Revenue Mobilisation Allocation And Fiscal Commission (RMAFC) v. Attorney General Of Rivers State & ors (2023)

LAWGLOBAL HUB Lead Judgment Report – SUPREME COURT

HELEN MORONKEJI OGUNWUMIJU, JSC (Delivering the leading judgment)

This is an appeal from the judgment of the Court of Appeal, Abuja Division delivered on 14th December, 2021, Coram: A. D. Yahaya, P. O. Igeand K. I. Amadi, JJCA.

The court below unanimously dismissed the appeal of the appellant and affirmed the judgment of the Federal High Court.

The appellant being dissatisfied with the decision of the court below, filed a notice of appeal on 3rd March, 2022 containing six grounds of appeal.

The facts that led to this appeal are as follows:

The 1st respondent commenced an action at the trial court by way of originating summons on 8th July, 2019. The 1st respondent had sought answers to the following questions, the following declarations and the following reliefs:

1. Whether it is constitutionally ultra vires the powers of the defendants to by administrative fiat deviate from the subsisting conclusions of facts and law arrived at by the Supreme Court of Nigeria in its judgment delivered on 18th March, 2011 in suit No: SC/27/2010, between: Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor in respect of OML112 offshore.
2. Whether the provisions of section 235 of the Constitution of the Federal Republic of Nigeria 1999 (as amended) gives a stamp of finality to any decision of the Supreme Court of Nigeria and thereby renders the purported administrative acts of review by the defendants to deduct or purport to deduct the sums of N502,298,943.03 or any sum whatsoever forming the proprietary rights of the plaintiff granted and established by the judgment of the Supreme Court of Nigeria in its judgment delivered on 18th March, 2011 in suit No: SC/27/2010, between Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor in respect of OML 112 offshore is unconstitutional null and void and of no effect whatsoever.
3. Whether the 1st defendant has the constitutional powers to disregard the decision and finality of the judgment of the Supreme Court of Nigeria delivered on 18th March, 2011 in suit No: SC/27/2010, between: Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor in respect of OML 112 offshore, whether by altering the original nomenclature or purporting to claim it is a new field referred to as “Okoro Oil Filed” in its pieces of correspondences dated 26th November, 2018, 30th April, 2019 and 25th June, 2019 respectively.
4. If the answers to question 1 and 2 above are in the affirmative, whether the defendants, their assigns, agents or privies can legitimately deduct or recommend for deduction the sum of N502,298,943.03 or any sum whatsoever from the statutory allocation of the plaintiff for a period of 112 months or any period whatsoever.
5. If the answers to questions 1 and 2 above are in the affirmative, whether the defendants are not obliged to make a full refund of the 13% derivation from crude oil and gas production from OML 112 offshore which has been unconstitutionally denied to the plaintiff from September, 2018 to determination of this suit.

Upon the determination of the above questions the plaintiff prays this court for the following reliefs:

1. A declaration that the subsisting conclusions of facts and law arrived at by the Supreme Court of Nigeria in its judgment delivered on 18th March, 2011 in suit No. SC/27/2010, between: Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor inrespect of OML 112 offshore is sacrosanct and same cannot be deviated upon by the defendants, their agents, assigns or privies by administrative fiat or any manner whatsoever.
2. A declaration that the provisions of section 235 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) gives a stamp of finality to any decision of the Supreme Court of Nigeria in respect of the oil field in OML 112 offshore, and that same renders the purported administrative acts of review by defendants, their assigns, agents, privies or any person or authority unconstitutional, null and void and of no effect whatsoever.
3. A declaration that the 1st defendant does not have the constitutional powers to disregard the decision and finality of the judgment of the Supreme Court of Nigeria delivered on 18th March, 2011 in suit No. SC/27/20120, between Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor in respect of OML 112 offshore, by altering the original nomenclature of the oil field and referring to the said oil filed as “Okoro Oil Field” in its correspondences dated 26th November, 2018, 30th April, 2019 and 25th June,2019 respectively.
4. A declaration that the defendants, their assigns, agents or privies cannot legitimately deduct or recommend for deduction the sum of N502,298,943.03 or any sum whatsoever from statutory allocation of the plaintiff for a period of 112 months or any period whatsoever.
5. A declaration that the decision of the Supreme Court of Nigeria in its judgment delivered on 18th March, 2011 in suit no: SC/27/2010, between Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor, whereby it declared the plaintiff as the legitimate owner of 86 oil wells in the then disputed OML 112 offshore is valid and subsisting.
6. An order of this honourable court setting aside the administrative decisions taken by the defendants in respect of OML 112 offshore which is at variance with the decision of the Supreme Court of Nigeria delivered on the 18th of March, 2011 in suit No: SC/27/2010, betweenAttorney General of Rivers State and General of Akwa Ibom State & Anor.
7. An order of this honourable court directing the defendants to make a full refund of the 13% derivation illegally denied the plaintiff.
8. An order of this honourable court directing the defendants to forthwith continue payments of the 13% derivation generated from the crude oil and gas production within OML 112 offshore to the plaintiff.
9. An order of this honourable court perpetually restraining the defendants, their agents, assigns, representatives, privies or howsoever called from disregarding the finality of the Supreme Court judgment delivered on 18th March, 2011 in suit No: SC/27/2010, between Attorney General of Rivers State and Attorney General of Akwa Ibom State & Anor as it relates to the proprietary rights of the plaintiff in respect of OML 112 offshore.
10. An order directing the defendants to pay interest at the various commercial rates not being less than 15% per annum with monthly rests, on the illegality deducted and denied 13% derivation due to the plaintiff from OML 112 offshore until satisfaction of the whole debt.

All the processes together with hearing notices were served on the appellant and 2nd respondent respectively. The 2nd respondent entered appearance and filed her counter-affidavit to the substantive suit. The appellant did not answer the summons, neither did it file any counter-affidavit toe the originating summons.

The appellant in effect did not defend the summons. The trial court refused the motion to arrest the judgment of the trial court. After hearing all sundry applications and dismissing them, the judgment of the trial court was read and all the reliefs sought by the 1st respondent were granted.

The appellant was dissatisfied with the judgment of the trial court and appealed to the court below and after hearing the case made out by the respective parties, the court below unanimously dismissed the appellant’s appeal.

The circumstances which led to the filing of the summons by the 1st respondent is set out below:

1. The appellant is an executive body established by the Constitution of the Federal Republic of Nigeria (1999) (As Altered) (1999 Constitution) with the mandate to review, from time to time, the revenue allocation formulae and principles in operation to ensure conformity with changing realities. In the course of the performance of its duty, the appellant on the 27th February, 2017 wrote a letter of invitation to the 1st respondent informing it of its decision to:

Update the Commission’s records and also ensure continuous compliance with the constitutional provision for the application of the 13% Derivation Principle and the Allocation of Revenue (Abolition of Dichotomy in Application of Derivation) Act, 2004.

2. The appellant then proceeded to invite the 1st respondent to send its Surveyor-General to participate in the exercise because the 1st respondent is considered “a critical stakeholder”.
3. This invitation was extended to all Littoral States entitled to 13% Derivation from Exploration activities in the oil and gas sector of Nigeria. At the conclusion of the exercise, the appellant informed stakeholders of the outcome of the exercise and conveyed to the then Department of Petroleum Resources the following:

The result of the exercise showed that Okoro Oil field in OML 112 operated by AMNI International Petroleum is located offshore Akwa Ibom State and not offshore Rivers State as was being previously reported. As a result, the Commission requests that all oil and gas productions from Okoro Oil field be reported in Akwa Ibom State for the purpose of sharing 13% derivation revenue to beneficiary States.

4. With the above finding, Akwa Ibom State, under cover of the letter “Ref. No. GHU/AKS/87/Vol.2/516 dated March 13, 2019” then requested for the refund of derivation revenue from Okoro oil field from July, 2008 to September 2018
5. The appellant then requested the 2nd respondent to:

…implement the refund in favour of Akwa Ibom State Government being the derivation revenue wrongly paid to Rivers State Government for the production of Oil and Gas from Okoro oil field from July, 2008 to September, 2018.”