The Federal High Court in Lagos has ordered commercial banks to restrict withdrawals from accounts operated by the Osun State Government over an arbitration award exceeding $13.9 million and ₦157.5 million in favour of Gamji Nigeria Company Limited.
Justice D.E. Osiagor granted the interim preservation order following an application filed by Gamji through its counsel, Yunus AbdulSalam, SAN, in suit FHC/L/CS/1233/2026.
The order directs affected banks to place a Post No Debit restriction on Osun State Government accounts up to the value of $13,924,343.32 and ₦157.5 million, pending determination of the contractor’s substantive motion for enforcement of the arbitral award.
The financial institutions cited include major Nigerian commercial banks such as 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.
Dispute arose from water projects
The underlying commercial dispute concerns two water infrastructure contracts awarded to Gamji in June 2017 for projects in Ilesa West Local Government Area.
Disagreements later arose over claims relating to extensions of time, price adjustments and increases in the cost of materials, labour and other project inputs.
Gamji says efforts to resolve the disagreements did not succeed and that it eventually issued a notice of arbitration on April 3, 2025.
The Osun State Government participated in the arbitration process and nominated an arbitrator.
The panel reportedly delivered its final award on July 24, 2026, directing the state to pay Gamji $13,924,343.32 alongside ₦157.5 million in reimbursable arbitration fees.
The award also reportedly provides for 20 per cent annual interest on outstanding sums after expiration of the compliance period.
Gamji says the deadline expired on August 24 without payment, prompting its enforcement action before the Federal High Court.
Osun moves to vacate order
The Osun State Government has challenged the restriction and asked the Federal High Court to vacate the ex parte order.
Commissioner for Information and Public Enlightenment, Kolapo Alimi, said the state filed its application on October 2.
The government alleges that Gamji failed to disclose material facts to the Federal High Court when seeking the restriction order.
It also says it had already commenced separate proceedings at the Lagos State High Court challenging the underlying arbitral award before Gamji approached the Federal High Court.
According to the state, its challenge to the award was filed on September 1, together with an application seeking suspension of enforcement.
Those allegations remain to be determined by the court.
Enforcement versus challenge
The case illustrates an important feature of arbitration law.
An arbitral award can generally be enforced through the courts, but a party against whom an award is made may also seek to have it set aside on recognised statutory grounds.
The existence of a challenge does not necessarily invalidate an award automatically.
The courts may therefore be required to consider both the contractor’s attempt to enforce the award and the state’s arguments for setting it aside.
The interim Post No Debit order is a preservation measure, not a final determination that Gamji is ultimately entitled to recover the money from the restricted accounts.
The Federal High Court has adjourned proceedings to October 22, 2026, for hearing of the motion on notice.
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