CBN Governor, Godwin Emefiele.
A Federal High Court sitting in Akure, Ondo State, on Thursday resolved to wait on the Supreme Court, as it adjourned hearing in a suit brought against the Central Bank of Nigeria (CBN) by a group, Social Rehabilitation Grace and Supportive Initiative (SRG), challenging the CBN over the voiding of old N200, N500 and N1000 Naira notes within a period considered too short.
When the matter was mentioned, the trial judge, Hon. Justice T. B Adegoke, said it was improper for her court to commence trial as the suit is similar to the one pending before the Supreme Court, which is the highest court in the land.
At the mentioning of the case, counsel to the SRG, Mrs L.E Ukpabi-Owolabi, said the group had brought a motion on notice to amend its originating summons, and also a second motion on notice for interlocutory injunction.
But the counsel to the CBN, Prince Aderemi Adekile, countered that the motion to amend the SRG’s motion was served on him 24 hours ago, as against 48 hours.
In her ruling, however, Justice Adegoke noted that as for SRG’s second motion for interlocutory injunction, the plaintiffs should await the verdict of a similar case at the Supreme Court, “since the Supreme Court is already seised of the matter”.
Justifying the need for her court to wait for the outcome of the case between some state governments and the CBN cum federal government, over the vexed issue of the new Naira notes, Justice Adegoke said, “That is why they are Supreme Court; it doesn’t mean they are infallible but they are the apex court. Whether they are right or wrong, I don’t want to pass any comment. So we wait”.
She, as a result, adjourned the suit to March 30, 2023, for hearing.
But the matter also raised some dust among lawyers as some of them queried the legality of the directive by President Muhammadu Buhari that only the old N200 notes should be retained till April 10, while the old N500 and N1000 notes should cease to be legal tenders; against a temporary ruling of the Supreme Court that the three old notes should remain in circulation pending its verdict.
The SRG in the suit had averred that the CBN acted beyond its power by setting a timeline for the expiration of the old Naira notes.
“While we know that the CBN has a right to demonetise the Naira, it has no right to erase the value acquired by individuals,” the group noted.
It recalled that “the former President Goodluck Jonathan administration also redesigned currency notes, following which the new and old naira notes were both legal tenders for over two years before the old notes went out of circulation.”
The first plaintiff, Dr. Marindotin Oludare, said, “When I visited Nigeria from the United States of America on December 29, 2022, I went to Automated Teller Machine (ATM) operated by First Bank of Nigeria PLC in Lagos to make cash withdrawals, but the machine dispensed only the old notes.”
He said the CBN had failed to also provide a means whereby Nigerians resident abroad could exchange their old notes.
The group said the time given by the CBN could not be considered a reasonable time, “as contained in Section 20 (3) of the CBN Act 2007, considering the population of the country, which, according to Worldometre elaboration of the United Nations ‘ data, stands at about 219, 375,886; about 2.64 per cent of the world population.”
It averred that setting a hurried expiry date for the old Naira notes at a time Nigeria was preparing for a major election smacked of mischief and could derail a smooth transition from one government to another.
The body said India did the same thing in 2016, but that they sought a cessation of liability ordinance in order for the old notes to cease from being a legal tender. It added, “The rupees were readily available in all banks during this period.
“The cessation of liability is not in the CBN Act, hence they do not have a right to stop being liable for those old notes.”
In the suit, the four plaintiffs, namely Oludare, the SRG, Omoyele Ishola, and Demola Obadofin, are asking the court to extend the expiration of the old naira notes by six months.
They are also seeking, among others, an interim injunction restraining “the respondents and her privies, agents, or servants from enforcing the deadline date of February 10, 2023, wherein the old N200, N500, and N1000 currencies cease to be legal tender, pending the hearing and determination of the motion on notice.”
The applicants said the court should give “an order compelling the respondent to extend the submission of old N200, N500 and N2000 notes by a minimum of six months before same are finally called in and cease to be a legal tender, pending the hearing and determination of the motion on notice.”
The applicants want an order of interim injunction restraining the respondent from setting a deadline for setting old N200, N500 and N1000 notes, saying such is alien to CBN Act 2007, pending hearing and determination of the motion on notice.
The plaintiffs added that the scarcity of naira notes occasioned by the redesigning of N200, N500 and N1000 notes had brought untold hardship to the Nigerian public, as the notice for the swap was too short.
However, the CBN replied that the policy was introduced to avert vote-buying at the coming presidential election.
The apex bank gave the reason, among others, in a counter-affidavit to the suit, urging the court to dismiss the suit, as it averred that the plaintiffs had no justifiable reason for filing it.
In the counter-affidavit by another of the CBN counsel, O. M. Atoyebi (SAN), the apex bank opposed the defendants’ interlocutory injunction on the grounds that “the extension (of expiry date for old naira notes of N200, N500 and N1000) will give room for vote-buying and undermine the forthcoming election.”
It also contended that “the extension of the timeline will jeopardise the fight against fraud, corruption and criminal activities perpetrated by the use of the old currencies”. It specifically cited the festering kidnapping crime, claiming a change in currency notes will end it.
On the group’s reference to currency change in India in 2016 in which the group said Indians were given enough time to replace old Indian rupees, the CBN differed in its narration of the Indian experience.
It said, “The government of India announced the change of their legal tender on November 8, 2016 and was implemented within two days.”
The CBN added: “The entire citizens of India of about 1.417 billion adhered to the timeliness strictly, which has led to positive improvement of the Indian economy.”
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