The Malawi Supreme Court of Appeal has largely upheld a High Court judgment ordering Agriculture Resources Limited to pay US$1.2 million to Zimbabwean fertiliser and chemicals supplier Windmill (Private) Limited, bringing a major commercial dispute between the companies closer to finality.
In a unanimous decision which we have seen, a nine-member Supreme Court bench rejected almost all of Agriculture Resources Limited’s challenges to the lower court judgment.
The case involved unpaid fertiliser, unpaid profits and a management agreement between the two companies.
The Supreme Court upheld a US$544,530 claim for fertiliser supplied directly to Agriculture Resources Limited.
It also upheld a claim of US$418,554.56, which Agriculture Resources was supposed to remit to Windmill as its share of profits from fertiliser supplied through Windmill (Malawi) Limited.
The Court further found that Agriculture Resources improperly took US$216,574.53 as a profit share during the 2012/2013 season, even though there was no profit for that year.
The company was also ordered to meet a US$37,641 debt, together with applicable interest.
Agriculture Resources Limited challenged the lower court’s decision on six grounds, later abandoning one and leaving five for determination by the Supreme Court.
The only major point on which the company succeeded was collection costs. The Supreme Court said the lower court was wrong to award collection costs at 15 percent after the case had already started.
The Court also ruled that Windmill could claim the amounts in US dollars, finding that the relevant foreign-exchange rules did not prevent the Zimbabwean company from making the claim.
Windmill was also awarded the costs of the appeal.
