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Applicability of Nigeria's Arbitration and Conciliation Act: Which Field Does the Act Cover?

Published online by Cambridge University Press:  11 February 2013

Abstract

In 1988, Nigeria's Federal Military Government promulgated the Arbitration and Conciliation Decree (now the Arbitration and Conciliation Act) to provide a unified legal framework for commercial arbitration throughout Nigeria. At the time of the decree's promulgation, the Federal Military Government had unlimited competence to legislate over any matter in, and for all parts of, Nigeria. However, under Nigeria's current constitutional democracy and federal structure of government, legislative powers are shared between the Federal Government and the respective state governments. This article investigates the constitutionality of the continued application of the Arbitration and Conciliation Act as federal legislation with application in all states of the federation.

Type
Research Article
Copyright
Copyright © School of Oriental and African Studies 2013

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References

1 Arbitration Law of Lagos, cap 13, Laws of the Federation of Nigeria and Lagos, 1958, vol 1.

2 Arbitration Law, cap 10, Laws of Eastern Nigeria, 1963, vol 1. Although this law was re-enacted by some of the states that were later created out of the defunct Eastern Nigeria, some states (eg Anambra State) did not re-enact it. It would seem that the law ceased to apply in any emergent state that omitted the Arbitration Law while re-enacting its body of laws.

3 Arbitration Law of Northern Nigeria, 1963, applicable in Kano State.

4 Arbitration Law, cap 12, Laws of Cross River State, 1981, applicable in Akwa Ibom State at the material time considered in this article.

5 Ordinance No 16 of 1914.

6 Arbitration Decree, sec 58.

7 Id, sec 35.

8 This is by virtue of sec 2(1) of the Constitution (Suspension and Modification) Decree No 1, 1984, as amended. However, this decree was repealed by the Constitution of the Federal Republic of Nigeria (Certain Consequential Repeals) Decree No 63, 1999, with effect from 29 May 1999, and a new federal system of government was established for the country based on the 1999 Constitution.

9 This is discussed in detail below.

10 Cap A18, Laws of the Federation of Nigeria 2004. Although the Laws of the Federation of Nigeria 2004 were published in that year, they took effect in 2007 by virtue of the Revised Edition (Laws of the Federation of Nigeria) Act, 2007.

11 [2004] 1 NWLR (pt 853) 20.

12 See 1999 Constitution, sec 4(3) and part I of the second schedule. The exclusive list contains 68 items.

13 See id, secs 4(4)(a) and 4(7)(a) and part II of the second schedule. The concurrent list contains 30 items.

14 See id, sec 4(3).

15 Id, sec 4(4).

16 See Attorney General of Ogun State v Aberuagba (1985) 1 NWLR (pt 3) 395.

17 [2006] 16 NWLR (pt 1005) 265 at 380.

18 See Attorney General of Ogun State v Aberuagba, above at note 16. The Supreme Court decided in that case that the legislative competence of the National Assembly is limited to those matters on which it is expressly or by implication empowered to make laws by the constitution. See also Doherty v Balewa (1961) 1 All NLR 604.

19 [2003] 12 NWLR (pt 833) 1.

20 Cap N138, Laws of the Federation of Nigeria, 2004 (formerly Decree No 88 of 1992).

21 See above at note 17.

22 See also Attorney General of Abia State v Attorney General of the Federation [2002] 6 NWLR (pt 763) 264.

23 1999 Constitution, sec 315.

24 By sec 315(4) of the constitution, “existing law” means “any law and includes any rule of law or any enactment or instrument whatsoever which is in force immediately before the date when this section comes into force or which having been passed or made before that date comes into force after that date.”

25 [2003] 3 NWLR (pt 808) 604.

26 Cap 447, Laws of the Federation of Nigeria, 1990.

27 Decree No 41 of 1966.

28 Above at note 25.

29 Item 34 grants legislative power to the National Assembly with regard to “[l]abour, including trade unions, industrial relations; conditions, safety and welfare of labour; industrial disputes; prescribing a national minimum wage for the Federation or any part thereof; and industrial arbitration”.

30 Item 62 grants legislative power to the National Assembly with regard to “[t]rade and commerce, and in particular – (a) trade and commerce between Nigeria and other countries including import of commodities into and export of commodities from Nigeria, and trade and commerce between the states…”

31 In Attorney General of Ogun State v Aberuagba, above at note 16, the Supreme Court, while interpreting item 61 of the Constitution of the Federal Republic of Nigeria 1979 (which deals with the same subject matter as item 62), established the limit to the National Assembly's power to legislate on trade and commerce. In the court's decision, notwithstanding the presence of item 61 on the exclusive list, the terms of the provision are such that the control of trade and commerce is not exclusively reserved for the federation. The court concluded (at 412): “For the above reasons, having regard to all the relevant provisions of the Constitution, I am of the firm view that the Constitution does not confer on the Federation exclusive power over trade and commerce in item 61. I hold that all Governments (Federal, State and local) have been accorded their respective shares to control trade and commerce … For avoidance of any doubt, I may emphasise that the Federal Government had power to make law on the items specified in sub-items (a) to (f). In this respect international trade and commerce and inter-state trade and commerce are specifically reserved for the Federation while trade and commerce within a State is left as a residuary matter to the States.” (Emphasis added) Specifically, Bello JSC held that the words “in particular” in item 61 of the exclusive legislative list in the 1979 Constitution are words of limitation and not words of emphasis. Consequently, the Supreme Court decided in that case that trade and commerce within a state is a residuary matter over which only a House of Assembly may validly legislate.

32 Id at 652 (emphasis added).

33 See sec 315(2) which provides: “The appropriate authority may at any time by order make such modifications in the text of any existing law as the appropriate authority considers necessary or expedient to bring that law into conformity with the provisions of this Constitution.”

34 See Emelogu v The State [1988] 2 NWLR (pt 78) 524. It may nevertheless be elegant for the appropriate authority to re-designate the title or citation of such laws by order published in the appropriate gazette for elegance and ease of reference.

35 See 1999 Constitution, sec 315(4).

36 A contrary view would seem to have been expressed with regard to the continued application of the Value Added Tax Act as a law of a House of Assembly (without the necessity of an intervening modification by the appropriate authority). See Okeke, LOThe VAT Decree and the Nigerian Constitution” (2000) 27/3Tax Planning International Review 7Google Scholar. Mr Okeke nevertheless recognized that the practical application of the VAT Act in its present form as a law of a House of Assembly (without any modification) would be fraught with difficulties.

37 Above at note 19.

38 Id at 200–01.

39 Specifically Uwaifo JSC, in granting the second relief sought by the plaintiff in the matter, granted (id at 205) a “DECLARATION that the provisions of sections 1(2) and (3), 2(i), 3, 4, 5, 8, 9, 10, 11, 12, 28, 30 to 46, 47 to 63, 75, 76(3) and 86 to 88 of the Urban and Regional Planning Act (Decree No 88 of 1992) which seek to control Urban and Regional Planning as well as physical development of land in Lagos State are inconsistent with section 4 of the Constitution and to that extent null and void”.

40 This uncertainty is compounded by the growing body of conflicting decisions of High Courts and the Court of Appeal. Prof RACE Achara in a speech delivered at the 2008 Law Week of the Enugu branch of the Nigerian Bar Association also pointed out some conflicting decisions of the Supreme Court in the following cases: Atolagbe v Awuni [1997] 7 SCNJ 1; Offor v Osagie [1998] 1 SCNJ 122; Amadi v NNPC [2000] 79 LRCN 1951; Savannah Bank Ltd v Ajilo [1989] 1 NWLR (pt 97) 302; Yaro v Arewa Construction [2008] 154 LRCN 163; and Calabar Central Co-operative v Ekpo [2008] All FWLR (pt 418) 198.

41 To argue otherwise would encroach on the express provisions of the constitution reserving legislative powers to the legislature. The power given to the appropriate authority under sec 315 of the 1999 Constitution is limited to the purpose of making an existing law conform to the constitution, so as to save that law and not to obliterate or destroy it. The applicable principle of statutory construction is as expressed in the Latin maxim: interpretare et concordare leges legibus, est optimus interpretandi modus [to interpret in such a way as to harmonize laws with laws is the best mode of interpretation].

42 Nolan, JR and Nolan-Haley, JMBlack's Law Dictionary (6th ed, 1990, West Publishing Co) at 1299Google Scholar.

43 [1920] 3 KB 96.

44 [1891] 2 QB 267.

45 Flanagan v Shaw, above at note 43 at 105.

46 F Dwarris and WH Amyot (2nd ed, 1848, W Benning).

47 Flanagan v Shaw, above at note 43 at 101.

48 In Edet v Chagoon [2008] 2 NWLR (pt 1070) 85, the question arose as to whether the Pools Betting and Casino Gaming (Prohibition) Act, cap 360, Laws of the Federation of Nigeria, 1990, as an existing law under the 1999 Constitution, deemed to have been made by the Cross River State House of Assembly on 29 May 1999, impliedly repealed the Cross River State Pools Betting Law and Cross River State Casino Gaming Law, both enacted in 1983. Ngwuta JCA, who read the lead judgment, appeared inclined to hold that it did except for the fact that the Pools Betting and Casino Gaming (Prohibition) Act was not validly enacted when it was enacted in 1979. As such it was null and void from the outset and could not qualify as an existing law under the 1999 Constitution.

49 Cap 123, Laws of the Federation of Nigeria 2004, sec 6(2) (emphasis added).

50 See part III of the Arbitration Act.

51 Above at note 4.

52 Compagnie Générale, above at note 11 at 48, paras D–E.

53 Id at paras F–G.

54 As is argued later, the case should not have been decided by reference to the 1999 Constitution.

55 Compagnie Générale, above at note 11 at 54, paras B–C.

56 Id at 41, paras D–E.

57 Id at 54, paras C–E.

58 Id at 55–56, paras G–H and E–F.

59 In Attorney General Ogun State v Attorney General Federation (1982) 13 NSCC 1 at 11, Fatayi Williams CJN (as he then was), while expounding on the doctrine of covering the field, stated: “Where identical legislations on the same subject matter are validly passed by virtue of their constitutional powers by the National and a State House of Assembly, it would be more appropriate to invalidate the identical law passed by the State House of Assembly on the ground that the law passed by the National Assembly has covered the whole field of that particular subject matter.” See also Nwabueze, BOFederalism in Nigeria Under the Presidential Constitution (1983, Sweet & Maxwell) at 62Google Scholar: “Until the federal government actually exercises its power on a concurrent matter, the mere co-existence of its power on the matter does not by itself restrict or affect the kind of legislation a state government can enact on it. It is only the actual entry of the federal government into the field, whether after or before the state government has entered it, that gives rise to the question how far the state law can co-exist with the federal one.”

60 Given the wording and intention of Decree No 1 in concentrating the legislative powers of the federation in the Federal Military Government, Decree No 1 extinguished the legislative lists contained in parts I and II of schedule II of the 1979 Constitution. In the words of Olagunju JCA, Decree No 1 “prowled the legislative field and backed into a corner the State legislations [sic] that became emasculated and are confined to limited areas where they operated on sufferance. Thus, the law making powers of states was [sic] more a matter of delegation than a matter of right.”

61 The section provides: “The repeal of an enactment shall not … (b) affect the previous operation of the enactment or anything done or suffered under the enactment; (c) affect any right, privilege, obligation or liability accrued or incurred under the enactment.”

62 Compagnie Générale, above at note 11 at 56, para E.

63 See for instance sec 36(8) of the 1999 Constitution.

64 The legal position is generally that the law in force at the time the cause of action arose governs the cause of action while the law as at the time the action is filed governs the jurisdiction of the courts. See Adah v NYSC (2004) 7 KLR (pt 184–86) 2249; (2004) 13 NWLR (pt 891) 639 SC. See also Aremo II v Adekanye (2004) 7 KLR (pt 184–86) 2131; (2004) 13 NWLR (pt 855) 488 CA; and Shell Petroleum Development Co Nigeria Ltd v Chief TBA Tiebo VII (2005) 4 KLR (pt 194) 921, (2005) 9 NWLR (pt 931) 439.

65 The Court of Appeal judgment in Adesoye v Governor of Osun State [2005] 16 NWLR (pt 950) 1 would seem to suggest that, in respect of contracts, it is not per se the law in force at the time the cause of action arose that applies to define the substantive rights of parties but that which is in force at the time the contract was entered into. This suggestion would seem to arise from the language of Ibiyeye JCA, who read the lead judgment. His lordship stated (at 22): “The applicable law to any contractual relationship of parties is invariably the law in force at the time the contract was entered into and not the law applicable when the writ of summons was taken out.” In that case, the appellants were appointed as chairman and members of Osun State Teaching Service Commission in October 1998. At the time of that appointment, the Civil Service Commission and Other Statutory Bodies etc (Removal of Certain Persons from Office) Act, 1984 (the 1984 Act) and the Post Primary Schools Teaching Service Commission Law, 1992 (the 1992 Law) were still in force and applied to service in the Teaching Service Commission. Sec 5(2) of the 1992 Law empowered the governor to vary the period of appointment of applicants at will. In July 1999, after the 1999 Constitution came into force, the governor dissolved the board consisting of the appellants. The appellants challenged the constitutionality of sec 5(2) under the 1999 Constitution. The respondent raised a preliminary objection on the basis that the 1984 Act ousted the jurisdiction of the courts in such circumstances, which objection was upheld by the trial court. The appellants argued at the Court of Appeal that the 1999 Constitution was the law in force at the time the cause of action arose, not the 1984 Act or the 1992 Law. It was in ruling on this argument of the appellants that his lordship made the statement quoted above as his basis for applying the 1984 Act and the 1992 Law to the case instead of the 1999 Constitution. In the authors' view however, the better approach would have been for the court to have held that the provisions of both the 1984 Act and the 1992 Law were part of the conditions of service governing the appellants' employment contract. The question would then have been whether it would still be lawful to enforce those conditions of service under the 1999 Constitution.

66 Indeed, as is explained above, even if the law in force at the time the cause of action arose were subsequently to have been repealed, it would still be the law governing that cause of action by virtue of the provisions of sec 6(1) of the Interpretation Act.

67 See sec 1 of Decree No 1.

68 See id, sec 2.

69 See id, sec 2(3).

70 This section defines existing laws as “all laws (other than the Constitution of the Federal Republic of Nigeria 1979) which, whether being a rule of law or provision of an Act of the National Assembly or of a Law made by a State House of Assembly or any enactment or instrument whatsoever”.

71 It is however observed that the previously dominant model of the doctrine of covering the field had the effect that the federal legislation sent the state legislation into abeyance, so that the state legislation revived and applied automatically if and when the federal legislation ceased to be in force.

72 Even assuming, but not conceding, that there was no such repeal of the Arbitration Law and assuming that its provisions still applied where they were not inconsistent with the provisions of the Arbitration Act, the provisions of sec 7 of the Arbitration Law on the appointment of arbitrators, in so far as they empower a party to appoint a sole arbitrator without recourse to court where the other party is in default, would be inconsistent with sec 7 of the Arbitration Act, and would be void to the extent of that inconsistency under sec 2(4) of Decree No 1.

73 Above at note 19.

74 See Lagos State Arbitration Law, No 18, 2009.