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Nigerian States Warn F.G. Over $418m Paris Club Loan

The Federal Government (F.G.) has been warned by the 36 states of the federation not to tamper with funds accruing to them and the 774 local government areas in the guise of satisfying alleged $418 million London/Paris Club Loan refund-related judgement debts.

The states said they were not parties to any suit in the London/Paris Club refund, and were, therefore, not liable to any person or entity in any judgement debt being relied on by the Federal Government.

The Body of Attorneys-General of the Federation, through which the states spoke, warned that should the Federal Government proceed to make any such deduction, it would be acting illegally and in contempt of their appeal challenging the judgement.

The states gave the warning in an April 4, 2022 letter in their response to a November 11, 2021 letter from the Minister of Finance, Budget and National Planning, advertising the commencement of the deduction for the liquidation of the alleged judgment debts

The Body of Attorneys-General of the Federation, through its Interim Chairman, Mr. Moyosore Onigbanjo, SAN, of Lagos State; Interim Secretary, Dr. Abdulkarim Kana of Nasarawa State and Attorneys-Generals of Rivers, Abia, Taraba, Benue and Zamfara states, for and on behalf of all the state attorneys-general, in the letter, said: “Their Excellencies have drawn our attention to your letter referenced above, which the various states of the federation received about the end of March 2022.

“The letter notified the states of your (Minister of Finance) intention to commence deduction from allocations due to the states from the Federation Account for the liquidation of London/Paris Club loan refund-related judgement debts on behalf of the 36 states of the Federation and the 774 LGAs.

“Please note that the states of the federation were not parties to any contract or suits concerning the London/Paris Club refund, from which the said judgement debts arose. Consequently, the 36 states of the federation are not liable to any person or entity in any judgment debt.”

The letter warned that the deduction of the allocations due to the 36 states of the federation from the Federation Account to liquidate the London/Paris Club loan refund-related judgement debts is the subject of an appeal filed by the 36 states at the Court of Appeal, Abuja.

“The appeal challenges the Federal High Court’s (per Justice I.E. Ekwo) judgement delivered on March 25, 2022, in Suit No: FHC/ABJ/CS/1313/2021 between A.G Abia State v. President, Federal Republic of Nigeria & 42 Ors. Therefore, the issue is sub judice.”

It added that the states have also filed a motion on notice for an injunction pending appeal.

The letter added that the Body’s legal representatives had published a public caveat in national dailies notifying the public of the pending appeal, which also advised concerned parties “to desist from dealing with the subject matter thereof, pending the hearing and determination of the appeal and the application for Injunction pending appeal.

“The law requires you to restrain from taking any step, whatsoever, that is capable of interfering with the res of the suit, which is now a subject of an appeal.

“Accordingly, Nigerian case law enjoins you to refrain from effecting any deduction whatsoever, from the allocations due to the 36 States from the Federation Account for the liquidation of the London/Paris Club Loan refund-related judgment debts purportedly on behalf of the 36 States of the Federation and the 774 LGAs, pending the hearing and determination of the appeal by the States of the Federation. Doing otherwise, in the face of the pending appeal and motion on notice for injunction pending appeal shall be at your peril.”

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