Mulli Brothers Limited is among four companies that have scored a major legal victory after the High Court ruled that they are entitled to compensation for business losses arising from the failure to award them fertiliser supply contracts under the Affordable Inputs Programme (AIP).
The High Court sitting in Lilongwe ruled that Mulli Brothers Limited and three other companies had been wrongfully denied contracts despite having successfully gone through the procurement process for the supply and delivery of fertiliser during the 2020/2021 AIP.
The companies had been recommended for contract awards by the Procuring and Disposing Entity, and the Public Procurement and Disposal of Public Assets Authority (PPDA) issued a “no objection” on September 11, 2020, allowing the procurement process to proceed.
However, the contracts were never awarded.
The companies were later informed that the decision was linked to allegations that they had outstanding loans with the Government of Malawi.
But in a judgment delivered on August 27, 2026, Justice Simeon Mdeza ruled that concerns about the companies’ financial standing should have been investigated during the due diligence process — before the PPDA issued its approval.
The court found that raising such concerns after the bidding process had been completed and the intention to award the contracts communicated was procedurally unfair.
“The due diligence regarding the financial standing of the Appellants should have been conducted prior to the issuance of the ‘no objection,’ and not after,” the court ruled.
Justice Mdeza said the failure to properly conduct the necessary checks earlier undermined the principles of transparency, fairness and predictability in public procurement.
For Mulli Brothers, the ruling opens the way for compensation over the business opportunity it lost after the fertiliser contract failed to materialise.
The court found that the failure to proceed with the awards, without lawful justification, resulted in losses to the companies, including anticipated profits that could have been earned from performing the contracts.
The judgment further criticised the PPDA Review Committee for finding that the contracts should have been awarded to the companies but limiting their remedy to the costs of preparing and submitting their bids and the costs of seeking a review.
Justice Mdeza ruled that the companies were entitled to more than just those costs.
The court ordered that the claimants, including Mulli Brothers Limited, are entitled to damages for loss of business, profit or revenue. The amount will be assessed by the Registrar if the parties fail to agree on compensation.
The companies were also awarded legal costs.
