Appeal Court affirms Federal High Court’s jurisdiction over CBN contracts

The Court of Appeal, Abuja Division, has ruled that the Federal High Court has jurisdiction over simple contracts that are regulated by statute, including those entered into by the Central Bank of Nigeria (CBN) with an engaged contractor.

Justice Okon Abang delivered the unanimous judgment of the appellate court on 25th April 2025, in an appeal filed by the CBN against Adani Mega System Ltd, which had acted as a service provider/vendor of a screening platform for the inspection of all inbound and outbound cargo.

According to the Certified True Copy (CTC) of the judgment, made available to newsmen on Thursday in Abuja, the dispute stemmed from an executed Build, Operate, and Own Agreement dated 3rd March 2017.

Adani Mega System Ltd, by virtue of a project engagement mandate from the CBN dated 16th February 2017 and a Build, Operate, and Own Agreement dated 20th March 2017, held a valid and duly executed contract with the CBN Technical Committee of the Comprehensive Import Supervision Scheme (CISS), acting on behalf of the Federal Government of Nigeria as the exclusive service provider/vendor for the enterprise screening platform for inspecting all inbound and outbound cargo.

In compliance with Nigeria’s due process laws, the CBN sought and obtained a letter of no objection from the Bureau of Public Procurement (BPP) regarding the contract between the company and the Federal Government of Nigeria through the CBN’s Technical Committee of the Comprehensive Import Supervision Scheme (CISS).

After obtaining the certificate of no objection, the company expanded its capital—including borrowed funds running into millions of dollars—and carried out extensive work on the project.

However, the company alleged that the CBN, without reasonable grounds, suspended its contract despite its completion. Consequently, the CBN Technical Committee on the Comprehensive Import Supervision Scheme, in a letter dated 18th September 2017, terminated the company’s contract.

Aggrieved by this development, the company challenged what it termed the unlawful termination of its completed contract at the Federal High Court in Abuja, citing provisions of the Pre-Shipment Inspection of Import Act Cap 26, Laws of the Federation, and the Pre-Shipment Inspection of Export Act Cap 25, Laws of the Federation of Nigeria 2004, among other authorities.

After arguments from both parties, Justice Mohammed J. faulted the CBN’s suspension of the contract and ruled in favour of the company.

Dissatisfied with the trial court’s judgment, the CBN appealed to the Court of Appeal in Abuja, seeking legal interpretation on whether the Federal High Court had jurisdiction over simple contracts.

The apex bank urged the appellate court to determine whether the trial court had the competence and jurisdiction to hear and decide the respondent’s suit, which was based on a simple contract, and further requested that the Court of Appeal quash the company’s suit.

In the lead judgment delivered by Justice Abang, the appellate court held that “having regard to the agreement between the parties that led to the execution of Exhibit PL3 (Build, Operate, and Own Agreement) for the provision of scanning services infrastructure required for pre-shipment inspection of all inbound and outbound cargo as prescribed by Nigerian law, the contract is not an ordinary simple contract.”

The court determined that the contract, which the CBN had referred to as simple, possessed a statutory flavour—meaning that it was regulated by statute, specifically by the Pre-Shipment Inspection of Import Act Cap 25, Laws of the Federation of Nigeria 2004, and the Pre-Shipment Inspection of Export Act Cap 26, Laws of the Federation of Nigeria.

Justice Abang held that in cases where a dispute arises from a contract regulated by statute, the statute itself dictates the appropriate legal forum for resolving grievances.

Referencing Section 20(3) of the Pre-Shipment Inspection of Export Act Cap 25, Laws of the Federation 2004, the judge ruled: “Every proceeding under this Act shall, subject to the applicable procedure, be commenced at the Federal High Court, and any reference in this Act to ‘Court’ shall be construed accordingly.”

Justice Abang, after reviewing eight Supreme Court judgments on the jurisdiction of the Federal High Court, distinguished them from the case at hand and dismissed the appeal for lacking merit.