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The Federal High Court in Abuja yesterday dismissed an application by the state Attorney General seeking to be made a party to a Federal Government suit seeking to block the redemption of promissory notes issued to some consultants/contractors in connection with the Paris Club refund dispute.
The consultants/contractors claimed to have been engaged by the Nigeria Governors’ Forum (NGF) and the Association of Local Governments of Nigeria (ALGON) to recover their share of the Paris Club refunds. They obtained a court judgment ordering the state to pay about $418 million.
The defendants listed by the government are FSDH Merchant Bank Limited, Ned Munir Nwoko, Gregory Lar, Riok Nigeria Ltd, Orji Orizu, Olaitan Bello, Ted Edwards, and Panic Alert Security System Limited, which is a consultant/contractor.
In the suit marked FHC/ABJ/CS/896/2023, the Federal Government was joined by the Attorney General of the Federation (AGF), the Minister of Finance, Budget and National Planning and the Accountant General of the Federation as co-plaintiffs.
Judge Inyang Ekwo was of the opinion that the Attorney General was not required to be a party to the lawsuit.
He considered the application flawed and stressed that the lawsuit could be effectively decided by the court without involving them.
However, Ekwo postponed the trial until October 22 to hear initial objections filed by the defendants to the competence of the lawsuit.
The Attorney General argued that as representatives of the states whose funds would be affected by the agreement, they should be heard by the court.
The Federal Government, when it filed the lawsuit last year, had faulted the procedure for issuing 62 promissory notes in 2021 and urged the court to quash them.
The court was also asked to issue a perpetual injunction prohibiting the defendants and their agents “from exercising any rights of ownership” over the deed.
READ ALSO: Court postpones Emefiele’s case regarding Paris Club’s $53 million debt
The 62 promissory notes, valued at $418,953,668, were issued to the defendants on September 27, 2021 by the Debt Management Office (DMO), following a judgment and writ of mandamus obtained against the Federal Government and the Department of Finance.
The government, among other things, is of the opinion that the agreement is invalid, because it was issued erroneously and violated the relevant law.
However, it was noted that although the letter of agreement was signed by the Ministry of Finance, Budget and National Planning and the DMO, it was not signed as required.
“The disputed agreement was wrongly and unlawfully amended to the assets and revenues of the federation, rather than to the assets and revenues of the state and local governments, which are liable for the applicable loans/debts,” the government argued.
A senior official of the Federal Ministry of Justice, Mr. Oyinlade Koleosho, stated, in an affidavit in support, that the debenture was wrongfully and unlawfully issued against the assets of the federation.
He stated that Articles 314 and 317 of the Constitution had separated the assets of the State or Local Government Councils from the assets of the Federal Government.
Koleosho added that the promissory note was charged against government assets, which did not owe any debt to any contractor/consultant.
He said: “The debt on which the promissory note was issued is not borne by the Federal Government of Nigeria or the Federation.
“Promissory notes charged against the assets of the Federal Government of Nigeria are only issued in respect of loans taken by it and not by the State Governments or Local Government Councils.
“A promissory note of the Federal Government of Nigeria can only be issued to offset a debt of the Federal Government.”
According to court documents, FSDH Merchant Bank Limited had issued 10 promissory notes worth $67,925,661 at an exchange rate of $6,499,561 per note (allegedly for the benefit of Nwoko)
Lar, who was described as Nwoko’s agent, was given two promissory notes “for the account/benefit of Nwoko with a total value of $732,511 at an exchange rate of $366,256.00 per promissory note.
Riok Nigeria Ltd issued 10 Federal Government promissory notes worth $142,028,941 at a rate of $14,202,895 per note. Orizu has 10 promissory notes worth $1,219,440.00 at a rate of $121,944.00 per note.
Bello was said to have been given eight promissory notes totaling $215,195 at a price of $21,524 each. Edwards was given 10 promissory notes totaling $159,000,000 at a price of $15,900,000.00 each.
Panic Alert Security System Limited also issued 10 promissory notes worth $47,831,920 at a price of $4,783,192.00 each.
PARIS CLUB REFUND: Court denies state Attorney’s request to join FG lawsuit over $418m payout first appeared on Latest Nigeria News | Headlines from Ripples Nigeria.
