The Supreme Court of Nigeria has struck out a lawsuit filed by the 36 state governments and the Nigeria Governors’ Forum (NGF) challenging the federal government’s management of recovered looted funds, according to a report by Daily Trust.
In a unanimous decision delivered on Friday, a seven-member panel of the apex court held that the case was wrongly instituted before it. The lead judgment, prepared by Justice Chidiebere Uwa and read by Justice Mohammed Idris, emphasized that the matter falls under the jurisdiction of the Federal High Court rather than the Supreme Court.
The suit, marked SC/CV/395/2021, alleged that the federal government failed to remit approximately ₦1.8 trillion in recovered assets—including 167 properties, 450 cars, 300 trucks and cargo, and 20 million barrels of crude oil—into the Federation Account. Instead, the states claimed, the funds were diverted to the Consolidated Revenue Account, which is not recognized by the Nigerian Constitution as a distribution channel for national revenues.
The plaintiffs also contended that other earnings payable to the Federation Account—such as revenue from licenses, land, administrative fees, and investment returns—were similarly misallocated. They based their legal argument on Sections 80 and 162 of the 1999 Constitution and Section 2 of the Finance (Control and Management) Act of 1958.
Furthermore, they sought a court order compelling the federal government, through the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), to disclose the distribution formula and modalities for allocating recovered assets to the federating units.
Despite these claims, the Supreme Court ruled that the legal pathway chosen by the states was procedurally flawed. It reaffirmed that only matters that directly fall under the original jurisdiction of the apex court, such as disputes between the federal government and states, can be heard directly. Since the claims revolved around financial procedure and federal administrative actions, the court advised that the Federal High Court was the proper venue for such litigation.
The Supreme Court’s decision has once again underscored the importance of observing jurisdictional boundaries in legal disputes involving government finances.
Legal Context: Why Jurisdiction Matters in Constitutional Cases
By striking out the suit filed by the 36 state governments, the court reinforced a basic rule of constitutional law: before any court can hear a case, its jurisdiction must be properly established. Under Section 232(1) of the 1999 Constitution, the Supreme Court has original jurisdiction in disputes between the Federation and a State, or between States themselves. But this isn’t automatic. That jurisdiction can only be exercised when there’s a clear, justiciable dispute that falls squarely within the limited matters the Constitution allows the court to decide at first instance.
The justices held that the claims—centred on the alleged diversion and misallocation of recovered assets—are issues of financial procedure and statutory compliance, which fall within the administrative oversight and enforcement jurisdiction of the Federal High Court, not the apex court. This position is consistent with Section 251(1) of the Constitution, which gives the Federal High Court authority over matters relating to the revenue of the Federal Government, including issues involving fiscal operations and the management of public funds.
Interestingly, while the states had relied on Sections 80 and 162 of the Constitution to argue that all funds recovered by federal agencies should be paid into the Federation Account, the Supreme Court did not take issue with that interpretation. Instead, the case was struck out on procedural grounds. The court made it clear that although the dispute raised constitutional questions, it also involved factual issues and evidentiary matters — the kind of controversies that are better handled by trial courts like the Federal High Court.
In essence, the ruling reaffirms a long-standing principle: even constitutional cases must follow the proper legal process, beginning in the appropriate court where facts can be properly established.
Furthermore, the court’s posture safeguards its role as the final appellate body and constitutional interpreter, reserving its original jurisdiction for matters of grave federal-state contention, rather than administrative grievances dressed in constitutional clothing.
For legal practitioners and constitutional scholars, this case reaffirms that jurisdiction is not conferred by subject matter alone, but by the nature of the parties’ legal relationship and the proper framing of claims within established procedural architecture.
Why It Matters
The ruling clearly shows that even constitutional cases must follow the right legal channel. The Supreme Court didn’t say the states had no case—rather, it simply said they brought the action to the wrong court.
By clarifying that such financial disputes start at the Federal High Court, the judgment helps maintain order in how legal claims, especially those involving public funds, are handled. It also protects the Supreme Court’s role as a final arbiter, not a first stop.
For states seeking greater transparency in how recovered funds are shared, this decision highlights the importance of a proper legal process.
