Following the Federal Government’s and the Central Bank of Nigeria’s (CBN’s) failure to comply with the Supreme Court’s March 3rd judgment on the extension of the validity of the old naira notes, ten states are preparing for a new legal battle.
The failure to implement the court order has heightened anger and frustration across the country, as Nigerians wait in vain for the government to give the go-ahead for the reintroduction of the old N500 and N1000 notes.
At the time of publication, merchants, gas stations, and transportation companies continued to refuse to accept the notes, despite the fact that new notes were still scarce.
The consequence is a massive slow-down of the economy.
The governments of Kaduna, Kogi, Zamfara, Ondo, Ekiti, Katsina, Ogun, Cross River, and Lagos served the enrolled order of the Supreme Court on the extension of the validity of the old N200, N500, and N1,000 notes to December 31st, 2023 on the Attorney-General of the Federation and Minister of Justice, Mr. Abubakar Malami (SAN).
The order became automatically applicable to all Federal Government agencies, including the Central Bank of Nigeria, as a result of the service (CBN).
Malami and CBN Governor Godwin Emefiele face charges of contempt of court if they do not comply with the apex court’s order by Monday.
If Malami and Emefiele defy the order of the court, the ten states have activated the machinery to file contempt charges against them.
The delay in releasing the Certified True Copy (CTC) seems to have encouraged the banks to adopt different attitudes to the judgment of the apex court.
Some of the banks have been giving the old notes to customers but the banks insist that customers go through the strenuous process stipulated by the CBN for the old notes to be banked.
The Nation gathered that the enrolled order, dated March 3rd, 2023, was served on AGF Malami yesterday.
One of the counsel in the matter said: “We have finally served the Attorney-General of the Federation the enrolled order of the Supreme Court.
“What we did on Friday was to fulfill all righteousness by serving the enrolled order on the AGF. The Federal Government has been evasive by claiming that it had not received the Certified True Copy (CTC) of the judgment, which we have obtained and made available to it. The burden is on Malami to act as the Chief Law Officer of the Federation to comply with the order.
“There is no hiding place for the government; there is no excuse again. While we are waiting for the government’s decision, the law provides us backing for Plan B.”
The enrolled order of the Supreme Court, which was sighted by The Nation, reads as follows: “It is ordered that this suit has merit. That the demonetization directive/policy by the President of the Federation to wit: withdrawal of the old 200, 500, and 1000 naira notes is not consistent with the provision of the Constitution of the Federal Republic of Nigeria 1999 (as amended) which makes provision for the Executive power of the President of the Federation and the extant laws on the subject matter.
“That the three months’ notice given for the implementation and completion of the said demonetization policy by which time the old N1,000, N500 and N200 naira notes shall cease to be legal tender does not satisfy the condition set out in Section 20(3) of the CBN Act 2007.
“That the President cannot unilaterally give a directive to embark on the demonetization policy pursuant to Section 20(3) of the CBN Act 2007 in view of Nigeria’s Fiscal Federalism, the economic interest of the Constituents of the Federation and without consultation with, and advice from the plaintiff, individually, and in their capacity as members of the National Council of States and National Economic Council and that the directive cannot be given without consultation with, and advice from the cabinet, the National Security Council and other stakeholders.
“That in issuing the directive for demonetization policy pursuant to Section 20(3) of the CBN Act, 2007 on behalf of the Federation of Nigeria, the President is under an obligation to ensure that adequate structures are put in place for the plaintiffs and Nigerian citizens prior to the implementation of the said directive.
“That the demonetization directive/policy by the President of the Federation to wit: withdrawal of the old N200, N500 and N1, 000 notes unlawfully impede the exercise of the Executive Powers of the plaintiffs’ states and other obligations to facilitate and protect the welfare of the citizens of the said states pursuant to Section 5(2) and other provisions of the Constitution of the Federal Republic of Nigeria 1999(as amended) as well as other extant laws.
“That the directive given by the President pursuant to Section 20(3) of the CBN Act 2007 limiting the amount that can be withdrawn and the charges therein without an enabling law is unconstitutional and not binding on the plaintiffs.
“That the directive of the President of the President of the Federation exercised is illegal to the extent that it restricts, without an enabling law, the rights of the plaintiffs to freely use their money in various bank accounts.
“That the old version of N200, N500 and N1,000 notes shall continue to be legal tender alongside with the new or redesigned version until 31st December, 2023.
“That the reception of old N200, N500 and N1,000 notes and the swapping of same with new Naira notes shall continue till 31st December, 2023.
“That all the consolidated suits listed in pp. 12-13 of the judgment shall abide this judgment.”
The Supreme Court declared that Buhari cannot implement the demonetization policy pursuant to Section 20(3) of the CBN Act 2007 without consultation with, and advice from the cabinet, the National Security Council and other stakeholders.
It also said Buhari’s directive limiting the amount that can be withdrawn and the charges therein without an enabling law was unconstitutional.
One of the lawyers to the plaintiffs, said: “The truth is that the order of the apex court is binding on the CBN and Emefiele because the CBN Governor acts as an agent of the bank and the CBN is also an agent of the Federal Government. In this case, the Federal Government was represented by the Attorney-General of the Federation.
“We are set for the next stage of the battle. We will initiate contempt proceedings against the AGF and the CBN Governor if the judgment is ignored. Our team is ready to see to the logical conclusion of this case.”
In its unanimous judgment, a seven-member panel of the apex court, led by Justice John Okoro, said the procedure adopted by government in effecting its cashless/naira swap policy was wrong.
Justice Emmanuel Agim, in the lead judgment, held that condition precedent was not met before President Muhammadu Buhari directed the Central Bank (CBN) governor to distribute the new notes and withdraw the old ones.
According to him, the directive by President Buhari to the CBN governor to distribute new notes and withdraw old one was invalid because no reasonable notice was given to Nigerians as required under Section 20 (3) of the CBN Act.
He noted that rather than issuing a formal or public notice, what the CBN governor did was to simply give a press statement, which he equated to the required three-month notice under Section 20(3) the CBN Act.
He said the press statement did not qualify as a reasonable notice envisaged under the CBN Act.
The justice added that Federal Government’s reliance on the said press release as the notice of plan to distribute new naira notes and withdrawal of the old ones showed its disregard for the importance of giving reasonable notice as a valid foundation for the introduction of new naira notes and withdrawal of old ones.
Malami’s spokesman, Dr. Umar Gwandu, had told The Nation last weekend that “the functions of the office of Attorney General do not include monetary policy regulation.”
He had been contacted to respond to the silence of the federal government on the court order.
The CBN has been similarly silent on the matter.
Confusion grips banks over CBN silence
The CBN silence is causing confusion in the banking industry with some of the commercial banks giving out the old naira notes while others seem not to be interested at all.
However customers who accept the old notes are stuck with them.
Traders, artisans and cab drivers are rejecting the old notes in favour of the new ones or Point of Sale (PoS) payments.
In Gwagwalada Area Council of the FCT, many traders, artisans and other informal business operators are rejecting the old notes.
An animal feed seller, Mohammed Abubakar, said he would not accept the old notes until he hears directly from Buhari or the CBN governor that the old notes can be accepted.
Many bank customers were forced to return the old notes they collected to their banks.
They however met a brick wall at the banks as they were told to go back and fill the CBN cash swap form online before the old notes can be accepted from the customers as deposits.
Most Automated Teller Machines (ATMs) are still not dispensing cash. As a result, many bank customers are now forced to go to their banks to get cash over the counter.
An old bank along Ralph Sodehinde in the Central Business District paid out only N10,000 in old notes to their customer but refused to accept the same old notes when customers returned them.
A cab driver, Isa Idris, rejected fares paid in old notes. His reason was that “President Muhammadu Buhari has not told Nigerians to accept the old notes”.
Attempts to get the CBN to speak to the status of the old notes did not yield any result as nobody was ready to speak on the matter.
However, it is most likely that the CBN will be forced to comment on the development after the Monetary Policy Committee (MPC) meeting next week.
The frustrations faced daily by Nigerians since the beginning of the naira swap crisis are not helped by the epileptic functioning of the online platform of the banks.
Customers complain about failed transactions and arbitrary deductions from their accounts by the banks.
Yahaya Bello threatens to arrest, prosecute those rejecting old naira notes
Kogi State Governor Yahaya Bello yesterday threatened to arrest and prosecute those rejecting the old Naira notes.
Information and Communications Commissioner Kingsley Fanwo said in a statement in Lokoja, the state capital, that the continued rejection of the old Naira notes even after the Supreme Court ruling was unacceptable and demeaning.
”This administration will not stand and watch some persons and businesses continue to reject the use of the old naira notes, even after the court judgment validating their use,” he said.
Continuing, Fanwo said: “To us, rejecting the old naira notes is a clear disobedience of the Supreme Court ruling, which shall be vehemently resisted.
“Anyone who rejects the old naira notes should be reported to the security and government authorities for immediate arrest and prosecution.
“Also, banks that refuse to accept old naira deposits shall be sealed up as the state government will not accommodate financial institutions that willfully disobey court orders, more so the orders of the highest court in Nigeria.”
The governor implored all residents of Kogi to endeavour to accept the old notes since the commercial banks have started issuing them (old naira notes) for day to day business transactions.
“As patriots, the people of Kogi are bound to also receive it, because we cannot continue to kill our economy after the Supreme Court has granted us freedom.
“Consequently, the state government has set up a high-powered Committee to ensure full adherence and compliance to the ruling of the Supreme Court as regards the use of the old notes,” he said.
The committee members include the state Commissioner for Finance, Budget and Economic Planning; Commissioner for Information and Communications. Others are: Commissioner for Commerce and Industry; the State Security Adviser and the Managing Director, Kogi Enterprise Development Agency (KEDA).
The governor said that the Committee was to ensure that residents take full benefits of the Supreme Court ruling on the old naira notes.
Bayelsa community protests rejection of old N500, N1000 notes
The anger sparked by the non-compliance with the Supreme Court ruling yesterday snowballed into a protest in Akenfa community in Yenagoa Local Government Area of Bayelsa State with residents taking to the streets to call government attention to their plight.
They said they had had enough of the rejection of the old naira notes by traders one week after the apex court extended their validity to December 31, 2023.
The placard carrying protesters said life had come to a standstill as they can neither sell nor buy while hunger continued to bite them and their children.
Benin residents reject old N500, N1,000 in spite of Obaseki’s appeal
Many Benin residents are still rejecting the old N500 and N1,000 notes for business transactions in spite of Governor Godwin Obaseki’s appeal to accept them.
The governor had in a statement issued on Thursday by the Edo State Ministry of Communication and Orientation urged residents of the state to accept the old Naira notes.
The statement was signed by the Commissioner, Chris Nehikhare.
“With the Supreme Court judgment, the controversy over the circulation of the notes have been put to rest and people are urged to accept and trade with the notes.’’ the governor said.
Newsmen who monitored various markets, commercial banks, bus parks and Point of Sales yesterday said the old N500 and N1000 notes were not accepted.
Residents said they would only accept the old notes when the CBN and the Federal Government had made an official statement to that effect.