What you should know about commercial litigation


11/20/20212 min read


What is commercial litigation and what does it entail?

Commercial litigation is a means of resolving a commercial dispute in Nigeria through instituting an action in court with its origin rooted in English Common Law. A commercial dispute can arise between Nigerian parties to a transaction or between international parties where there is the existence of a connecting Nigerian factor which could be as a result of the location of the contract, place of performance, or domicile of parties to the transaction.

Commercial litigations in Nigeria are commenced in the State High Courts or the Federal High Court of the Federal Capital Territory (FCT) through Writ of Summons or an Originating Summons depending on the nature of the suit.

These courts have the unlimited general jurisdiction to hear and determine any commercial litigation instituted before it regardless of the value, other than those commercial disputes that are within the exclusive jurisdiction of the Federal High Court such as disputes relating to securities, admiralty, intellectual properties, operation of companies among others as stipulated in Section 249 of the 1999 Constitution of the Federal Republic of Nigeria.

Commercial litigation in Nigeria is regulated and governed by various sources of laws such as; Constitution of the Federal Republic of Nigeria 1999 (as amended), which created the various courts in Section 230(1), 237(1), 249(1), 270(1) and jurisdictions of each court; Various statues; Judicial precedents; Rules of courts and practice directions.

The jurisdiction of a court is the power of the court to decide a commercial dispute between parties. Every court in Nigeria is established by laws and it usually the law establishing the court that also defines the jurisdiction of such a court. In the case of Madukolu & Ors Vs. Nkemdili 1962 2 SCNLR, 341, the Supreme court laid down the conditions that determine the jurisdiction of a court as follows:

- The court must be properly constituted with regards to the number and qualification of its members.

-The subject matter of the dispute must be within the jurisdiction of the court and no feature in the case which prevents the court from exercising its jurisdiction.

-The case must have been brought to court by the due process after satisfaction of relevant provisions on condition precedents.

It is essential to know that before commencing commercial litigation in Nigeria, one must consider the subject matter of the claim, the location of parties, the place where the dispute occurred, or where the course of action arose, among others. All these factors will determine the appropriate court to institute the action and the procedure to follow.


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