The Supreme Court of Nigeria has upheld a ruling of the Court of Appeal directing Emerging Markets Telecommunications Services Limited (EMTSL), operators of 9Mobile, to pay about $87.5 million to two investors following a long-running dispute.
The apex court affirmed the November 22, 2024, decision of the Court of Appeal, which validated an arbitral award granted in favour of Afdin Ventures Limited and Dirbia Nigeria Limited.
The award, issued on September 26, 2022, ordered EMTSL to refund over $43 million invested by the two firms, alongside accrued interest and costs, bringing the total sum to approximately $87.4 million.
In a unanimous decision, a five-member panel led by Mohammed Garba dismissed the appeal filed by EMTSL, ruling that it lacked merit.
Delivering the lead judgment, prepared by Tijani Abubakar and read by Mohammed Idris, the court held that EMTSL could not deny being bound by the arbitration clause in the original agreement, having benefited from the funds invested.
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The court rejected the company’s argument that it was not a signatory to the contract containing the arbitration clause. It maintained that contractual obligations, including arbitration provisions, extend to parties who assume the benefits and responsibilities of such agreements.
The judgment emphasised that arbitration clauses remain binding when contractual rights are transferred, noting that parties cannot enjoy the benefits of a contract while avoiding its obligations.
The court further clarified that the principle of privity of contract does not apply where evidence shows active involvement in, and benefit from, a transaction. It ruled that EMTSL was deeply connected to the investment arrangement and could not evade the dispute resolution mechanism.
Describing the appeal as baseless, the court dismissed it and affirmed the earlier judgment of the appellate court. It also awarded a cost of ₦10 million against EMTSL in favour of the investors.
The dispute dates back to 2018, when Afdin Ventures and Dirbia Nigeria filed a suit before the Federal High Court of Nigeria, seeking a refund of their investments.
The companies claimed they were excluded from the management and decision-making processes of the business despite contributing significant funds. They also alleged that plans were underway to sell the telecom firm—formerly known as Etisalat Nigeria—without their knowledge.
The matter was later referred to arbitration by the trial court, presided over by Justice Binta Nyako, leading to the final arbitral award in 2022.
Following the award, the investors returned to court to seek its enforcement, which was granted in April 2023. Subsequent appeals by EMTSL at both the Court of Appeal and the Supreme Court were unsuccessful.
The ruling reinforces the binding nature of arbitration in commercial agreements and underscores the judiciary’s stance on accountability in business transactions.
