$1bn SWF: States Get March 8 Date Against FG At Supreme Court

SAN FRANCISCO, December 08, (THEWILL) – Supreme Court has adjourned till March 8, 2016, the suit filed by the 36 states of Nigeria against the Federal Government over the dispute arising from the maintenance of the Excess Crude Account and the transfer of $1 billion from the account to the Sovereign Wealth Fund (SWF).

The 36 states are praying the court to decide whether the states had a share in the SWF. The Supreme Court had earlier granted a request by the parties to settle the matter out of court and to explore an amicable resolution of the disagreement.

At the resumed hearing, the Federal Government through its counsel, Wole Olanipekun and Austin Alegeh’s chambers informed the court that a new attorney general of the Federation had just resumed in office and would need time to study the case file for necessary actions.

While adjourning, the Chief Justice of Nigeria, Mohammed Mahmud, who presided over the matter, urged the parties to try as much as possible to settle the disputes before the next adjourned date or the court would go into full trial.

The CJN noted that the matter had lingered for long since 2008, as such matter was better to be resolved outside the court, stressing that the parties should resolve before the next adjourned date.

The SWF manages the surplus income produced from Nigeria's excess oil reserves on behalf of the states and Federal Government.

The 36 state governors are seeking an order declaring the proposed creation of the SWF illegal and unconstitutional.

The Federal Government had challenged the jurisdiction of the apex court to hear the suit, arguing that the matter was not between states and the federation, but a dispute between the states and the Federal Government, which it said ought to have been filed before a Federal High Court.

The states are also praying the apex court to issue an order to affect that all sums standing to the credit of the Excess Crude Account should be paid into court or be otherwise secured as the court may deem fit, pending the hearing and determination of the substantive suit.

Governors of the 36 states also want the court to compel the Government of the Federation to pay into the Federation Account N5.51 trillion being the balance of the money that accrued to the central purse between 2004 and 2007 from the proceeds of crude oil sales, petroleum profits tax and oil royalties.

The governors also asked the court to order the Federal Government to transfer to the Federation Account all sums standing to the credit of the Excess Crude Account.

However, in a counter affidavit filed on behalf of the Federal Government by the law firm of Alegeh and Co., it said efforts to find a common ground did not succeed.

The Federal Government also accused the states of mischief because they took part in the deliberation of the National Economic Council where the decision to transfer the $1 billion from the Excess Crude Account to the SWF was taken.

It added that the states had also been receiving their shares from the money and accused them of insincerity.

In response, the states insisted that they had shared only the legitimate funds deposited in the Federation Account and not from the funds illegally deposited in the Excess Crude Account.

The governors, through their counsel, Adegboyega Awomolo, had applied to the Supreme Court to restrain the Federal Government from making any withdrawals howsoever from the account styled the “Excess Crude Account” (or any account replacing same by any name howsoever), pending the hearing and determination of a suit they filed in 2008.