Enterprises
Other than customary arbitration, the first statutory enactment in
A cursory look at the constitutional development of
In March 1988, the Arbitration and Conciliation Act (ACA) was
promulgated as a decree of that year[5]. Section 58(1) of ACA provides that it shall apply throughout the Federation while subsection
(2) of section 58 repealed the Arbitration Act.
In this regard, will the doctrine of “covering the field” apply in which
case, the existing state laws which were not expressly repealed were suspended.[6]
With the emergence of democratic rule in 1999 and the coming into force
of the 1999 Constitution of the Federal Republic of Nigeria, these issues came
to the fore. This is compounded by the
fact that under section 315 of the 1999 Constitution, the ACA is deemed to be a
valid existing Act of the Federal Government.
The consequence of this is that the appropriate authority can amend the
ACA.
This presentation seeks to locate the constitutional basis of arbitral
enactments in
THE NEED FOR REFORM
The Discussion Paper has highlighted the need for reform and the
subject matter of reform. Suffice it to
say, however, that there are some defects in the ACA which can be summarized as
follows[7]:
a) Inelegant drafting as can be found in sections 12(2), 33(a), 44, 45, 49
and 50 of the ACA
b) Repetition as can found in
sections 4 and 5; and 22(3) and 47(4)[8]
c) Constitutionality of some of the provisions in the ACA especially
sections 7(4) and 34[9].
d) Omissions of provisions on Immunity of Arbitrators, Umpire,
Consolidation, Interest, Deposits for Costs, Remedies and Enforcement
Procedures.
THE CONSTITUTIONAL BASIS
A careful examination of both Exclusive and Concurrent Legislative
Lists in the 1999 Constitution will show that neither ‘arbitration’ nor
‘conciliation’ is expressly referred to in any of the two lists. However, the following items in the Exclusive
List in the 1999 Constitution are germane, namely
a) Item 31 dealing
with implementation of treaties relating to matters on this list
b) Item 62(a) dealing with trade and commerce and in
particular trade and commerce between
c) Item 68 dealing with any matter incidental and
supplementary to any matter mentioned elsewhere in this list.
All these are matters outside the legislative competence of a
state. It can be argued, therefore, that
since arbitration and conciliation are merely procedural law and not
substantive law, the Federal Government can legislate on them. The other argument is that since
‘arbitration’ and ‘conciliation’ are not in any legislative list, it is only
the States that can legislate on them.
While this argument is constitutionally and conventionally valid, a
state cannot legislate in the realm of implementation of treaties and trade
between
LEGISLATIVE ARRANGEMENTS
As has been stated,
All these considerations influenced the drafting of two bills, namely,
Federal Arbitration and Conciliation Bill and Uniform Arbitration and
Conciliation Bill. The latter is like a
model law for the States. It is
suggested that the Conference of Attorneys-General should consider and approve this Model Law.
THE FEDERAL ARBITRATION AND CONCILIATION BILL (FACB)
The main features of the draft
Bill:
a)
Unlike the ACA that has a Part for
International Commercial Arbitration, the draft bill has abolished this
dichotomy.
b)
The Bill has three parts and four
schedules, namely,
I.
Part I – Arbitration (ss 1 – 50)
II.
Part II – Conciliation (ss 51 – 63)
III.
Part III – Miscellaneous (ss 64 –
66)
IV.
Schedules.
a) First Schedule – Arbitration Rules
b) Second Schedule – Convention on the Recognition and Enforcement of Foreign Arbitral
Awards
c) Third Schedule – Arbitration Claims and Appeal (Procedures) Rules
d) Fourth Schedule – Conciliation Rules
One other way of appreciating the work of the Committee is to consider
each Part of the Bill.
Part I – Arbitration
A careful perusal of this part will show that it falls into three main
categories, namely, provisions in the ACA that were retained in the bill
without modification, provisions in the ACA that were modified and new subjects
and provisions. We will briefly
highlight the categories.
Provisions in the ACA that were
retained in the Bill without modifications are as follows:
a)
Section 2 – Arbitration Agreement
irrevocable except by agreement or leave of court.
b)
Section 3 – Death of a Party
c)
Section 11 - Appointment of
Substitute Arbitrator
d)
Section 17 - Commencement of arbitral proceedings
e)
Section 18 – Language to be used in
arbitral proceedings
f)
Section 20 – Hearing and written
proceedings
g)
Section 21 – Default of a party
h)
Section 25 – Settlement
i)
Section 27 – Terminations of
Proceedings
j)
Section 28 – Correction and
Interpretations of award and additional award
k)
Section 35 – Extent of application
of this Act to arbitration
l)
Section 36 – Extension of Time
m) Section 53 – Application of the Arbitration Rules Set out in Schedule
1.
Provisions in the ACA that were
modified. They are
a) Section 1 – Form of the Agreement
b) Sections 4 and 5 – Stay of
Proceedings
c) Section 6 – Number of Arbitrators
d) Section 7 – Appointment of Arbitrators[14]
e) Section 8 – Grounds for challenge
f)
Section 9 – Challenge procedure
g) Section 10 – Termination of mandate due to failure or impossibility to
act
h) Section 12 – Competence of the tribunal to rule on its jurisdictions
i)
Section 13 – Power of arbitral
tribunal to order interim measure of protection
j)
Section 14 - Equal treatment of
parties
k) Section 15 – Arbitral proceedings
l)
Section 16 – Place of arbitration
m) Sections 22 and 47 – Power of arbitral tribunal to appoint expert
n) Section 26 – Form and contents of award
o) Section 29 – Application for setting aside an arbitral award[15]
p) Section 30 – Setting aside of award in case of misconduct by arbitrator
q) Sections 31 and 51 – Recognition and enforcement of awards
r)
Sections 32 and 52 – Refusal of
recognition or enforcement of awards
s) Section 33 – Waiver of right to object
t)
Section 34 – Extent of court’s
intervention
u) Section 47 – Rules applicable to the substance of the disputes[16]
(Quaere – should we retain the
conflict of laws rules in subsections (1), (2) and (3) especially for
international commercial arbitration?
v) Section 49 & 50 – Costs and deposits for costs
w) Section 54 – Application of the Convention on Recognition and
Enforcement of Foreign Arbitral Awards.
New Subjects and Provisions
Introduced. They are
a) General Principles and Scope of Application – underscoring the
principle of party autonomy[17].
b) Appointment of Umpires
c) Immunity of Arbitrators
d) Application of Statute of Limitation to Arbitration[18]
e) Remedies
f)
Consolidation and Concurrent
Hearing
g) Interest[19]
h) Security for Costs
These new provisions and the modifications were inspired by the
UNCITRAL Model Law on International Commercial Arbitration[20],
the UNCITRAL Model Law on Electronic Commerce[21]
and the Report of the UNCITRAL Working Group II
on Commercial Arbitration[22].
Part II – Conciliation
This part of the draft Bill was treated exactly the same way as Part
I. Sections 38, 39, 40, 41 and 42 of the
ACA are without modifications while section 37 was modified. The following are the new provisions:
a) Impartiality of Conciliators
b) Disclosure of Information
c) Confidentiality of Information and Proceedings
d) Admissibility of Evidence in other Proceedings[23]
e) Conciliator acting as Arbitrator
f)
Enforcement of Settlement
Agreement.
The beauty of these new provisions is that they incorporate some of the
provisions of the UNCITRAL Model Law on International Commercial Conciliation[24]
and elements of the UNCITRAL Conciliation Rules in the bill[25].
One innovation that I would like to highlight is f) above – enforcement
of settlement agreement. Enforcement of
settlement agreements has been the main weakness of any ADR process. Fortunately, Article 14 of the UNCITRAL Model
Law on International Commercial Conciliation provides that each enacting state
may consider the possibility of making the procedure for enforcement of settlement agreements mandatory.
Accordingly section 62 of the draft bill provides that if the parties
conclude an agreement settling a dispute, that settlement agreement is binding
and enforceable on the parties as if same were an arbitral award. Furthermore, under Article 1 of the
Arbitration Claims and Appeal (Procedure Rules), the definition of ‘arbitration
award’ includes settlement agreement that is enforceable in the same manner as
an award under section 62 of the draft bill.
Article 7 of the Rules provides for the procedure for the enforcement of
awards and interim measures of protection – by Originating Notice of
Motion. This is a welcome relief for all
ADR practitioners.
Part III – Miscellaneous
Under the definition and interpretation section, the word ‘commercial’[26]
has been given a wider definition to include non-contractual relationship while
‘interstate arbitration’ has been introduced and defined.
The Schedules
Out of the four Schedules, three are well-known to practitioners. The novel one is the Third Schedule –
Arbitration Claims and Appeal (Procedures) Rules[27]. Thus to apply for stay of proceedings,
appoint an arbitrator/umpire, enforce an arbitral award or appeal from the High
Court to the Court of Appeal and thence the Supreme Court, you need not make
any enquiry, the Rules provide a comprehensive procedure. This way, arbitration or ADR processes will
never be the first step to litigation.
UNIFORM ARBITRATION AND
CONCILIATION BILL
The main differences between the provisions of the Federal Arbitration
and Conciliation Bill and the Uniform Arbitration and Conciliation Bill are as
follows:
a)
The Federal
b)
The Uniform Arbitration and
Conciliation Bill, if passed by the Houses of Assembly of the States will apply
to such states. What happens to States
that fail to pass this Bill? It is
submitted that if the ACA is repealed, the doctrine of ‘covering the field’
will apply.
C O N C L U S I O N
Personally, I see this exercise as pivotal to the attraction of direct
foreign investment to
When compared to legislations from other jurisdictions, the two bills
have comprehensively covered the field.
We look forward to your discussions and contributions.
Thank you and
God bless.
Email: pidornigie@bpeng.org, idornigie@hotmail.com and idornigie@yahoo.co.uk
[1] This was derived from the English Arbitration Act of 1889
[2] See section 2 of the Arbitration Act, Cap 13, Laws of the Federation of Nigeria and Lagos, 1958 which provides that the Ordinance shall apply to the Northern, Western and Eastern Regions and to Lagos and the Southern Cameroons as if they were each a Region.
[3] See the
Arbitration Law, Cap 7, Laws of
[4]See
Arbitration Act, Cap 13, Laws of the Federation of
[5] See
Decree No. 11 of 1988 now Cap A18, Laws of the Federation of
[6] See
Idornigie, P O ‘The Doctrine of Covering the Field and Arbitration Laws in
[7] See Idornigie, P O ‘The 1988 Arbitration and Conciliation Act: Need for Review’ in International Arbitration Law Review, Vol. 6, Issue No. 2, April 2003, p 50 (published by Sweet & Maxwell)
[8] See also Idornigie P O ‘Determining the Applicable Law in Arbitral Proceedings’ in MODUS International Law & Business Quarterly, Vol.5, No. 3, September 2000
[9] See
Idornigie P O ‘The Default Procedure in the Appointment of Arbitrators: Is the
Decision of the Court Appealable?’ in Arbitration, The Journal of the Chartered
[10] See section 4(2) of the 1999 Constitution
[11] See section 4(4) Id
[12] See section 4(5) Id
[13] See Attorney General,
[14] See
also Idornigie P O ‘Revocation of the Authority of an Arbitrator – How
Exercised: BJ Export & Chemical Co
Ltd v Kaduna Refining & Petrochemical Co Ltd: Appeal No. CA/KA/34/98 of
[15] See
also Idornigie P ‘The Relationship
between Arbitral and Court Proceedings in
[16] See Idornigie, Op Cit at No. 8
[17] See also Idornigie P O ‘Anchoring Commercial Arbitration on Fundamental Principles’ in The Arbitrator & Mediator, The Journal of The Institute of Arbitrators & Mediators (Australia), Vol 23, No. 1, April 2004 and Idornigie P O The Principle of Party Autonomy in Arbitral Proceedings: A Myth or Reality?’ in The Arbitrator & Mediator, The Journal of The Institute of Arbitrators & Mediators (Australia), Vol. 22, Vol. 3, December 2003
[18] See
also Idornigie P O ‘Statutes of Limitation and ADR Processes’ in The Arbitrator & Mediator, The Journal
of The Institute of Arbitrators & Mediators (
[19] See also Idornigie P O ‘Making an Arbitral Award a Judgment of the Court: Ras Pal Gazi Construction Ltd v FCDA (2001) 10 NWLR (pt 722) 559 in International Arbitration Law Review, Vol. 5, Issue 4, 2002 – Case Review
[20] See UN
General Assembly Resolution 40/72 of
[21] See UN
General Assembly Resolution 51/162 of
[22] See UN Doc A/CN.9/WG.II/XXXVI/CRP.1/Add.1 to Add.5 and UN Doc A/CN.9/WGII/WP.136
[23] See also section 25 of the Evidence Act, Cap 14, LFN 2004
[24] See UN
General Assembly Resolution 57/18 of
[25] See the definition of ‘Conciliation’ in section 51(2) of the draft bill.
[26] See also Idornigie P O ‘The Principle of Arbitrability in Nigeria Revisited’ in Journal of International Arbitration (The Hague) Vol. 21, No. 3, June 2004 and Idornigie P O ‘Nigerian Telecommunications Plc v Pentascope International BV Private Ltd: Separability Circumscribed by Arbitrability’ in Arbitration, The Journal of the Chartered Institute of Arbitrators (UK), Vol 71, No. 4, November 2005
[27] Similar to Fundamental Rights Enforcement Procedure Rules and Matrimonial Causes Rules