Case No. IP-2022-000006

by the Partnership to the First Defendant.12.The Claimant company was incorporated on 12 August 2014, initially under the name Tom Hayman-Joyce Limited. It changed its name to Hayman-Joyce Property Limited on 12 January 2015. Thomas Hayman-Joyce has been its sole director throughout and owns the shares in the business with his wife, Amy. The business and goodwill of the Moreton LLP was apparently sold and transferred to the Claimant company in 2014 or 2015. Again, so far as I understand it, there was no formal documentation evidencing the assignment, but there is no dispute that the goodwill must have been transferred with the business. After the Claimant took over the Moreton LLP’s business, James Hayman-Joyce remained as a consultant to the Claimant’s Moreton business, combining that role with his position as a partner in the First Defendant until early 2022.13.At some point after the structural and personnel changes in 2010, the relations between the two businesses and the parties began to deteriorate. I do not need to establish when the strains began to appear, nor why they did so, but it is notable that no agreement was reached in 2012 for the Broadway LLP, and it appears that disagreements arose both between James Hayman-Joyce and Mr Comber, and between Thomas Hayman-Joyce and Mr Comber. For instance, in 2015 Mr Comber took legal advice at least about the First Defendant’s entitlement to the income on commercial sales, and discussed that advice with the others. It seems that both Thomas and James Hayman-Joyce disagreed with the advice he had been given.14.By 2018 Thomas Hayman-Joyce and Mr Comber disagreed (amongst other things) about the ownership and use of the Hayman-Joyce name, and each party’s right to trade under the Hayman-Joyce name in the Broadway Patch. This put James Hayman-Joyce in a difficult position as he remained a partner in the Broadway business (he and his service company retired from the LLP on 2 February 2022). Mr Comber’s evidence was that when there was conflict between himself and Thomas Hayman-Joyce as to the businesses, James Hayman-Joyce tended to side with his son, and I was shown a number of emails in which James Hayman-Joyce disagreed with Mr Comber’s approach or activities at various dates. 15.During the course of 2018, James Hayman-Joyce and Mr Comber sought again to negotiate terms of an LLP agreement. They (and Thomas Hayman-Joyce) instructed separate firms of solicitors. From mid-2018 they discussed the continued use of the Hayman-Joyce name by the First Defendant and whether there should be a co-existence agreement with the Moreton business. James Hayman-Joyce relied on the transfer of the ‘brand’ Hayman-Joyce to the Claimant in 2014, but Mr Comber riposted that he considered that the Partnership Agreement still governed the position. In July 2018, Mr Comber’s solicitors proposed a formal co-existence agreement relating to use of the brand and the exclusive areas in which each business would operate. That led to some discussions directly between Mr Comber and Thomas Hayman-Joyce, seeking, unsuccessfully, to resolve the issue. 16.On 29 October 2018, Mr Comber wrote to James Hayman-Joyce saying that there was to be a meeting with Thomas, whose solicitors had proposed “some sort of licence agreement” and he asked James Hayman-Joyce to attend. He added that he assumed that James Hayman-Joyce would “not wish to agree to a licence that would in any way affect the freedom to conduct our business.” James Hayman-Joyce responded that he saw no reason to attend the meeting as he thought there was not much to negotiate, as the agreement “should cover the geographical restrictions for the sale of residential property as set out in the 1999 agreement” as well as “our” use of the brand. As I understand it, a meeting did take place on 1 November 2018, without James Hayman-Joyce’s attendance. There was some dispute as to what was said on that occasion. Thomas Hayman-Joyce said, in the opposition proceedings mentioned below, that following that meeting he thought the First Defendant/Mr Comber would be amenable to taking a licence to use the Hayman-Joyce name.17.It was in those circumstances that, on 5 November 2018, the Claimant applied to register HAYMAN-JOYCE and HAYMAN JOYCE as a series of trade marks for the following services:Class 35Auctioneering services; arranging and conducting auctions; online auctioneering; property auctioneering services.Class 36Real estate affairs; real estate brokerage; real estate appraisal; rental of real estate; real estate management; real estate agency services; rental of offices [real estate]; financial evaluation [real estate].18.On 7 November 2018, Mr Comber’s solicitors set out some proposals for terms of a co-existence agreement and said “Both [Thomas Hayman-Joyce and the First Defendant] have developed goodwill in their businesses … We agree that it would be worthwhile for the parties to register the trade mark but as originally suggested to [Thomas’s solicitor], this should be a joint application.” James Hayman-Joyce objected on the same day to what he saw as the expansion of the matters in issue, and expressed concern at the same solicitors acting both for Mr Comber and for the First Defendant. After some further exchanges that day, Mr Comber’s solicitor wrote again on 16 November 2018, expressing disappointment that the trade mark application had been made unilaterally and without notice. He said that if the outstanding issues were not resolved in time, he would advise his client to oppose the application. James Hayman-Joyce objected that he would not allow the LLP to contest the application, moreover, he said that he supported the trade mark application.19.Mr Comber (and his service company) therefore opposed the Claimant’s trade mark application in their own names rather than on behalf of the First Defendant, claiming to have goodwill in the signs HAYMAN-JOYCE and HAYMAN JOYCE based upon use since 1998 in “Broadway, Worcestershire and the surrounding areas of approximately a 9 mile radius” in relation to “Real estate services including residential sales, sale of freehold commercial property, property auctions and valuations,” such that the mark offended against section 5(4)(a) of the Act. They also alleged that the mark was applied for in bad faith as the parties were in a partnership and jointly using the mark, but the application was made without the knowledge of the opponents.20.Mr Comber claimed in the opposition (according to the decision dated 15 July 2020) that he and James Hayman-Joyce jointly owned the assets of the original Broadway partnership, including its goodwill. However, James Hayman-Joyce filed a witness statement in December 2019 supporting the trade mark application, concentrating on his view that no goodwill was owned by Mr Comber or his service company, so that they were not in a position to oppose the trade mark application. He made some contradictory statements in his witness statement. On the one hand he said “I believe it is common ground that no goodwill exists in the original Partnership or owned by each of us as partners to that Partnership. I do not understand how [Mr Comber] can think that the Partnership exists when we have each disposed of our goodwill in that and it is clear that the partnership can no longer trade.Even if the Partnership is not dissolved (I do not see how this could be the case) … The original goodwill from the Partnership is clearly now held by [the First Defendant] - created to continue the business of the Partnership …” On the other hand, he said“I believe that the HAYMAN-JOYCE brand is owned by [the Claimant]. This is because I began the original Hayman-Joyce brand when I started to operate as a sole trader in Moreton on the Marsh in 1991. This business subsequently became [the Claimant].I never sold the Brand to [the First Defendant].I firmly believe that [the First Defendant] uses the Brand under an implied licence from [the Claimant]”21.The Hearing Officer for the Registrar, Mr Salthouse, in a written decision of 15 July 2020, decided that Mr Comber and his service company had no locus to bring the opposition based on s 5(4)(a), as they did not personally own any relevant goodwill. He went further, and expressed his view that the Claimant had goodwill in and around Moreton and the “new partnership” had goodwill in and around Broadway, saying “In the instant case there is disagreement as to whether the initial partnership which was subject of the agreement was dissolved in 2010 when HJB LLP was formed. To my mind, it does not matter whether the partnership was dissolved or not. The goodwill accrued between 1 May 1998 and 31 July 2010 under the partnership of Mr James Leslie Hayman-Joyce (JHJ) and Mr Comber belonged to the partnership. Either that partnership continued under the guise of HJB LLP and the goodwill of twenty plus years is owned by the partnership or the initial partnership was dissolved in 2010 and a new partnership (HJB LLP) owns the goodwill accrued subsequently.” In his view, which it is common ground is not binding upon me, both of the LLPs had localised goodwill, so neither was entitled to register the mark without the other’s consent. He concluded that had the opponent had locus, the opposition would have succeeded. He rejected the opposition under s 3(6). The mark therefore proceeded to registration on 9 October 2020.22.Then in late 2020 the Broadway business took a number of steps to which the Claimant objected, such as starting to use the name HAYMAN-JOYCE BROADWAY, registering the domain name www.haymanjoycebroadway.co.uk and distributing a flyer in the Moreton office’s area of exclusivity. Mr Comber’s position was that the Claimant had refused to agree to various joint contracts, and in late 2020 he had felt obliged to start to make alternative arrangements for the Broadway business. On 25 January 2021, the Claimant’s solicitors wrote to Mr Comber complaining of breach of an implied licence from the Claimant to use the trade mark, and calling on him to remedy the breaches and enter into a written licence agreement by 31 January 2021, failing which the licence would be terminated on that date, and the business would be required to rebrand by 30 April 2021. No agreement or resolution was reached. On 31 January 2021, the Claimant took the First Defendant off the joint website and excluded it from the joint management and email systems. 23.This breakdown in the relations between the LLPs plainly put James Hayman-Joyce in a difficult position. On 28 May 2021, his solicitors wrote to the solicitors for all of the other parties, explaining that he felt under pressure to “raise his head above the parapet” - perhaps an odd remark given his previous support of the Claimant’s trade mark application. In any event, his solicitors stated that his view, on more careful analysis, was that there had never been a licence from the Moreton business to the Broadway business, contrary to what he had said in his evidence to the UKIPO. His solicitors expressed the view that goodwill which he had owned in the Broadway area before formation of the original partnership with Mr Comber had been superseded by goodwill generated by the Broadway business, such that the Claimant’s trade mark had been invalidly registered. Their (optimistic) suggestion was that the parties should instead enter into a co-existence agreement.24.On 2 February 2022, Mr Comber purchased James Hayman-Joyce and his company’s share of the First Defendant. 25.The witnesses26.At trial I heard evidence for the Claimant from Thomas Hayman-Joyce, Mr Asad Noorani, the accountant who had advised the various businesses for some years, including in 2010 when the LLPs were formed, and from Mr John Yarnold, who is an employee of the Claimant but previously worked for the Winchcombe office. Mr Hayman-Joyce accepted that his knowledge of the position prior to 2010 was not direct, but was based upon the documents and what his father had told him. I bear that in mind in considering his evidence. I found all of them to be honest witnesses, who were doing their best to assist the court.27.Mr Comber was the sole witness for the Defendants. The Claimant’s counsel accepted that he was doing his best to tell the truth, but suggested that there were a number of inconsistencies between his oral evidence and his witness statement, whilst he was overly “fixated” on the continuing impact of the Partnership Agreement. It does seem to me that Mr Comber’s statement contained material that amounted to comments or submissions drafted by his lawyers rather than being evidence of facts which he could recall. There were also some points made in his witness statement (for instance as to commercial sales claimed to have been effected by the Broadway office) which were incorrect. That was unfortunate, but to his credit Mr Comber willingly admitted points on which his recollection was mistaken or unclear. I have borne this in mind where relevant, for instance in relation to the evidence about the commercial sales, but overall I find that he too was an honest witness seeking to assist the court.28.The obvious missing witness was James Hayman-Joyce. He did not give evidence in support of either side in the dispute. Thomas Hayman-Joyce set out in his witness statement a number of reasons why the Claimant had not called his father. He was not cross-examined on this, nor was I invited to draw any inference based on the fact that James Hayman-Joyce did not give evidence. Without having heard him it is not possible for me to assess whether his real views about an implied licence are those set out in his witness statement in the opposition, or the opposite view expressed in his solicitors’ letter in May 2021, or indeed how the points made in his witness statement may be reconciled with each other. However, I have borne in mind his evidence about the position in 1997-8, so far as it is consistent with the documents, or is not seriously contested by the parties.Goodwill29.The essential issue in this case is that of the ownership of the goodwill in the Hayman-Joyce name. There are issues as to the ownership of the goodwill at various dates in the areas which the parties dubbed the Moreton and Broadway Patches, and also an issue as to whether the Broadway business can claim goodwill in relation not just to residential sales but also to other aspects of the estate agency business.30.There was no real dispute between the parties as to the applicable principles. Lord Oliver in Reckitt & Colman Products Ltd v Borden Inc [1990] 1 WLR 791, at 499, spoke of the plaintiff in a passing off action being required to “establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying…brand name or a trade description or [get-up].” In Star Industrial Company Ltd v Yap Kwee Kor [1976] FSR 256 (PC), Lord Diplock said at 269:“A passing-off action is a remedy for the invasion of a right of property not in the mark, name or get-up improperly used, but in the business or goodwill likely to be injured by the misrepresentation made by passing-off one person's goods as the goods of another. Goodwill, as the subject of proprietary rights, is incapable of subsisting by itself. It has no independent existence apart from the business to which it is attached.”31.However, as Lloyd LJ said in Dawnay Day at [50]-[51], it is possible for several businesses using the same name to acquire their own goodwill in a business name, or to share the goodwill. Such goodwill may have evolved independently, or have devolved from a common ancestor (see W. S. Foster & Son Ltd v Brooks Brothers UK Ltd [2013] EWPCC 18). Whether the businesses do share the goodwill, or whether on the particular facts of the case one of them owns the rights, depends on the individual facts of the case, and in this case, the contractual arrangements between them. The Claimant accepted that the Broadway businesses had generated goodwill in the Broadway Patch, limited to residential sales, but said it accrued to the Moreton business. The Defendants submitted that it would be artificial to distinguish between residential sales services and other kinds of estate agency services, such as lettings or commercial sales, and that the parties cannot be said to have goodwill only in certain of those services. Its case was that both sides own goodwill in a business which includes the full range of estate agency services. Had the parties set up independently of each other or had they both provided the full range of such services following the Partnership Agreement, I accept that both would probably have had such goodwill, but in my judgment two factors militate against such a conclusion here: first, the impact of the exclusive “Patches” has to be taken into account, and secondly the First Defendant and the partnership before it are said not to have provided a full range of estate agency services. I have therefore felt it necessary to analyse the position in relation to different categories of estate agency services.The Claimant’s claim to goodwill32.The Claimant produced a number of documents showing the scope of James Hayman-Joyce’s business prior to 1997, including marketing materials and ledgers, and the agreement with the Mayfair Office. It is no surprise that the early records were rather limited so long after the event, but Thomas Hayman-Joyce was able to identify from hand-written ledgers of properties dealt with pre-1997 a number of properties which were in Broadway or in what became the Broadway ‘Patch.’ In the Defence the Defendants denied that the Claimant or its predecessors in business ever had goodwill in relation to residential sales in the Broadway Patch. However, Mr Comber gave evidence that James Hayman-Joyce’s business had offered estate agency services, from the Moreton office and had, in particular, marketed properties in Broadway and the surrounding area prior to 1997, although he said that this represented a small proportion of the overall business.33.In the circumstances, I am satisfied that James Hayman-Joyce’s business had generated goodwill in relation to estate agency services in and around Moreton by 1997, amongst those potentially wishing to sell or let their properties in the area, that is to say, the pool of clients potentially attracted by the goodwill attaching to the name. Broadway is only 8 miles from Moreton, and in my view, goodwill generated by the original business would undoubtedly have extended to Broadway, and indeed further afield in (or, given the Mayfair office, even beyond) the Cotswolds, and probably in the whole of what was later called “No Man’s Land.” Doing the best I can, I accept the Claimant’s submission that the area in which it had goodwill extended to a radius of 25 miles from the Moreton office.34.There is no dispute as to the Claimant’s ownership of goodwill in the Moreton Patch as the successor to James Hayman-Joyce’s business. The Defendants put the Claimant to proof of its goodwill as at November 2020, when the Defendants commenced acting in the manner which the Claimant says amounts to passing off, in both the Broadway Patch and “No Man’s Land.” As to the latter, it was not seriously disputed by the Defendants that the Moreton business had offered estate agency services in No Man’s Land over many years. In my judgment, the evidence, such as the Rightmove listings and sales identified by Thomas Hayman-Joyce, amply supports the Claimant’s claim to goodwill in No Man’s Land for estate agency services up to November 2020.35.Mr Comber also admitted that the Claimant and its predecessors had offered residential lettings and commercial sales and lettings services in the Broadway Patch after 1998 despite the exclusivity terms of the Partnership Agreement, although he claimed that it too had offered commercial sales and lettings, but no residential lettings, in the area. In the circumstances, I find that as at November 2020 the Claimant also owned goodwill in the Broadway Patch for residential lettings and commercial sales and lettings services. It (and its predecessors) have not traded in the Broadway Patch in relation to residential sales since 1998. For the reasons given below, I reject its claim to have been the licensor of the partnership or later of the First Defendant, and I find that the Claimant did not own goodwill in the Broadway Patch area in relation to residential sales as at November 2020.The First Defendant’s claim to goodwill36.When the Broadway office was set up in 1997 in my judgment it benefited from and relied upon the existing goodwill generated by James Hayman-Joyce from his existing business (both from the Moreton and Mayfair offices). The Broadway office was an extension of that business, as Mr Comber accepted in cross-examination, and prior to the formation of the Broadway partnership, the goodwill generated by the Broadway office belonged to James Hayman-Joyce. It is common ground that once the partnership came into being, the partnership and thereafter the First Defendant continued to trade in the Broadway Patch, and to a lesser extent in No Man’s Land. In doing so, it is common ground that they built up goodwill in the Broadway Patch for residential sales services. However, a central issue between the parties was who owned the goodwill in (at least) residential sales services in the Broadway Patch, which turns on how, if at all, ownership changed upon the commencement of the partnership.37.Plainly, the partnership could not have started to use the Hayman-Joyce name in the Broadway Patch for any kind of estate agency services in 1998 without James Hayman-Joyce’s consent. Mr Comber’s evidence was that there was an understanding that the Moreton and Broadway businesses would each accrue goodwill in the name attaching to their own business, but as he did not explain how or when that understanding had arisen, or suggest that there had been any express agreement to that effect, it seems to me that I must rely upon the terms of the Partnership Agreement dated 29 January 1999 as recording the parties’ intentions at the relevant time. Neither side suggested that there was any other relevant agreement, whether oral or in writing.38.The Agreement stated that the partnership commenced on 1 May 1998. It provided that the business of “Estate Agents and Surveyors” was to be carried on from offices at The Green, Broadway under the Hayman-Joyce name, but contained no express provisions relating to the goodwill which would be generated by the partnership under that name. Clause 10 provided that, unless otherwise agreed in writing, all assets used by the partnership would be assets of the partnership, which, as the Defendants contended, would suggest that goodwill in the name was a partnership asset, consistently with s 20(1) of the Partnership Act.1 However, Clause 10 went on, “The Moreton Business and all assets used therein shall be expressly excluded from the Partnership Property.” To my mind it is not clear from Clause 10 alone whether the parties intended the Hayman-Joyce name to be an asset of the partnership, or excluded from the partnership assets as an asset of the Moreton business.39.Clause 20 of the Agreement made various provisions for retirement and dissolution. Sub-clauses (a)-(c) provided that either partner could retire on giving 6 months’ notice, or one partner could give the other notice to retire on reaching the age of 68 or being unable to perform his duties due to ill health etc. Clause 20(d) provided that in the event of a dissolution pursuant to Clause 20 (a)-(c), or due to the expulsion or death of a partner, “the Partnership shall not be wound up but shall be continued by the other Partner (unless he shall elect otherwise) subject to the option of the Continuing Partner(s) to purchase the outgoing or deceased Partner’s share.” There is nothing in this clause restricting the right of the surviving or continuing partner to continue to use the Hayman-Joyce name for the business, whether or not the option was exercised.40.Clause 21 dealt with the option to purchase the outgoing or deceased partner’s share, this was to be on the basis set out in the Second Schedule to the Agreement, which says nothing about the name. Clause 22 contained non-competition clauses for departing partners, which included a ban on James Hayman-Joyce opening a competing office within a radius of 10 miles of the Broadway office, but expressly did not prohibit him from carrying on the Moreton business.41.Clause 25 then provided for dissolution in other circumstances: “Upon Dissolution of the Partnership in any event not otherwise provided for its affairs shall be wound up in manner provided by the Partnership Act 1890, except that the Goodwill (if any) of the practice shall not be sold and each partner may individually or collectively continue the business carried on by the Partnership but none of them shall use the name of any other Partner without the consent of such other Partner or his personal representative