The presiding judge of the High Court of the Federal Capital Territory, Justice Eneojo Eneche yesterday issued an order restraining the President Muhammadu Buhari, the governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele and 27 commercial banks from suspending the currency swap policy of the federal government.
Eneche issued the order while giving ruling in an ex parte application brought by four political parties against the government and 27 commercial banks in the country.
The four political parties in the suit marked FCT/HC/CV/2234/2023 are the Action Alliance (AA), Action Peoples Party (APP), Allied Peoples Movement (APM) and National Rescue Movement (NRM) while the defendants included Buhari, CBN, Emefiele and 27 commercial banks.
The judge also granted an order directing the CEOs of the 27 commercial banks and their alter egos to show cause why they should not be arrested and prosecuted for the economic and financial sabotage of the country by their illegal hoarding, withholding, not paying or disbursing the new N200, N500 and N1000 banknotes despite supply of such notes by CBN.
The court also restrained CBN from extending the deadline on the use of old naira notes pending the determination of the suit.
The order will be for an initial period of seven days until the motion of notice is heard on February 14.
“An order of interim injunction is hereby made restraining the defendants, whether by themselves, staff, agents, officers, interfacing banks or whosoever not to suspend, stop, extend, vary or interfere with the extant termination date of use of the old N200, N500 and N1, 000 bank notes, being February 10, 2023, pending the hearing and determination of motion on notice,” the judge declared.
The judge also made an order of interim injunction “directing and mandating the defendants whether by themselves, staff, agents, officers, interfacing banks or whosoever described to comply with, implement and give effect to the currency redesign and restructuring of the old N200, N500 and N1, 000 bank notes on or before the last day of February 10, pending the hearing and determination of motion on notice.”
The court further directed bank heads, chief executive officers, managing directors and/or alter egos “to forthwith show cause as to why they shall not be arrested and prosecuted for the economic and financial sabotage of the Federal Republic of Nigeria by their illegal act of hoarding, withholding, nor paying or disbursing the new N200, N500 and N1000 bank note, being the legal tender of the Federal Republic of Nigeria to their respective customers, despite supplies of such currency note by the second and third defendants, thereby leading to the present scarcity of currency notes in circulation.”
Also yesterday, three governors elected on the platform of the All Progressives Congress (APC) filed a suit at the Supreme Court challenging the federal government’s naira redesign policy.
Governors Nasir el-Rufai (Kaduna), Yahaya Bello (Kogi) and Bello Matawalle (Zamfara) are the litigants.
In the suit marked: SC/CV/162/2023 and filed on February 3, the states prayed the court for a declaration that the demonetisation policy of the federation being currently carried out by CBN under the directive of President Buhari is not in compliance with the extant provisions of the Constitution of the Federal Republic of Nigeria 1999 (as amended), CBN Act, 2007 and actual laws on the subject.
They also asked the court to make a declaration that the three-month notice given by government and CBN, the expiration of which will render the old notes inadmissible as legal tender, is in gross violation of the provisions of Section 20(3) of the CBN Act 2007, which specifies that reasonable notice must be given before such a policy and that the limit cannot be outside that provided under Section 22(1) of the CBN Act 2007.
The attorney general and commissioner for justice, Kaduna State, Ms Aisha Dikko, averred in an affidavit that although the naira redesign policy was introduced to encourage the cashless policy of the federal government, it is not all transactions that can be conveniently carried out through electronic means.
She also pointed out that the federal government “has embarked on the policy within a narrow and unworkable time frame, and this has adversely affected citizens within Kaduna, Kogi and Zamfara states as well as their governments, especially as the new notes are not available for use by the people, as well as the state governments.
She further contended that the majority of the indigenes of the plaintiffs’ states, who reside in the rural areas, 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 reside.
While the attorneys general and commissioners of justice of the three states were the plaintiffs, the attorney-general of the federation and minister of justice, Abubakar Malami was the only respondent in the suit filed by AbdulHakeem Mustapha.
The plaintiffs sought a declaration that the demonetisation policy of the federation being currently carried out by the CBN under the directive of the president was not in compliance with the extant provisions of the Constitution and CBN Act, 2007 and actual laws on the subject.
Besides, plaintiffs wanted a declaration that the three-month notice given by the federal government through the CBN under the directive of the president, the expiration of which would render the old banknotes inadmissible as legal tender, is in gross violation of the provisions of Section 20(3) of the CBN Act 2007, which specifies that Reasonable Notice must be given before such a policy.
Similarly, the plaintiffs urged the court to declare that given the express provisions of Section 20(3) of the CBN Act 2007, the federal government through the CBN had 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.
The plaintiffs claimed that since the announcement of the policy, there had been an acute shortage in the supply of the new naira notes in Kaduna, Kogi and Zamfara states, adding that citizens who had dutifully deposited their old naira notes have increasingly found it difficult and sometimes next to impossible to access new naira notes to go about their daily activities.
In addition, they cited the inadequacy of the notice coupled with the haphazard manner in which the exercise was being carried out and the attendant hardship same was wrecking on Nigerians, which has been well acknowledged even by the government itself.
The plaintiffs further maintained that the 10-day extension by the federal government was not sufficient to address the challenges bedeviling the policy.
They therefore sought an order of court directing the federal government to immediately suspend the policy until it complies with the relevant provisions of the law.
In an affidavit in support of its own originating summons, the Attorney General and Commissioner for Justice, Kaduna State, Aisha Dikko, who observed that the need to encourage cashless policy was behind the introduction of the naira redesign, stated that not all transactions are however convenient through electronic means.
The deponent claimed that the federal government has embarked on the policy within a narrow and unworkable time frame, adding that this had adversely affected Nigerian citizens within Kaduna, Kogi and Zamfara states as well as their Governments, especially as the newly redesigned naira notes are not available for use by the people as well as the state governments.
“That the majority of the indigenes of the plaintiffs’ states who reside in the rural areas 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 reside.
“Most 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.
“There is restiveness amongst the people in the various states because of the hardship being suffered by the people, and the situation will sooner than later degenerate into the breakdown of law and order.
“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”, she averred.
While stating that 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 if there is sufficient time frame for implementation of the policy, Dikko submitted “that the 10-day extension by the federal government is still insufficient to address the challenges bedeviling the policy.”
