The following article was first published by the Law Society Gazette in November 2023.
The judgment in Nigeria v P&ID  EWHC 2638 (Comm) has attracted considerable attention with respect to the findings by Mr Justice Knowles as to the conduct, during the arbitration, of those retained to advise P&ID. He concluded that there had been a serious irregularity affecting both the arbitration proceedings and the award as the result of the ‘most severe abuses of the arbitral process by P&ID’. The abuses included the presentation of evidence which Knowles J found to have been knowingly falsified, as well as the persistent obtaining and use by P&ID of privileged material, including advice provided to Nigeria by its lawyers.
For the conduct of arbitrations involving states more generally, however, Knowles J’s judgment poses challenges for both arbitrators and practitioners in the future. He called for ‘the facts and circumstances of this case [to] provoke debate and reflection among the arbitration community, and also among state users of arbitration, and among other courts with responsibility to supervise or oversee arbitration’. The facts and circumstances of this case, ‘which are remarkable but very real’, may give rise to a risk that the arbitration process, ‘which is of outstanding importance and value in the world’, may need further attention, where the value involved is so large and where a state is involved.
The starting point or initial ‘red flag’ in this case was the relative lack of detail in the subject contract (the GSPA), and the fact that it exposed the state to high risks of high-value claims where the state was in breach. While a tribunal cannot, of course, rewrite the parties’ bargain, the nature of that bargain was an important contextual consideration when analysing the claims of breach.
Implicitly, Knowles J was concerned that the tribunal in the arbitration had not taken more steps to interrogate the Nigerian government’s conduct of the case, and to ensure that the state’s case was presented as fully as possible, given the sums of public money at issue.