A Federal High Court sitting in Abuja is set to hear a suit filed by the Association of Local Governments of Nigeria (ALGON) against the Central Bank of Nigeria (CBN) and other federal agencies regarding the implementation of local government autonomy.
The suit, marked FHC/ABJ/CS/353/2025, was filed by the Registered Trustees of ALGON against several key defendants, including the Attorney General of the Federation (AGF), the Minister of Finance, state Commissioners for Finance, and the Minister of Budget and National Planning, among others.
Remember that the Supreme Court had ruled in favour of the 774 local governments on July 11, 2024, which granted financial autonomy to local governments.
However, the implementation of this ruling has faced setbacks as state governments have allegedly stalled the full implementation of the autonomy.
ALGON is now seeking an order to restrain the disbursement of funds to local governments without its prior approval.
The organization also demands that the 774 local councils be granted representation at Federation Account Allocation Committee (FAAC) meetings, where federal allocations are discussed.
The originating summons filed by ALGON outlines the following prayers:
Financial Control: A declaration that, following the Supreme Court decision on July 11, 2024, the first to eighth defendants cannot disburse funds to the 774 local government councils in Nigeria through the ninth to twenty-third defendants, or any other entity, without ALGON’s authorization and due diligence to prevent fund diversion.
Representation at FAAC: A declaration that the defendants cannot discuss, approve, or disburse funds accruing to local governments without the representation of the local government councils, particularly in the Federation Account Allocation Committee, which is chaired by the Minister of Finance.
ALGON in its suit argues that while the Supreme Court ruling was meant to empower local government administrations, the AGF, Ministry of Finance, state Commissioners of Finance, and CBN have taken steps to frustrate the implementation of the decision.
ALGON claims that the commercial banks involved in the process are positioning themselves to act as intermediaries for the funds meant for local government councils.
Meanwhile, nearly all the defendants have filed preliminary objections to the suit, questioning ALGON’s right to initiate the case.
The CBN, represented by Senior Advocate of Nigeria (SAN) Sam Ologunorisa, has submitted a notice of preliminary objection, dated March 24, 2025.
The CBN argues that ALGON is not a legally recognized entity under the Constitution or any statute, and was not a party or beneficiary in the Supreme Court case upon which it now bases its claims.
It further stated, “In precis, the plaintiff/respondent has no cause of action and locus standi to competently call on this honourable court to determine the questions brought before it and to grant the consequential reliefs sought. Also, this honourable court lacks the jurisdiction to hear and determine this suit as it is a clear abuse of the court process and urges this honourable court to be wary of the ploy of the plaintiff/respondent in inviting this honourable court to dispense its valuable time and resources on academic issues and usurp the powers of the legislative arm of government.”
The CBN maintained that under the Central Bank of Nigeria Act, 2007, only statutory bodies may interface with the CBN in banking matters, and ALGON does not fall into this category.
It argued that ALGON’s assertion that its approval is required before commercial banks can act as bankers to local councils is unfounded and unsupported by law.
The apex bank urged the court to dismiss the case with substantial costs awarded against the plaintiff.
Similarly, counsel for the Federal Account Allocation Committee, Olawale Fapohunda (SAN), argued that ALGON lacks the legal standing to bring the case, thereby robbing the court of jurisdiction.
“That being the case, since on the face of the plaintiff’s claim with requisite locus standi, we submit that it has also disrobed or divested this court of jurisdiction.
“We submit that by the tenor of the plaintiff’s claim before this court, it is obvious that the plaintiff is a mere busybody who has no statutory standing in the business of revenue sharing in Nigeria,” Fapohunda argued.
Also, the state Commissioners of Finance, through their counsel, Olawale Fapohunda (SAN), stipulated that the members of FAAC did not include representatives of the 774 LGAs as being canvassed for.
He cited Section 6(1) of the Allocation of Revenue (Federation Account, etc.) Act, 1982, which outlines the FAAC’s statutory membership—excluding local government representation.
“The plaintiff is not recognised under the Constitution and cannot enforce rights that were never conferred upon it by the law,” he added.
Also speaking on behalf of the state Commissioners for Finance, Fapohunda argued that ALGON is not a member of FAAC and lacks any constitutional or statutory entitlement to participate in its processes.
In an affidavit, Jeff Otache, the administrative manager at the offices of the Incorporated Trustees of State Finance Commissioners, described ALGON’s suit as “vague, imprecise, evasive, and an abuse of court process.”
The commissioners held, “The suit of the plaintiff is conjectural, vague, imprecise, evasive and hollow. That hearing the suit is a sheer waste of judicial time and it is in the interest of justice to dismiss or strike out the suit for want of jurisdiction.
“I know as a fact that the plaintiff is not a member of any of the defendants and as such cannot force itself on them. I also know for a fact that the plaintiff is a non-government organisation that has no nexus with the defendants’ statutory duties. That the plaintiff/respondent is not entitled to any of the reliefs sought.”
In response, however, ALGON filed a counter-affidavit, asserting its legal status.
It claims to have been incorporated as an association on May 10, 2002, with the principal objective of promoting and defending the autonomy and interests of local governments in Nigeria.
ALGON further accused the 24th defendant of falsely parading himself as its President without valid authority, in violation of the group’s constitution.
The group submitted its constitution and Corporate Affairs Commission registration documents as evidence of its legal status and right to sue.
