SOURCES OF ALTERNTIVE DISPUTE RESOLUTION (ADR) LAWS IN NIGERIA

58

by Chioma Angela Okeke

Introduction

There is no universally accepted definition of ADR. ADR is used generally to describe the whole range of different alternatives to litigation, and it involves third party intervention to assist resolution of disputes. They are not superior to litigation but compliment it.[1] Some of the different forms of ADR are arbitration, expert determination, ombudsman, mediation, conciliation, executive tribunal, neutral fact finding, early neutral evaluation, negotiation, restorative justice etc. Since the aim of every ADR process is to settle disagreements peacefully between disputing parties and if possible let the parties be bound by their voluntary decision, it is pertinent that all parties involved in the process should work within the applicable law. How then can parties work within the law which they may not know applies; or make choice of a law which they do not know exists? The article attempts to provide the different sources of ADR laws available to parties in Nigeria.

1. CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA 1999 (AS AMENDED) (CFRN)

The Nigerian Constitution was passed for the purpose of promoting the good government and welfare of all persons in Nigeria, on the principles of Freedom, Equality and Justice, and for the purpose of consolidating the Unity of Nigerians. It is supreme and its provisions have binding force on all authorities and persons throughout the Federal Republic of Nigeria.[2] If any other law is inconsistent with the provisions of the Constitution, the Constitution shall prevail, and that other law shall to the extent of the inconsistency be void.[3] Section 19(d) of the CFRN provides that “foreign policy objectives shall be… respect for international law and treaty obligations as well as the seeking of settlement of international disputes by negotiation, mediation, conciliation, arbitration and adjudication…” The legal framework and development of mediation and conciliation in Nigeria, indeed ADR generally is hinged on these constitutional provisions.  

• ABRBITRATION AND CONCILIATION ACT LAWS OF THE FEDERATION OF NIGERIA 2004 CAP A18 (ACA)

Nigeria’s most significant law on ADR is the ACA. The ACA incorporates the 1985 United Nations Commission on International Commercial Arbitration (UNCITRAL Model Law) which Nigeria adopted in 1988, through the Arbitration and Conciliation Decree No. 11 of 14 March 1988. The Decree repeals the Arbitration Act of 1914, which was modeled on the Arbitration Ordinance of 1914.[4] The ACA provides for arbitration and conciliation and distinguishes between domestic and international disputes settled by those mechanisms. It however makes no provision for mediation. The ACA contains some mandatory legislative provisions which if not complied with may result in the successful setting aside of a non-compliant arbitration award and generally the arbitration process as a whole. Some of such provisions are:

• Every arbitration agreement shall be in writing.[5]
• The arbitral tribunal shall ensure that the parties are accorded equal treatment and that each party is given full opportunity of presenting his case.[6]
• Any award made by the arbitral tribunal shall be in writing and signed by the arbitrator or arbitrators.[7]
• On impartiality of the arbitrators.[8]
• Treaties and Convention
• The United Nations Commission on Commercial Arbitration (The Model Law)

The United Nations Commission on International Trade Law (UNCITRAL) adopted a proposed model law on June 21, 1985, after years of deliberations.[9]  The Model Law is designed to harmonize and unify the laws of member nations to facilitate international commercial arbitration and ensure its proper functioning and recognition.[10] It “provides pattern that law-markers in national governments can adopt as part of their domestic legislation on arbitration.”  The Model Law applies to “international commercial arbitration,” whether ad hoc in nature or administered by a permanent arbitral institution.[11]  It is “subject to any agreement in force” between two or more nations.[12] The Model law provides for the composition[13]/ jurisdiction[14] of the arbitral tribunal, the conduct of arbitral proceedings,[15] making of award[16] etc .

• The UNCITRAL Arbitration Rules

The UNCITRAL Arbitration Rules was adopted by the United Nations General Assembly on 15th December, 1976. It provides a comprehensive set of procedural rules parties can select either as part of their contract or after a dispute arises to govern the conduct of an arbitration intended to resolve disputes arising out of their commercial relationship. They are widely used in ad-hoc arbitrations as well as administered arbitrations. The Rules cover all aspects of the arbitral process, beginning with providing a model arbitration clause to setting out procedural rules regarding the appointment of arbitrators and the conduct of arbitral proceedings, and establishing rules in relation to the form, effect and interpretation of the award. Presently, there exist three different versions of the Arbitration Rules: (i) the 1976 version; (ii) the 2010 revised version; and (iii) the 2013 version which incorporates the UNCITRAL Rules on Transparency for Treaty-based Investor-State Arbitration.[17]

• UNCITRAL Conciliation Rules

UNCITRAL Conciliation Rules was adopted by the UNCITRAL on 23 July 1980. It provides comprehensive set of procedural rules upon which parties may agree for the conduct of conciliation proceedings arising out of their commercial relationship. Like the arbitration rules, it covers all aspects of the conciliation process such as providing a model conciliation clause, defining when conciliation is deemed to have commenced and terminated and addressing procedural aspects relating to the appointment and role of conciliators and the general conduct of proceedings. The Rules also address issues such as admissibility of evidence in other proceedings, confidentiality, and limits to the right of parties to undertake judicial or arbitral proceedings whilst the conciliation is in progress.[18]

• The United Nations Convention on the recognition and Enforcement of Foreign Arbitral Awards (New York Convention, 10 June 1958)

Nigeria acceded to the convention on 17^th March 1970, and domesticated the convention as the second Schedule to the ACA. The Convention provides for the recognition of arbitral agreement and award. Its principal aim is to ensure foreign and non-domestic arbitral awards are not discriminated against but that state parties ensure recognition and enforcement of such awards in their jurisdiction in the same way as domestic awards.[19]

• International Centre for Settlement of Investment Disputes (ICSID) Convention  1965 (Washington Convention)

The ICSID Convention entered into force on October 14, 1966.[20] It provides the framework for the conduct of an arbitration proceeding. An ICSID Convention arbitration proceeding is governed by the ICSID Convention, the Institution rules, Arbitration rules and the Administrative and financial regulations. Nigeria ratified the ICSID Convention in 1965. Pursuant to this the National Assembly enacted the International Centre for Settlement of Investment Disputes (Enforcement of Awards) Act, Cap I20, Laws of the Federation of Nigeria, 2004 (ICSID Act) which provides for the recognition and enforcement of Washington Convention awards in Nigeria. Pursuant to the ICSID Act, applications for recognition and enforcement of awards made by the ICSID are filed at the Supreme Court of Nigeria. The award shall for all purposes have effect as if it were an award contained in a final judgment of the Supreme Court, and the award shall be enforceable as such.[21]

• The Economic Community of West African States (ECOWAS) Energy Protocol.

This protocol is a treaty with investment provisions. It addresses the issue of foreign investments, resolving disputes between participating states etc. Article 26 thereof provides for the settlement of disputes between a contracting state and an investor amicably. If the dispute is not settled within three months, the investor can submit the dispute for resolution at the International Centre for Settlement of Investment Disputes (ICSID), if the investor’s country and that of the contracting party are both parties to the ICSID Convention or a sole arbitrator or ad hoc arbitration tribunal established under the United Nations Commission on International Trade Law (UNCITRAL) Rules, or an arbitral proceeding under the Organisation for the Harmonisation of Trade Laws in Africa (OHADA).

• The Economic Community of West African States (ECOWAS) Revised Treaty (24^th July, 1993)

The ECOWAS Treaty is a multilateral agreement signed by member States of ECOWAS on 28^th May 1975. The Treaty was later revised in 1993.[22] Article 16 of the Revised Treaty establishes an Arbitration Tribunal for the community whose powers, status, composition and procedure were to be set out in a subsequent protocol.

• The Regional Centre for International Commercial Arbitration (RCICA) 1999 [No. 39] LFN 2004

The Regional Centre for International Commercial Arbitration Lagos (RCICAL) was established in 1989 under the auspices of the Asian African Legal Consultative Organisation as a non-profit, independent, international arbitral institution to promote settlement of disputes arising from international trade and commerce and investments within the region where the contract was performed; to provide arbitration under fair, inexpensive and expeditious procedure in the region etc. The RCICAL enjoys diplomatic privileges and immunities under international law for the unfettered conduct of its functions.[23] It also renders assistance in the enforcement of awards made under its Rules.[24]

• International Chamber of Commerce (ICC) Rules of Arbitration 2021

The ICC Rules of Arbitration entered into force on 1 January 2021. They define and regulate the management of cases received by the International Court of Arbitration from 1 January 2021 on. The ICC Arbitration Rules are used all around the world to resolve disputes. They assure parties of a neutral framework for the resolution of cross-border disputes.[25]

• The Geneva Protocol on Arbitration Clauses of 1923 and the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927

Article VII(2) of the New York Convention provides that, “The Geneva Protocol on Arbitration Clauses of 1923 and the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927 shall cease to have effect between contracting states on their becoming bound and to the extent that they become bound by this convention.” ‘This convention’ here refers to the New York Convention.

• OTHER STATUTES

There are numerous Nigerian Laws which directly or indirectly encourage the use of ADR in dispute resolution. Some of these laws are:

• Industrial Inspectorate Act Cap.18 LFN 2004- Section 4
• Matrimonial Causes Act (MCA) Cap. M7 LFN 2004 –Sections 11and 30
• Minerals and Mining Act Cap. M12 LRN 2004 –Section 76 and 255
• National Office for Technology Acquisition and Promotion Act Cap. N62 LFN 2004

Section 4

• National Communications Commission Act Cap. N97 LFN 2004 – Section 4 of the National Health Insurance Scheme Act, Cap. N42 LFN 2004 – Section 26
• National Co-operative Societies Act, Cap. N98 LFN 2004- Section 49
• Nigerian Dock Labour Act Cap N103 LFN 2004- Section 2
• Nigerian Investment and Promotion Commission Act Cap N11 LFN 2004-Section 26
• National War College Act Cap N83 LFN 2004- Section 5
• Petroleum Act Cap. P10 LFN 2004- Section 11
• Trade Disputes Act Cap. T8 LFN 2004 –Section 4
• Consumer Protection Council Act Cap C25, LFN 2004- Section 2
• Environmental Impact Assessment Act Cap. E12, LFN 2004 –Sections 29, 31, 33, 35
• Federal High Court Act Cap. F12, LFN 2004 –Section 17
• National Industrial Court Act 2006- Section 20
• High Court Laws and Arbitration Laws of various States like High Court Act Cap 510 (Abuja) LFN 1990- Section 18; 2009 Lagos State Arbitration Law which incorporates the UNCITRAL Model Law 2006 amendments; Section 28 of the High Court Laws of Rivers State, Chapter 63 Laws of Rivers State 1999, section 24 of the High Court of Lagos State Chapter H3 Laws of Lagos State 2003 etc.
• JUDICIAL PRECEDENT

In Owoseni v Faloye,[26] on whether an aggrieved party must exhaust all the remedies available to him in law before resorting to court the Supreme Court held that:

“The law is that, where a particular statute has prescribed a particular remedy, an aggrieved party must exhaust the remedy provided and the jurisdiction of the courts to grant declaration is generally ousted.”

Also in Aribisala v Ogunyemi,[27] the Supreme Court  held:

“…Where a statute prescribes a legal line of action for determination of an issue, be that issue an administrative matter, chieftaincy matter or matter of taxation, the aggrieved party must exhaust all the remedies in that law before going to court…”

• RULES OF COURT

Nigerian courts have aided the development of ADR mechanisms through their various rules of court, which enjoin courts to encourage settlements by ADR mechanism. Some of these court rules are:

• High Court of Lagos State (Civil Procedure) Rules 2012 -Order 25
• High Court of the Federal Capital Territory, Abuja Civil Procedure Rules 2018-Order 19
• Court of Appeal Rules 2016 – Order 16
• Rules Of Professional Conduct (RPC) For Legal Practitioners, 2007- Rule 15(3) (d)

• CUSTOMARY LAW

In recognizing customary arbitration, the court in Raphael Agu v Ozurumba Ikewibe [28] noted that customary law arbitration is an arbitration in dispute founded on the voluntary submission of the parties to the decision of the Arbitrators who are either the Chiefs or Elders of their community and the agreement to be bound by such decision or freedom to resile where unfavourable. The courts have also recognized and enforced awards pursuant to customary arbitration.[29]

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[1] Uchenna Jerome Orji, “Law and Practice of conciliation in Nigeria” Journal of African Law (2012) 56(1)  87.

[2] CFRN, s 1(1).

[3] CFRN, s 1(3)

[4] Edward Atanda, “The Nigerian Arbitration and Conciliation Decree, 1988”  American Review of International Arbitration (1990) 1 (3).

[5] ACA, s 1.

[6] ACA, s 14.

[7] ACA, s 26.

[8] ACA, ss 9 -12.

[9] Saturnino E. Lucio, “The UNCITRAL Model Law on International Commercial Arbitration”  The University of Miami Inter-American Law Review 1986(17)2 313.

[10] Ibid.

[11] UNCITRAL Model Law, art 2(a).

[12] Ibid, art 1(1).

[13] Ibid, chapter  III.

[14] Ibid, chapter  IV.

[15] Ibid, chapter V

[16] Ibid, chapter VI

[17] United Nations Commission on International Trade Law < uncitral.un.org/en/texts/arbitration/ contractual texts/arbitration> accessed 2 April 2022. 

[18]United Nations Commission on International Trade Law <uncitral.un.org/ en/texts/ mediation/ contractual texts/conciliation> accessed 2 April 2022.

[19] New York Convention, art I; P O Idornegie, Commercial Arbitration Law & Practice in Nigeria (LawLords Publication 2015) 151.

[20] International Centre for Settlement of Investment Disputes <Icsid.worldbank.org/resources/rules-and-regulations/convention/overview> accessed 2 April 2022.

[21] ICSID Act, s 1(1).

[22] Economic Community of West African State < www.ecowas.int/ecowas-law/treaties/> accessed 27 April 2021.

[23] Diplomatic Immunities and Privileges (Regional Centre for International Commercial Arbitration) Order 2001.

[24] RCICAL Rules, rules 35.6 and 35.8.

[25]International Chamber of Commerce </iccwbo.org/dispute-resolution-services/arbitration /rules-of-arbitration/> accessed 2 April 2022.

[26] Owoseni v Faloye & ANOR (2005) LPELR-2856 (SC)  22-23, paras. A-C; [2005] 14 NWLR (Pt 946) 719, 740

[27] (2005) LPELR-549(SC); [2005] 6 NWLR (Pt 921) 212

[28] (1991) 3 NWLR (PT. 180) 385 AT P. 407; Awonusi and another v Awonusi (2006) LPELR-11611(CA). 12-15 paras D-A.

[29] Ohiaeri v Akabeze (1992) 2 NWLR (PT 221) 1, Odonigi v  Oyeleke (2001) 6 NWLR (PT 708) 12; Eke v Okwaranyia (2001) 12 NWLR (PT 726) 181 at 208; Egesimba v Onuzuruike (2002) 15 NWLR (PT 791) 466; Okereke v Nwankwo (2003) 9 NWLR (PT 826) 592; Nwannewuihe v Nwannewuihe (2007) 16 NWLR (PT 1059) 1; Algaita v Amos (2018) LPELR-44398(CA) 38-41 paras C-D.