Federal High Court in Lagos has ordered commercial banks to place a “Post No Debit” restriction on accounts operated by the Osun State Government over a $13.9 million arbitration award in favour of Gamji Nigeria Company Limited.
Gatekeepers News reports that Justice D.E. Osiagor issued the interim order following an application by Gamji in suit number FHC/L/CS/1233/2026.
The company is seeking to preserve $13,924,343.32 and N157.5 million, which it said were awarded to it following an arbitration arising from water infrastructure projects in Ilesa West Local Government Area of Osun State.
Banks affected by the order include GTBank, Access Bank, First Bank, Zenith Bank, UBA, Ecobank, Fidelity Bank, Stanbic IBTC, Sterling Bank, Union Bank and Wema Bank, among others. The institutions were directed to restrict withdrawals from the state’s accounts up to the value of the awarded sums.
The dispute over water projects arose from two contracts awarded to Gamji in 2017 for water infrastructure works in Ilesa West. The projects involved the construction of transmission mains and booster pump stations, as well as water reservoirs.
Gamji said disagreements later developed over claims relating to extensions of time, price adjustments and increased costs of materials and labour. After mediation efforts failed, the company commenced arbitration.
According to Gamji, the arbitral panel issued its final award on July 24, 2026, ordering Osun State to pay $13,924,343.32 and N157.5 million in reimbursable arbitration fees. The award also provided for 20 percent annual interest on any outstanding balance after the compliance deadline.
Gamji said the deadline for payment expired on August 24, but the state government had not settled the award, prompting the company to approach the Federal High Court.
The court has adjourned the matter until October 22, 2026, for hearing of the motion on notice.
The Osun State Government has rejected the basis of the restriction and said it has filed an application seeking to set aside the court order.
The state government said its legal team had already approached the Lagos State High Court on September 1 to challenge the arbitration award before Gamji obtained the Federal High Court order.
Osun Commissioner for Information and Public Enlightenment, Kolapo Alimi, alleged that Gamji failed to disclose the pending legal challenge when it approached the Federal High Court.
The state also disputed the validity of the arbitration process, alleging that it was denied fair hearing and that the award contained several irregularities.
The government said its application to vacate the Federal High Court order was filed on October 2, maintaining that the underlying arbitration award is itself being challenged.
