In The Supreme Court of Nigeria
On Friday, the 13th of December 2002
SC. 137/2001
SC. 189/2001
SC. 253/2001
SC. 277/2001
SC. 296/2001
(Consolidated)
Attorney-General of Ogun State
Attorney-General of Lagos State
Attorney-General of Oyo State ....... Plaintiffs
Attorney-General of Ondo State
Attorney-General of Osun State
And
Attorney-General of the Federation ....... Defendant
Judgement of the Court
Delivered by
Sylvester Umaru Onu, J.S.C.
The five Suits considered together herein are so considered because of similarity as to facts and for facility and convenience of trial. I have decided to consolidate them, as I shall shortly demonstrate.
Be that as it may, I wish to commence their considerate observing that as the Lagos State Attorney-General's case is Comprehensive albeit that the other States are asking for less the same I will dwell more on the Lagos State case while forgetting to treat the other States' matters in due course. In dealing with the reliefs claimed in all these cases one cardinal point that remains uppermost in my mind, however, is the fact that our decision in this court reported as Attorney-General, Federation v. Attorney-General, Abia State & 35 Ors. (No. 2) (2002) 6 (Pt. 764) 542 SC, has answered most questions in the present case. That case having thus answered many points raised in the case in hand, what remains to be considered will be confined within a narrow compass.
In the Lagos State case, the reliefs claimed by the Attorney-General in his amended statement of claim, which I regard as the fulcrum upon which this action revolves, are pleaded in paragraph 18 thereof thus:
"18. Whereof the plaintiff claims the following Reliefs:
1. A declaration that it is illegal and unconstitutional being contrary to Section 162(3) of the Constitution of the Federal Republic of Nigeria 1999 for the defendant to make deductions as a first line charge on the Federation Account to fund the following to wit:
(a) NNPC joint venture projects;
(b) NNPC priority projects;
(c) Central Bank of Nigeria (CBN) priority projects;
(d) The National Judicial Council;
(e) Foreign Debts incurred by, the Federal Government;
(f) 1% of the Federation Account said to be statutory allocation to the Federal Capital City, Abuja.
2. A declaration that the defendant is under Section 162(3) of the Constitution of the Federal Republic of Nigeria, 1999 to distribute the amount standing to the credit of the Federation Account between the Federal, State and Local Government Councils and to no other party or Fund.
3. A declaration that the defendant is not entitled to make any deductions whatsoever from the Federation Account before the amount in the Account is distributed among the Federal, State and Local Government Councils on the terms and in the manner prescribed by the National Assembly, and that any prior deductions before such distribution as being made at present by the defendant is illegal and unconstitutional being contrary to section 162(3) of Constitution of the Federal Republic of Nigeria, 1999.
4. A declaration that on a proper construction and interpretation of Sections 80, 81 and 162 of the Constitution of the Federal Republic of Nigeria, 1999 the payment of salaries of Judicial Council is not a charge on the Federation Account and it is illegal and unconstitutional to deduct those salaries directly from the Federation Account as first line charge or at all.
5. A declaration that the Federal Government is mandatorily obliged by the combined effect of Section 162(i) and (iv) of the Constitution of the Federal Republic of Nigeria 1999 to pay into Federation Account all the proceeds and income, save those exempted under Section 162(i), accruing from the privatisation of government enterprises, from stamp duties, capital gains and other income accruing to or derived by Federal Government from any other source.
6. A declaration that it is unconstitutional and illegal for the defendant whether by itself, its office agents, privies, or otherwise howsoever to withhold and not pay into the Federation Account proceeds and/or income, save those exempt under Section 162(i), accruing from privatisation of government enterprises and other income accruing to or derived by the Federal Government from any other source.
7. A declaration that the defendant is not entitled within the proper meaning of Section 162(5) and (8) of the Constitution of the Federal Republic of Nigeria, 1999 to pay the amount standing to the credit of the Local Government Councils in the Federation Account directly to the Government Councils and that such payments by the defendant is illegal and unconstitutional.
8. An order directing the Federal Government Nigeria, whether by herself, her officers, servants, and/or privies or otherwise howsoever to pay such sums or amount as are standing credit of the Local Government Councils Federation Account from time to time to the plaintiff for the benefit of the States and Local Government Councils in accordance with the provisions of Section 162(5) of the Constitution of the Federal Republic of Nigeria, 1999.
9. A declaration that the deduction of funds from the Federation Accounts by the defendant to fund and maintain a Stabilisation Account is illegal and unconstitutional.
10. A declaration that it is illegal and unconstitutional for the defendant to deduct any sums of money from the Federation Account for the purpose of servicing foreign or external debts incurred by the Government.
11. A declaration that Section l (d) (i - v) of the Allocation of Revenue (Federal Account, etc.) Cap. 16, Laws of the Federal Republic of Nigeria as amended by Decree No. 106 of 1992 is inconsistent with Section 162(3) of the Constitution of the Federal Republic of Nigeria, 1999 and is to that extent invalid, unconstitutional, null and void and of no effect.
12. A declaration that Section 3 and 6(1), (2) and (3) of the Allocation of Revenue (Federation Account) Act, Cap. 16, Laws of the Federal Republic of Nigeria as amended by Decree No. 106 of 1992 are inconsistent with Section 162(5), (6) and (8) of the Constitution of the Federal Republic of Nigeria, 1999 and are invalid, unconstitutional, null and void and of no effect.
13. An order directing the federal government to render a full and proper account of all the monies properly payable into the Federation Account and or mandatory/required to be paid into the Federation Account as stipulated by Section 162(1) and (10) of the Constitution of the Federal Republic of Nigeria, 1999 from 29th May, 1999 till Judgment.
14. An order directing the Federal Government of Nigeria to pay to the plaintiff all sums properly found due and unpaid to the plaintiff in respect of its share from the Federation Account on the proper and lawful distribution amongst the States of the appropriate and true amount standing to the credit of States in the Federation Account.
15. An order of injunction restraining all officers, servants and functionaries of the Government of the Federal Republic of Nigeria or any other public officer whomsoever and howsoever from keeping.
16. An order of injunction restraining the Federal Government of Nigeria whether by herself, servants, and/or agents or otherwise howsoever from breaching the clear provisions of Section 81 (3) and 162 of the Constitution.
17. An order of injunction restraining all office servants, and functionaries of the Government of the Federal Republic of Nigeria or and other put officer of the said Government whomsoever; howsoever from deducting or taking any money whatsoever from the Federation Account for the purpose of funding any project or effecting any payment whatsoever except for the pi of distributing such monies amongst the Federal, State and Local Government as provided by law.
18. An order of injunction restraining all officers, servants and functionaries of the Government of the Federal Republic of Nigeria or any other public officer of the said Government whomsoever and howsoever from withholding and not paying into the Federation Account all the revenue collected by the Government of the Federal Republic Nigeria from any source whatsoever.
19. An order of injunction restraining the Government of Nigeria whether by its servants and functionaries whomsoever howsoever from breaching the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria, 1999."
A 13-paragraph statement of defence was filed on behalf of the defendant, thus joining issues with the plaintiff, as follows:
"Save and Except as is hereinafter specifically admitted, the Honourable Attorney-General of the Federation and Minister of Justice (hereinafter referred to as the defendant) denies each and every allegation of fact contained in the plaintiff's statement of claim as if same were specifically set out and traversed seriatim:
1. The defendant admits paragraphs 1, 2 and 3 of the plaintiff's statement of claim.
2. The defendant admits paragraph 4 of the statement of claim only to the extent that the President shall table before the National Assembly proposals for revenue allocation, upon receipt of advice from the Revenue Mobilisation, Allocation and Fiscal Commission.
3. The defendant admits paragraph 5 of the statement of claim.
4. The defendant admits paragraph 6 of the statement of claim only to the extent that the Federation Account Allocation Committee meets monthly to ensure that allocation made to the States from the Federation Account are promptly and fully paid into the Treasury of each State on the basis and terms prescribed by the Allocation of Revenue (Federation Account, etc) Act, as amended, and the 1999 Constitution.
5. The defendant in further rebuttal of the averments in 6 (i - v) of the statement of claim state as follows:
(i) That any amount standing to the credit of the Federation Account shall be distributed among the Federal and State Government Councils in each State on such terms and in such manner as may be prescribed by the National Assembly.
(ii) The distribution of any amount standing to the credit of the Federation Account is subject to the prescription of the terms and manner of such distribution by the National Assembly, and the latter has not prescribed such terms and manner.
(iii) That all debts currently being charged on the Federation Account are the debts previously charged before 29th May, 1999 and which shall continue to be so charged by virtue of Section 314 of the 1999 Constitution.
6. The defendant in response to paragraph 8 of the statement of claim state that the payment to the States Primary Education Board and the Education Tax Fund is in compliance with the extant statute on this Subject.
7. The defendant States in response to paragraph 9 of the statement of claim that the deductions made either as first line charges on the Federation Account or otherwise are not illegal -and unconstitutional. This is because pending the Act of the National Assembly in this regard the system of revenue allocation in existence shall continue to apply.
8. The defendant avers in response to paragraphs 10 and 11 of the statement of claim that until the Act of the National Assembly comes into force, deductions or disbursements from the Federation Account Under the existing distribution System put in place pursuant to the existing laws continue to be in force constitutionally by virtue of Sections 313, 314 and 315(4) (b) of the 1999 Constitution.
9. The defendant denies paragraph 12 of the statement of claim and state that in so far as the National Assembly has not made any prescription as to the allocation and distribution of the amount standing to the credit of the Federation Account, the existing laws continue to be in force.
10. The defendant denies paragraph 12 of the statement, of claim and state that the retention by the Federal Government since June, 1999 Constitution which provides that the National Assembly in exercise of its powers, shall prescribe the manner for distribution of such funds; and that the National Assembly has not made any Act specifying manner for distribution of such funds described herein.
11. The defendant denies paragraph 14 of the statement of claim and state that the claim for account in this suit is wrongful as the plaintiff's Commissioner of Finance is a member of the Federation Account Allocation Committee, which was established pursuant to Section 5(1) of the Allocation of Revenue Account, etc. Act, Cap. 16, L.F.N. 1990. By virtue of Section 2 of the revenue Allocation and Fiscal Commission Act, Cap.392, LFN, 1990, the plaintiff is also represented in the composition of the Revenue Mobilisation Allocation and Fiscal Commission and there is no allegation that the said Commission failed or refused to supply to the plaintiff the Statement of Federation Account on request.
12. In response to paragraph 15 of the statement of claim, the defendant shall contend at the hearing of this suit:
(a) that pursuant to Section 162(9) of the 1999 Constitution, any amount standing to the credit of the judiciary in the Federation Account shall be paid directly to the National Judicial Council for disbursement to the heads of courts established for the Federating States under Section 6 of the Constitution.
(b) That the payment of 1 % of the proceeds from the Federation Account to the Federal Capital is lawful by virtue of the provisions of Allocation of Revenue (Federation Account, etc.) Act, Cap. 16, L.F.N. 1990. The said 1% deduction is accordingly not unconstitutional by virtue of Sections 313 and 315(4) (b) of the 1999 Constitution.
(c) That Section 162(5) of the 1999 Constitution provides that the amount standing to the credit of Local Government Councils in the Federation Account shall also be allocated to the States for the benefits of their Local Government Councils on such terms and in such manner as may be prescribed by the National Assembly.
13. Whereof the defendant prays the court to hold that:
(a) Until the relevant Act of the National Assembly for the distribution from the Federation Account comes into force, any claim for shares of the Federation Account under Section 162 of the 1999 Constitution as being claimed by the plaintiff in this suit is incompetent before this Honourable Court.
(b) Until the said Act of the National Assembly comes into force, deduction for priority projects, 1st line charges, service for external debts, 1% deduction for the service of the Federal Capital Territory, etc. under the existing distribution system put in place pursuant to the existing laws continue to be in force constitutionally by virtue of Sections 313, 314 and 315(4) (b) of the Constitution of the Federal Republic of Nigeria, 1999."
After pleadings were delivered by the plaintiffs to these consolidated suits namely, Ogun, Lagos, Oyo, Ondo and Osun States, each of them went ahead to file and exchange briefs and some other affidavit evidence verifying their cases with the defendant. I wish first of all to consider the case of the Attorney-General of Lagos State whose case is more comprehensive in presentation and outlay.
I shall hereafter consider the cases of Ogun, Oyo, Ondo, and Osun States in order of sequence. The lone issue submitted as arising for our determination in the Lagos state case:
The issues for determination especially turn on questions whether or not the provisions of Section 162, in particular and other relevant provisions of Constitution of the Federal Republic of Nigeria, have been breached in the circumstances by defendant and whether the plaintiff is not entitled to the reliefs sought in the event of such breach or violation being established.
On 16th September, 2002, when the hearing of this case took place, Honourable Attorney-General of Lagos State, Mr. Yemi Osinbajo, SAN adopting his brief dated 18th March, 2002 and filed the same day, expatiated and relied thereon. On reliefs (I), (II) and (III), it was Submitted that Section 102(3)) clearly stipulates that any amount in the Federation Account shall be distributed among the Federal, State and Local Governments on such terms and in such manner as may be prescribed by the National Assembly. It is next contended that such amount cannot properly or constitutionally be distributed in favour of any other party/fund.
Secondly, it was submitted that the provisions of any law of the National Assembly, which require that the distribution of the amount in the Federation Account be made among any parties other than the Federal Government, State Government and Local Government Councils, will be inconsistent with Section 162(3) and are therefore invalid, null and void.
Thirdly, that to include other parties in the distribution of the said amount will effectively deprive the plaintiff of its appropriate share in the amount in the Federation Account.
Fourthly, it is contended, that in its Statement of defence the defendant admittedly made as a first line charge on the Federation Account, which the plaintiff complains about in paragraphs 6, 9,10 and 11 of its statement of claim, are consistent with the provisions of the Allocation of Revenue (Federation Account, etc) Act, Cap. 16, Laws of the Federal Republic of Nigeria, 1990 as amended by The Revenue Act and the 1999 Constitution and that the action of the Federal Government and its agents in the circumstance, is not illegal or unconstitutional. The learned Attorney-General from the foregoing, first argued that the Revenue Act makes no provisions for deducting any sums as a first line charge or on the Federation Account. Indeed, he contended, the relevant provisions of the Act. i.e. Section 1 provides as follows:
"The amount standing to the credit of the Federation Account as specified in subsection (1) of Section 149 of the Constitution of the Federal Republic of Nigeria shall be distributed by the Federal Government among the various governments in Nigeria and the funds concerned on the following basis, that is to say:"
(a) |
the Federal Government |
48.5% |
(b) |
the State Governments |
24% |
(c) |
the Local Governments |
20% |
(d) |
special Funds |
7.5% |
(i) |
Federal Capital Territory |
1% of the Federation Account |
(ii) |
Development of Minerals Producing areas |
3% of the Revenue accruing to the Federation derived from Minerals |
(iii) |
General ecological problems |
2% of the Federation Accounts |
(iv) |
Derivation |
1% of the revenue accruing to the Federation Account derived from minerals |
(v) |
Stabilisation Account |
0.5% of the Federation Account, plus the revenue arising out of using minerals revenue, instead of the Federation Account, as the base for allocation to the fund for development of the mineral producing areas and derivation." |
Consequently, the learned Attorney-General argued, such deduction do not, in the first place, have any basis or support in any Act of the National Assembly and is illegal. Secondly, the 1999 Constitution itself does not provide for any deduction as a first line charge on the Federation Account while the act of deduction, he argued, is inconsistent with the provision of the Constitution. Indeed, he contended Section 163(3) of the Constitution stipulates how the amount in the Federation Account shall be distributed. This, he pointed out, demonstrated how unilateral the Federal Government of Nigeria was. The Constitution he argued, expressly mentioned those to have a share in the money in the Federation Account. The word "shall" used by the section, it is contended, makes it mandatory that the money be distributed amongst the parties mentioned only. The defendant, it is further submitted, purportedly relied on Sections 313, 314 and 315(4) of the Constitution to contend that:
"Until the Act of the National Assembly comes into force deductions or disbursements from the Federation Account under the existing distribution system put in place pursuant to the existing laws continue to be in force constitutionally ......." See paragraph 8 of the statement of defence).
Section 313 of the Constitution of the Federal Republic of Nigeria, 1999 on the other hand, it is asserted, provides as follows:
"Pending any Act of the National Assembly for the provision of a system of Revenue allocation between the Federation and the States, among the States, between the States and Local Government Councils in the States, the system of revenue allocation in existence for the financial year beginning from 1st January, 1998 and ending on 31st December, 1998 shall, subject to the provisions of this Constitution and as from the date when this Section comes into force, continue to apply:
Provided that where functions have been transferred under this Constitution from the Government of the Federation to the States and from the States to the Local Government Councils the appropriations in respect of such functions shall also be transferred to the States and the Local Government Councils, as the case may require."
Clearly therefore, it is further argued, the application with effect from 29th May, 1999 of the system of revenue allocation in existence between 1st January, 1998 and 31st December, 1998 under the Constitution, is subject to the provisions of the 1999 Constitution. The case of Labiyi v. Anretiola (1992) 8 NWLR (Pt. 258) 139 at 164 A - B wherein this Court (per Karibi-Whyte, JSC) stated the true meaning of the expression "subject to" to be as follows:
"In other words, where the expression is used at the commencement of a statute as in section 1(2) of Decree No 1 of 1984, it implies that what this subsection is 'subject to' shall govern, control and prevail over what follows in that section or subsection of the enactment. See also Tukur v. Government of Gongola State (1989) 4 NWLR (Pt. 117) 517 at 529" which was called in aid.
It is next submitted that the existing Law under which the system of revenue allocation was put in force and effect, as rightly contended by the defendants in paragraph 8 of their defence, is the Allocation of Revenue (Federation Account, etc Act) Cap. 16, Laws of the Federal Republic of Nigeria, 1990 as amended by Decree 106 of 1992 (supra). The effective application and use of that system from 29th May, 1999 under section 313, to the provisions of Section 162(3) of the same Constitution which requires that the distributions of any amount in the Federation Account, on the terms and in the manner prescribed by the National Assembly, shall be amongst the Federal State and Local Governments. No other body, fund or institution, it, is argued, is contemplated as a recipient or beneficiary of the amount in the Federation Account; the division being amongst three parties only. Consequently, it is next contended, any system of Revenue Allocation whereby the amount in the federation Account is distributed from time to time amongst other bodies or persons apart from or outside of the Federal, State and Local Governments, will be unconstitutional. The argument that such distribution is being applied pursuant to the provisions of the Revenue Act, it is fur maintained, is of no moment as the said provisions are inconsistent with the provisions of Section 162(3) as earlier demonstrated. If the system of revenue allocation for 1st January, 1988 to 31st December 1988 provides for distribution of money direct from the Federation Account to other Funds or groups, that will only continue to apply subject to the provisions of the 1999 Constitution i.e. in so far as it inconsistent with any of the provisions of the Constitution. In the instant case, learned Attorney-General asserted that such application would be clearly inconsistent with Section 162(3) and therefore, prohibited by Section 313. Any continuance of such distribution from 29th May, 1999, he added, would therefore be consistent with the provisions of the Constitution whether such system is provided by any Act or not. Thus, clearly it is argued, Section 1 (d) (i-v) of the Allocation of Revenue (Federation Account, etc) of 1990 as amended which is existing law under Section 315 is inconsistent with Section 162(3) among the beneficiaries of the distribution of the amount in the Federation Account. The Supreme Court, it is pointed out, has effectively decided on the proper way to approach the subject of the inconsistencies of any law with the provisions of the Constitution. In the very recent case of Edjerode v. Ikine (2001) 18 NWLR (Pt. 745) 446, it is stressed, the court held that if any existing laws or any of their provisions are inconsistent as from 1st October, 1979 with the 1979 Constitution, such laws or any of their provisions whether or not pronounced upon by the court as being inconsistent with the said Constitution, are impliedly repealed or modified to conform with its provisions.
After we were referred to the dictum of Ejiwunmi, JSC in the latter case reference was also made to the Uwaifo v. Attorney-General of Bendel State (1982) 7 SC 124 where Idigbe, JSC succinctly stated the law thus:
"It is important to note that the preclusion or prohibition is limited and confined to existing laws. It therefore becomes abundantly clear that if such laws or any of their provisions are inconsistent as from 1st October, 1979 with 1979 Constitution, such laws or any of their provisions whether or not pronounced upon by the Courts as being inconsistent with the said Constitution, are impliedly repealed or modified to conform to its provisions. Likewise, all things done or purported to be done under such impliedly repealed or modified laws after 1st October, 1979, are equally of no effect...." (Italics mine for emphasis).
Section 274 of the 1979 Constitution which was the subject of interpretation in Ikine and Uwaifo cases (supra), it was argued, is in pari materia with Section 315 of the present 1999 Constitution upon which the defendant relies, adding that the same construction and interpretation must a fortiori be given to Section 315 of the Constitution. The case of Okon & Ors. v. The State (1988) NWLR (Pat.69) 172 (1988) 1 NSCC 156 at 161 was called in aid thereof. Nnaemeka-Agu, JSC stating the laws on the subject in that case, it is pointed out, held as follows:
"With respect, I think that the principle on which a previous legislation has been relevant to the interpretation of a later statute is fairly well settled. A previous legislation may be relevant to the interpretation of a later legislation in two ways:
"First, the course which legislation on a particular point has followed often provides an indication as to how the present statute should be interpreted. It is in such cases presumed that the interpretation in the former must have been known to those who drafted the later. Hence in the case of Armah v. Government of Ghana (1968) A.C. 192 it was applied by the