Oyo Govt’s Accounts on Ice: Court Freezes 10 Banks in N3.5 Billion Debt Battle

A Federal Capital Territory High Court in Abuja recently issued a consequential order, directing the freezing of accounts belonging to the Oyo State Government in ten major commercial banks across the country. This development stems from an outstanding judgement debt of N3.5 billion, and the order was issued as part of a garnishee proceeding initiated by former council leaders in Oyo State who were relieved of their positions on May 29, 2019, by Governor Seyi Makinde.

These dismissed Local Government Chairmen and Councillors had secured a substantial judgement in 2021, amounting to N4.9 billion against Governor Makinde and various state agencies. Notably, the Supreme Court’s decision on May 7, 2021, identified additional parties as judgment debtors alongside Governor Makinde. These include the Attorney-General of the state, Commissioner for Local Government and Chieftaincy Affairs, Accountant-General of Oyo State, Speaker of the House of Assembly, the House of Assembly itself, and the Oyo State Independent Electoral Commission (OYSIEC).

The objective of the garnishee proceeding, spearheaded by the former council leaders under the leadership of Bashorun Majeed Ajuwon, is to recover the outstanding balance of N3.5 billion from the initial judgement sum. It is noteworthy that Governor Makinde had previously paid N1.5 billion in 2022, leaving the balance subject to the ongoing legal proceedings.

The High Court’s order led to the freezing of Oyo State Government’s accounts in ten prominent banks, including Zenith Bank, United Bank of Africa (UBA), Wema Bank, First Bank of Nigeria, Ecobank, Guaranty Trust Bank, Access Bank, Polaris Bank, Jaiz Bank, and Union Bank.

In response to the order, Justice Anitte Ebong instructed the banks to file affidavits and appear in court on the next adjourned date, compelling them to provide reasons why the garnishee orders nisi, which were initially granted, should not be made absolute. As part of the ruling, a cost of N300,000.00 was awarded against the judgement debtors, and a copy of the order was directed to be served on Governor Makinde and the other concerned parties. The court adjourned the case until January 5 of the following year for further proceedings.

To provide context, it is crucial to recall the events leading up to this legal tussle. On May 7, 2021, the Supreme Court nullified Governor Makinde’s decision to sack elected Local Government Chairmen and Councillors in Oyo State. The court further mandated the state government to pay the salaries and allowances owed to the affected former council chiefs. Justice Ejembi Eko, delivering the lead judgment in the case, strongly criticized Makinde’s premature dismissal of the elected council chiefs before the expiration of their tenures.

In a related development, the Court of Appeal, in December of a previous year, upheld the decision of the Federal Capital Territory High Court made on April 27. This ruling required Governor Seyi Makinde to settle the outstanding balance of 3.4 billion naira from the total debt of N4.9 billion. The Court of Appeal, through a unanimous judgement delivered by a three-member panel led by Justice Danlami Senchi, expressed disapproval of Makinde’s conduct, describing it as disrespectful to the nation’s judicial system.

In essence, these legal proceedings underscore the complex interplay between executive decisions, legal obligations, and the judiciary’s role in upholding the rule of law. As the case unfolds, it will be of interest to observe how the Oyo State Government and the concerned parties navigate the legal terrain and address the implications of the frozen accounts on the state’s financial operations.