UK Supreme Court Upholds Nigeria’s £44M Legal Costs Against P&ID

The United Kingdom Supreme Court on October 22, 2025, ruled decisively in favor of the Federal Republic of Nigeria in its long-standing legal battle with Process & Industrial Developments Limited (P&ID) over legal costs relating to fraudulently procured arbitration awards. The apex court dismissed P&ID’s appeal, affirming that Nigeria is entitled to recover legal costs amounting to £44.2 million in British pounds rather than Nigerian naira. This ruling comes after Nigeria successfully overturned two arbitral awards worth over US$11 billion on grounds of fraud and public policy violations.

Presided over by Lord Reed, the Supreme Court panel unanimously upheld earlier judgments by the Commercial Court and the Court of Appeal, which held that costs must be paid in the currency in which Nigeria incurred its legal obligations. Nigeria’s legal expenses were billed and paid in sterling over 116 invoices between November 2019 and November 2024. P&ID had argued for costs to be paid in naira, claiming that paying in pounds would give Nigeria an unfair windfall due to the sharp depreciation of the naira since 2023 when it was floated freely. The Supreme Court rejected this, emphasizing that costs awards are statutory indemnities for expenses incurred, not compensatory damages.

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In a joint judgment, Justices Lord Hodge and Lady Simler stated that since Nigeria’s liability and actual payments were made in sterling, awarding costs in the same currency was proper. The court noted that assessing costs in naira would require complex and impractical conversions across multiple exchange rates from the five-year period. The ruling also clarified that English courts are not bound to award costs exclusively in pounds but typically do so when legal services are billed and paid in that currency unless exceptional circumstances apply.

This ruling not only reaffirms the principle that costs are to be awarded in the currency of the legal services billed and paid but also sends a strong message against arguments based on currency fluctuations in legal cost recoveries in cross-border litigation. P&ID must now pay Nigeria’s legal costs on the standard basis, further consolidating Nigeria’s legal victory in this high-profile case.