ABUJA INTERNATIONAL HOTELS LTD V MERIDIEN SAS

[2012] EWHC 87 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Hamblen, 26 January 2012

Arbitration - Arbitration clause governed by English law - Substantive agreement governed by Nigerian law - Challenge to validity of arbitration clause under Nigerian law - Allegations of serious irregularity - Arbitration Act 1996, sections 67 and 68

Meridian, a French company, in 2003 entered into a Hotel Management Agreement with Abuja, a Nigerian company owned by the Nigerian government. For an initial period of 10 years, Meridien was to market and manage a hotel in Nigeria in return for fees. The agreement was stated to be governed by the law of Nigeria, but contained an arbitration clause which provided for arbitration in London under ICC Rules. In November 2006 Abuja was privatised. The new owners repudiated the agreement by means of various breaches. Meridian terminated the agreement and commenced arbitration in London.  It was not disputed that the curial law of the arbitration was English law so that the Arbitration Act 1996 applied, and the arbitrators held - and they were not challenged - that the arbitration clause was most closely connected with England and was governed by English law. The arbitrators found against Abuja and awarded some US$7.2 million plus interest and costs. Abuja appealed against the award, arguing that on various grounds the arbitration agreement was void under Nigerian law (the jurisdictional challenge under section 67 of the 1996 Act) and that the arbitrators were guilty of exceeding their powers, failing to act fairly and not dealing with all of the issues put to them (the serious irregularity challenge under section 68 of the 1996 Act).