MedPro litigation: what’s next after the judgment?

On 1st October 2025, Mrs Justice Cockerill DBE, handed down her judgment in the claim brought by the Secretary of State for Health and Social Care (DHSC) against PPE Medpro Limited (Medpro).

This case has attracted a huge amount of general interest not only because of the individuals involved, but because of the perceived need to see Medpro held accountable for the £122 million paid to it for medical gowns in the depths of the Covid-19 pandemic, which turned out to be unusable.

The Court found that Medpro was in breach of contract and it was ordered to repay the full amount paid by the DHSC (the “Judgment Debt”). Following judgment, the Chancellor, Rachel Reeves, posted on X that “We want our money back” and “We are getting our money back.”

On 1 October 2025, a notice confirming that Medpro had been placed into administration was filed at Companies House. In light of that fact, how realistic is it to expect that DHSC will recover the Judgment Debt and what options are potentially available to it?

In this article, Chris Darvill looks at the background to the judgment, the current position and the lessons that can be learned.

The background

On 23 March 2020, the UK Government announced a nationwide lockdown in an attempt to slow down the spread of the Covid-19 virus.

One of the many challenges faced by the UK Government was sourcing supplies of medical gowns, masks and gloves for the NHS.

In an effort to address that issue, the DHSC took the decision to bypass its normal procurement channels and create a “PPE Cell”, which was tasked with operating a parallel supply chain for the procurement of PPE for the NHS.

As part of that process, a “VIP Lane” was created to manage referrals received from MPs, ministers and other senior officials. The VIP team would then make contact with potential suppliers and any viable offers would then be passed to and assessed by a Technical Assurance Team.

If successful, commercial terms would then be negotiated, approved by a Deals Committee and then ultimately signed off by the Accounting Officer.

For contracts with a value in excess of £100 million, these were required to be personally approved by the Accounting Officer (David Williams, Director General of Finance Group Operations and Second Permanent Secretary at the DHSC). A purchase order would then be issued and a contract executed.

Medpro was incorporated on 12 May 2020. On the same day, Medpro was referred to the DHSC by Baroness Mone, as a company able to source and supply PPE. The DHSC ultimately granted a contract to Medpro, which resulted in a supply of gowns being delivered between July and September 2020.

Medpro was paid “a few pence less than £122 million for them” (the Purchase Price).

As has been widely reported, it subsequently came to light that the ultimate beneficial owner of Medpro was Douglas Barrowman, Baroness Mone’s husband.

The gowns supplied to the NHS were not immediately inspected on arrival in the UK. However, it was later found that the gowns were not properly certified and did not meet the agreed requirements.

This resulted in the DHSC rejecting the gowns on 23 December 2020 and seeking recovery of the full Purchase Price. The gowns were subsequently subjected to sterility testing and a number were found not to be sterile.

Medpro challenged the claim that the gowns supplied were not in conformity with the contract, which ultimately resulted in DHSC commencing proceedings in the High Court for (a) repayment of the sum of £121,999,291.20 paid to Medpro and (b) storage costs of £8,648,691.

The judgment

The Judge found MedPro to be in breach of its contract with the DHSC. The Judge also dismissed Medpro’s argument that DHSC was prevented by the doctrine of estoppel from relying on its contractual rights to reject the goods for non-conformity.

Having concluded that Medpro was liable for breach, the Judge then had to consider whether DHSC had validly rejected the gowns, which if it had, would entitle it to recover the full Purchase Price.

If the gowns had not been validly rejected, then DHSC’s claim would be limited to a claim in damages and there would then be a question as to how those damages ought to be calculated.

This would also involve a consideration of what steps (if any) had been taken by DHSC to mitigate its losses and whether the gowns retained any residual value.

The Judge found that DHSC had lost the right to reject the gowns as it had failed to perform an inspection and communicate its decision to reject the goods within a reasonable time.

This left DHSC with a claim for damages, which it argued should be the full Purchase Price on the basis that the gowns could not be used and therefore had no value. The Judge found that DHSC had contracted for sterile gowns, but what had been delivered “were not (contractually speaking) sterile, or properly validated as sterile, and nor properly CE marked.

This means that they could not be used as sterile gowns in the NHS or elsewhere.”

The question was then whether the gowns could have been repurposed by the NHS as non-sterile/isolation gowns. Medpro argued by failing to do so, DHSC had failed in its duty to mitigate its losses.

The duty to mitigate is a concept in English contract law which is applied when deciding what losses are potentially recoverable by a claimant by way of damages. It involves the Court asking if there are any steps the claimant could or should have taken, as a reasonable party, to mitigate or reduce its losses.

For example, if the parties enter into an agreement for the supply of goods, which are not then delivered and there is an available market for those same goods, the claimant is expected to go out to market to purchase replacement goods. It should not simply sit back and do nothing.

What steps are or are not reasonable in a particular case will depend on the facts.

The Judge concluded that there was no identifiable route to sell or redeploy the gowns and as a result, DHSC’s failure to act “was not one which led to the loss of an opportunity to reduce the financial damage and therefore the case on failure to mitigate must fail.”

This resulted in the Judge concluding that DHSC was legally entitled to recover the full cost of the gowns. DHSC failed in its claim to recover its storage costs.

For anyone interested in reading the full judgment, it can be accessed here.

Judgment debt

Medpro was required to pay the full judgment debt by 4pm on 15 October 2025. This date passed without payment, which prompted the Secretary of State for Health and Social Care, Wes Streeting, to comment that the Government intended to “pursue PPE Medpro with everything we’ve got to get these funds back.”

But is this a promise that the Government can hope to deliver on, especially as the company is now in administration?

Potential options for recovery of judgment debt

Use of the administration process

Medpro is now in the hands of its administrators.

When a company is put into administration, an insolvency practitioner is appointed to take control of the business and its assets.

Their role is to achieve one of the statutory objectives set out in the Insolvency Act 1986. These include, but are not limited to, saving the company so it can continue as a going concern and, if that is not possible, achieving an outcome that is more advantageous for its creditors than what would be achieved if the company were to be placed into liquidation.

An administrator has wide ranging powers to achieve those objectives, which include the power to:

• Take control of the company’s property;
• Sell the company’s property;
• Carry on the company’s business; and
• Set aside transactions at an undervalue or transactions which are intended to defraud creditors.

One of the administrators’ tasks will be to review the conduct of Medpro’s directors to check that they have discharged their statutory duties and have acted in the best interests of the company.

As part of that process, the administrators can raise questions. If an individual fails to comply, the administrators could seek a Court order compelling them to attend Court for examination.

A continuing failure to cooperate would be a contempt of Court and could result in the imposition of a fine and/or potentially imprisonment.

A finding of misconduct on the part of any director could also potentially result in that person being disqualified from acting as a company director for a period of up to 15 years.

The administrators are also likely to want to investigate transactions undertaken by Medpro to ensure that:

• Assets have not been sold or disposed of at an undervalue;
• It did not unjustly favour one group of creditors over another; and
• It was not carried out with the intention of seeking to defraud creditors.

If any such transactions are identified, they could potentially be set aside, which would have the net effect of increasing the assets available to the administrators for the benefit of Medpro’s creditors as a whole.

It has been widely reported that Mr Barrowman and Baroness Mone derived a significant personal benefit from the deal with DHSC. The administrators will no doubt want to investigate if there are any grounds to claw back any amounts received by them.

For example, if profits were extracted by way of dividend payments and there were insufficient distributable reserves available at the time those dividends were declared, any dividends paid out would be unlawful and would need to be paid back.

Is there an option to pursue the shareholders for the debts of the company?

Medpro is a limited liability company. This means that it has a separate legal personality from its shareholders and as a result, those same shareholders cannot normally be held responsible for the actions and debts of the company.

However, it is possible in certain limited circumstances to “pierce the corporate veil” and impose personal liability on shareholders. This is usually only possible where the company structure is being misused to commit fraud or in an attempt to avoid legal obligations.

The circumstances that will allow the corporate veil to be pierced were considered by the Supreme Court in Prest v Petrodel Resources Ltd [2013]. The leading judgment was handed down by Lord Sumption.

He concluded that there was a “limited principle of English law which applies when a person is under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately frustrates by interposing a company under his control.”

In those types of cases, the Court is able to pierce the veil “for the purpose, and only for the purpose, of depriving the company or its controller of the advantage that they would otherwise have obtained by the company’s separate legal personality.”

Lord Neuberger stressed that the corporate veil could only be pierced “when all other, more conventional remedies have proved to be of no assistance.” The Court will however require cogent evidence and therefore it is only ever going to be an option in a small category of cases.

What about personal claims against individuals?

No such claims were actually brought in the proceedings. The only defendant was Medpro itself, as the contracting party.

A scenario where personal liability could arise would be if a party connected with Medpro, such as a director or one of the ultimate beneficial owners, were found to have made false statements of fact during the negotiations with DHSC, which were relied upon and caused DHSC to enter into the agreement with Medpro.

There is no evidence that any such representations were in fact made, but if they had been then this may potentially open up a claim in misrepresentation.

An actionable misrepresentation arises where one party makes a statement of fact to another, which is false or misleading and the other party relies on that statement to its detriment by entering into the contract with the party who made the representation.

A misrepresentation can be fraudulent, negligent or innocent.

Investigation for the breach of the House of Lords’ Code of Conduct

Baroness Mone is currently under investigation by the House of Lords Commissioners for Standards’ Office for her alleged involvement in procuring contracts for Medpro leading to potential breaches of the 11th edition of the Code of Conduct.

Criminal investigation

A separate criminal investigation by the National Crime Agency is currently underway and assets linked to Mr Barrowman and Baroness Mone understood to be in the region of £75 million have been made subject to a freezing order pending the completion of those investigations.

The order covers a range of assets, including a number of properties and bank accounts. Both Mr Barrowman and Baroness Mone deny all allegations of criminal wrongdoing.

What next?

The options for recovering the Judgment Debt obtained by DHSC appear to be limited.

Medpro is in administration and there do not appear to be any clear, alternative options available. DHSC’s best hope of recovery probably lies with the administrators, but Medpro’s last set of filed accounts only show net assets of £666,025. If the administration fails, then Medpro is likely to be placed into liquidation.

This case serves as a powerful reminder that securing a judgment is only half the battle and does not guarantee recovery. When considering litigation, it is important that a proper analysis of a defendant’s ability to pay is undertaken as part of the case review to ensure there are good prospects of recovery.

How Morr & Co can help?

If you have any questions or would like any further information on the content of this article, please do not hesitate to contact our Dispute Resolution team on 0333 038 9100 or email info@morrlaw.com and a member of our expert team will get back to you.

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Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.