This Day (Lagos)

17 March 2013

Nigeria: FG in Fresh Move to Terminate 'MMA 2' Agreement With Bi-Courtney

Less than a year after the Court of Appeal sitting in Abuja ordered the Federal Government and its agents to hands-off the Murtala Muhammed Airport Terminal Two (MMA2), Lagos, operated by Bi-Courtney Limited, which built the terminal on a Build, Operate and Transfer (BOT) agreement, the Federal Government has launched a fresh legal bid to get the concessionary agreement, which gave Bi-Courtney the exclusive right to run the terminal, terminated.

The Court of Appeal in Abuja had on June 15 last year dismissed the suit filed by the federal government to set aside a high court judgement which had upheld Bi-Courtney's exclusive right to run the airport.

In a unanimous judgement, a three-man panel led by Justice Zainab Bukachuwa, dismissed the Federal Government's appeal because of failure to compile and transmit the records of the trial (at the lower court) within 30 days to the appellate court.

However, the Federal Government, through its counsel, Kenna Partners, has gone back to the Court of Appeal, asking it to restore the appeal that was earlier dismissed.

the federal government said that it was desirous of prosecuting the appeal and was compiling the records when the appeal was dismissed.

It also blamed its inability to compile the record on an application filed by Bi-Courtney at the Federal High Court in Abuja. It said that because the records were with Justice Gladys Olotu of the Federal High Court in Abuja, it could not easily access and compile the record.

But Bi-Courtney has vehemently opposed the attempt by the Federal Government to resurrect the dismissed appeal.

In a counter-affidavit, the company said that it should not be made to suffer for the Federal Government's tardiness and disregard for the rules of court.

It stated that allowing government to restore the appeal would work great hardship and injustice against it, adding that there ought to be an end to litigation.

It said: "The instant application is a mere ploy to deny the company the fruits of its victory at the lower court since 3rd March, 2009."

No date has been fixed for hearing of the Federal Government's application.

The Federal Government had been making moves to drastically curtail the powers of Bi-Courtney Limited, the company to which the development of the domestic terminal of the Murtala Mohammed Airport, Ikeja, was concessioned on April 24, 2003.

Whereas Bi-Courtney is claiming that the agreement allows it to operate the MMA2 for 36 years, the federal government is of the view that the agreement covers only 12 years.

The Federal Government is now making a desperate move to set aside a Federal High Court judgement, which had already upheld Bi-Courtney's claim that the agreement was for a 36-year period.

The government argued that the original term of the agreement between it and Bi-Courtney entered into on April 24, 2003 was for 12 years.

It government also said that an alleged addendum of February 2, 2007 purportedly extended the period of the concession to 36 years.

It said that section 2(1) and (2) of the Infrastructure Concession Regulatory Commission (ICRC) Act 2005 subjected concessions to the prior approval of the Federal Executive Council (FEC).

It also said: "However, the approval of FEC for the extension of the agreed tenure of 12 years to 36 years was not obtained.

"That the substitution of the original term of 12 years for a new term of 36 years is inimical to the growth and development of the country's air transport industry and against the national interest taking into consideration the provisions of the Concession Agreement between the Federal Government and Bi-Courtney." Under the agreement, Bi-Courtney was awarded the concession for the re-development of the MMA2 to design, build and operate for an agreed number of years to recoup its investment therein.

Based on the agreement, MMA2 valued at about N39 billion was completed and was commissioned by the then president, Olusegun Obasanjo under which Bi-Courtney promoter, Chief Wale Babalakin SAN, enjoyed tremendous patronage/support.

However, trouble started for Bi-Courtney shortly after Obasanjo left the scene. Many people in government felt that Bi-Courtney was unduly favoured and efforts began in earnest to undermine the concession agreement.

Bi-Courtney claimed that it the Federal Government violated the terms of the agreement by allowing airlines to operate domestic flights to and from Lagos from the airport other than MMA2 and that the Federal Government by allowing Virgin Nigeria and Arik Airways to operate domestic flights from Lagos was in violation of the agreement.

Several meetings were held to resolve the dispute but to no avail. Consequently, Bi-Courtney invoked Article 22.11 of the Agreement by referring the disputes to a Co-ordinating Committee jointly established by the parties under the agreement.

The committee found in favour of the company, but the Federal Government refused to be bound by the decisions of the committee.

Claiming that the refusal of the Federal Government to comply with the decisions of the committee was frustrating its effort to recoup over N30 billion it had invested in the MMA2 development, Bi-Courtney filed a suit at the Federal High Court.

For reasons best known to him, the then Attorney General of the Federation and Minister for Justice, Chief Michael Aondoakaa did not "diligently" defend the case. The trial court found in favour of the concessionaire (Bi-Courtney).

However, since he took over as the AGF, Mohammed Bello Adoke, SAN had been making efforts to redress the perceived injustice in the judgement of the high court.

He consequently briefed a firm of lawyers, Kenna and Associates who on July 11, 2011 filed a notice of appeal at the Court of Appeal seeking to set aside the judgement of the Federal High Court.

In an affidavit filed along with the appeal, several averments which cast aspersion on the way and manner Aondoakaa prosecuted the case was made.

The affidavit became necessary because the notice of appeal was filed outside the mandatory period of filing an appeal.

Paragraphs b and c state, "That the then occupant of the office of the Attorney General of the Federation (Aondoakaa), who was the Chief Law Officer for the Federal Government did not file any counter affidavit to the Respondent's Originating Summons.

"That the then occupant of the AGF did not also notify the other Federal Government ministry and agencies directly involved in the dispute of the existence of the suit to enable them to either join in as parties and properly defend the suit or in the very least present him with the facts to effectively defend the suit."

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