Court Restricts Osun Accounts Over $13.9m Arbitration Award

Court Restricts Osun Accounts Over $13.9m Arbitration Award

The Federal High Court in Lagos has ordered several commercial banks to place a “Post No Debit” restriction on accounts belonging to the Osun State Government over an unpaid $13.924 million arbitration award in favour of Gamji Nigeria Company Limited.

The interim order, issued by Justice D.E. Osiagor, also covers ₦157.5 million in arbitration fees awarded to the company.

The court order followed an application by Gamji Nigeria Company Limited, which is seeking to preserve the Osun State Government’s funds pending steps to enforce the arbitral award.

The dispute arose from contracts0000 awarded by the Osun State Government to Gamji in June 2017 for the construction of water infrastructure in Ilesa West Local Government Area.

The projects involved the construction of transmission mains, booster pump stations and water reservoirs under a wider water supply and sanitation programme.

According to documents before the court, the projects were initially valued at about $15.98 million and $9.70 million, respectively. Gamji later claimed that design changes and variations increased the contract values.

The company said about 93 per cent of the works had been completed by October 2023 and that the state government issued a Substantial Completion Certificate in November 2024.

READ ALSO:

• Tension as Kidnappers Threaten to Kill Abducted Oyo Corps Members
• Oyo Corps Members Abductors Demand ₦950m Ransom, Threaten to Kill Victims
• Adeleke Rejects Ataoja Palace Appointment, Reaffirms Oyebode as Osun Iyaloja-General

A dispute subsequently developed over issues including extensions of time, variations, price adjustments and additional costs incurred during execution of the projects.

After attempts to resolve the disagreement failed, Gamji commenced arbitration proceedings against the Osun State Government.

The arbitral tribunal eventually delivered its final award on July 24, 2026, directing the state government to pay Gamji $13,924,343.32, alongside ₦157.5 million in reimbursable arbitration fees.

The award also provided for 20 per cent annual interest on the outstanding amount after the specified compliance period.

Gamji told the Federal High Court that the deadline for payment expired on August 24, 2026, without the award being settled.

The company consequently approached the court for an interim order to prevent the state government from dissipating funds that could be required to satisfy the award.

Justice Osiagor subsequently directed the affected banks to place a Post No Debit restriction on the relevant Osun State Government accounts and preserve funds up to the value of the award.

The affected financial institutions include Guaranty Trust Bank, Access Bank, First Bank, Zenith Bank, United Bank for Africa, Ecobank, Fidelity Bank, Stanbic IBTC, Sterling Bank, Union Bank and Wema Bank, among others.

The order is an interim preservation measure and does not amount to a final transfer of the state government’s funds to Gamji. The substantive legal proceedings concerning enforcement of the award remain before the court.

The Federal High Court has adjourned the matter until October 22, 2026, when the relevant applications are expected to be considered.

The latest development is separate from the earlier restriction placed on some Osun State Government accounts in connection with an Economic and Financial Crimes Commission (EFCC) investigation. That restriction was subsequently lifted.

The current case centres on the contractual dispute between the state government and Gamji and the company’s attempt to enforce the $13.9 million arbitration award and associated naira payment.

The court’s decision could have significant financial implications for the Osun State Government if the arbitral award is ultimately enforced.

Court Restricts Osun Accounts Over $13.9m Arbitration Award