Federal Aviation Authority of Nigeria loses battle in British high court over Lagos airport hotel

NIGERIAN construction firm AIC has won a legal battle against the Federal Aviation Authority of Nigeria (Faan) in a British high court enabling it to pursue compensation over a $48m hotel dispute at the Murtala Mohammed International Airport in Lagos.

On June 1, 2010, an arbitration panel headed by Late Justice Kayode Esho awarded $48m  as damages against Faan for violating a concession agreement involving AIC Ltd. However, Faan successfully appealed the ruling but in a recent judgement, a London court overturned the order that prevented AIC from enforcing the award.

At the London hearing Veronique Buehrlen, sitting as a deputy high court judge ordered that AIC has leave to enforce the arbitration award in its favour in the sum of $48m, together with interest. She then allowed an application by Faan to reconsider her order and the judge further rescinded AIC’s right to enforce the award and also granted Faan relief from sanctions.

In the latest judgment, the British court of appeal allowed an appeal by AIC after finding that the lower court did not take into accounts the role of Faan in slowing the proceedings when it reversed an earlier decision to enforce the award.  Court documents showed that by a deed of lease dated February 17, 1998, Faan leased parcels of land at Murtala Mohammed Airport in Ikeja to AIC for a term of 50 years for the sole purpose of developing a flight path hotel and resort complex.

However, by a letter dated May 16, 2000, Faan directed AIC to refrain from work on the hotel development and prevented it from proceeding with the construction of the hotel and resort as planned. AIC later got an award in 2010 after an arbitration panel headed by the Late Justice Eso was set up to resolve the concerns.

Following the publication of the award in favour of AIC, Faan filed an application at the Federal High Court in Lagos to set aside the award. Justice Buba of the Federal High Court delivered judgment on the applications on June 19, 2013, dismissing AIC’s applications and setting aside the award.

However,  AIC filed an appeal at the Court of Appeal in Nigeria challenging the judgment. In its ruling, the Court of Appeal allowed AIC’s appeal and remitted Faan’s application to set aside the award to a different judge of the court.

For many years, AIC, owned by politician and businessman, Harry Akande, battled with Faan for the control of the controversial piece of land in Lagos. In June 2013, Faan claimed that Mr Akande used thugs to displace aviation workers at the site, adding that it had reclaimed a land it disputed with the late politician.

In July of same year, reports said a police officer attached to AIC threatened to gun down a Faan official at the Lagos airport.  Mr Akande, a presidential aspirant under the defunct All Nigeria Peoples Party, who died on December 2 last year, fought Faan right up until his death.