$418m Debt: Court fixes date for judgement in Paris Club refund suit

The Federal High Court in Abuja, on Tuesday, fixed March 25 for judgment in a case filed by the 36 state governors over plan to deduct funds from the federation account to settle $418 million judgment debt in relation to Paris Club refund.

Inyang Ekwo, the judge, fixed the date for verdict after counsel for the parties in the matter adopted their final written addresses on Tuesday.

The 36 states Attorneys-General (plaintiffs) had sued the Attorney-General of the Federation (AGF), Accountant General of the Federation and Ministry of Finance, and others, over the planned deduction.

Others are the Central Bank of Nigeria (CBN), Debt Management Office (DMO), Federation Account Allocation Committee (FAAC), Incorporated Trustees of Association of Local Government of Nigeria (ALGON), among others.

There are a total of 43 defendants, including the judgement creditors, sued in the suit that was filed by the 36 state governors on October 27, 2021.

Mr Ekwo had last November restrained the federal government from making any deduction from the federation account to settle the controversial judgment debts until his court’s resolution of the issues.

Lawyers’ closing arguments

The plaintiffs’ lawyer, Sunday Ameh, a Senior Advocate of Nigeria (SAN), in his final submission, contended that the defendants misunderstood the crux of his clients’ suit.

Mr Ameh challenged the argument by the AGF that the suit was challenging existing judgments given by the court in favour of some of the consultants.

“We are not challenging the judgments, we are saying the way the federal government and its agencies are going about enforcing the judgments violates sections 120 and 162 of the (Nigerian) constitution,” Mr Ameh said.

He argued that since the defendants agreed that the contractors were owed in relation to the services they rendered, it should settle the indebtedness without deploying funds belonging to the states and local government.

The plaintiffs’ lawyer urged the court to allow the case and grant his client’s prayers.

On his part, the defendants’ lawyers– Wole Olanipekun (SAN), Maimuna Lami-Shiru (Acting Director, Civil Litigation, Federal Ministry of Justice) and Olusola Oke (SAN) faulted the competence of the suit and urged the court to dismiss it.

Mr Olanipekun, who represented one of the consultants, Ted Iseghohi-Edwards (14th defendant), described the plaintiffs as “meddlesome interlopers”, noting that the state governments claimed to be fighting for the local councils, a distinct level of government, without the consent of the third tier of government.

He prayed the court to dismiss the suit for being time-wasting and constituting an abuse of court process.

Mrs Lami-Shiru argued that not only was the suit statute-barred, the plaintiffs are also seeking the impossible by asking the court to sit in appeal over judgments earlier delivered by it and other courts of coordinate jurisdiction.

The lawyer further argued that the decision by the federal government to issue promissory notes to the consultants as a way of settling the debt owed them was legitimate.

She added that the plaintiffs cannot distance themselves from the decision taken by the Nigeria Governors’ Forum (NGF) in engaging some of the consultants.

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Mrs Shiru represented the President, Federal Republic of Nigeria; the Attorney-General of the Federation (AGF), the Accountant General of the Federation (AGoF), the Ministry of Finance Incorporated and the Debt Management Office (DMO), sued as the first, second, third, fourth and sixth defendants in the suit, marked:

Mr Oke, who represented Riok Nigeria Limited and Prince Nicholas Ukachukwu, some of the judgement creditors, argued that the suit is without merit and should be dismissed.

Background

The debts had accrued from court judgments awarding the creditors, who claimed to be “consultants” and “contractors” to the states and local governments, various sums of money which currently stand at $418 million.

Some of the creditors claimed to have earned their shares of the money through ‘consultancy services’ of helping state and local governments to recover funds over-deducted by the federal government from their allocations between 1995 and 2002 to service the London Club and Paris Club loans.

PREMIUM TIMES had reported how President Muhammadu Buhari had ignored the protests by the Nigerian Governors’ Forum (NGF) to approve the issuance of promissory notes to the creditors.

The promissory notes asked to be issued by the Debt Management Office (DMO) are to be funded through deductions from the allocations of the states and local governments for a period of 10 years.