A Federal High Court in Lagos has ordered commercial banks to restrict withdrawals from accounts belonging to the Osun State Government over an outstanding $13.9m arbitration award in favour of Gamji Nigeria Company Limited.
The order was made by Justice D.E. Osiagor following an application by Gamji, through its counsel, Yunus AbdulSalam, SAN, in suit No. FHC/L/CS/1233/2026.
The company is seeking to secure $13,924,343.32 and N157.5m awarded to it after an arbitration arising from disputes over water infrastructure projects executed in Ilesa West Local Government Area of Osun State.
Banks named in the interim order include 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 documents filed before the court, the dispute originated 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 programme in Ilesa West.
The projects were reportedly financed through a loan facility from the Islamic Development Bank, facilitated by the Federal Ministry of Finance.
Gamji said the original values of the two contracts stood at $15.98m and $9.70m respectively, but subsequent design modifications and changes in the scope of work resulted in revisions to the contract sums.
Following the variations, the company said the value of Slot 1 increased to $20.24m, while Slot 2 was revised to $10.95m.
The contractor further claimed that it had completed about 93 per cent of the projects by October 2023, with the state government subsequently issuing a Substantial Completion Certificate on November 14, 2024.
However, disagreements reportedly emerged over extension of time, adjustments to contract prices and rising costs of materials and labour.
Gamji said its claims were rejected by the state government, while attempts to resolve the dispute through mediation failed.
The company consequently issued an arbitration notice on April 3, 2025, with the state government accepting the process and nominating its arbitrator. Preliminary proceedings commenced in Lagos on May 15, 2025.
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 costs.
The panel also imposed an annual interest rate of 20 per cent on any outstanding amount after the stipulated compliance period.
Gamji told the court that the August 24, 2026 deadline for compliance expired without payment by the state government, prompting the company to seek judicial intervention to preserve the funds.
In his ruling, Justice Osiagor directed the affected financial institutions to immediately place a “Post No Debit” restriction on the Osun State Government's accounts and preserve sufficient funds to cover the arbitral award.
The judge ordered the banks to preserve up to $13,924,343.32 and N157.5m pending the hearing and determination of the substantive motion.
The court described the arbitral award of July 24, 2026, as due and enforceable, while granting the preservation order as an interim measure.
The suit has been adjourned until October 22, 2026, for hearing of the motion on notice.
