High Court dismisses injunction application as plaintiff failed to prove a substantial dispute regarding payment obligations.

THE HIGH COURT

[2026] IEHC 1

[Record No. 2025/3284P]

BETWEEN

SAN LEON ENERGY PLC

PLAINTIFF

AND

BRIGHTWATERS ENERGY LTD

DEFENDANT

JUDGMENT of Mr Justice Kennedy delivered on 13 January 2026.

1. The plaintiff seeks an interlocutory injunction restraining the presentation of a winding up petition. I need to decide: a. whether the petition grounds are disputed on bona fide and substantial grounds. This depends on whether an obligation placed on the plaintiff under a Nigerian law agreement (“the Parties’ Agreement”) was conditional upon the plaintiff first being placed in funds pursuant to its independent corporate refinancing agreement (“the TRAM Agreement”) with Tri Ri Asset Management Corp (“TRAM”); b. whether the presentation of a petition would be an abuse of process because the Parties’ Agreement contains an arbitration clause;

c. whether - irrespective of the existence of any dispute - the petition should proceed in any event because there is evidence to suggest that the plaintiff is insolvent; and d. whether relief in any event should be refused on the basis of nondisclosure on the ex parte application. I will decline the plaintiff’s application because I am not satisfied that there is a substantial and bona fide issue in dispute. The arbitration clause does not change my conclusion. It would go to how any dispute would be resolved. The determination as to whether there is a bona fide and substantial dispute which justifies restraining the defendant from bringing a petition pursuant to section 570 of the Companies Act 2014 (as amended) is an Irish law issue for determination by this Court. Furthermore, even if the plaintiff had established a bona fide and substantial factual or legal dispute, I would have been disinclined to stay the petition due to the unchallenged evidence of the plaintiff’s insolvency.

The background

2. At the outset of the events leading to these proceedings, the plaintiff had a 10.58% interest in Oil Mining Lease 18 ("OML18"), an onshore asset in Nigeria. It also held (and has increased) a 13.32% interest in Energy Link Infrastructure (Malta) Ltd (“ELI”), a Maltese registered company which owns a major project (“the Project”). The Project remains under construction; it is intended to provide a 47.4km pipeline ("the Pipeline") from the OML18 asset to a storage and offloading vessel. The defendant, a Nigerian registered company, provides engineering, construction and other services in respect of oil facilities. ELI engaged it in respect of the construction of the Project under an agreement (“the Pipeline Agreement”) providing for a USD$51m cost. Not being a party to the Pipeline Agreement, the plaintiff had no obligations thereunder (and the issue is whether it subsequently assumed obligations on a conditional or unconditional basis).

3. ELI’s failure to make payments due to the defendant resulted in settlements (to which the plaintiff was, again, not privy) which ELI repeatedly failed to honour, followed by litigation, resulting in a consent judgment against ELI and a related company, Eroton, (but not the plaintiff) in Nigeria requiring ELI and Eroton to pay USD$25,152,608 to the defendant in 2022. Payment remains outstanding and the defendant has commenced winding up proceedings against ELI and Eroton.

4. In view of its commercial interest in ELI and the importance of the Project to OML18, the plaintiff agreed to invest in ELI to regularise its affairs and get the Project back on track. Initially, on 8 August 2023, it announced a USD$5m investment in ELI, acquiring, inter alia, additional share options. It subsequently negotiated with ELI with a view to investing more. At around the same time, the plaintiff engaged with various parties, including TRAM, on a wider corporate refinancing proposal which included provision for funding the ELI investment. This resulted in the TRAM Agreement.

5. It appears that the TRAM Agreement envisaged an investment of up to USD$187m by TRAM in the plaintiff to, inter alia, allow it to proceed with its further investment in ELI. The TRAM Agreement required the plaintiff to contract with ELI's creditors, including the defendant, with a view to settling ELI’s debt to the defendant, facilitating the resumption of construction and the completion of the Project. To that end, the plaintiff was to use part of the funding to lend USD$37m ELI, gaining 35% of its shares, while also buying 13.5% from another ELI shareholder and discharging the $16m debt due from ELI to the defendant (as part of the €37m). Accordingly, the plaintiff intended to rescue the Project and ELI as part of its own refinancing. The plaintiff says that the intention was reflected in the TRAM Agreement, to which the defendant is not a party – under that agreement the plaintiff committed to paying ELI’s debt to the defendant. The payment of the debt as part of the investment in ELI was intended to resolve legal and commercial issues and to facilitate the completion of the Project. The plaintiff says that a condition precedent in the TRAM Agreement required the plaintiff to reach an agreement with the defendant on the basis of the plaintiff’s commitment to discharge ELI’s debt to resolve the defendant’s litigation against ELI and Eroton, and to induce it to resume construction work. It says that the TRAM Agreement’s condition precedent obliging the plaintiff to enter a contract with the defendant is the genesis of the Parties’ Agreement. The latter duly offered the defendant assurances as to the plaintiff’s payment of ELI’s debt in return for the defendant’s commitment to drop proceedings against ELI and Eroton and resume work on the Project.

6. Accordingly, these proceedings concern the interplay between the three agreements;

(a) the Pipeline Agreement between the defendant and ELI; (b) the TRAM Agreement between the plaintiff and TRAM; and (c) the Parties’ Agreement that grounds the petition which the plaintiff seeks to restrain. Although it had no obligations under the Pipeline Agreement itself, to secure the TRAM refinancing and to comply with the condition precedent in the TRAM Agreement, the plaintiff effectively underwrote ELI’s liability to the defendant in return for the defendant’s commitments. The plaintiff emphasised the fact that it was a condition precedent of the TRAM Agreement that it should enter into the Parties’ Agreement and says that it was likewise a condition of the Parties’ Agreement that that Agreement, or the plaintiff’s payment obligations thereunder, should be subject to the plaintiff’s receipt of the funding from TRAM.

Communications between the Parties prior to execution of the Parties’ Agreement

7. The contemporaneous communications prior to the Parties’ Agreement primarily comprised emails in September and October 2023. In particular, on 22 September 2023 the plaintiff informed the defendant that: “…there have been some positive developments in the past hour that would be helpful to discuss with you.

Our refinancing partner is aware of the outstanding payments due to and also the importance of Brightwaters in completing the ELI project. We have outlined a plan with them whereby San Leon and Brightwaters could enter into a direct contract with each other that would:

1. Confirm terms of payment for settlement of all amounts due to directly by San Leon

2. End the legal proceedings between Brightwaters and ELI (subject to payment of course)

3. Set out a work programme to completion of the pipeline (again subject to payment) The contract would be entered into simultaneously with our refinancing which you would have visibility over and therefore know that money is in place to make the payments. Please let me know your thoughts and your availability to discuss it”.

8. On 24 September 2023, the plaintiff sent the defendant a draft agreement which, save as is discussed below, was materially reflected in the final agreement.

The Parties’ Agreement

9. The Parties’ Agreement was entered into on 5 October 2023 (as was the TRAM Agreement). The Parties’ Agreement was encapsulated in a letter (signed by both parties) in the following terms (and I have underlined the most relevant clauses): “Settlement of payments owed by Energy Link Infrastructure (Malta) Limited Completion of Alternative Crude Oil Evacuation Strategy (ACOES)

1. We refer to our recent discussions relating to the outstanding payment of US$16,652,608.00 (Debt) that is due to Brightwaters Energy Limited (Brightwaters) from Energy Link Infrastructure (Malta) Limited (ELI). You have confirmed to us that this is the entire amount that is due to you as at the date hereof under the consent judgment of 4 April 2022 (Consent Judgment).

2. We also refer to the investment in San Leon Energy pie (San Leon) by Tri Rf Asset Management, for which drawdown is expected to be requested tomorrow (Investment).

3. We hereby undertake to settle the Debt in full on behalf of ELI. Settlement shall be made as to US$16,652,608.00 by payment to your bank account within four business days of the date hereof.

4. Immediately on receipt of the entire payment for the Debt (Payment), you undertake to file withdrawal notices to terminate all legal proceedings brought by you against ELI and Eroton Exploration and Production Company Ltd (Eroton) in Malta and Nigeria in connection with the Debt and to make no further claim against, or seek any further remedy from, either of those parties, their directors or officers in respect of the Debt.

5. You further undertake to recommence construction of the ACOES pipeline (Construction) in accordance with the Engineering, Procurement and Construction Contract between Brightwaters and ELI dated 28 February 2019 (as amended). You undertake that (I) you will arrange a meeting with ELI and San Leon within five business days of Payment to put in place all necessary matters to re-mobilise your employees and contractors to recommence Construction and (II) Construction will commence on a mutually agreed date upon conclusion of matters required to recommence the project (including community affairs and establishment of core issues) that is expected to be by no later than within thirty business days of Payment and that Following recommencing Construction, you will use all reasonable endeavours to complete the Construction in all respects within 120 days. Any delays or Impediments should be reported by you promptly to ELI.

6. During Construction you shall receive payments from ELI according to the already established and operated contractor milestone completion payment framework memorandum … Following the Investment, San Leon expects to become the largest shareholder of ELI and undertakes therefore to procure full compliance by ELI with its contractual to you ...

7. Each party shall pay its own costs and expenses in relation to this letter save that San Leon, on behalf of Ell, agree to contribute US$300,000 towards legal fees incurred by Brightwaters in pursuit of the Debt which shall be paid to Brightwaters by no later than the date on which Construction commences.

8. This letter and any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with it or its subject matter shall be governed by and construed in accordance with the law of the Federal Republic of Nigeria. Any such dispute or claim shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one arbitrator appointed in accordance with the said Rules, with London as the place of the arbitration and English as the language of the arbitration.

9. The terms of this letter shall not be construed so as to affect or prejudice any other right or remedy available to us, above and beyond that contained in this letter, in the event of a breach of this letter.

10. No neglect, delay or indulgence on our or your part in enforcing the terms of this letter shall be construed as a waiver thereof.

11. Any notice or other communication given to a party under or in connection with this letter shall be in writing ...

12. This letter is not intended to create any legal relation between San Leon and Brightwaters outside of the contents contained herein. Specifically there ls no intention or expectation that San Leon will assume any other contractual duties of either ELI or Eroton aside from settlement of the Debt.

13. For the avoidance of doubt nothing in this letter shall prevent either of us or any of our respective directors, employees, agents or advisers discussing the contents of this letter in confidence with the appropriate regulatory authorities. Please sign and date the attached copy of this letter below to acknowledge your agreement to its terms and then return the copy to us”. The letter was duly signed on behalf of both parties.

Events following the executing of the Parties’ Agreement and the TRAM Agreement

10. The plaintiff says that it expected to receive funds from TRAM in early October 2023 but, despite TRAM’s assurances that funds were being transferred, they were never received in accordance with the TRAM Agreement (and litigation is in train between the plaintiff and TRAM). The plaintiff says that in consequence it was unable to pay the defendant as envisaged by clause 3 of the Parties Agreement. The failure to make that payment is the main ground for the threatened petition. The plaintiff says that there is a bona fide and substantial issue as to whether its obligation was conditional on the TRAM funding.

Correspondence following Execution of the Parties’ Agreement

11. On 7 October 2023, two days after the Parties Agreement, the defendant emailed the plaintiff asking if the latter had closed with its funder and had the funds available to pay the defendant. The plaintiff affirmed that its funding had closed. It expected to be in funds by the Monday and would revert to confirm payment. No funds were received, so the defendant requested an update on 18 October 2023. The plaintiff responded that there had been delays but it expected to receive the funds the next day. On 13 November 2023, the plaintiff forwarded a letter from TRAM explaining its delay in putting the plaintiff in funds. The letter was in the following terms: “On behalf of Tri Ri Asset Management Corp. (TRAM), I would like to apologize for the ongoing delay in access of funds to San Leon Energy plc (San Leon) in accordance with the terms of our facility agreement of 6 October 2023 and the associated finance documents. As you have been informed by our CIO last week, after further deliberation into the delay with our officers at our primary bank, HSBC, we understand that the transaction has likely been flagged due to a Suspicious Transaction Report (STR). At present we do not know the reasons for the STR, and this being brought to my knowledge only recently, I myself am unable to provide further clarity but we are working both with HSBC and our other financial intermediaries to address the matter as quickly as we can. We recognize that this matter has had unintended adverse consequences on your business, including the inevitable delay to your proposed further investments in Energy Link Infrastructure (Malta) Limited (ELI) and in particular the contractual settlement of certain ELI creditors, including Brightwaters Energy Limited, and the contractual purchase of further shares in ELI from Ocean Pearl Maritime SA. Whilst TRAM is not party to these arrangements, we nevertheless recognize that the impact of the STR on the transfer of funds has created unforeseen challenges and difficulties for you and these parties. I can assure you that it remains our firm intention to complete the transactions between us and we are working hard to facilitate the transfer of funds to you. You may produce this letter to any interested party as evidence of our ongoing commitment to San Leon”.

12. The defendant says that such communications continued to reassure it that payment was imminent. Following further assurances from the plaintiff that payment was imminent, the plaintiff informed the defendant and its lawyer on 1 December 2023 that TRAM had still not paid and that, although discussions with it continued, the plaintiff was exploring other options. Although the plaintiff could not guarantee this as they were “entirely reliant” on third parties, it was realistic to expect meaningful progress before a hearing on 4 December in the defendant’s winding up proceedings against Eroton. At the plaintiff’s request the defendant had delayed those proceedings on the basis of the expected payment.

13. On 4 December 2023, the defendant confirmed that the hearing was moved to 8 December 2023, expressing hope that substantial progress would be made with regard to the payment of the debt to the defendant by then. On 8 and again on 10 December 2023, the plaintiff stated that its directors were flying to the Middle East that Sunday to sign funding agreements with another party. On 13 December 2023, it reported "a productive meeting with the investor" anticipating settlement of the defendant’s debt 18 or 19 December). On 19 December 2023, it said that it would receive funds by 22 December.

14. On 22 December 2023 the plaintiff confirmed that it had been told that the investment funds had been received into an escrow account administered by TRAM’s lawyer and expected the transfer to the plaintiff to be completed by 27 December 2023. On 27 December 2023 the plaintiff confirmed that the plaintiff had been informed that the funds had indeed been transferred to the plaintiff's account, and it awaited their arrival. On 5 January 2024 the plaintiff advised that the funds had not been received but it had been assured that they s had left the escrow account and that it would receive a letter from the Dubai bank to confirm that their transfer to the plaintiff 's bank account. On 6 January 2024 the defendant sought a copy of the letter. It is not clear whether it was furnished.

15. On 10 May 2024 the defendant served a statutory demand, confirming its intention to present a winding up petition unless the debt was paid within 21 days. The plaintiff’s solicitors responded on 21 May 2024, asserting that the debt was not due because: “…a contingent agreement as between our respective clients was reached on the 05.10.2023 whereby our client conditionally undertook to discharge a debt owed by Energy Link infrastructure (Malla) Limited ("ELI") to your client in the sum of US $ 16,652,608.00. We are further instructed that it was at all material times clearly understood and intended by our respective clients that the contingent agreement was strictly subject to and conditional on Tri Ri Asset Management's anticipated investment in our client proceeding on the 06.10.2023 (the "investment"); as your client is fully aware that investment never materialised, Therefore, the contingent agreement as between our respective clients dated the 05.10.2023 is null and void”.

16. On 1 July 2024 the London Stock Exchange's website noted the cancellation of the plaintiff’s AIM listing due to its continued failure to publish its statutory accounts (a different reason from that offered by the plaintiff). The accounts apparently remain outstanding.

The Plaintiff’s solvency

17. The defendant also questions the plaintiff's solvency, citing the plaintiff’s public statements which, the defendant says, reveal its insolvency. It also relies upon: (i) the plaintiff's failure to file annual returns for the years ending 31 December 2022, 31 December 2023 and 31 December 2024; (ii) the suspension of its London listing. Paragraph 53 of the affidavit sworn on the defendant’s behalf stated: “…one of the remarkable features of Mr Fanning’s Affidavit is what Mr Fanning does not say. Nowhere in Mr Fanning’s Affidavit is he willing to swear that San Leon is solvent. He simply ignores this issue”.

18. The plaintiff’s affidavits did not engage with those issues. They did not aver that it was solvent or explain the noncompliance with filing obligations placed on the plaintiff and its directors by the Companies Act 2014.

Legal principles

19. The parties are largely agreed as to applicable Irish and Nigerian legal principles concerning (a) applications to restrain winding up petitions; (b) conflicts of laws; and (c) the principles governing the duty of disclosure on ex parte applications. There was no real controversy concerning Irish law principles governing the circumstances in which Irish Courts may restrain the presentation of winding up petitions. The Court has a discretion to restrain such a petition where a debt is bona fide disputed. The plaintiff cited Re Pageboy Couriers Ltd [1983] ILRM 510, in which O’Hanlon J cited Stonegate Securities Ltd v Gregory [1980] 1 All ER 241, also noting that in Re WMG (Toughening) Ltd (No 2) [2003] 1 IR 389 McCraken J endorsed the Pageboy Couriers principles as the “proper test to be applied” in respect of a bona fide disputed debt. It also emphasised Re Kasam Investments Ireland Ltd [2012] IEHC

553 where Laffoy J accepted that a debt was bona fide disputed – the issue was whether loan terms provided that it would only be repaid following the realisation of a particular investment. Clandown Ltd v Davis [1994] 2 ILRM 536 was to similar effect. The test was refined in Truck and Machinery Sales Ltd v Marubeni Komatsu Ltd [1996] 1 IR 12 in which Keane J cited the warning of Buckley LJ. in Bryanston Finance Ltd v De Vries (No 2) [1976] 1 Ch 63 that the jurisdiction should be exercised with great circumspection. The Court disapplied the standard test for interlocutory injunctions on such applications, stating: “The constitutional right of recourse to the courts should not be inhibited, save in exceptional circumstances, and this applies as much to the presentation of a petition for the winding up of a company by a person with the appropriate locus standi as it does to any other form of proceedings. The undoubted power of the courts to restrain proceedings which are an abuse of process is one which should not be lightly exercised. In the context of winding-up petitions, I have no doubt that it should be exercised only where the plaintiff-company has established at least a prima facie case that its presentation would constitute an abuse of process. In many cases, a prima facie case will be established where the plaintiff-company adduced evidence which satisfies the court that the petition is bound to fail or, at the least, that there is a suitable alternative remedy”.

20. In Meridian Communications Ltd v Eircell Ltd [2001] IESC 42 the Supreme Court approved Truck and Machinery Sales. McGuinness J stated: “(a) Since a winding-up petition was not a legitimate means of enforcing payment of a debt which was bona fide disputed, the presentation of a petition would in normal circumstances be restrained if the company, in good faith and on substantial grounds disputed all liability in respect of the debt claimed. […] Even where the company appeared to be insolvent the court might in the exercise of its equitable jurisdiction, restrain the presentation of the petition where it was satisfied that the petition was being presented for an ulterior or collateral purpose and not in good faith; but that the court must approach the position of such a company with the interests of the creditors particularly in mind. The jurisdiction to restrain the presentation of the petition should be exercised only with great caution. Since an application to restrain the presentation of a winding-up petition involved not the restraint of an alleged violation of a plaintiff’s right but of the exercise by a creditor of his right of access to the courts, the normal considerations of a fair question to be tried, the adequacy of damages as a remedy and the balance of convenience did not arise; instead, it was for the plaintiff to establish at least a prima facie case, which would in many instances be established by evidence that the petition was bound to fail or, at the least that there was a suitable alternative remedy.”

21. The defendant agreed that the test was whether the plaintiff disputed the liability “in good faith and on substantial grounds”. It accepted that if the application is refused the plaintiff can oppose the petition, then at its hearing on all grounds ventilated before me. It may also raise additional arguments and adduce further evidence.

22. The duty of disclosure on an ex parte application is reflected in the Supreme Court’s

decision in Re: John Horgan Livestock Limited [1995] 2 IR 411 at 416 and 418. Bambrick v Cobley [2005] IEHC 43 and Green D Projects Ireland Ltd [2023] IEHC 773 were to similar effect. An ex parte applicant must disclose all material information to the Court. Failure to do so may lead to the discharge of any ex parte order and the refusal of interlocutory relief.

The significance of an arbitration clause

23. It is common ground that the petition cannot proceed if there is a bona fide and substantial dispute, and that any such dispute would have to be resolved by arbitration. At the hearing, I understood the plaintiff to also argue that the question of whether there is such a dispute must itself be resolved by arbitration. There has been conflicting international jurisprudence on that point, with such a position being reflected in the English Court of Appeal’s controversial decision in Salford Estates (No 2) Ltd v Altomart Ltd (No 2) [2014] EWCA Civ 1575; [2015] Ch 589 (“Salford Estates”). However, the issue was more recently analysed by the Privy Counsel in Sian Participation Corp (In Liquidation) v Halimeda International Ltd [2024] UKPC 16. The Board rejected the proposition that a winding up petition should be stayed on the basis of a wide arbitration clause unless the debt was genuinely disputed on substantial grounds. Having considered competing public policy considerations1 and international jurisprudence, the Board overruled Salford, deciding that it was wrong to stay’ petitions where an insubstantial dispute was raised between parties to an arbitration agreement. The Board noted that a winding up petition is not a claim of the type subject to a mandatory stay pursuant to Article 8 of the Model Law or associated statutory provisions because such a petition does not determine the petitioner’s debt claim. The existence or amount of the debt is not an issue for resolution in such winding up proceedings.

Such as the need for a relatively simple means for an insolvent company to be placed without undue delay into an insolvency process whereby its assets are divided fairly between creditors and the policy that those who agree to resolve disputes by arbitration should be held to that agreement without judicial interference.

24. Lord Briggs and Lord Hamblen observed at paragraph 89 that typical arbitration clauses oblige parties to refer disputes to arbitration for resolution but winding up proceedings do not offend such clauses. Nor does a petition seeking the liquidation of a debtor which fails to pay a debt offend the policies underpinning arbitration or the legislation which implements the Model Law. Liquidation could not be pursued, or even threatened, against a company which genuinely disputes a debt on substantial grounds. If there is such a dispute, the creditor must first establish its claim, either by securing a judgment in court or, if there is an applicable arbitration agreement, by an arbitral award.

Nigerian law

25. Both parties provided reports from Nigerian lawyers. It was agreed that: (a) prima facie evidence of a material bona fide and substantial dispute as to Nigerian law could be a reason for granting the interlocutory injunction sought (subject to the nondisclosure and solvency issues); (b) in the absence of expert evidence from either side of the Nigerian law position on particular issues, I am entitled to apply Irish law. The key principles arise from Talos Capital Ltd v Sheehan [2015] IEHC 27; [2021] IECA 316 (particularly paragraph 46 of the High Court decision of Ryan J and paragraph 41 of the Court of Appeal decision of Collins J).

In fact, the Nigerian law reports do not reveal any major controversy as to Nigerian law. Both parties accepted, that the Nigerian and Irish law approach to key issues is similar, which begged the question as to why three reports were needed to confirm that proposition.2 I note the observation of Egan J (when dealing with the ex parte application) that she was not presently satisfied that the debt was conditional and that expert evidence would be required for the Court to interpret the Nigerian law agreement and determine whether there were substantial grounds.

At that stage the plaintiff had apparently not secured any Nigerian law advice and was therefore could not inform the court as to the position in that regard. Both parties having subsequently secured such advice, no material difference between Irish and Nigerian law positions has been identified. I agree that any party seeking ex parte relief to enforce a foreign law contract should consult with foreign lawyers before seeking ex parte application to obtain nonpartisan advice as to the relevant foreign law principles. If it emerges (as in this case) the foreign law and Irish law principles are broadly similar (as might be the case in respect of certain issues governed by the laws of our neighbouring jurisdictions, then for the ex parte application it may be sufficient to advise the Irish court accordingly without exhibiting a foreign law report.

However, the duty of disclosure on the ex parte application would extend to any material difference in the foreign law, particularly one which is favourable to the respondent. Accordingly, as far as the inter partes application was concerned, both parties should have initially obtained nonpartisan advice from foreign lawyers. However, once it emerged that there was no material difference between Irish law and the foreign law nor any real controversy in that respect, then there was no need for foreign law evidence.

a. the construction of agreements; Counsel accepted that the approach of the Nigerian courts to the construction of agreements appeared similar to what Irish lawyers might call a "text in context" approach. The plaintiff’s expert confirmed that under Nigerian law, the literal rule of interpretation is applied to commercial contracts if the terms are expressly written, clear and simple, as is the case here. He cited the

decision of the Supreme Court of Nigeria in Dangote Cement PLC v Peter Asam Ager & Anor (2024) LPELR-61800(SC) which held that such provisions should be given their ordinary, plain and grammatical meanings, since the words, in such a situation, “best declare the intention of the parties to the contract [as law givers].” He also cited the Nigerian Court of Appeal’s ruling in Mohammed Umar Aabara v. Unity Bank Plc (2025) LPELR-80002(CA) that, when interpreting contractual provisions, “the proper course is to discover the intention or contemplation of the parties and not to import into the contract, ideas not potent on the face of the document”. Likewise, he noted that in Amadi v. Thomas Aplin Co. Ltd (1972) 4 SC 228, (1972) 7 NSCC 262, the Court held that “where there is a contract regulating any arrangement between the parties, the main duty of the Court is to interpret that contract to give effect to the wishes of the parties as expressed in the contract document." The defendant’s experts were in broad agreement with the plaintiff’s expert as to the Nigerian courts’ approach to the interpretation of contracts. The defendant’s expert also cited authorities confirming that the court should disregard extraneous material when interpreting contracts if the terms of the document were clear explicit The parties’ Irish lawyers should have engaged to discuss the issue in which case they could have dispense dwith the three expert reports. Time and cost could have been saved if the parties had fulfilled their duties in relation to the efficient administration of justice and the expeditious and cost-effective disposal of the matter. If they had consulted with their respective Nigerian lawyers at the outset and then with each other, the need for the experts’ reports could have been eliminated or, at the very minimum, the scope of such reports could have been reduced to any points of Nigerian law which were seriously in contention and which differed from Irish law. The plaintiff should have taken the initiative in that regard but did not do so. Such an omission would be material to the award of costs if I was to grant the application.

and unambiguous. Although the plaintiff’s expert pushed back on these comments, there did not appear to be any real controversy at the hearing. b. conditions precedent in contracts. No material differences were identified between the two jurisdictions. Both recognise conditions precedent in principle; such conditions prevent a binding contract coming into existence unless the condition precedent is fulfilled or waived. c. the doctrine of frustration; The experts confirmed that the law on frustration was the same in Nigeria and England. Unsurprisingly, they appeared better placed to compare those jurisdictions than to make a direct comparison with Irish law. However, the parties agreed with my suggestion that in the absence of any material difference between Irish law and the law of England and Wales it follows that there is no material difference between Irish and Nigerian principles as to the doctrine of frustration.

26. To the extent that the plaintiff asserts an implied term, and in the absence of evidence of the Nigerian courts’ approach to such issues, I note Finlay Geoghegan J’s summary in the Court of Appeal decision in Flynn v Breccia [2017] IECA 74. At paragraph 76, she endorsed the statement in BP Refinery v Shire of Hastings [1977] 180 CLR 266 that in order to imply a term: “…the following conditions (which may overlap) must be satisfied: (1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; (3) it must be so obvious that “it goes without saying”; (4) it must be capable of clear expression;

(5) it must not contradict any express term of the contract.”

27. Finlay Geoghegan J. added at paragraph 86 that to imply a term based on obviousness: “requires the Court to be satisfied that, firstly, reasonable people in the position of the parties would all have agreed to make provision for the contingency in question, and second, that they would ‘without doubt’, or with something approaching certainty, have accepted the term proposed by the officious bystander”.

28. Finally, in respect of foreign law, authorities cited by the plaintiff’s Nigerian law expert focussed on the inappropriateness of commencing litigation to resolve issues subject to an arbitration clause. The Nigerian and Irish law positions appear remarkably similar in many respects. The plaintiff's expert asserted that even threatening winding up proceedings would breach of the dispute resolution clause in the agreement. I agree that this might follow from the authorities he cited if there was a bona fide and substantial dispute but I am not satisfied that the authorities cited would support the proposition that doing so would be a breach of contract in the absence of any such dispute, nor, based on its supplemental submissions, do I understand the plaintiff to maintain that position. I comment further on this point below.

Analysis

Preliminary Observations

29. Nigerian law governs the interpretation of the contract, including the arbitration clause but as noted above, there does not appear to be a material difference between the jurisdictions. In any event, to the extent Nigerian law applies, it is for me rather than Nigerian law experts, to apply such principles and Irish law governs whether the presentation of the petition would constitute an abuse of process3. At the outset I should note that my approach to this application reflects my conclusion that there is negligible difference between the parties as to the primary facts. The contract is written, and the surrounding communications were effected by email. There is no contested evidence of oral I have disregarded portions of the plaintiff’s expert’s reports which made assumptions, advanced unsubstantiated assertions or sought to apply Nigerian legal principles to assumed facts and to draw conclusions that were matters for the Court. For example, his first expert report asserted that the agreement was conditional, without justifying that assertion. When (appropriately) challenged by the defendant, he doubled down in a second report. Leaving aside the fact that his response did not withstand scrutiny in any event, whether the agreement is in fact a conditional agreement is an issue for the court, not the expert. The gratuitous inclusion of inappropriate material or any attempt to enter the realm of advocacy (on this and other points) does not enhance any expert’s credibility. This issue may be relevant to cost orders as the Court should not tolerate the incurring of unnecessary effort and expense.

representations or undocumented events, no dispute of primary fact. The controversy concerns the meaning of the documented agreement, the inferences to be drawn from and the legal consequences of the contractual terms (and the correspondence to the extent it is admissible) and as to what, objectively speaking, was the parties’ understanding. Oral evidence is not required (and would probably not be admissible) to resolve such issues. Nor does the fact that the agreement is subject to Nigerian law complicate matters or necessitate an oral hearing since no material conflict as to the Nigerian law position has been identified.

Nondisclosure

30. Although the affidavits did not raise the issue, the defendant submitted that the plaintiff was guilty of nondisclosure by failing to disclose its insolvency or adequately disclosing the reasons for the suspension or cancellation of its AIM listing or to exhibit the TRAM agreement. A party alleging material nondisclosure should raise the issue (and, if necessary, bring an application) promptly once the issue emerges. The defendant’s failure to do so inhibited the plaintiff’s response.

31. In any event some examples of alleged non-disclosure (such as the suspension of the plaintiff’s AIM listing) were addressed by the plaintiff’s grounding affidavit. Such information should have been better presented. It was split between paragraphs 5 and 62

– 64, which were not entirely consistent. A fairer presentation at the outset of the affidavit would have been appropriate. However, key facts are disclosed such as the TRAM and its unexplained and persistent default in filing accounts resulting in the suspension of its listing. The grounding affidavit could have dealt better with those issues. Their piecemeal disclosure may have obscured the plaintiff's predicament, its failure to meet its statutory filing responsibilities and the doubts as to its solvency. Judges dealing with ex parte applications are afforded little time to review papers in advance or in Court. They should not have to parse averments, comparing paragraphs as if assembling jigsaws. I suspect that the affidavit reflected hasty drafting rather than an inappropriate attempt to deflect attention from awkward facts. Accordingly, I am not disposed to resolve the application on the basis of nondisclosure in that respect.

32. The defendant also criticises the curious failure to exhibit the TRAM Agreement. It is indisputable that when a party relies on a document as one of its proofs, it should be exhibited (with minimal redactions if strictly necessary). Averments as to its contents are a poor substitute. It should also be noted that the question of nondisclosure on an ex parte application (which may justify setting aside an ex parte order) can overlap with a separate issue as to the adequacy of proofs for a subsequent inter partes hearing. Even if a plaintiff originally made adequate disclosure, once a point is put in issue in subsequent affidavits, the Court may draw inferences if a party fails to sufficiently address issues by adducing evidence within its possession. Accordingly, irrespective of the adequacy of ex parte disclosure, the failure to exhibit the TRAM Agreement could be an issue at any hearing of the petition.

33. The failure to exhibit the TRAM agreement is remarkable, particularly as the plaintiff has, for example, exhibited the 137-page Pipeline Agreement and two other agreements which appear less material to the issues before the Court. Without having seen the TRAM Agreement it is impossible to confirm whether there are other material terms, such as, for example, terms which might suggest that TRAM’s obligations to provide funding were more equivocal or conditional than appears from the plaintiff’s affidavits. Nevertheless, for two reasons (and subject to the caveat that I have not seen the document), I am not unduly concerned by the failure to exhibit the TRAM Agreement at this stage.

Firstly, the facts in relation to the TRAM Agreement, which go to the context of the Parties’ Agreement, do not appear to be disputed. Secondly, and more fundamentally, while the plaintiff has repeatedly averred to the TRAM Agreement as containing a condition precedent requiring it to reach agreement with the defendant, it is a different issue that concerns me - whether there is a basis to contend for an express or implied reciprocal obligation in the Parties’ Agreement. It is the latter which matters. The TRAM Agreement may be of contextual relevance in that, according to the plaintiff, it was intended to provide the financing to enable it, inter alia, to increase its stake in ELI and to ensure the completion of the project.

Accordingly, it contained a condition precedent requiring the plaintiff to enter into an agreement with the defendant along the lines of the Parties’ Agreement. Those propositions do not appear to be seriously disputed or to necessitate scrutiny of the TRAM Agreement which the defendant (a non-party) presumably regards as irrelevant to its deal with the plaintiff. Without having seen at least redacted copies of the document, it is impossible to reach a concluded view in that regard, a lacuna which reduces the credibility of the plaintiff’s averments since it chose not to adduce such evidence.

However, while that observation goes to the strength of the plaintiff’s proofs in the absence of an exhibit, different considerations apply in the context of the nondisclosure allegation. The grounding affidavit referred to the Refinancing agreement (calling it the Conditional Agreement) and the omission to exhibit it would have been evident to the Court (and to the defendant once served). At no stage prior to the furnishing of submissions was the plaintiff called upon to exhibit the TRAM Agreement. If this point was of concern, it should have been raised earlier.

34. For completeness, I also note the paucity of the plaintiff’s evidence as to TRAM’s position, particularly as to whether, and if so on what basis it is defending the plaintiff’s claim that it has wrongfully failed to transfer the funds. Presumably, TRAM has outlined its position in correspondence and in the litigation commenced by the plaintiff. However, the plaintiff has not disclosed such details. The only document we have seen from TRAM was its 13 November 2023 letter cryptically suggesting that a suspicious transaction report may have delayed the transfer of the funds (without intimating any insurmountable issue), but it is not clear whether there was such a report and, if so, the basis for it and whether it was resolved. However, I have disregarded this omission because it was not addressed in submissions.

Was the Parties’ Agreement or the payment obligation conditional?

35. In assessing the plaintiff’s argument (that the Parties’ Agreement or proceeded on the basis that the plaintiff was only obliged to pay the defendant once it was in funds) I will separately consider: (i) the express terms of the agreement; (ii) possible commercial absurdity;

(iii) context; (iv) subsequent communications; (v) reciprocity between the two agreements;

(vi) holistic interpretation of agreement; (vii) contra preferentem; (viii) implied terms.

36. The plaintiff's key premise is that the TRAM Agreement was conditional on it reaching an agreement with the defendant which committed it to pay ELI’s debt, clearing the way for the resumption of construction and the completion of the Project. The crucial issue is whether the Parties’ Agreement (or at least the plaintiff’s payment obligation) was conditional on receipt of the TRAM funds. The plaintiff argued that this was so because; (i) the TRAM Agreement was conditional on the plaintiff’s agreement with the defendant; (ii) the plaintiff entered into the agreement with the defendant to secure refinancing, facilitating completion of the Project, and (iii) the plaintiff could not pay the defendant until it was received funds from TRAM.

(i) The express terms of the agreement

37. The Agreement’s express terms do not support the plaintiff’s case. The executed version largely reflected a draft which the plaintiff prepared and furnished to the defendant on 24 September 2023. In both draft and final agreement, the plaintiff used contrasting language for the timing of various contractual commitments. The different terminology suggests an understanding of the interconnection between commitments and deliberate decisions as to the choreography of, and triggers for, contractual obligations. For example: a. Clause 2 refers to the TRAM drawdown being expected to be requested that day. Accordingly, the plaintiff was not yet in funds. Drawdown had not even been requested. However, the TRAM agreement having been signed, the plaintiff was presumably confident that it would soon be in funds. Presumably, the clause 3 provision for payment within four business days was intended to allow time for the funds to come through. Knowing that it was not yet in funds and that the drawdown request had not even been made, the plaintiff committed in clause 3 to a hard deadline (11 October 2023). If the commitment was intended to be conditional, it could and should have been expressly tied to receipt of the funds. b. By contrast, the defendant’s clause 5 obligation (to resume construction work) was expressly conditional (depending upon the defendant first being paid in full). It required the parties to meet (concerning construction resumption) within a week of the payment of the debt. Clause 5 contrasts with the interpretation of clause 3 which the plaintiff advocates. c. Clause 12 acknowledged the plaintiff’s assumption of responsibility for ELI’s debt, without suggesting that it was conditional.

38. Although there were few changes between the plaintiff’s 24 September 2023 draft and the executed version 11 days later, certain changes highlight a focus on timing: a. tightened wording emphasised that the defendant required receipt of the entire debt to trigger its obligations; b. the word “immediately” was inserted in clause 4 (in respect of the defendant’s obligation to terminate pending proceedings once the plaintiff paid the debt;

c. clause 5 imposed a deadline for resumption of construction work – it effectively made the plaintiff’s payment a condition.

(ii) Commercial Absurdity? Although Nigerian courts’ approach to such a scenario was not addressed in the experts’ reports, I have considered whether a literal interpretation of the agreement would give rise to a manifest absurdity. I do not consider that any absurdity would arise from the plain meaning of the agreement. The parties agreed to proceed on a defined basis. The plaintiff entered into the transaction confident that funding was in place, shouldering that risk. The defendant’s unchallenged evidence was that it would not have agreed to making funding a condition precedent, and its position appears plausible in the light of the past issues. In any event, the parties are bound by their deal. If the plaintiff intended to qualify its commitment to pay the defendant by making that obligation conditional on funding, it needed to agree such a condition precedent with the defendant, but it did not do so. It does not seem commercially absurd for the Parties’ Agreement to have been entered into unconditionally. The plaintiff was confident of funding once TRAM signed, so it evidently saw no need to provide for the possibility of the monies falling through.

(iii) The context

39. To the extent the plaintiff relies on the TRAM Agreement, it should be noted that whereas the financing transaction involved investment of up to $187m, the figure involved in the Parties Agreement ($16m) was a fraction of that sum. Accordingly, and given the different parties, there is a limit to the extent to which the agreements can be read together, particularly as the plaintiff has not exhibited one of them.

40. Even though the plaintiff was not a party to the original agreement or the associated litigation and dishonoured settlements, such matters form part of the factual matrix. Along with the strength of the parties’ respective bargaining positions, they are relevant to considering the likelihood of a co position (rendering plausible the defendant’s testimony that it would not have agreed to the insertion of a condition precedent) is illustrated by changes from the plaintiff’s draft; (a) the draft envisaged that everyone should bear their own costs, the final version provided for the plaintiff to pay US$300,000 towards the defendant’s legal fees incurred “in pursuit of the debt" - before construction resumed; (b) the final agreement was subject to the law of Nigeria, the defendant’s jurisdiction, noy England and Wales as the plaintiff proposed.

41. It seems to me that the plaintiff’s argument that the agreement was conditional is essentially premised on its dependency on the TRAM funding, but conditionality does not necessarily follow. The need to synchronise commitments with different competing parties is a common legal and commercial dilemma. The financial implications, risks and benefits presented by the interplay between its proposed transactions with TRAM and the defendant would have been obvious to a sophisticated commercial entity such as the plaintiff as it engaged in complex, multi-million dollar, international agreements.

There are well known ways of addressing such dynamics. Where a party’s ability to meet a commitment depends on circumstances outside its control it may seek to insert an express condition precedent to that effect. A typical example would be where a purchaser’s ability to complete a domestic conveyancing depends on a lender’s approval and/or on the completion of the sale of another property). Any such condition precedent must be mutually agreed. No such condition was proposed or agreed here. Accordingly, although express back-to-back provisions in the Parties Agreement (stipulating reciprocal conditionality as between each of the two agreements) may have been the obvious solution to the plaintiff’s dilemma, the defendant would not have agreed to such provisions.

Significantly, such express provisions apparently appeared in the TRAM Agreement, but the plaintiff did not even propose corresponding provisions for the Parties’ Agreement, perhaps because they would have been unacceptable to the defendant in the light of the previous false dawns in its dealings with ELI. Instead, the plaintiff proposed another the solution, simultaneous execution of the two agreements. It evidently considered that simultaneous execution of the TRAM Agreement and a four-business day window meant that it (and the defendant) could be confident as to the plaintiff’s ability to honour its commitment to the defendant.

However, by entering into an unconditional agreement with the defendant, the plaintiff accepted the risk (which it may have regarded as low) that, having signed its agreement, TRAM would renege on its commitment. The plaintiff made an unconditional commitment and is bound accordingly. If the plaintiff had intended its commitment to be conditional, then it should have stipulated accordingly. It did not do so. Perhaps the plaintiff saw no need to impose such a condition since both agreements were executed simultaneously and it was confident that funding had been secured.

Alternatively, it might have appreciated that the defendant would reject such a request (which would have implied uncertainty as to funding). In any event the deal proposed by the plaintiff and reflected in the Parties’ Agreement did not contain any such provision.

(c) Communication prior to the Parties Agreement

42. While citing “contemporaneous communications” as supporting its position, the plaintiff does not identify specific communication between the parties other than the

22 September 2023 email in support of its contention that it was agreed or understood that the Parties’ Agreement was subject to receipt of funding from TRAM. It asserts that it was obvious that the plaintiff's motivation for agreeing to pay ELI’s debt, a debt for which it was not otherwise liable, was to ensure that the project was completed and that it was required to give such a commitment in order to achieve the essential refinancing. However, on its face the 22 September 2023 email does not support that claim. To the extent that the email is admissible, it seems to me that the plaintiff offered to enter into a direct contract with the defendant, promising to pay all amounts owed (by ELI) in return for the termination of the legal proceedings and the resumption of work on the project, in each case the defendant’s obligations were "subject to payment of course". The plaintiff’s obligations were not characterised as conditional. They were unqualified.

43. It is significant that the plaintiff’s email made the defendant’s commitments subject to it being paid but did not make the plaintiff’s commitment conditional on its receipt of funds. Instead, evidently mindful of its need for funding, the plaintiff proposed that the contract with the defendant "would be entered into simultaneously with a refinancing which you would have visibility over and therefore know that money is in place to make the payments". Such simultaneous execution is fundamentally different from conditionality. The plaintiff and its advisors would have understood the implications of the structure they proposed and adopted.

44. The terms of the plaintiff’s own emails suggest that, before committing to the Parties’ Agreement, it waited until TRAM signed its agreement to satisfy itself (and the defendant) that funds were assured. Perhaps, if it had harboured doubts then it may have delayed finalising the agreement to protect itself against that contingency (although the defendant says it would not have agreed to such terms). However, as it stands, the Parties’ Agreement creates binding obligations. There is no basis on the face of the document to suggest that the plaintiff’s payment obligation was contingent upon prior payment by TRAM, a non-party.

(d) Ex post facto communications

45. The plaintiff sought to rely on emails exchanged after the execution of that agreement (which it characterises as “contemporaneous”) as supporting its contention that there was a condition precedent. I do not accept that submission for three reasons. Firstly, I would not describe communications after the event as “contemporaneous”. Secondly, such documents are generally not admissible for the purposes of interpreting an earlier agreement. Thirdly, I disagree with the plaintiff’s interpretations of the communications. It argues that the defendant’s forbearance implied that it had no right to demand immediate payment, and that the defendant would have been less patient if the plaintiff was already in breach. I do not agree that this is a fair interpretation. The emails appear consistent with a practical appreciation of the plaintiff’s need for time to address its funding issues and that forbearance was in the defendant’s interests in the hope that the plaintiff would be able to resolve the issue (in line with its repeated, unfulfilled, assurances). The defendant can scarcely be faulted for trusting the plaintiff and according it some grace in the hope that it would honour its promises. The drastic alternative was the course on which the defendant has now embarked, winding up proceedings. I would not criticise the defendant for extending some latitude, particularly in the light of the plaintiff’s assurances. It would be unfair to conclude that such forbearance constituted an admission that no binding obligation had arisen or that such reasonable forbearance (which was, after all, both at the behest and for the benefit of the plaintiff) precludes subsequent winding up proceedings. Also, such a submission ignores clause 11 of the Parties’ Agreement.

(e) Reciprocal conditionality between the agreements?

46. It is evident that the plaintiff’s commitment to pay ELI’s debt was an essential part of its plan to refinance and complete the Project. The converse does not necessarily follow - that it was obvious that the plaintiff’s commitment to the defendant was subject to its first being placed in funds. I see no objective evidence of any mutual intention in the plain words of the agreement. It would have been a simple matter for the parties to have amended clause 3, expressly confirming the position for which the plaintiff contends. I agree with the observation at paragraph 37 of the affidavit sworn on the defendant’s behalf that it would have been straightforward to include such a clause in the draft Parties’ Agreement but that would have entailed defining what investment/receipt of funds would trigger the obligation and such language would have significantly changed the agreement. The defendant says it would not have agreed to such wording. In any event, the plaintiff never it.

(f) Holistic Interpretation

47. The plaintiff argued (correctly) that the agreement must be read holistically and, more controversially, that the conditionality of the commitment emerges when clauses 2 and 3 are read together. I disagree with the latter premise. As appears from clause 2, the plaintiff knew that: (1) it had a commitment from TRAM to pay the monies; (2) the monies had not been paid. It proceeded without specifying that its obligations under the Parties’ Agreement were subject to TRAM honouring its commitments under the TRAM Agreement.

(g) Contra Preferentem

48. I do not consider the agreement ambiguous but, if there had been any ambiguity as to whether the clause 3 obligation was conditional, then the contra preferentem rule would suggest that it should be resolved in the defendant's favour.

(h) Implied term?

49. I have seen no evidence of any express stipulation of conditionality in the Parties’ Agreement. Nor do I think that there is a basis for conditionality to be implied. Even accepting the plaintiff’s claim that the TRAM Agreement was conditional on the plaintiff and the defendant entering into the Parties’ Agreement and assuming that there are no other material terms in the TRAM Agreement which the defendant might rely upon, there is no basis to imply a corresponding requirement in the Parties’ Agreement making it conditional upon the counterparty to the TRAM Agreement performing its obligation. As a matter of logic, a condition precedent in the TRAM Agreement requiring the execution of the Parties’ Agreement does not necessarily imply a converse provision in the Parties’ Agreement. Accordingly, while it is not for me to resolve the substantive construction of the Parties’ Agreement, the plaintiff has not satisfied me that there are substantial or bona fides grounds to contend that there was an express or implied provision in the Parties’ Agreement to the effect that either the agreement or the payment obligation thereunder were conditional on the plaintiff’s receipt of funds from TRAM. There is no basis to interpret the Parties’ Agreement as containing a condition precedent. I reject with the plaintiff’s contention that it was under no obligation to pay the Defendant as promised.

Arbitration clause

50. Clause 8 of the agreement provides: “This letter and any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with it or its subject matter shall be governed by and construed in accordance with the law of the Federal Republic of Nigeria. Any such dispute or claim shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one arbitrator appointed in accordance with the said Rules, with London as the place of the arbitration and English as the language of the arbitration.”

51. I understood from the plaintiff’s original submissions and from its expert’s reports that it was contending that a broadly worded arbitration clause necessitates the restraint of winding up proceedings and that a duly constituted arbitral tribunal rather than the Court would need to determine even the existence of any genuine and substantial dispute.

However, after I invited submissions in respect of the Sian decision, the plaintiff helpfully clarified its position. Although Sian is only persuasive, the plaintiff did not submit that it differed from the Irish law position. It noted that the decision does not change the Irish test. It sought to distinguish Sian on factual grounds, contending that whereas in Sian the debt, although denied by the company, was not genuinely disputed on substantial grounds, the situation was otherwise in this case. The plaintiff adopted the Privy Council conclusion and accepted that the Irish test was materially identical to the test referred to in Sian - to trigger an arbitration clause there must be a dispute which requires determination by way of arbitration, but the court need only be satisfied that the dispute is in good faith and on substantial grounds. It is not required to determine, nor can it determine this stage in the proceedings, the likely outcome. I agree with that formulation, but I am not satisfied that there a dispute in good faith and on substantial grounds as to the proper interpretation of the agreement and, in particular as to whether the obligation to pay the relevant sum has arisen. Accordingly, both parties accept Sian as consistent with Irish law. I agree. The Privy Council’s reasoning is compelling. I am satisfied that the clause in this case identifies the extent of the defendant’s obligation: not to seek resolution of a dispute in court. As Lord Briggs and Lord Hamblen put it at paragraph 92 of their judgment, a winding up petition lies outside both that boundary and the policy which underpins it. They added that: “None of the general objectives of arbitration legislation (efficiency, party autonomy, pacta sunt servanda and non-interference by the courts) are offended by allowing a winding up to be ordered where the creditor’s unpaid debt is not genuinely disputed on substantial grounds. To require the creditor to go through an arbitration where there is no genuine or substantial dispute as the prelude to seeking a liquidation just adds delay, trouble and expense for no good purpose. Party autonomy and pacta sunt servanda are not offended because seeking a liquidation is not something which the creditor has promised not to do. And by ordering a liquidation the court is not resolving anything about the debt, nor interfering with the resolution of any dispute about it”.

52. I endorse the observation that the legislative policy embodied in Model Law legislation, is that issues within the scope of an arbitration agreement should be resolved in arbitration rather than in court but that: “nothing about a debt covered by an arbitration agreement is resolved in winding up or liquidation proceedings in court. The legislative policy therefore stops short of such proceedings”.

53. As the Board noted, the alternative, Salford, approach would not advance the cause of supporting and enforcing arbitration clauses. To the contrary, it could disincentivise the inclusion of arbitration clauses if such clauses could be used to delay or obstruct winding up proceedings even where there was no genuine or bona fide dispute. Although Irish arbitration law is not identical to the law in England & Wales, the Board’s conclusions are equally applicable in an Irish context. I agree that a broad arbitration clause does not provide a basis for a stay in the absence of a substantial and bona fide dispute. Arbitration law is about resolving genuine disputes outside courts, not providing a procedural obstacle to legitimate statutory procedures. To paraphrase Lords Briggs and Hamblen: (a) Irish Courts will continue to enforce arbitration agreements but such agreements are only engaged in respect of matters subject to the arbitration agreement; (b) it is not the policy of the Arbitration Act, or arbitration law generally, to fetter parties’ rights in respect of matters outside the clause’s scope; (c) the parties’ freedom to choose to resolve disputes by arbitration should be respected but that also means respecting the boundaries of their choice.

54. Accordingly, as a matter of Irish law (and I think it is a matter for Irish law), I consider that if there was a real and substantial dispute then the petition would need to be stayed under Irish law, and it would need to be resolved by ICC arbitration. However, in the absence of such a dispute the clause does not provide a basis to seek a stay.

55. Even if the issue was governed by Nigerian law, having considered the authorities cited by the plaintiff's expert4, I do not consider that those authorities support the proposition (if he intended to support such a proposition) that the arbitration clause prevents the defendant from invoking statutory winding up proceedings in Ireland, obliging it to pursue a contractual dispute resolution procedure even in the absence of a bona fide and substantial dispute. Such an interpretation would be novel if advanced as a matter of Irish law (and contrary to Sian). It does not appear to be supported by the Nigerian authorities cited. Nor do I consider that the clause would justify interrupting the defendant’s access to the Irish courts in the absence of a bona fide and substantial dispute. The Nigerian authorities focussed on the uncontroversial proposition that it is an abuse of process to commence litigation to resolve issues covered by an arbitration clause. The Nigerian and Irish law positions appear similar in that regard. However, I do not accept that winding up proceedings would constitute a breach of the arbitration clause unless there was a genuine and bona fide dispute.

56. The defendant asserts a statutory right to proceed with its petition. I agree and do not consider that the exercise of the right could constitute an abuse of process due to the clause unless there was a bona fide and substantial dispute to be determined by arbitration. The clause is clearly intended to determine how any contractual disputes should be resolved. If (but only

if) a substantive or bona fide dispute was to arise, then as a matter of Irish law (if the agreement was governed by Irish law) the plaintiff would have been entitled to seek a stay.

57. I accept the plaintiff’s expert’s uncontroversial testimony that under Nigerian law, as under Irish law, parties are bound by arbitration clauses. However, if the expert intended to suggest that presenting a winding up petition constituted the pursuit of a "noncontractual dispute or claim" in breach of the arbitration clause then I would not agree. Firstly, the Although copies of the authorities cited were not appended to the expert’s report I requested and reviewed copies. Although the expert seemed to suggest at page18 of his first report that, before commencing winding up proceedings, the defendant must first submit the dispute to arbitration to determine whether the plaintiff has breached the contract, that observation may assume the existence of a substantial bona fide dispute. As noted above, I am not convinced that there is any such dispute so I see nothing to trigger the arbitration clause or to prevent the defendant invoking the statutory right to present a winding up petition to the Irish Courts.

interpretation clause is a matter for the Court. Secondly, none of the authorities which the expert has cited appear to support that proposition that Nigerian courts should stay a winding up petition by virtue of the existence of an arbitration clause even in the absence of a bona fide and substantial dispute. The Nigerian authorities cited do not support the proposition that the presentation of a winding up petition in Ireland in the current circumstances would breach the arbitration clause as drafted. Firstly, notwithstanding the plaintiff’s expert’s assertions, I am not satisfied that the presentation of the petition would be a breach of Nigerian law. Secondly, I do not consider that the defendant can be accused of circumventing an arbitration clause in the absence of a bona fide dispute. Thirdly, whether the Court should restrain presentation of this petition is a matter of Irish law. The arbitration clause is only triggered if the plaintiff has established a substantive or bona fide dispute. I am not satisfied that it has done so.

Frustration

58. The plaintiff's expert confirms the Nigerian law position in

respect of frustration and volunteered his view that the lack of funding in this case may trigger the doctrine. I disagree with the latter assertion. Many transactions fail because a paying party has funding problems. Parties are embarrassed if overdraft or lending facilities are withdrawn. It would be a radical development of the common law if such developments could, without more, constitute frustration. There is no basis for such an assertion here other than a suggestion in the TRAM letter that its attempt to transfer the funds had possibly been delayed or blocked by a suspicious transaction report resulting in a freezing of the funds. That isolated comment in third party correspondence scarcely suffices to ground a frustration plea nor was any such submission advanced by the plaintiff.

Solvency

59. Even leaving aside the nondisclosure and conditionality issues, the Court may direct a company’s winding up if satisfied that it is insolvent. The defendant has advanced unrefuted prima facie evidence that the plaintiff is indeed insolvent. Such a prima facie conclusion is consistent with the defendant’s own public statements, its repeated and ongoing defaults in meeting its statutory filing obligations, the suspension of its listing and the lack of any adequate explanation for its various omissions.

60. The plaintiff submitted that the defendant had no standing to raise the issue as it cannot be regarded as a creditor unless and until the conditionality issue is resolved. It cited section 570 of the Companies Act 2014. However, the fact remains that the defendant has adduced prima facie evidence of solvency problems. The defendant has also submitted that the plaintiff’s directors may be in breach of their statutory obligations by allowing the plaintiff to continue to trade when it was unable to pay its debts when they fell due. The plaintiff’s affidavits failed to engage meaningfully with those issues. The directors have statutory duties and must act in the company’s best interests (as defined by section 69 of the Companies Act 2014). They have responsibilities in the event of insolvency. The plaintiff’s reticence is material to this application, and I am not convinced that I should ignore such issues based on its objection to the defendant’s standing. Such a course would ignore the public interest in upholding the Companies Acts and protecting creditors. In the absence of any explanation from the plaintiff the Court is entitled to reach the obvious conclusions arising from the protracted failure to file financial statements as required by law, underscoring the significance of the plaintiff’s silence as to its solvency.

61. In my view, doubts as to solvency may be material to the exercise of my discretion. In this case, the plaintiff and its CEO have not refuted cogent prima facie evidence. Furthermore, this issue increases the doubts as to the adequacy of the disclosures to the Court on the ex parte application.

Conclusion

62. As noted above, at the hearing of the petition, the plaintiff can contest the conditionality issue and can also challenge the defendant’s standing as a creditor and its right to seek its winding up on the grounds of the plaintiff’s insolvency. As far as this application is concerned, my conclusions are that the plaintiff unconditionally committed to paying the defendant US$16,652,608 but it has defaulted in that regard, as a result of TRAM’s alleged default. It has not established a real and substantial dispute. Accordingly, the defendant is entitled to issue a petition and its doing so would not be an abuse of process.

63. Prima facie evidence suggests that the plaintiff may be insolvent and trading unlawfully. It has not filed any accounts for three years and it is evidently in a parlous financial position. This is clearly a consideration on the exercise of the Court’s irrespective of the standing issue which can be resolved at the hearing of the petition.

64. The Supreme Court has emphasised that Irish Courts should be slow to deprive petitioners of the right to exercise their statutory entitlement to bring a winding up petition before them. I am not satisfied that I should take such a step in the circumstances based on the evidence before me. The plaintiff’s position is protected because it can defend any petition on any factual and legal basis it may wish to assert, including but not limited to the evidence and submissions on this application.

Next Steps

65. I am refusing the relief sought. The defendant is presumptively entitled to its costs. If either party wishes to contend for any other order, they may submit short written submissions (up to 2000 words) setting out the position within 10 days. If such submissions are received, the other party can file replying submissions within a corresponding period. In the absence of such submissions, the registrar will perfect the final order on the application, awarding costs to the defendant on a party and party basis. If submissions are received then, unless I deem it appropriate to convene a short hearing in respect of costs, I will deal with the issue on the basis of the written submissions and the order will be finalised accordingly.

Representation

Gary McCarthy SC and Eoin Coffey BL, instructed by Turner Solicitors, for the Plaintiff Bernard Dunleavy SC and Ross Gorman BL, instructed by Mayson Hayes & Curran LLP, for the Defendant