Dec 12 (Reuters) - Nigeria's Supreme Court will decide on Friday whether the election of President Umaru Yar'Adua was legitimate, a ruling that could bolster his power or spark political chaos in Africa's most populous nation.

The court is broadly expected to uphold Yar'Adua's victory, a verdict that analysts hope would usher in a more dynamic second phase of his rule.

Below are answers to some questions on the case and what could happen:

WHAT IS THE SUPREME COURT DECIDING?

Former military ruler Muhammadu Buhari and ex-vice president Atiku Abubakar, Yar'Adua's main rivals in last year's polls, have appealed to the Supreme Court to annul his victory in a vote deemed flawed by foreign and local observers.

WHAT IS THE EVIDENCE?

Lawyers to both Buhari and Abubakar argue that ballot papers used for the election were not properly numbered and that procedural errors meant the final results were not credible.

Lawyers for the vice president also argue that approval for Abubakar to take part in the election had come so late he had not been able to campaign effectively.

WHAT WERE THE PREVIOUS JUDGEMENTS ON THIS CASE?

A special five-judge tribunal in February rejected every legal challenge filed by the two former presidential candidates.

It said Buhari had failed to prove that violations of the electoral law were substantial enough to invalidate Yar'Adua's victory.

It also ruled that Abubakar had not been excluded from the poll, but rather had participated actively.

WHAT IS AT STAKE?

The leadership of Africa's most populous nation with 140 million people. Nigeria is also the world's eighth-biggest exporter of crude oil, producing around 2 million barrels per day.

WHAT HAPPENS IF THE COURT UPHOLDS THE ELECTION RESULT?

Analysts hope that an end to the legal wrangling will give Yar'Adua the mandate to speed up reform in sub-Saharan Africa's second biggest economy.

Uncertainty over whether Yar'Adua would finish his four-year term has slowed policy-making and investment decisions.

WHAT HAPPENS IF THE COURT ANNULS THE ELECTION RESULT?

If the Supreme Court annuls the April 2007 election, both Yar'Adua and Vice President Goodluck Jonathan would leave office.

The president of the Senate would take over as acting president and organise fresh elections within 3 months.

WHERE MIGHT THIS LEAVE POLICY?

Yar'Adua's critics believe he has already moved too slowly on reforms such as restructuring the energy sector and have questioned the seriousness of his efforts to curb corruption.

The doubts over his health and Nigeria's political direction, whether or not he is forced out early, risk holding up the process even further.

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