The High Court has upheld a Civil Court ruling ordering the Local Government Authority (LGA) to pay MVR 1.6 million in compensation to Afami Maldives Company. This compensation is related to the halted construction of the Madifushi Council office building, which was disrupted by protests and subsequent directives.

Afami Maldives had been awarded the contract by the LGA on 18 November 2019, and construction commenced shortly after the land was handed over. However, local protests in late November and December 2019 disrupted the project, leading to damage to materials. On 14 December 2019, the LGA directed Afami Maldives to temporarily halt the work.

After the disruptions, Afami Maldives requested compensation for damages and halted operations until their claim was addressed. Although the LGA initially agreed to compensate the company, it later reversed its decision, prompting Afami Maldives to seek redress in the Civil Court. The court ruled in favour of Afami Maldives, awarding MVR 1.6 million in damages, a decision that the state subsequently appealed in the High Court.

During the High Court proceedings, the state argued that the Civil Court had failed to adequately consider whether Afami Maldives had taken steps to minimise its losses. The state also questioned the evidence presented, such as logbook entries, which it claimed were prepared solely by the company.

Afami Maldives countered that it had been unable to reduce losses as it was instructed to halt work temporarily. The company emphasised that neither party had cancelled the contract, and the submitted logbook entries were endorsed by the Madifushi Council.

Justice Hussain Majeed, presiding over the High Court bench, ruled that compensation is valid only if the damages are proven. He noted that Afami Maldives had initially sought MVR 4 million but was awarded MVR 1.6 million as the remaining amount could not be substantiated. The judge found that the Civil Court had acted appropriately in determining the compensation amount.

Justices Mohamed Niyaz and Hassan Shafiu concurred with the ruling, concluding that the state had provided no legal basis to overturn the Civil Court’s decision. As a result, the High Court affirmed the earlier judgment, maintaining that the LGA must pay the MVR 1.6 million compensation to Afami Maldives.