Three States – Kaduna, Kogi and Zamfara – have asked the Supreme Court to order the immediate suspension of the demonetisation policy of the Federal Government being executed through the Central Bank of Nigeria (CBN) under the directive of President Muhammadu Buhari until it complies with relevant provisions of the law.
The request forms part of the reliefs being sought in a suit jointly filed by the three States through their Attorneys General.
The States, in an originating summons filed on February 3 by a team of lawyers led by Abdulhakeem Mustapha (SAN), raised four questions for the court’s determination.
They also, in the suit marked: SC/CV/162/2023 want the apex court to make the following declarations:
*That the demonitisation policy being currently carried out by the CBN under the directive of the President is not in compliance with the extant provisions of the Constitution, Central Bank of Nigeria Act, 2007 and extant laws on the subject.
*that the three-month notice given by the Federal Government through the CBN, under the directive of the President, the expiration of which will render the old banknotes inadmissible as legal tender, is in gross violation of the provisions of Section 20(3) of the Central Bank of Nigeria Act 2007 which specifies that reasonable notice must be given before such a policy.
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*that in view of the express provisions of Section 20(3) of the Central Bank of Nigeria Act 2007, the Federal Government, through the CBN, has no powers to issue a timeline for the acceptance and redeeming of banknotes issued by the Bank, except as limited by Section 22(1) of the CBN Act 2007, and the Central Bank shall at all times redeem its bank notes.
The three states filed along with the originating summons, a motion for an injunction, in which they are praying restraining the Fed Govt and it’s agents, including the CBN, and commercial banks, among others, “from suspending or determining or ending on the 10th of February 2023 the timeframe within which the now older versions of the 200, 500 and 1000 denominations of the naira may no longer be legal tender pending the hearing and determination of the substantive suit.”
They stated that the grounds on which they are seeking the injunction include that, “since the announcement of the new naira note policy, there has been an acute shortage in the supply of the new naira notes in Kaduna, Kogi and Zamfara States. Citizens who have dutifully deposited their old naira notes have increasingly found it difficult and sometimes next to impossible to access new naira notes in order to go about their daily activities.
“This inadequacy of the notice coupled with the haphazard, cack-handed manner the exercise is being carried out and the attendant hardship same is wrecking on Nigerians (and this includes citizens of Kaduna, Kogi and Zamfara States of Nigeria) has been well acknowledged even by the Federal Government of Nigeria itself.
“The Naira (whether old or new) is scarce.”
The plaintiffs also filed a motion for abridgement of time to five days from the date of service within which the defendant, the Attorney General of the Federation (AGF) could file a response to the suit.
The states added, in a supporting affidavit, that “contrary to the requirement for the naira redesign policy to be implemented within a reasonable time frame, the Federal Government of Nigeria has embarked on the policy within an unreasonable and unworkable time frame and this has adversely affected Nigerian citizens within Kaduna, Kogi and Zamfara states as well as their governments, especially as the newly redesigned naira notes are simply not available for use by the people as well as the state governments.
“Government activities and services requiring the use of cash have been adversely affected on account of the massive cash shortage thus making it difficult for the government to effectively operate.
“People in the P
Plaintiff states (Kaduna, Kogi and Zamfara) have been deprived of their right to access their hard-earned money from their bank accounts having deposited their old naira notes with the banks.
“The people cannot access funds to purchase basic necessities such as food, transportation, health care, etc.
“As for the majority of the indigenes of the Plaintiffs’ states who reside in the rural areas, they have been unable to exchange or deposit their old naira notes as there are no banks in the rural areas where the majority of the population of the states actually reside.
“The majority of people in rural areas of the Plaintiffs’ states do not have bank accounts and have so far been unable to deposit their life savings which are still in the old naira notes.
“Economic activities in the plaintiffs’ states have grounded to a halt as people in the various states have no money to trade with and this is adversely affecting the states’ revenue as taxes that would accrue to the states on account of the various economic activities in the states are no longer forthcoming.
“There is restiveness amongst the people in the various states on account of the hardship being suffered by the people and the situation will sooner than later degenerate into the breakdown of law and order.
“Critical stakeholders have had reasons to communicate their concerns to the Federal Government on account of the challenges and hardship being experienced by Nigerians as result the naira exchange policy.
“The Nigerian Bar Association via a letter dated 23rd January 2023, addressed to the Governor of the Central Bank of Nigeria, have expressed its concerns regarding the implementation of the said policy.
“The plaintiff state governments cannot stand by as they are duty-bound to protect citizens in their states and prevent the breakdown of law and order in the states.
“There is no justifiable basis for the ongoing difficulty and suffering being meted out on the governments and good people of Kaduna, Kogi and Zamfara State by the Federal Government.
“If sufficient and reasonable time had been given by the Federal Government of Nigeria for the naira redesign policy, all the current hardship and loss being experienced by the Plaintiffs’ State Governments as well as people in the various states would have been avoided.
“Owing to the hardship occasioned by the short and unreasonable notice by the Federal Government on the implementation of the naira redesign policy, the Senate of the Federal Republic of Nigeria whilst inter alia acknowledging the shortage of the new naira notes, had reason to pass a resolution for extension of the time frame for implementation of the policy until the 31st of July, 2023.
“On account of the hardship being experienced by Nigerians as a result of the short length of the notice for the implementation of the new naira redesign policy by the Federal Government, the Federal Government through the CBN on the 29th of January 2023, announced a 10-day extension of the implementation period, to last until the 10th of February 2023.
“By the further extension, the old naira notes would lose their legal tender status by 10th February 2023, while a further seven-day grace period was purportedly given as the deadline for the deposit of the old naira notes.
“The 10-day extension by the Federal Government is still insufficient to address the challenges bedevilling the policy.
“The Federal Government cannot bar Nigerians from redeeming their old naira notes at any point in time, despite the fact that the old notes are no longer legal tender.
“Unless this honourable court intervenes, the governments and people of Kaduna, Kogi and Zamfara states will continue to go through a lot of hardship and would ultimately suffer great loss as a result of the insufficient and unreasonable time within which the Federal Government is embarking on the ongoing currency redesign policy.”
