Law & Judiciary

Judiciary Promoting Restructuring – Falana

Applauds court verdict against deductions from federation account to fund Police Trust Fund 

 By Onyebuchi Sampson

To many, the recent judgment of a Federal High Court sitting in Abuja, which barred further deductions from the federation account to fund the Nigeria Police Trust Fund (NPTF) could not have come at a better time than now.

This is so because many judiciary observers are of the view that Nigeria is in dire need of restructuring to save the nation from disintegration.

With the seeming political actors’ reluctance to listen to the voice of reason and restructure the polity, the courts are expected to lead the way for the nation’s survival.

Hence, the pronouncement of the Abuja court has been adjudged as a promotion of restructuring through litigation. The verdict followed Rivers State’s suit marked FHC/ABJ/CS/511/2020 and instituted on its behalf by Mr. Joseph Daudu, a former President of the Nigerian Bar Association (NBA).

In the suit, the state challenged the decision of the federal government allocating funds directly from the Federation Account to fund some of its agencies claiming that the decision violated section 162 of the 1999 Constitution.

The Rivers State government also claimed that the federal government’s unlawful action, had deprived it of substantial revenue from the federation account, and therefore prayed the court to nullify the unlawful funds’ allocation from the federation account.

Named as defendants were the Attorney General of the Federation and Minister of Justice AGF, Accountant General of the Federation, Revenue Mobilization Allocation and Fiscal Commission, and Minister of Finance.

In its verdict, the court holds that institutions or bodies, such as the Nigeria Police Trust Fund not listed in the Nigerian constitution cannot be funded directly from the Federation Account.

It also contended that it was not the responsibility of the state governments, but that of the federal government to fund the police.

The court’s verdict was in tandem with earlier pronouncements of the courts in 10 other cases.

Acceding to this, a foremost human rights lawyer and senior advocate of Nigeria (SAN), Femi Falana, described it as a very sound judgment.

The former president of the West African Bar Association (WABA) said the Supreme Court had ruled, several years ago, that the Federal Government lacks the power to remove funds from the Federation Account without the authorization of State Governments and Local Governments.

According to him, under the defunct military junta, the unitary military government usurped the powers of the other tiers of Government.

“But since 1999, the courts have consistently promoted restructuring by litigation. Before the VAT judgment, State and Local Governments have defeated the Federal Government in not less than 10 cases.

Some of the cases dwelled on physical planning, conduct of local government elections, seizure of local government funds, monitoring of local government funds, collection of entertainment/hospitality levies, control of land, control of inland waterways, and setting up of commissions of inquiry,” Falana added.

HISTORY OF THE SUIT

The Federation Account Allocation Committee (FAAC) had announced at its April 2020 meeting that the deductions were to commence in earnest.

But a month after the FAAC meeting, Governor Nyesom Wike-led Rivers State Government filed its suit on May 20, 2020, to challenge the planned deductions and the law on which it was premised.

The Rivers State Government, through its Attorney-General, challenged what it described as the unlawful deductions being made from the federation account, jointly owned by the federal, state, and local governments, to fund the NPTF.

It contended that it was not the responsibility of the state governments, but that of the federal government to fund the police.

It also urged the court to order a refund of the money deducted from the Federation Account and paid into the NPTF, up to when it was informed about it at the FAAC meeting of April 2020.

Delivering judgment in the suit, Justice Ahmed Mohammed, declared it as “illegal, unlawful and unconstitutional,” the direct allocations made so far by the federal government from the federation account to fund the NPTF.

The judge held that Section 161 and Section 162 of the 1999 Constitution were breached by the federal government in making direct allocations to the NPTF from the Federation Account.

He added that Section 162 of the 1999 constitution is unambiguous to the effect that only the federal, state, and local government shall be allocated funds directly from the Federation Account.

The court also held that section 4 of the Nigeria Police Trust Fund Act 2019 relied upon by the federal government to justify the unlawful deductions from the federation account is inconsistent with section 162 of the 1999 Constitution which recognises only the federal, states and local governments.

It also agreed with the plaintiff that the levies imposed on companies operating in Nigeria by the federal government to be paid directly to the NPTF instead of the Federation Account were also illegal, unlawful, and unconstitutional.

The Rivers State government had argued that such levies ought to be paid to the federation account for it to benefit from it.

It said failure to pay such funds into the federation account and rather into the NPTF has deprived it of substantial revenue accruable to the state as taxes.

The court dismissed the Attorney General of the Federation’s objections and upheld all arguments of Rivers State that where the provisions of the 1999 Constitution are clear and unambiguous, they must be given their ordinary meanings.

The court also agreed with Mr. Daudu that the federal government was completely wrong in the interpretation given to section 4 of the Nigeria Police Trust Fund Act to the effect that the Nigerian Police was established for the federal government alone and as such the funding is solely on the shoulder of the federal government.

The AGF had in his preliminary objection asked the Federal High Court to decline jurisdiction in the matter on the ground that such suit ought to be filed directly at the Supreme Court.

Read also: Ikoyi Property: Firm Withdraws from Bank’s Suit Against Odogwu’s Family

But the judge dismissed the preliminary objection before going ahead to deliver the verdict.

The court held that the jurisdiction of the Supreme Court can only be invoked when a dispute involves the federation and any of the component states.

On the objection raised by the AGF that the Rivers State government ought to have sought and obtained the leave of the Federal High Court before instituting the suit, the judge said the plaintiff had no reason to seek the court’s permission to file the case.

While upholding the plaintiff’s suit, the judge ordered that the funds belonging to Rivers State but were used to fund the NPTF by the federal government should be refunded to the state.

The judge, however, declined to extend similar order of refund to the 35 remaining states because they were not parties in the suit and Rivers State as the plaintiff in this matter did not file it on behalf of others.

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