9Mobile Ordered To Pay $87.5M To Investors As Supreme Court Upholds Ruling

According to Ireporter Online, the Supreme Court has affirmed a November 22, 2024, judgment of the Court of Appeal in Abuja, upholding an arbitral award against Emerging Markets Telecommunications Services Limited (EMTSL), operating as 9Mobile, in favor of two aggrieved investors.

The award, originally issued on September 26, 2022, required EMTSL to refund $43,033,950 invested by Afdin Ventures Limited and Dirbia Nigeria Limited, including interests and costs, now totaling approximately $87,448,929.45.

A five-member panel, led by Justice Mohammed Garba, unanimously dismissed EMTSL’s appeal, ruling it lacked merit. The apex court rejected EMTSL’s claim that it was not bound by the arbitration clause in the original contract, stating that the company had benefited from the invested funds and could not repudiate its obligations.

Justice Tijani Abubakar, in a lead judgment read on March 6 by Justice Mohammed Idris, emphasized that arbitration clauses are inseparable from the substantive contracts and bind assignees or parties benefiting from the agreement. He stated that the appellant’s insistence on formal signature as a requirement for arbitration jurisdiction is outdated and inconsistent with modern commercial practice.

The court further clarified that the principle of privity of contract does not protect parties who actively participate in a transaction yet attempt to evade its dispute resolution provisions. The arbitrator had found EMTSL “inextricably intertwined” with the investment transaction, and these findings were affirmed by the trial court and the Court of Appeal.

The Supreme Court consequently upheld the lower courts’ rulings, dismissing EMTSL’s appeal and awarding N10 million in costs to Afdin Ventures and Dirbia Nigeria.

The dispute traces back to 2018 when both firms instituted a suit at the Federal High Court in Abuja, seeking the refund of their investments totaling $43,330,950. The investors claimed EMTSL and its affiliates had planned to sell the company without their consent, leading the court to refer the matter to arbitration. The arbitral award mandated EMTSL to refund the funds within 90 days, a ruling later enforced by the Federal High Court and affirmed through successive appeals up to the Supreme Court.