The Federal High Court in Lagos has ordered several commercial banks to place a Post No Debit (PND) restriction on accounts operated by the Osun State Government to preserve funds towards an outstanding arbitration award of $13.9 million and ₦157.5 million in favour of Gamji Nigeria Company Limited.
Justice D.E. Osiagor granted the interim preservation order following an application filed by Gamji through its counsel, Yunus AbdulSalam, SAN, in suit number FHC/L/CS/1233/2026.
A certified true copy of the ruling was made available to journalists on Saturday.
The company is seeking to recover $13,924,343.32 and ₦157.5 million awarded to it following an arbitration over water infrastructure projects executed in Ilesa West Local Government Area of Osun State.
The order directs the affected financial institutions to restrict transactions on the state government’s accounts and preserve funds up to the amounts specified in the ruling pending the hearing and determination of the company’s motion on notice.
The banks listed in the 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.
How the dispute began
According to an affidavit filed in support of the application, the dispute arose from two contracts awarded to Gamji by the Osun State Government in June 2017 for water supply and sanitation projects in Ilesa West.
The first contract, known as Slot 1, covered the construction of transmission mains and booster pump stations, while Slot 2 involved the construction of water reservoirs.
Gamji said the projects were financed through a loan facility from the Islamic Development Bank, facilitated by the Federal Ministry of Finance.
The company stated that the original value of the Slot 1 contract was $15.98 million, while Slot 2 was valued at $9.70 million.
It said subsequent engineering design changes and variations in the scope of work led to delays and revisions to the contract sums.
Following the changes, the value of Slot 1 increased to $20.24 million, while Slot 2 rose to $10.95 million.
Gamji further claimed that it had completed 93 per cent of the contracted work by October 2023. It said the state government subsequently issued a Substantial Completion Certificate on November 14, 2024.
Arbitration and award
The company said disagreements later developed over claims involving extensions of time, price adjustments and increases in the cost of materials and labour.
According to Gamji, the state government rejected its claims, while efforts to resolve the dispute through mediation were unsuccessful.
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 held in Lagos on May 15, 2025.
The arbitral panel delivered its final award on July 24, 2026, directing the Osun State Government to pay Gamji $13,924,343.32 and ₦157.5 million in reimbursable arbitration fees.
The panel also awarded interest at an annual rate of 20 per cent on any outstanding amount after the stipulated compliance period expired.
Gamji said the deadline for payment passed on August 24, 2026, without the state government settling the award, prompting the company to seek the Federal High Court’s intervention to preserve the funds.
What the court ordered
In his ruling, Justice Osiagor directed the listed financial institutions to immediately place a PND restriction on the affected accounts and preserve funds up to the amounts stated in the arbitration award.
The judge stated:
“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.”
A Post No Debit restriction generally prevents withdrawals and other debit transactions on an affected account, subject to the terms of the order.
The ruling is an interim preservation measure intended to secure funds while the court considers the pending application. It does not, by itself, establish that the money has been recovered or transferred to Gamji.
The court adjourned the case until October 22, 2026, for the hearing of the motion on notice.
The Osun State Government’s response to the application was not included in the account of proceedings provided.
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