Court of Appeal Overturns US$16m Mask Contract Award

Background to the Covid‑Era Supply Contract

The Court of Appeal has overturned an award of more than US$16 million in a dispute arising from a Covid-era contract for the supply of millions of surgical face masks.

The case concerned an April 2020 agreement under which Advanced Multi-Technology for Medical Industry, trading as Hitex, a Jordanian manufacturer, agreed to supply Uniserve Ltd, a UK logistics company with 80 million Type IIR surgical masks at a price of US$0.30 per unit. The masks were to be collected “ex works” from Hitex’s factory in Jordan under a strict delivery schedule, with time stated to be of the essence for Hitex having the goods ready.

Production Problems and Revised Timetable

Production problems quickly emerged. The masks initially lacked a required nose bridge, machinery had to be modified, and output was reduced. Early deliveries were missed, and the parties later agreed a revised timetable by email. Relations then broke down, and in June and July 2020 Uniserve treated the contract as at an end. Hitex brought proceedings, arguing that the termination was unlawful and that Uniserve had wrongfully failed to accept and pay for the remaining 77 million masks.

First‑Instance Judgment

At first instance, the High Court accepted that case and awarded damages of about US$16.9 million, even though the judge reached that result on a basis not advanced by either party. Uniserve appealed.

Court of Appeal: Readiness to Deliver & Time of the Essence

Giving the leading judgment, Lord Justice Males held that the damages award could not stand. A central issue was whether Hitex was in a position to perform its obligations when Uniserve said the contract was over.

The Court of Appeal accepted evidence that, under Jordanian regulatory requirements, around 15 per cent of Hitex’s mask production had to be reserved for potential requisition by the Jordanian authorities and was therefore not available for export. When that reserved stock was taken into account, Hitex did not have sufficient masks available on key dates in late June and early July 2020 to meet the cumulative quantities required under the revised delivery schedule.

Because the contract made time of the essence for Hitex’s readiness to deliver, those shortfalls entitled Uniserve to terminate. The court rejected Hitex’s argument that it could “re-tender” the same stock for successive instalments when earlier deliveries were not collected. If the contract remained alive, Hitex was required to have the full cumulative quantities available; it could not claim damages for non-acceptance of goods it was never able to supply.

Procedural Fairness: Criticism of the Trial Approach

The Court of Appeal also criticised the way the trial had been decided. It said it was a fundamental principle of the adversarial system that cases must be resolved on the issues pleaded and argued. The High Court had erred by deciding the dispute on a theory that neither side had advanced and without giving the parties an opportunity to address it.

Outcome

As a result, the appeal on the supply contract was allowed and Hitex’s damages claim was dismisse

Case Details

Case: Advanced Multi-Technology for Medical Industry (t/a Hitex) & Ors v Uniserve Ltd
Citation:[2025] EWCA Civ 1212
Court: Court of Appeal (Civil Division), England and Wales
Date of Judgment: 2 October 2025
Appeal from: High Court of Justice, Business and Property Courts (Chancery Division), Nicholas Thompsell (Deputy High Court Judge), [2024] EWHC 1725 (Ch)
Judges: Lord Justice Males, Lord Justice Phillips, Lord Justice Snowden
Hearing Dates: 22–23 July 2025

Speak to Our Commercial Litigation Team

This case is a clear reminder that even in high‑pressure trading conditions, such as Covid‑era supply chains, businesses must ensure contractual obligations are clearly defined, deliverable, and properly evidenced. When time is stated to be of the essence, even small shortfalls can have major legal consequences.

If your organisation is facing a commercial contract dispute, or you need advice on termination rights, supply chain performance, or dispute resolution, our specialist solicitors can help protect your position and reduce risk.

Visit our Business Disputes page to find out more about how we can help you, or contact us to speak to a member of our team.

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