Twist In Osun–CBN Legal Battle: State Government Suddenly Drops Lawsuit Over Withheld Local Government Funds

The Osun State Government has officially withdrawn its lawsuit against the Central Bank of Nigeria (CBN) and the Accountant-General of the Federation, Shamsedeen Ogunjimi. The suit had sought to halt the disbursement of local government funds to chairmen and councillors removed from office by the courts during the administration of former Governor Adegboyega Oyetola.

At the Federal High Court sitting on Friday, counsel for the Osun Government, Musibau Adetumbi (SAN), informed the court that the case had become unnecessary since the disputed funds had already been released by the CBN.

Adetumbi stated, “On September 29, 2025, I informed the court that our intention was to secure the funds. However, between then and now, the funds have already been moved from the CBN.”

He further noted that even if the court-removed local government officials from the All Progressives Congress (APC) had any remaining tenure, it expired on Wednesday, October 16, 2025.

Counsel for the defendants, Muritala Abdulrasheed and Tajudeen Oladoja, did not oppose the withdrawal but raised objections to certain portions of the plaintiff’s affidavit. Abdulrasheed argued that paragraphs five to eleven contained “damaging” statements against individuals who were not parties to the suit and urged the court to strike them out, claiming the discontinuance was done “in bad faith.”

Oladoja, while not objecting to the withdrawal, disputed the plaintiff’s claim that the funds had been disbursed, insisting that the Accountant-General of the Federation had not yet responded. He also requested ₦10 million in costs, citing the time expended on the case.

In response, Adetumbi argued that, under the Federal High Court Rules, a notice of discontinuance does not attract costs, especially since the defendants had not filed any formal processes before the court.

Justice Emeka Nwite adjourned the matter until October 29, 2025, for a ruling on the discontinuance application and the issues raised by the defence counsel.