The Federal High Court sitting in Lagos has directed commercial banks to freeze the accounts of the Osun State Government with a “Post No Debit” restriction, pending the enforcement of a $13.9m arbitration award granted to Gamji Nigeria Company Limited.

Justice D.E. Osiagor handed down the interim order after an application by Gamji, brought through its counsel, Yunus AbdulSalam, SAN, in suit number FHC/L/CS/1233/2026.

The PUNCH obtained a certified true copy of the ruling on Saturday.

Gamji wants to safeguard the sum of $13,924,343.32 and N157.5m awarded to it after arbitration proceedings that arose from water infrastructure projects in the Ilesa West Local Government Area of Osun State.

Among the financial institutions covered by the order are 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.

An affidavit supporting the motion stated that the dispute grew out of two contracts the Osun State Government awarded to Gamji in June 2017 for water infrastructure works.

Under Slot 1, the projects covered the construction of transmission mains and booster pump stations, while Slot 2 involved water reservoirs, all forming part of a water supply and sanitation project in Ilesa West.

Gamji said the projects were financed with an Islamic Development Bank loan facility arranged through the Federal Ministry of Finance.

The company said the initial contract values stood at $15.98m for Slot 1 and $9.70m for Slot 2.

According to Gamji, engineering design changes and variations in scope led to delays, which in turn forced revisions to the project costs.

Later amendments increased the values of Slot 1 and Slot 2 to $20.24m and $10.95m, respectively.

Gamji also said the contract was 93 per cent complete by October 2023, and that the state government issued a Substantial Completion Certificate on November 14, 2024.

Disagreements then emerged over claims relating to extensions of time, price adjustments, and the escalated costs of materials and labour.

The company said the state government turned down its claims, which led to unsuccessful mediation efforts and eventually an arbitration notice on April 3, 2025.

The state government accepted the arbitration process and named its arbitrator, after which preliminary proceedings were held in Lagos on May 15, 2025.

On July 24, 2026, the arbitral panel delivered its final award, ordering the Osun State Government to pay $13,924,343.32 and N157.5m in reimbursable arbitration fees.

The panel further awarded 20 per cent annual interest on any outstanding balance once the compliance period expired.

Gamji said the compliance deadline passed on August 24, 2026, without any payment from the state government, which led it to approach the court.

In his ruling, Justice Osiagor ordered the named banks to place an immediate restriction on the state government’s accounts.

The judge directed that funds be preserved up to $13,924,343.32 and N157.5m towards settling the arbitral award, until the motion on notice is heard and determined.

“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,” the order read in part.

The court fixed October 22, 2026, for the hearing of the motion on notice.