- Category: Business and Economy
- Published on Wednesday, 28 March 2012 09:52
- Written by Admin
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The Federal Government yesterday, in Abuja, made a u-turn and begged the Supreme Court for an adjournment to enable her settle out-of-court the case instituted by the 36 states challenging the legality of the Excess Crude Account and the decision to transfer $1 billion from the account to the Sovereign Wealth Funds (SWF).
Already, the states are poised for a showdown as they accused the Federal Government of insincerity in her promise to settle the case of court.
Yusuf Alli (SAN), who represented the states in court, said his clients wanted the issue resolved once and for all.
But counsel to the Federal Government, Austine Alegeh (SAN), pleaded with the court to allow a short adjournment to enable the parties hold further discussion and resolve the dispute amicably.
He said that almost all the issues had been resolved and that outstanding issues could still be resolved out of court by the parties.
Although, the Chief Justice of Nigeria (CJN), Justice Dahiru Musdapher, was reluctant to grant an adjournment, he nevertheless conceded to the request for an adjournment.
He expressed concern at the inability of both the Federal Government and the states to reach a compromise even as he rhetorically asked, “if states and the Federal Government are not ready to uphold the sanctity of the constitution, who else will?”
He consequently adjourned the case to May 21 this year for the parties to report back to the court how far they have gone with the out-of-court settlement arrangement.
The Federal Government had earlier informed the court that talks between the parties had collapsed and that she was ready to allow the apex court to enter a decision on the matter.
The two parties, which had previously asked the Supreme Court to stand down the case aimed at resolving the dispute over the retention of the Excess Crude Account and the transfer of $1 billion to the recently created SWF, have now gone back to the apex court for adjudication on the dispute.
The Supreme Court had earlier granted a request by the parties to settle the matter out of court and to explore an amicable resolution of the disagreement.
Governors of the 36 states had gone to court to among others, seek an order compelling the Government of the Federation to pay into the Federation Account N5.51 trillion being the balance of the money that accrued to the central purse between 2004 and 2007 from the proceeds of crude oil sales, petroleum profits tax and oil royalties.
The Government of the Federation had classified such earnings as "excess crude proceeds" and "excess PPT and royalties" which were paid into an account termed the "Excess Crude Account".
The governors also asked the court to order the Federal Government to transfer to the Federation Account all sums standing to the credit of the Excess Crude Account.
However, in a counter affidavit filed last week on behalf of the Federal Government by the law firm of Alegeh and Co., it said efforts to find a common ground did not succeed.
Mr. Uchena Njoku of the law firm said: "I know as a fact that subsequent to the institution of the substantive case, the parties explored the possibility of an amicable settlement of the issues discernible in the case and mutually sought several adjournments of the case to enable them to conclude the settlement option and report same to the court.
"That when it became clear the plaintiffs/applicants were not amenable to the settlement options, discussions in this regard were called off and parties accordingly informed the court."
The Federal Government also accused the states of mischief because they took part in the deliberation of the National Economic Council where the decision to transfer the $1 billion from the Excess Crude Account to the SWF was taken.
It added that the states had also been receiving their shares from the money and accused them of insincerity.
In response, the states insisted that they had shared only the legitimate funds deposited in the Federation Account and not from the funds illegally deposited in the Excess Crude Account.
While asking the Supreme Court to refuse the application by the states to stop the Federal Government from transferring $1 billion from the Excess Crude Account to the SWF, the latter’s counsel said his client would run into problem if the application was granted.
He said the day-to-day running of the nation's economy would be put in danger if the application was granted.
The governors, through their lawyer, Chief Adegboyega Awomolo, had applied to the Supreme Court to restrain the Federal Government from making any withdrawals howsoever from the account styled the "Excess Crude Account" (or any account replacing same by any name howsoever), pending the hearing and determination of a suit they filed in 2008.
The governors also asked the apex court to order that all sums standing to the credit of the account styled the "Excess Crude Account" (or any account replacing same by any name howsoever) be paid into a dedicated account at the instance of the court or be otherwise secured as the court may deem fit, pending the hearing and determination of the substantive suit.
Awomolo said the governors were forced to file the application because the Federal Government and its officials had consistently, and in total disregard for the pending suit, withdrawn, utilised, disbursed and allocated funds from the account and had nearly depleted N5.51 trillion being the balance on the account as at 2008 when the case was instituted.
He further stated that the Federal Government had announced its intention to withdraw, disburse and utilise another $1 billion from the credit balance from the account in disregard to the subsisting suit and in disrespect to the authority of the Supreme Court.