ONTARIO OIL & GAS LTD V. FEDERAL REPUBLIC OF NIGERIA (2018)

Background

This appeal arose from criminal proceedings concerning alleged fraud in Nigeria’s Petroleum Support Fund (PSF) or fuel subsidy scheme. Ontario Oil & Gas Nigeria Limited, together with four other defendants, was prosecuted before the High Court of Lagos State in a nine-count information. The charges included obtaining money by false pretence under the Advanced Fee Fraud and Other Fraud Related Offences Act 2006, forgery, uttering and conspiracy under the Criminal Code Law of Lagos State.

The prosecution alleged that the defendants inflated the quantities of Premium Motor Spirit (PMS) purportedly imported and discharged into Nigerian storage facilities. In the first transaction, the defendants claimed to have discharged 19,327,460 litres, whereas the evidence suggested that only 12,470,706 litres were discharged. The alleged inflation resulted in a subsidy payment exceeding N340 million. In a second transaction, the defendants claimed 19,523,892 litres, although only approximately 10,146,594 litres were allegedly discharged, leading to a further payment of over N414 million on the inflated quantity.

After the prosecution called twelve witnesses and tendered 712 documents, the defendants made a no-case submission. Ontario Oil & Gas also challenged the jurisdiction of the Lagos State High Court, arguing that the allegations related to Federal Government revenue, petroleum and crude oil products, admiralty matters and other subjects within the exclusive jurisdiction of the Federal High Court under section 251 of the 1999 Constitution and the Federal High Court Act.

The trial court dismissed the no-case submission and held that it had jurisdiction. The Court of Appeal affirmed that decision. The company then appealed to the Supreme Court, principally on jurisdictional grounds.

Issues

1. Whether the Lagos State High Court had jurisdiction to try the offences of obtaining money by false pretence, forgery, uttering and conspiracy arising from the alleged fuel subsidy fraud.
2. Whether the Federal High Court had exclusive criminal jurisdiction merely because the alleged transactions concerned Federal Government funds, petroleum products or a federal agency.
3. Whether the Court of Appeal ought to have set aside the trial court’s ruling because the trial court had, without inviting counsel to address it, struck out section 19 of the Admiralty Jurisdiction Act.
4. Whether the Supreme Court should interfere with the concurrent findings of the two lower courts.

Ratio Decidendi

The Supreme Court, by a majority, dismissed the appeal and affirmed the jurisdiction of the High Court of Lagos State. The court held that jurisdiction in a criminal case is determined principally by the nature and particulars of the charge, not by the background transaction, the identity of the investigating agency, the involvement of a federal institution or the documents tendered as evidence.

Although obtaining money by false pretence under the 2006 Act was a federal offence because it was created by an Act of the National Assembly, that fact did not automatically confer exclusive jurisdiction on the Federal High Court. Section 251(3) of the Constitution provides that the Federal High Court shall “also” exercise criminal jurisdiction in respect of matters within section 251(1). The word “also” indicates an additional jurisdiction and does not create a general monopoly over every federal offence. Section 272 confers broad criminal jurisdiction on State High Courts, while section 286 expressly recognises the jurisdiction of State courts to try federal offences.

The court further relied on section 14 of the Advanced Fee Fraud and Other Fraud Related Offences Act, which expressly gives State High Courts jurisdiction to try offences under that legislation. The offences of forgery, uttering and conspiracy were also offences under the Lagos State Criminal Code. No admiralty offence was stated in the information, and the mere fact that the alleged fraud occurred within a petroleum subsidy scheme did not transform the charges into admiralty or Federal High Court matters.

Court Findings

The Supreme Court rejected the appellant’s argument that the Federal High Court’s jurisdiction was triggered by the connection between the alleged offences and Federal Government revenue. The relevant inquiry was whether the specific offences charged fell within the constitutionally or statutorily defined jurisdiction of the Federal High Court. They did not. The court reaffirmed the reasoning in Daboh v. State, Queen v. Owoh and FRN v. Okey Nwosu, namely that State High Courts retain jurisdiction over offences created under State laws and may also try federal offences where the Constitution or relevant legislation permits.

On the fair-hearing complaint, the court held that the Court of Appeal correctly treated the trial court’s comments concerning section 19 of the Admiralty Jurisdiction Act as an obiter dictum. The issue was not necessary to the determination of jurisdiction because the case was not an admiralty proceeding. An appeal lies against the ratio decidendi, not against an incidental observation or passing remark. In any event, not every error in a judgment warrants reversal; the error must be material, substantial and capable of affecting the decision.

The court also declined to disturb the concurrent findings of the High Court and Court of Appeal. Such findings are rarely overturned by the Supreme Court unless shown to be perverse, founded on a misapplication of law or misconception of fact, or productive of a miscarriage of justice. The appellant failed to establish any exceptional circumstance.

Conclusion

The appeal was dismissed. The decisions of the High Court of Lagos State and the Court of Appeal were affirmed, and the criminal trial was ordered to proceed. The majority position is that the Lagos State High Court possessed jurisdiction to try the charged offences.

Significance

The decision is important in Nigerian criminal procedure and constitutional jurisdiction. It clarifies that “federal offence” and “offence within the exclusive jurisdiction of the Federal High Court” are not synonymous. Federal subject matter, federal funding or prosecution by a federal agency does not, without more, oust the jurisdiction of a State High Court. It also reinforces liberal constitutional interpretation, the distinction between ratio and obiter, and the reluctance of the Supreme Court to interfere with concurrent findings.