A recent Court of Appeal decision may have important implications for businesses operating under long-term trade mark licences.
In Zaha Hadid Limited v The Zaha Hadid Foundation [2026] EWCA Civ 192, the Court considered whether a party to a trade mark licence had an implied right to bring that licence to an end, even where the agreement itself only gave that right to the other party.
Background Zaha Hadid Limited v The Zaha Hadid Foundation
Zaha Hadid Limited had been using the trade mark Zaha Hadid under a licence granted by the Zaha Hadid Foundation. However, in 2024, the Company sought to terminate that licence, despite the agreement only expressly allowing the Foundation to do so.
The issue for the Court of Appeal was whether the Company nevertheless had an implied right to terminate the licence.
Indefinite or perpetual?
A key part of the Court’s decision was the distinction between an “indefinite” licence and a “perpetual” licence.
To determine which applied, the Court examined the wording of the agreement and considered what the parties were likely to have intended when they entered into it.
The Court held that an indefinite licence is one that is expected to end at some point. Where the contract does not set out how that should happen, the Court may imply a right for either party to terminate on reasonable notice.
By contrast, a perpetual licence is intended to last forever. If such a licence contains no termination provisions, the parties may be bound by it permanently.
In this case, the licence stated that it would continue “indefinitely”. The Court found that this did not mean forever. It concluded that it would make little commercial sense for the parties to have intended to remain bound for all time, and therefore treated the arrangement as an indefinite licence rather than a perpetual one.
As a result, the Court found that both parties had an implied right to terminate the licence on reasonable notice, even though the written terms only gave the Foundation an express right to terminate on three months’ notice.
Why this matters
This decision represents a significant shift because it signals a notable development in the Court’s approach to commercial contracts. Historically, the Courts have been cautious about interfering with the agreed wording of commercial agreements.
Following this ruling, parties to indefinite trade mark licences may now have greater scope to bring those arrangements to an end on reasonable notice, even where there is no express contractual right allowing them to do so.
Equally, businesses that routinely enter into trade mark licences for indefinite periods should review those agreements carefully. They may be more exposed than previously thought to early termination and may wish to consider whether their drafting adequately protects their commercial position.
How DTM Legal can help
At DTM Legal, our Corporate & Commercial team can advise on your rights under existing trade mark licences and help you put robust agreements in place that protect your interests going forward.
If you are concerned that you are tied into an unfavourable licence and want to explore your options for termination, or if you believe your trade mark rights are being infringed, our Dispute Resolution team can help you assess and enforce your position.
