Supreme Court strikes out Osun’s suit on withheld LG funds

The Supreme Court has struck out a suit filed by the Osun State Government that sought to compel the Federal Government to release withheld allocations belonging to local government areas in the state.

A seven-member panel of the apex court, in a split decision of six to one, held that the legal action brought by the Attorney General of Osun State lacked competence.

In the lead judgment delivered by Justice Mohammed Idris on Friday, the court held that the LGCs of Osun state lacked the locus standi to activate the Supreme Court’s original jurisdiction on behalf of the 30 councils.

Justice Idris stressed that the Supreme Court could only be approached as a court of first instance to settle disputes between a state and the Federal Government and that the LGCs, being legally recognised autonomous entities, were the proper parties to challenge the FG’s action.

He dismissed the state AG’s argument that the suit was a public interest litigation.

Although the Supreme Court upheld a preliminary objection filed by the Attorney General of the Federation challenging the competence of the suit, it admonished the FG to give full effect to its judgment granting fiscal autonomy to all 774 Local Government Areas in the country.

Osun State had sought multiple reliefs, including a declaration that the AGF could not act contrary to the subsisting decisions of the Federal High Court and the Court of Appeal by withholding allocations and directing payments to sacked APC local government officials.

Musibau Adetunbi, SAN, Counsel for Osun State, argued that the AGF attempted to “destroy the res (subject matter) by attempting to pay the money to one of the contending parties,” noting that an earlier court order stopped the release of the funds. On its part, the FG contended that “no cause of action was established against it” and that the state was seeking to frustrate the APC officials whose three-year term had expired, adding that “the plaintiff not only lacked the locus standi but was also involved in an abuse of the judicial process.”

The Osun State Government, in October, withdrew its suit against the Central Bank of Nigeria and the Accountant-General of the Federation, Shamsedeen Ogunjimi, which sought to prevent the federal government from releasing withheld local government funds to court-sacked local government chairmen and councillors elected during former Governor Adegboyega Oyetola’s tenure.

Speaking in court, Musibau Adetumbi, SAN, the government’s counsel, said the purpose of the suit, which was to safeguard the funds, had been overtaken by events, as the money had already been released.