Naira Redesign: Supreme Court Restrains the CBN from Enforcing Feb 10 Deadline [Update: Govt Reacts]

In a new development on Wednesday, the Supreme Court of Nigeria has restrained the Federal Government from enforcing the February 10 Deadline, earlier issued by the Central Bank of Nigeria (CBN) for redesigned N200, N500 and N1,000 notes to permanently replace the old ones.

The controversial policy, which has been widely criticized due to the chaos resulting from its implementation, has recently been contested by the ruling All Progressive Congress (APC) that has alleged it was meant to undermine its chances in the February 25 elections. Kaduna State governor, Mallam Nasir El-Rufai, had last week echoed the allegation that some elements in the presidency are working hard to undermine the APC because their candidate didn’t win the primary election.

Based on this, three northern states — Kaduna, Kogi and Zamfara — had on February 3rd, filed a motion ex-parte, praying the Supreme Court to stop the CBN from implementing the currency swap deadline.

In response to the prayer led by the states’ lawyer, AbdulHakeem Mustapha (SAN), a seven-man panel of the Supreme Court led by Justice John Okoro, in a unanimous ruling, granted an interim injunction restraining the federal government, the central bank and commercial banks etc from implementing the February 10, deadline for the old 200, 500 and 1000 Naira notes to stop being a legal tender.

The apex court further held that the FG, CBN, commercial banks, by this ruling, must cease to enforce the February 10 deadline pending the determination of notice scheduled to hold on February 15 on the issue.

After the ruling, counsel to the three states, Mustapha told the press that they made the decision to drag the matter to the Supreme Court because among other things, the CBN policy has brought about a lot of hardship on Nigerians, riling the public up against commercial banks.

“We invoke the original jurisdiction of the Supreme Court when there is a dispute between the state government and the Federal Government. It is one of the few occasions where the Supreme Court act as the original jurisdiction. So, we invoked the powers of the Supreme Court to hear this application.

“The reason for it is that as well-intentioned as this policy of the Federal Government on this naira redesign, it is causing hardship all over the country. As we can all see, banks are being harassed, Nigerians are suffering, especially the downtrodden, even in the urban areas they are having difficulty, but it is more excruciating in the rural areas.

“So, the three state governments – Zamfara, Kaduna and Kogi deemed it fit for us to invoke the powers of the Supreme Court to intervene,” Mustapha said.

However, other lawyers in the country have faulted the Supreme Court’s ruling, saying the apex court isn’t the proper place “for the adjudication of this issue.”

“What the States have done is used the apex court to extend the deadline for currency swap. The Supreme Court is not the proper place for the adjudication of this issue. The proper place is the High Court – for judicial review of the lawfulness of the decision of the CBN,” Abdul Mahmud, a senior lawyer and rights activist said. He added that the Supreme Court has kept turning itself into a political instrument, diminishing its respect.

It could be recalled that a Federal High Court sitting in Abuja, had on Monday, restrained the CBN from extending the February 10 deadline.

“An order of interim injunction is hereby made restraining the defendants whether by themselves, staff, agents, officers, interfacing banks or whosoever not to suspend, stop, extend, vary or interfere with the extant termination date of use of the old N200, N500, and N1000 bank note being 10th day of February, 2023, pending the hearing and determination of motion on notice,” the court held.

However, going by the Supreme Court’s ruling, the Nigerian public will have five more days to transact with the old naira notes. But experts have warned about courts’ rulings against the CBNs policies, saying it undermines the apex bank’s independence which will impact the economy negatively.

Update: The Nigerian Government Reacts

Premium Times reports that the Nigerian government has asked the Supreme Court to dismiss states’ suit.

The federal government has called on the Supreme Court to dismiss a suit challenging the 10 February deadline set by the Central Bank of Nigeria (CBN) to end the legal tender status of the old versions of some newly designed currency notes.

It argues that the Supreme Court lacks jurisdiction to hear the suit. The suit was filed by three states – Kaduna, Kogi and Zamfara States, all in the northern part of Nigeria and controlled by the ruling All Progressives Congress (APC).

The respondent maintains that the case is not a dispute between the federation and the state governments, but merely an issue about CBN’s policy.

It says the suit is, therefore, not qualified to be taken directly to the Supreme Court for adjudication. It argues that the suit ought to have been commenced at the Federal High Court.

The Attorney-General of the Federation (AGF), Abubakar Malami, sued as the sole defendant as the representative of the federal government, filed his opposition to the suit as a preliminary objection against it at the Supreme Court on Wednesday.

Mr Malami’s filings came hours after the Supreme Court granted a request by the three state governments for an order temporarily halting the CBN’s plan to end the use of the old currency notes on 10 February.