The Court of Appeal’s decision in Zaha Hadid Limited v The Zaha Hadid Foundation [2026] EWCA Civ 192 shows that the courts will be slow to treat licence arrangements as irrevocable unless the drafting makes that intention unmistakably clear. In particular, the Court drew a sharp distinction between agreements expressed to continue “indefinitely” and those that are genuinely perpetual, with important consequences for termination rights in long-term licence agreements; explicit reference to the parties’ intentions is therefore key in drafting. This case is relevant to the drafting of licence terms and termination provisions generally and is of particular significance where goodwill or licensed rights are fundamental to the business. The key message is drafting precision:
- If parties genuinely intend a perpetual arrangement, they should say so expressly and ensure the termination mechanics align with that intention.
- Conversely, agreements stated to continue “indefinitely” may be treated as terminable on reasonable notice, even where express termination provisions appear one sided.
Background
The contract was a trade mark licence relating to the trade marks in the late Dame Zaha Hadid’s name, originally granted by Dame Zaha Hadid to her architectural practice (the company) as licensee. After Dame Zaha’s death in March 2016, the trade marks passed to the Zaha Hadid Foundation (the foundation), which became the licensor. The licence contained obligations including a best endeavours obligation to promote and expand services and for payment to the foundation as licensor of a 6% royalty on all net income. The defined “licensed services” were drafted broadly to cover services not limited to those using the trade marks.
The company wished to continue using the trade marks but sought to renegotiate the financial terms, arguing the licence fee was too high. When negotiations failed the company gave notice to terminate the licence, but the foundation disputed that the company had any right to terminate.
The termination provisions and the High Court’s approach
Clause 12.1 provided that the agreement would continue indefinitely, unless terminated earlier in accordance with clause 12. Clause 12 then granted the foundation express termination rights, including termination without cause on three months’ notice and immediate termination for specified defaults, however there were no express termination rights for the company. The High Court held that the parties had set out an exhaustive list of how they intended that the licence could end, and that the company therefore had no right to terminate, also rejecting a restraint of trade argument on the basis this doctrine does not cover a bad deal.
The Court of Appeal’s approach
The Court of Appeal used the two‑stage test from Winter Garden Theatre (London) Ltd v Millennium Productions Ltd, first considering as a matter of construction whether the parties intended the agreement to be of perpetual or indefinite duration. If the intention was for it to be perpetual, there can be no end point for the contract. If the intention was for it to be indefinite, then the ability to terminate on reasonable notice follows as the only way to give effect to that intention, noting that there was no express language excluding the licensee’s ability to terminate. The Court was clear that “indefinite” and “perpetual” are not synonyms, noting that the words "continue indefinitely" indicated an agreement of indefinite, rather than perpetual, duration.
The Court also held that reading the clause as perpetual (terminable only by the licensor) did not make business sense in the context: the agreement contained obligations to promote the marks, and the Court gave examples of how reputational or commercial change could make it disadvantageous for the company to be bound to promote the brand far into the future.
Restraint of trade
Although the argument on restraint of trade was pleaded in the High Court, the Court of Appeal did not need to consider it following its construction of the licence termination provisions. The Court of Appeal did however flag that trade mark licences may be a class of agreement in which restrictive terms are accepted as part of commercial arrangements.
