The NHS has settled a legal dispute with private healthcare group Virgin Care for an undisclosed amount.

The Labour Party said it was “scandalous” that the NHS had to defend a legal battle with the company, which is part of Richard Branson’s business empire. It also called on the Department of Health to disclose details of the settlement.

Virgin Care sued the NHS last year after it lost out on an £82m contract to provide children’s health services across Surrey, citing concerns over “serious flaws” in the way the contract was awarded.

The company filed proceedings at the UK High Court naming the six local NHS clinical commissioning groups (CCGs) in Surrey, as well as Surrey County Council and NHS England.

Virgin Care and NHS Guildford and Waverley CCG, which was the lead group, both told The Independent that the details of the settlement were “confidential”.

However, NHS magazine the Health Service Journal reports that one CCG inadvertently revealed the settlement had left them with financial liabilities running to hundreds of thousands of pounds.

NHS Surrey Downs CCG initially disclosed that its liability in the case was £328,000 in its October public finance papers, the HSJ reports.

But this reference was subsequently removed with the CCG, saying this level of detail “should not have been included in the report”.

Virgin Care has been a winner of several major contracts for community health and care services in recent years, including a £700m adult social services contract in Bath and North Somerset.

The winners of the Surrey contract, Surrey Health Children and Families Services, a partnership between the local hospital NHS Surrey and Borders Partnership Foundation Trust, and two local social enterprises, took over the service in April.

Spokespeople for Virgin Care and NHS Guildford and Waverley CCG did not comment on what payment, if any, was made, saying: “The parties are pleased to confirm that an agreed resolution on the litigation concerning the Surrey Children’s procurement has been reached to a satisfactory conclusion for all parties with detailed terms confidential to the parties.”

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When news of the legal dispute was first announced, NHS Guildford and Waverley had said the group were “confident” in their commissioning processes.

Shadow Health Secretary Jonathan Ashworth said: “It’s scandalous that NHS money is being wasted on fighting off legal bids from private companies.

“Ministers need to make clear how much public money has been used in this case – at the least it seems to be hundreds of thousands of pounds. That is money that could be being used for NHS patients who are waiting longer than ever for routine services.”