Supreme Court Strikes Out Osun Suit on Withheld Local Govt Allocations

The Supreme Court of Nigeria on Friday struck out a suit filed by the Osun State Government seeking to compel the Federal Government (FG) to release withheld Local Government Council (LGC) allocations, ruling that the action was incompetent and improperly instituted.

A seven-member panel of the apex court, in a 6–1 split decision, held that the Attorney General of Osun State lacked the locus standi to institute the matter on behalf of the state’s 30 Local Government Councils, stressing that only the councils themselves — recognised as autonomous constitutional entities — could sue or be sued over such matters.

Delivering the lead judgement, Justice Mohammed Idris declared that the Osun government could not activate the original jurisdiction of the Supreme Court since the dispute was not one directly between a state and the Federal Government as required under the Constitution.

He ruled that the LGCs were the proper parties to challenge the alleged withholding of allocations and that the apex court had “no jurisdiction to entertain the suit as constituted.” The court also rejected Osun’s argument that the matter qualified as public interest litigation.

Although the court upheld the preliminary objection filed by the Attorney General of the Federation (AGF), it admonished the Federal Government to fully comply with its previous landmark judgement granting fiscal autonomy to all 774 Local Government Areas in the country.

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In the suit marked SC/CV/775/2025, Osun State sought multiple declarations compelling the AGF to release funds allegedly withheld and to stop payments to sacked APC-backed local government officials whose election of October 15, 2022, had been nullified by both the Federal High Court and Court of Appeal.

The state further accused the AGF of directing, in a letter dated March 26, that allocations be paid to the removed officials, contrary to existing court decisions. It asked the court for orders compelling the release of all statutory allocations to the validly elected council officials inaugurated on February 23, 2025.

Counsel to Osun State, Musibau Adetunbi, SAN, told the court that the AGF had attempted to pay the disputed funds through the Central Bank of Nigeria (CBN) despite pending proceedings, but an interim court order halted the transaction.

The Federal Government, through its counsel Akin Olujimi, SAN, argued that Osun had no cause of action and accused the state of engaging in “judicial harassment” to frustrate APC local government officials whose tenure expired in October. He maintained that the case constituted an abuse of court process and fell outside the Supreme Court’s constitutional jurisdiction.

With Friday’s decision, the onus now falls on the 30 Osun Local Government Councils themselves to approach the courts if they wish to challenge the Federal Government’s handling of their allocations — a development that reshapes the legal and political dynamics of the long-running dispute.

Supreme Court Strikes Out Osun Suit on Withheld Local Govt Allocations