The Federal High Court in Lagos has directed commercial banks to restrict withdrawals from accounts operated by the Osun State Government over a $13.9m arbitration award in favour of Gamji Nigeria Company Limited.
Justice D.E. Osiagor granted the interim order after Gamji, through its counsel, Yunus AbdulSalam, SAN, filed an application in suit number FHC/L/CS/1233/2026, Punch reports.
The company is seeking to secure $13,924,343.32 and N157.5m awarded to it following an arbitration dispute connected to water infrastructure projects in Ilesa West Local Government Area of Osun State.
The order affects several commercial banks, including 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, among others.
According to an affidavit supporting the application, the dispute arose from two contracts awarded to Gamji by the Osun State Government in June 2017 for the execution of water infrastructure projects.
The first contract, identified as Slot 1, involved the construction of transmission mains and booster pump stations, while Slot 2 covered the construction of water reservoirs under a water supply and sanitation project in Ilesa West.
Gamji said the projects were financed through an Islamic Development Bank loan facility facilitated by the Federal Ministry of Finance.
The company said the initial contract values were $15.98m for Slot 1 and $9.70m for Slot 2.
It claimed that changes to the engineering designs and variations in the project scope resulted in delays and subsequent revisions to the contract costs.
Following the amendments, the value of Slot 1 rose to $20.24m, while Slot 2 increased to $10.95m.
Gamji further stated that 93 per cent of the work had been completed by October 2023, adding that the state government issued a Substantial Completion Certificate on November 14, 2024.
The company said disagreements later emerged over claims relating to extensions of time, price adjustments and increased costs of materials and labour.
According to Gamji, the state government rejected the claims, while attempts to resolve the dispute through mediation failed.
The company subsequently issued an arbitration notice on April 3, 2025. The state government accepted the arbitration process and nominated its arbitrator, with preliminary proceedings commencing in Lagos on May 15, 2025.
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The arbitral panel eventually delivered its final award on July 24, 2026, ordering the Osun State Government to pay Gamji $13,924,343.32 and N157.5m in reimbursable arbitration fees.
The panel also imposed an annual interest rate of 20 per cent on any outstanding amount after the deadline for compliance.
Gamji said the August 24, 2026 deadline for payment expired without the state government settling the award, prompting the company to approach the Federal High Court.
In his ruling, Justice Osiagor directed the affected financial institutions to immediately restrict transactions on the Osun State Government’s accounts.
The judge ordered the preservation of funds up to $13,924,343.32 and N157.5m to facilitate the enforcement of the arbitral award pending the determination of the motion on notice.
“A preservation order of interim injunction is granted directing the cited financial institutions in Nigeria to immediately place a Post No Debit restriction on the Respondent’s account domiciled with them for the preservation of the funds with them in the sum of $13,924,343.32 and N157,500,000.00 towards the liquidation of the Arbitral Award dated 24th July, 2026 which has become due and enforceable, pending the hearing and determination of the motion on notice,” the order read in part.
The court adjourned the case until October 22, 2026, for hearing of the motion on notice.