HFW wins in $40m Court of Appeal PPE masks claim

HFW has successfully acted for Uniserve Ltd in the Court of Appeal in defeating historic claims relating to PPE contracts brought by Advanced Multi-Technology for Medical Industry (“Hitex”), a Jordanian manufacturer of face masks, and their agents Caramel Ltd and David Popeck.

Hitex / Caramel / Mr Popeck brought claims in excess of $40m in the Chancery Division, concerning a contract for the manufacture and supply by Hitex of 80 million PPE face masks during the Covid pandemic to be supplied by Uniserve to the DHSC. Hitex claimed damages from Uniserve for non-acceptance of the masks, whilst Caramel and Mr Popeck claimed against Uniserve for unpaid commission. This culminated in a two week trial in May 2024, before Mr Justice Thompsell. Despite the judge rejecting the claim pleaded and advanced by Hitex at trial, judgment was unexpectedly awarded in favour of Hitex for approximately $17m.

However, on 2 October 2025, the Court of Appeal (Males, Stephen Phillips and Snowden LJJ) handed down judgment allowing Uniserve’s appeal and ruling that Hitex’s claim should be dismissed. Caramel and Mr Popeck’s appeal on the commission claim was also dismissed. The Court of Appeal ruled that:

• It was wrong for the trial judge to decide the case on issues not pleaded by the parties and it had been a “mistake” for the trial judge to reach his own independent conclusion which neither party had advanced in their pleadings. The Court of Appeal referred to previous case law Al-Medenni v Mars UK Ltd [2005] EWCA Civ 1041 and Satyam Enterprises Ltd v Burton [2021] EWCA Civ 287; [2021] BCC 640 in that regard. 
• Uniserve was entitled to terminate the contract on the basis that Hitex had insufficient masks to meet various shipments in June / July 2020. Even on Hitex’s own records, it had not produced enough masks to meet the delivery schedule.
• As Uniserve was entitled to terminate the contract, the claim for commission on the masks by Caramel and Mr Popeck did not arise.
• Even if Uniserve was not entitled to terminate the contract, Hitex had failed to continue to manufacture the goods. Therefore, it was not entitled to claim damages under section 50 of the Sale of Goods Act 1979 as pleaded. Hitex could not recover damages for 77 million masks in circumstances where it never had 77 million masks available for delivery in the first place.
• (Obiter) Hitex, in breach of their obligations, had not tendered the goods for delivery, i.e. Hitex had not given notice to Uniserve that the goods were ready for collection.

There was a last minute attempt by Hitex to claim damages for specific shipments where it did have sufficient masks available. However, this argument was swiftly rejected by the Court of Appeal on the basis that Hitex had never pleaded its damages claim on such a basis. Hitex had never advanced such a case and it was too late to do so after the Court of Appeal hearing.

The HFW team, led by Andrew Williams (Head of Commercial Disputes), included Gordon Rieck (Senior Associate) and Nicole Yeung (Associate), with Luke Parsons KC, David Walsh KC and Edward Mourdant acting as counsel.

Commenting on the Court of Appeal’s judgment, Andrew Williams said, “This is a great result for our client and fully vindicates the hard work of the team over the last 5 years. It is pleasing to see that the Court of Appeal agreed with our arguments and dismissed the claims. It was clear from the outset that Hitex could not meet the delivery schedule and so these claims should never have been brought. The Claimants’ failure to plead their damages claim properly is also a salutary lesson to seek specialist advice when dealing with commodities disputes”