ANALYZING THE POWERS OF THE SUPREME COURT: THE LEGALITY OF THE CBN’s DIRECTIVE ON NAIRA REDESIGN
By: Victory Sarah Opawoye
The question of whether the Supreme Court of Nigeria has jurisdiction to entertain and determine the naira redesign suit to restrain the Central Bank of Nigeria from effecting its February 10 deadline on naira swap have been viewed from different perspectives by lawyers, legal analysts and experts. What exactly is the position of the Nigerian Law and does the Supreme Court have authority to make decisions on naira redesign?
What is Jurisdiction?
In law, Jurisdiction is the authority of a court to hear and determine cases. This authority is derived from the constitution. It is the right and power to interpret and apply the law.[1]
It is very vital and essential in any judicial system to ascertain the power of a court to determine a cause of action presented before it. Where a decision is reached and the court without jurisdiction of a court it is void ab initio, in other words of no legal effect.
In a recent case of GTB v. Toyed (Nig) Ltd & Anor (2016)2 the Nigerian
Court of Appeal, per Ndukwe-Anyawu, J.C.A restated the elementary law thus:
The law is well settled and it no longer admits of any argument
that jurisdiction is the very basis and the life wire of every matter
and on which any Court tries or hears a case. It is, metaphorically
speaking, the life blood of all trials, whether it be at the Court of
trial or on appeal, and without which
In a recent case of GTB v. Toyed (Nig) Ltd & Anor (2016)2 the Nigerian
Court of Appeal, per Ndukwe-Anyawu, J.C.A restated the elementary law thus:
The law is well settled and it no longer admits of any argument
that jurisdiction is the very basis and the life wire of every matter
and on which any Court tries or hears a case. It is, metaphorically
speaking, the life blood of all trials, whether it be at the Court of
trial or on appeal, and without which
In a recent case of GTB v. Toyed (Nig) Ltd & Anor (2016)2 the Nigerian
Court of Appeal, per Ndukwe-Anyawu, J.C.A restated the elementary law thus:
The law is well settled and it no longer admits of any argument
that jurisdiction is the very basis and the life wire of every matter
and on which any Court tries or hears a case. It is, metaphorically
speaking, the life blood of all trials, whether it be at the Court of
trial or on appeal, and without which all such trials and hearings
are a nullity notwithstanding how well or meticulous such a
In a recent case of GTB v. Toyed (Nig) Ltd & Anor (2016)2 the Nigerian
Court of Appeal, per Ndukwe-Anyawu, J.C.A restated the elementary law thus:
The law is well settled and it no longer admits of any argument
that jurisdiction is the very basis and the life wire of every matter
and on which any Court tries or hears a case. It is, metaphorically
speaking, the life blood of all trials, whether it be at the Court of
trial or on appeal, and without which all such trials and hearings
are a nullity notwithstanding how well or meticulous such a
In GTB v. Toyed (Nig) Ltd & Anor (2016), the Nigerian Court of Appeal, Per Ndukwe- Anyawu JCA stated thus;
“The law is well settled and it no longer admits of any argument
that jurisdiction is the very basis and the life wire of every matter
and on which any court tries or hears a case. It is metaphorically speaking,
the life blood of trials, whether it be at the court of trial or on appeal,
and without which all such trials and hearings are a nullity,
notwithstanding how well or meticulous such a trial or proceeding
had been conducted or how sound or profound the resultant judgment. It is
simply a nullity.”[2]The Supreme Court has original jurisdiction on legal disputes between States or between States and the Federal government. Section 232 of the constitution provides that:
(1) The Supreme Court shall, to the exclusion of any other court, have original jurisdiction in any dispute between the Federation and a state or between states if and in so far as that dispute involves any question (whether of law or fact) on which the existence or extent of a legal right depends.
(2) In addition to the jurisdiction conferred upon it by subsection (1) of this section, the Supreme Court shall have such original jurisdiction as may be conferred upon it by any Act of the National Assembly.This case is a legal dispute between the states and the federal government and as such it invokes the original jurisdiction of the Supreme Court. It refers to the authority to hear cases that are brought directly to it. The Supreme Court provided the following guide for determining whether a court has jurisdiction. Hon. Justice Bairaman (FJ) while delivering the lead judgment in Madukolu v. Nkedilim (1962) 1NWLR 589, stated;
“put briefly a court is competent when
- The court is properly constituted as regards numbers and qualifications of the members of their bench, and no member is disqualified for one reason or another and
- The subject matter of the case is within its jurisdiction, and there is no feature in the case which prevents the court from exercising its jurisdiction and
- The case comes before the court initiated by due process of law, and upon fulfillment of a condition precedent to the exercise of jurisdiction. Any defect in competence is fatal, for the proceedings are a nullity, however well conducted and decided: the defect is extrinsic to its adjudication.
On February 8 2023, the Supreme Court suspended the CBN’s deadline following an order challenging the CBN’s directive. This matter revolves around currency and regulation, which falls within the exclusive list of the Federal Government.
In the suit, Kogi, Kaduna and Zamfara urged the Supreme Court to grant an interim injunction stopping the federal government either by itself or through the Central Bank of Nigeria, commercial banks and its agents from effecting the deadline of naira swap. They also challenged the demonetization policy of the federal government on the basis that it is not in accordance with the Nigerian constitution and Section 20(3) of the CBN Act, 2007;
“(3) Notwithstanding subsections (1) and (2) of this section, the bank shall have power, if directed to do so by the President and after giving reasonable notice on that behalf, to call in any of its notes or coins on payment of the face value thereof and any note or coin with respect to which a notice has been given under this sub-section, shall, on the expiration of the notice, cease to be legal tender, but, subject to the section 22 of this Act, shall be redeemed by the Bank upon demand.”[3]In other words, the CBN has a mandatory duty to redeem the old notes when presented to them or presented to the bank. The deadline stipulated by the CBN was not feasible. About 3 trillion naira of the old notes in circulation was deposited to the banks; however, less than half a trillion was only made available by the CBN.
The court held that the president failed to meet with the federal executive council to discuss the economic and security implications of the policy and did not have any form of consultation with stakeholders in the Nigerian economy. Although this is not expressly required by the constitution, the Supreme Court opined that such consultations “is inherent in the idea of a federation in a democracy”. The president breached the constitution in the manner he issued the directive banning the old notes from February 10.
Conclusively, the judgment of the Supreme Court has given the citizens hope that the rule of law still applies. In furtherance of the Supreme Court order the CBN disclosed on March 3rd 2023 that the old notes will remain legal tender till December 31st 2023. The decision of the Supreme Court is final and binding on the CBN being an agency of the Federal Government. In a democratic society, when the apex court has decided on an issue of law everybody or entity is bound by it.
What are your views?
[1] Horvath, E. (2022) Why the dark life is not the high life in god, emeryhorvath.com. Available at: https://www.emeryhorvath.com/s9-027-why-the-dark-life-is-not-the-high-life-in-god-podcast/ (Accessed: March 30, 2023).
[2] Tide, T. (2020) Jurisdiction, :::…The Tide News Online:::… Available at: http://www.thetidenewsonline.com/2020/04/08/jurisdiction/ (Accessed: March 30, 2023).
[3] Trustedadmin (2023) The Supreme Court decision on the old naira note and the enforcement, The Trusted Advisors. Top tier Law firm in Lagos Nigeria. Available at: https://trustedadvisorslaw.com/the-supreme-court-decision-on-the-old-naira-note-and-the-enforcement/ (Accessed: March 30, 2023).