Over the last few weeks, about 8 Nigerian States have instituted an action against the Federal Government on the Central Bank of Nigeria’s Naira redesign policy and the deadline for the use of old Naira notes.
The suit was originally instituted by the Attorneys General of Kaduna State, Kogi state and Zamfara State subsequently joined by the Attorneys General of Ekiti, Kano and Ondo State, who applied to the court to join the suit as plaintiffs in the action against the Federal Government.
The suit came as a result of the difficulties caused by the policy in the lives of citizens.The states questioned the practicality of the deadline and the constitutionality of the policy. The original plaintiffs, Kanduna State, Kogi state and Zamfara state applied for an interim injunction to suspend the February 10th deadline for the cash as legal tender until the determination of the whole suit. The court ruled in favour of the plaintiffs on the 8th of February, allowing citizens to continue with the use of the banknotes, and adjourned the case to the 15th of February when the court will hear the matter. On the 15th of February, the Supreme Court adjorned the case to the 22nd of Februray, in order to allow all the parties amend their processes to reflect the new position of their respective cases.
The question for determination posed by the states covers the issues faced by the citizens of the country, it is a commendable bid to protect the interest of the people. Amongst other things, the states question if the deadline given by the CBN is compliant with the provisions of Section 20(3) of the Central Bank of Nigeria Act 2007, which provides that reasonable notice must be given before any notes or coins cease to be legal tender.
The court is to determine if the 3 months’ notice given satisfies this provision of the Act, considering the lack of the availability of cash and the effect it has had on the masses. They also argue that the CBN has no power to issue a timeline for the acceptance and redemption of banknotes issued by the bank and shall at all times redeem its banknotes.
One of the major concerns in this suit has been the jurisdiction of the supreme court to hear the matter. Such jurisdiction is conferred upon courts by The Constitution of the Federal Republic of Nigeria 1999. Asides from hearing appeals from the Court of Appeal, the Supreme Court has original jurisdiction to entertain matters between states, or states and the federal government and also on the disputes between the National Assembly and the Federal Government.
The issue in this suit is a policy made by an agent of the Federation (CBN), not the Federation itself, hence this begs two questions: if the Federal Government should be the sole defendant in the suit, and if the matter being a policy of a government agency, is proper before the Supreme Court.
There are arguments that the court better suited to hear the matter is the Federal High Court of Nigeria as they have jurisdiction over economic and commercial issues involving departments and agencies of government, conferred by section 251 of the CFRN.