High Court Overturns Civil Court Order to Sell Resorts Linked to Heavy Load Loan Dispute

The High Court of the Maldives has overturned a Civil Court decision authorising the sale of two resort properties mortgaged by Heavy Load Private Limited to recover an unpaid loan owed to the Bank of Maldives (BML).

According to the High Court’s verdict, released yesterday, BML had extended a loan of USD 11 million to Heavy Load—owned by politician and former Maldivian Democratic Party (MDP) chairperson Moosa Manik (Reeko)—in December 2016. The loan was secured by mortgages on three properties: the land rights of the resort in Laamu Fares, headlease rights of Laamu Boduhuraa and Laamu Kudafares.

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Background to the Case

The Civil Court had initially ordered Heavy Load to honour its loan agreement on 13 January 2020, but the company failed to comply. Following this, the Civil Court granted BML the right to proceed with the sale of the mortgaged assets to recover its dues. By 24 September 2024, the total amount owed—including interest and fines—had reached USD 23 million.

In 2024, BML announced the sale of the mortgaged properties and opened bidding under two options:

• Option 1: A combined bid for all three properties, with a minimum price of USD 23,262,000.
• Option 2: Separate bids, with the same minimum price of USD 23,262,000 for Fares and Kudafares, and USD 23,262,000 for Boduhuraa individually.

BML’s valuation assessed Rahaa Resort—developed across Fares and Kudafares—at USD 17.8 million, and Boduhuraa at USD 3.9 million. Heavy Load disputed these figures and requested a government valuation. However, the Ministry of Tourism’s valuation committee had not completed its assessment for over two years, citing the absence of detailed architectural drawings and incomplete documentation.

High Court’s Observations

The High Court noted that in cases involving multiple mortgages, the judiciary must determine whether assets should be sold entirely or in part to recover debts. The court found that the Civil Court had authorised BML to sell the properties without the valuation of the committee, contravening due civil procedures.

Heavy Load had also argued that the Civil Court’s order breached Section 162(b) and 162(f) of the relevant regulations by not specifying the order or conditions of sale. While the High Court acknowledged there was no dispute over Section 162 itself, it stressed that bypassing procedural safeguards—particularly in the absence of negligence by either party—was “inadvisable”.

Additional Context

Moosa Manik, widely known as Reeko Moosa, is a prominent businessman and political figure. His company Heavy Load Pvt Ltd has been involved in major infrastructure and tourism developments in the Maldives. According to records from the Maldives Inland Revenue Authority (MIRA), Moosa’s businesses are classified as non–tax-exempt entities, meaning they are required to pay standard corporate and other applicable taxes under Maldivian law.

Verdict

The High Court cancelled the Civil Court’s order permitting the sale and instructed the lower court to continue the case in accordance with the Civil Procedure Code. It further highlighted the need for courts to expedite valuation and sale processes when pricing delays occur, to avoid prolonged uncertainty.

The decision temporarily halts the sale of the resorts while the Civil Court re-examines the case under proper procedural guidance.