Attorney General of the Federation v. Attorney General of Abia State & Ors (2024) LPELR-62576(SC).

Case Title & Citation

Attorney General of the Federation v. Attorney General of Abia State & Ors (2024) LPELR-62576(SC).

Court Name & Bench

Supreme Court of Nigeria – a seven-Justice bench: Mohammed L. Garba (JSC), Emmanuel A. Agim (JSC), Chioma E. Nwosu-Iheme (JSC), Haruna S. Tsammani (JSC), Moore A.A. Adumein (JSC), Habeeb A.O. Abiru (JSC), and Jamilu Y. Tukur (JSC).

Date of Judgment

11 July 2024.

Parties Involved

• Petitioner/Appellant: The Attorney General of the Federation (representing the Federal Government).
• Respondents/Defendants: The Attorneys General of Abia State and 35 other Nigerian states (i.e. the State Governments).

Facts of the Case

• On 24 May 2024 the Attorney General of the Federation filed suit (SC/CV/343/2024) in the Supreme Court, invoking its original jurisdiction. The FG challenged longstanding state practices at the local government (LG) level.
• The FG alleged that many state governors had dissolved democratically elected LG councils and governed LG areas through unelected “caretaker” committees. It argued this undermined Section 1(2) and 7(1) of the 1999 Constitution, which make each LGA an inalienable part of Nigeria to be governed by elected representatives.
• The FG further contended that state governments habitually diverted or withheld allocations from the Federation Account due LG councils. These funds had been channeled into State Joint Local Government Accounts (SJLGAs) under state control, leading to under-distribution and abuse.
• In its originating motion, the FG sought declarations that states must maintain elected councils, that dissolutions and caretaker appointments are unconstitutional, and that federal allocations meant for local governments must be paid directly to those councils, bypassing the states.

Issues Raised

• Direct Payment of Allocations: Whether the Constitution permits the Federal Government to pay local government allocations directly to the Local Government Councils (bypassing state control), given that many states have failed to remit these funds through the prescribed Joint Accounts.
• Caretaker Committees: Whether state governors’ practice of dissolving elected LG councils and appointing caretaker/interim committees violates Section 7(1) (federal part) and Section 1(2) (indivisibility of the federation) of the Constitution, since LGAs are constitutionally deemed parts of Nigeria.

Arguments of the Parties

• Applicant (FG): The FG argued that for decades states had “persistently refused” to pay LG allocations from the Federation Account into the LGAs, breaching Sections 162(4)–(6) of the Constitution. It contended that a literal reading of Sec.162(6) (“shall” pay through the state account) should not be applied if it nullifies the purpose of local autonomy. The FG urged the Court to permit direct federal payments to elected LG councils. It also argued that the use of unelected caretaker committees was unconstitutional. Such appointees, it said, subverted the people’s right to local self-government guaranteed by the Constitution.
• Respondent States: The State Governments countered that the 1999 Constitution expressly requires federation-to-LGA allocations to be paid into State Joint Local Government Accounts (Sec.162(5)-(6)), and that states have a duty to manage those funds on behalf of their LG councils. They maintained that this payment mechanism – and any delays in holding LG elections – were constitutionally mandated (or due to court orders), not an abdication of duty. Thus, they argued, the FG could not unilaterally bypass the states: direct payment would violate the letter of Sec.162(5)-(6) and upset the fiscal federal balance.

Judgment / Final Decision

• The Supreme Court allowed the Federal Government’s claims by a 6–1 majority. The majority judgment (per Agim JSC) granted virtually all the reliefs sought by the FG.
• The Court declared that all allocations in the Federation Account intended for Local Government Councils must henceforth be paid directly into the accounts of those LG councils, bypassing the State Governments entirely. It held that state governors have no constitutional authority to dissolve democratically elected LG councils or to run LGAs by caretaker committees. Such dissolutions were ruled “unlawful, unconstitutional, null and void”, and any council managed by a caretaker committee is not entitled to receive federal funds.
• Practically, the Court ordered the Federation to remit FG allocations straight to duly elected local councils. It restrained the States from ever touching or diverting these funds. Conversely, states without elected councils were held ineligible to receive LG allocations. (Justice Abiru JSC dissented in part: he agreed that states cannot dissolve councils or claim funds in the absence of elections, but he refused to endorse the remedy of direct federal payment, dismissing some financial reliefs.)

Legal Reasoning / Ratio Decidendi

• Purposive Interpretation of Sec. 162: The majority (per Agim JSC) found that giving Sec. 162(5)-(6) a strictly literal meaning (i.e. mandatory payment only through states) would undermine the Constitution’s federal structure. Since states were “wanton[ly]” abusing the joint accounts, the Court read the word “shall” in Sec.162(6) as permissive/discretionary. In effect, the Constitution permits either mode of payment, and the FG may pay directly when that best serves the Constitution’s purpose.
• Teleological Approach: The Court emphasized a teleological/purposive approach. It reasoned that the literal mandate (forcing LG funds through states despite proven abuse) would defeat the intent of local autonomy. To avoid absurdity or oppression, the Court gave Sec.162 a meaning consistent with its underlying objectives. Citing Nigerian precedents (e.g. Amokeodo v IGP, Evong v Obono-Obono, Okorocha v UBA), the Court noted that “shall” need not be read as mandatory if literal interpretation would negate constitutional rights.
• Democratic Governance Guarantee: Implicitly relying on earlier rulings affirming LG democracy, the Court reaffirmed that the Constitution guarantees governance of LGAs by elected councils. The majority found it self-evident that funding and governance must flow to democratically elected bodies, not unelected appointees. In short, upholding the spirit of federalism and the rule of law required empowering the third tier directly.

Obiter Dicta

• In addressing the broader context, the Court (through its majority reasoning) sharply criticized past practices: it described the diversion of LG funds into state accounts as “gross misconduct” by governors. The Court reiterated that any caretaker committee is illegal and that a council run by such a committee cannot lawfully receive Federation Account allocations. These observations, while not central to the legal outcome (having already been decided in earlier cases), underscored the Court’s disapproval of the governors’ conduct and reinforced previous dicta (e.g. APC v Enugu State IEC, Ajuwon v Oyo State) that only elected councils may govern LGAs.

Conclusion / Observations

The Supreme Court’s landmark 2024 ruling on local government autonomy has been widely praised as “transformational” and “at the heart of our governance”. By mandating direct funding of democratically elected councils, it cements the constitutional status of local governments as a distinct third tier. Critics, however, caution that this purposive interpretation effectively rewrites allocation provisions (what some call an “assault” on federalism).

Significance: This decision fundamentally reshapes Nigerian fiscal federalism by legally securing local councils’ autonomy and resources. It reaffirms the Supreme Court’s commitment to enforcing the 1999 Constitution’s vision of grassroots democracy. The ruling is expected to influence future revenue-allocation disputes and may prompt legislative reforms. By insisting on the autonomy of the grassroots, the Court has underscored that federated principles and constitutional mandates cannot be subverted by state action.