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	England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Bouverie No. 1 Ltd v De Vere Hotels & Leisure Ltd [2006] EWHC 2242 (Ch) (07 September 2006) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2006/2242.html Cite as: [2006] EWHC 2242 (Ch)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		7th September 2006

MR JUSTICE RIMER :

Introduction

1. This is a dispute about the management of a well-known hotel and golf resort at Wishaw, Warwickshire called The De Vere Belfry but also known more shortly as The Belfry. It should not be forgotten that its formal name is The De Vere Belfry, but for purposes of brevity I shall usually refer to it by its shorter, perhaps more familiar, abbreviation. The defendant, De Vere Hotels & Leisure Limited ("De Vere"), is a subsidiary of De Vere Group Plc and is the group's main trading company for its hotels division. De Vere owns and manages a number of hotels, leisure complexes and fitness centres. From 1971 until March 2005 The Belfry was one of the hotels it both owned and managed.
2. In March 2005 De Vere completed the sale of The Belfry to Quinn Hotels & Leisure Limited, a company in a group that is owned and managed by Sean Quinn and other members of his family. The Quinn group ("Quinn") is engaged in a wide variety of industries, including that of hotels and hospitality. Quinn now owns eight hotels, including The Belfry. It operates two, and the rest are operated under franchise or management agreements. Quinn bought The Belfry for a headline price of £186m. On 9 February 2005 Quinn and De Vere signed a 25-year management agreement under which De Vere was appointed to operate The Belfry. The agreement became effective on 16 March 2005 when the transaction was completed. De Vere has since been managing The Belfry.
3. The parties soon fell out. Quinn wants to be rid of its management agreement with De Vere and by this claim (brought by Bouverie No. 1 Limited ("Bouverie 1"), a Quinn company) Quinn asks for a declaration that it is entitled to terminate it because of De Vere's alleged commission of breaches which are said to have been material, irremediable and persistent. The dispute has arisen because De Vere has engaged in a re-branding exercise in relation to the hotels in its chain (including The Belfry) and has adopted a new logo. The heart of Quinn's complaint is that it claims that the new logo has either changed the hotel's name or at least has designated it by a name or names other than its permitted name under the management agreement. The only such permitted name (under clause 5.1) is "The De Vere, Belfry" (including the comma). In practice, it is and has always been known as "The De Vere Belfry" (without a comma) or (for short) just "The Belfry" and so the either careful or careless drafting of clause 5.1 is a minor mystery. The alleged new, or additional, name or names are said to be either "De Vere at The Belfry" or "De Vere" or both. De Vere denies it has either changed the hotel's name or designated it by any new or additional name.
4. A further complaint by Quinn is that De Vere's re-branding is said to have involved a use of trade marks incorporating the words "The Belfry" in a manner likely to cause damage to the goodwill and reputation attaching to those marks. There is, however, no dispute that De Vere is entitled to use the marks. De Vere rejects this complaint as groundless. Quinn also alleges further breaches of the management agreement, all related to the manner in which De Vere went about its re-branding exercise. De Vere denies it has committed any such breaches.

Background: De Vere's re-branding proposals

5. De Vere runs a chain of 18 hotels and resorts, of which the best known are The Grand at Brighton, The Cavendish in London and The Belfry (it also runs two other businesses for which it uses the brand names Village and Greens, but the claim does not concern them). All hotels in the chain are four or five-star hotels. They are located in different parts of the UK, and have different characteristics. De Vere owns 16 of its hotels and operates the other two under management agreements (The Belfry is now, since March 2005, one of them, the other being De Vere Whites at Bolton, which is part of a stadium complex at Bolton Wanderers Football Club and which De Vere has been managing since May 1999). The general scheme of such management agreements is that the operator runs the hotel on behalf of the owner and is rewarded by a percentage of gross turnover. In the case of The Belfry, De Vere also receives an incentive fee calculated by reference to the adjusted gross operating profit achieved at the hotel and a reservation fee for reservations obtained through its central reservations service based in its head office in Warrington. The guests contract with the owner, which also meets the costs of running the hotel and employs the staff apart from the operator's top management.
6. The Belfry is a 324-bedroom, four-star hotel set in 550 acres of countryside and grounds. It has three golf courses, including a Championship course known as the Brabazon. It has a night club called "The Bel Air". It is a famous hotel with a significant heritage, reputation and goodwill, particularly in relation to golf. The Ryder Cup, staged since 1927, has been held there a record four times, in 1985, 1989, 1993 and 2002. The Professional Golfers Association also has offices there. The business of The Belfry is huge. It has some 800 employees, an annual turnover of some £35m, thousands of customers walk through its doors and play golf there and it is (according to the belief expressed in evidence of Carl Leaver, De Vere Group Plc's Chief Executive Officer) the most profitable hotel in the United Kingdom outside London. De Vere has always regarded The Belfry as its best known, and flagship, hotel.
7. In 2003 De Vere embarked on a four-part strategy to improve its business, including considering the adoption of a stronger brand strategy, although the De Vere brand was by then already well known as a hotel chain. Its existing brand philosophy was to make a promise to consumers as to what they would experience at a De Vere hotel across the whole chain and so (with one exception) it was already part of its brand strategy to incorporate "De Vere" into each hotel name. For example, its hotel at Loch Lomond was known as the "De Vere Cameron House," its hotel near Chester was the "De Vere Carden Park", its hotel in Brighton was "The De Vere Grand" – and its hotel in Warwickshire was "The De Vere Belfry" (the last two hotels are the only ones to use the definite article; and De Vere's hotel in London is the said exception: it was and is simply called "The Cavendish"). De Vere's case is that all its hotels (including The Belfry) still bear the same names despite the recent re-branding about which Quinn makes complaint.
8. With a view to the proposed re-branding, De Vere initiated Project Core. It had a wide remit, including consideration of the hotel markets De Vere should be in, the sort of hotels it should be owning or managing, its strengths and its approach to questions of design. De Vere sought advice from Corporate Edge, a branding consultancy with experience in the hotel sector. The first part of Project Core was a research and analysis phase. The results were summarised in a paper that John Rogers, De Vere's Sales and Marketing Director, produced for the executive board in October 2004. This identified four core drivers for customers: (i) comfort (a luxury level above the ordinary), (ii) exploration (experiencing new things, whether on the menu, the design of the hotel or the history of its location), (iii) order (everything should work), and (iv) leadership (treating customers as important without being obsequious). This led to the recommended brand positioning, which was summed up as "Reassuring Difference". The theory of this was that De Vere could create a unique position in the minds of customers through a combination of (i) the reassurance of quality and service, reflecting the four core drivers, and (ii) the distinctive locations that its hotels could offer. This led to the concept of the location of each hotel being a stage, with De Vere bringing to it the De Vere experience in terms of quality of service, food and so on. The "stage" element was viewed as more than a mere address: it was a place with its own distinctive character. De Vere also arrived at three co-ordinates that would define it and its brand. These were (i) "Engineered", (ii) "Flair and Wit"; and (iii) "Restless", which formed part of De Vere's "brand template."
9. The ideas in this paper were approved by De Vere's executive board and the general managers of its hotels in November 2004 following presentations by Mr Rogers. Corporate Edge was commissioned to carry out research into how the identity of De Vere needed to change in the light of the brand template. Customer feedback was obtained on various ideas. It reported back on 17 December 2004. By now the so-called construct "De Vere at [a particular hotel]" was being considered as an original way of expressing the balance between the individuality of its hotels and the consistency throughout the chain of the De Vere brand, and it was this construct that formed the theme of the new hotel logo that De Vere later adopted. But at this stage research into a new brand identity and logo was still in progress. Nothing had been decided by the time Quinn bought The Belfry.

Quinn buys The De Vere Belfry

10. By 2004 Quinn was anxious to buy what Liam McCaffrey, the Group Chief Executive of Quinn Group Limited, called a "landmark and quintessentially English property." Quinn considered it would enhance its name and business reputation in the UK. It explored an opportunity to buy Wentworth golf and country club but was outbid in about October 2004. A representative of Deutsche Bank then brought Quinn and De Vere together, leading to discussions as to the purchase by Quinn of The Belfry, which it regarded as an even more impressive venue than Wentworth. De Vere made it clear at the outset that it would only be prepared to sell if it could continue to manage The Belfry under a long-term management agreement and Quinn agreed to deal on that basis. A price of £186m was agreed. Mr McCaffrey's evidence is that the book value of the hotel was around £126.2m, and he says the premium of some £60m that Quinn agreed to pay reflected the value that Quinn placed on The Belfry's name and reputation. He also agreed in cross-examination that the contemplation at the time, as is implicit in the management agreement, was that The Belfry would continue to be marketed as part of the De Vere chain (its name was to remain The De Vere Belfry) and as far as the customer was concerned there would be no change: he would not even know the hotel was now owned by Quinn. The sale agreement did not divide the consideration between values referable to property and goodwill and the evidence of David Edwards (company secretary and chief legal adviser of De Vere Group plc, who took part in the sale negotiations) is that he did not recall anyone from Quinn stating that they attributed a particular value to goodwill.
11. The sale was implemented as follows. By an agreement of 31 January 2005 De Vere hived down to a subsidiary, Bouverie No. 2 Limited ("Bouverie 2"), its business at The Belfry, including the hotel and the goodwill in relation to that business. By another agreement of the same date, De Vere assigned various trade marks to Bouverie 2. All these assets were later transferred to Bouverie 1 (a subsidiary of Bouverie 2) and, upon the completion of the sale to Quinn on 16 March 2005, Quinn acquired the entire issued share capital in Bouverie 2. The agreements of direct relevance to the claim are (i) the management agreement of 9 February 2005 entered into between Bouveries 1 and 2 and De Vere, which became effective on completion of the sale, and (ii) a trade mark agreement of 16 March 2005 between Bouverie 1 and De Vere.
12. The focus at the trial was on the management agreement. The main issues arising under it are (i) whether the implementation of De Vere's re-branding exercise in late 2005 and early 2006 has meant that De Vere has changed the hotel's name to an impermissible name or names or has designated it by an impermissible additional name or names; (ii) whether the re-branding has resulted in a use of certain trade marks (incorporating the words "The Belfry") in a manner reasonably likely to cause material harm to the goodwill attaching to them; (iii) whether the manner in which De Vere went about the adoption of its re-branding involved a breach of its duties to keep Quinn informed and advised of all material matters concerning the operation of The Belfry; (iv) whether in the circumstances relating to the re-branding exercise De Vere has performed its duties under the management agreement otherwise than diligently and faithfully; (v) if De Vere has breached the management agreement in one or more respects, whether its breaches have been material and either irremediable or persistent such as to entitle Quinn to terminate it.
13. The relevant provisions of the management agreement will make more sense if I defer referring to them until after I have described what it is that De Vere has done that Quinn claims has so incensed it. I will therefore first complete the re-branding story, which so far has reached December 2004; and will then summarise the evidence in relation to the communications between De Vere and Quinn about the re-branding. This is relevant because Quinn complains that De Vere has committed an unforgivable breach of trust and of its duties under the management agreement by not consulting Quinn at the earliest possible opportunity on its re-branding proposals. De Vere's response is that this is trumped-up nonsense, which is being used by Quinn as a phoney basis to make, if it can, a case which may enable it to get rid of De Vere, something it has wanted since within a matter of weeks of buying The Belfry. De Vere says it has always been open about its re-branding proposals, Quinn only learnt about them because De Vere told it (and before they had been implemented) and it offered full presentations on all that was involved. Quinn, however, was so shocked by the re-branding revelation that it found itself unable to discuss them. On Quinn's view, the fault is all on De Vere's side.

The De Vere re-branding – continued

14. In the early months of 2005 De Vere carried out further research into, in particular, the new logo which it wished to adopt for its hotel chain: its then current logo incorporated a lion rampant. Corporate Edge came up with a number of ideas and De Vere also appointed another consultancy, Sue Swalwell & Associates ("SSA"), to research them. SSA gave a presentation to Mr Leaver and Mr Rogers on 12 July 2005. One of Corporate Edge's ideas was a logo using calligraphy incorporating a stylised signature for De Vere in cursive manuscript, and it was this that consumers regarded as best reflecting the elements of the brand template. SSA's conclusion was that De Vere needed to be dominant in the overall brand identity in order to get the concept of consistent quality across to customers. Mr Leaver and Mr Rogers favoured this idea for a new logo, and it was this that De Vere adopted. Its theme was (I find) a dominant "De Vere" signature in flamboyant cursive script, below which would appear in print "at [THE HOTEL]", the "at" in lower case and the hotel in upper case. Thus, for example, (reproducing the words, but not the form of the proposed logo): "De Vere at Oulton Hall", "De Vere at Herons' Reach", "De Vere at Mottram Hall" – and "De Vere at The Belfry". I shall call this "the hotel logo". In certain cases the hotel logo also included the location of the hotel immediately below the hotel's name and in print of the same size and font. Thus, for example, "De Vere at Cameron House Loch Lomond", "De Vere at The Grand Brighton" and "De Vere at The Cavendish London" – with Loch Lomond, Brighton and London immediately below Cameron House, The Grand and The Cavendish respectively. SSA's advice was that the use of the "at" in the hotel logo added a rooting to the brand that implied a sympathetic approach to the particular hotel: it supported the individuality of the hotel - no doubt valuable advice because otherwise De Vere might not have realised that.
15. On 2 September 2005 Mr Rogers gave a presentation of the hotel logo proposal to De Vere's main board. The board had concerns about the form of the De Vere signature in the logo and about the proposed colouring (red script on a maroon ground), which it regarded as too modern. The result was that Mr Rogers came up with some revised proposals to meet these concerns. By 21 September 2005 each board member had approved them.
16. This was followed by a series of presentations that Mr Rogers made to De Vere managers running from 26 September to mid-October 2005 and known colloquially as the "Shine" presentations. Shine was the name given to the combined process of launching the new brand (although this apparently formed only a small part of it) and the newly established set of corporate values (defining the culture De Vere aimed to create) that aligned with its brand. At the same time De Vere commenced its planning on incorporating the hotel logo into its chain marketing materials (so-called "chain collateral"). Corporate Edge drew up identity guidelines, for example as to the font to be used in marketing collateral in brochures and in material to be placed in rooms in chain hotels. The process of agreeing these guidelines was a protracted one, continuing through November and December and into January 2006, during which period in particular Mr Rogers and Mr Leaver discussed the relative size of the "De Vere" signature and the "[at THE HOTEL]" in the hotel logo for the various chain hotels: and the result of their consideration was to increase the relative size of the latter parts of the logo so as to ensure that the identification of the hotel played its full part. I deal later with the communications between De Vere and Quinn about the re-branding, but will first summarise what it is that De Vere has actually done by way of implementation of it.

Use of the"De Vere at The Belfry" hotel logo

(a) The Planner Brochure

17. De Vere has used its new hotel logo in various brochures and publications. Taking them in chronological order of publication, the first is its "Planner" brochure. For comparison purposes, the evidence includes its 2004 brochure, which covers both De Vere's "Village" hotels and leisure clubs and its main chain of hotels. On the cover page appears "DE VERE HOTELS", with a lion rampant between the second and third words. The brochure is sub-headed "Conferences, Meetings, Events, Incentives". It opens by listing all the chain hotels as, for example, the "De Vere Slaley Hall", the "De Vere Mottram Hall" – and "The De Vere Belfry". It then includes a section on each hotel, including The Belfry. The heading that introduces The Belfry section (like the other hotels) includes the words "The De Vere" in print immediately above the word "Belfry", the latter being in larger and more prominent print. The body of the text describes the hotel as "The De Vere Belfry" in uniform text.
18. By contrast, in February 2006 De Vere distributed 40,000 copies of its new "Planner" brochure. Its cover page included the De Vere signature, below which are printed the words "Hotels and Resorts" (I shall call this "the Hotels & Resorts logo"), below which in smaller print is "Planner", below which in yet smaller print are the words "Conferences, Meetings, Events, Incentives". The map on page 2 identifies all the various hotels by name (including "The De Vere Belfry") in conventional print and on the contents page the various hotels are again listed with the same names as in the 2004 brochure. The brochure again includes a section on each hotel. Each is now introduced at the top of the page with the hotel logo appropriate to the hotel (thus, in the case of The Belfry, "De Vere at The Belfry", of course in logo form). The body of the substantive text dealing with The Belfry then describes the hotel four times as "The De Vere Belfry" and once as "The Belfry".
19. I find that the ordinary reader of this brochure would not conclude that the name of De Vere's hotel at Wishaw was either "De Vere" or "De Vere at The Belfry". It is obvious from the brochure that it is called "The De Vere Belfry" and is also more shortly known as "The Belfry". In the context in which it is used, the ordinary reader would interpret the sense of each hotel logo as referring to the experience that De Vere provides at the particular hotel referred to in it.

(b) The Mini Hotel Directories

20. These are similar in format, comprising information about De Vere's Village hotels and leisure clubs as well as its main hotel chain. They are on display in the hotels' public areas. The 2004 version lists at the beginning all the hotels with their conventional name and includes shorter sections on each hotel. The Belfry is introduced in the same way as in the 2004 Planner brochure and a map of its location makes it plain that its name is The De Vere Belfry.
21. In February 2006 De Vere delivered 80,000 new mini hotel directories to its chain of hotels. The cover page bears the Hotels & Resorts logo. The hotels are then listed at the beginning with their usual names. Page 8, headed "Passion for Golf", identifies the five De Vere hotels associated with golf, with each described by its conventional name. The same page does, however, include a photograph of De Vere Carden Park, with a printed caption at the bottom reading "De Vere at Carden Park" (the De Vere signature is not used, so this is not in the form of the hotel logo) and on page 9 there is a photograph of The Belfry with a caption in like printed form reading "De Vere at The Belfry". The sections dealing with each hotel are all introduced with the hotel logo, and that logo is also used to identify the location of each hotel on a map in the section relating to it.
22. I find that the ordinary reader of one of these directories would also conclude that the name of the Wishaw hotel is either The De Vere Belfry or, more shortly, simply The Belfry. The position here is not as clear as in the case of the Planner Brochure, because of De Vere's odd use of the printed caption "De Vere at The Belfry" on the photograph of The Belfry and the unusual use of the hotel logo to identify the map location of The Belfry. I nevertheless find that the ordinary reader would understand from the context of the brochure that the sense of the hotel logo was referring to the De Vere experience at each hotel, and would not regard the printed caption as representing another name for, or designation of, the hotel.
23. I should mention the 2002/03 mini directory. This is interesting because The Belfry section introduces the hotel by reference to a mark which has only been rarely used in De Vere's chain collateral (and this is one such instance), although it is prominently used at the hotel itself. It was referred to at the trial as the composite mark but I will call it "the bell logo". It consists of a bell at the top, below which is "De Vere" in print, below which is "The Belfry" in more prominent print, below which are four stars, below which is a line broken in the middle by four backward slashes. This is a trade mark to which Quinn claims to attach great importance and it appears to have developed a conviction that De Vere intended to do away with it, although there is no evidence supporting that and I find that, on the contrary, De Vere has always intended to retain it.

Guest Satisfaction Surveys

24. It is De Vere's practice to leave a guest satisfaction survey in its hotel rooms, which the guest is invited to complete by marking the hotel out of ten on a list of topics and adding his comments about it and its service. Such survey forms are created centrally for all De Vere hotels but are printed locally at the hotel to which each relates. Until 2006 the form used at The Belfry bore the bell logo.
25. On 1 February 2006 De Vere introduced a new survey form at The Belfry. The opening page included at the top the new hotel logo, the letter to the guest thanking him for choosing to stay at "this De Vere Hotel & Resort". It informed him that his comments would be carefully considered "as we work to provide you with service excellence in this hotel and across our other hotels in De Vere." The average guest would, I find, know that he was staying at a hotel called The De Vere Belfry, or just The Belfry (which is what the signage at the hotel has always called and still calls it and which he would have understood was its name when booking his stay if he did not already know it), and I find that he would not read the new survey form as telling him that he was in fact staying at a hotel called, or known as, either "De Vere" or "De Vere at The Belfry". I find that the message that the hotel logo and accompanying material would convey to him is simply that The Belfry was a hotel in the De Vere chain.

The Leisure Breaks Brochure

26. Much of the discussion at the trial related to De Vere's Leisure Breaks brochures. I refer first to the April 2002/March 2003 brochure. This lists the hotels with their usual names on the contents page, and has a section on each hotel. The Belfry section is interesting because it represents another of the rare occasions on which the hotel is introduced by the bell logo, although what follows refers five times to "The De Vere Belfry" and thrice to "The Belfry". The bell logo has not been used in any subsequent Leisure Breaks brochures.
27. The brochure for October 2005/March 2006 is headed on the cover page "De Vere Hotels" (complete with lion) and lists the hotels with their conventional names on the opening pages. A section on Christmas breaks offers different rates at different hotels, The De Vere Belfry (so described) being in the most expensive category. A section on golf breaks lists the De Vere golf hotels with their usual names, including The De Vere Belfry. There is then a section on each hotel, with each introduced at the top of the page with the words "De Vere" in print, and the remainder of the hotel name in larger print just below. Exceptionally, however, The Belfry and The Grand are introduced slightly differently: they are each introduced with their usual name in uniform print (and The Cavendish is introduced simply as "The Cavendish, London"). The Belfry section then includes at least 10 references to "The De Vere Belfry" and none merely to "The Belfry".
28. The new Leisure Breaks brochure, about which Quinn complains, is for April 2006/March 2007. 200,000 copies were printed and distributed to De Vere hotels in March 2006. The cover page bears the Hotels & Resorts logo. The opening pages list the De Vere hotels with their usual names, including "The De Vere Belfry". The Christmas Breaks section still includes The Belfry in the most expensive category, and this time it is referred to simply as "The Belfry". The Golf Breaks section lists all the De Vere golf hotels, and again lists The Belfry simply as "The Belfry", although on the same page there is also a reference to "The De Vere Belfry" being the Ryder Cup host venue for 1985, 1989, 1993 and 2002. Below that there is a reference to "The Quinn Direct British Masters", which was to be held at The Belfry in May 2006, so Quinn gets a plug, although no-one reading the brochure would know that it had anything to do with The Belfry (nor is it part of Quinn's complaint that it is not so credited anywhere in De Vere's publicity material). The pages include a picture of a smiling Sam Torrance saying "Every time I play at De Vere they go out of their way to make it a special day." That is not a reference to any particular De Vere golf hotel, but to each of them.
29. The sections on each hotel are then introduced with the new hotel logo appropriate to the particular hotel. That is how The Belfry is introduced. The four Belfry pages then include seven references to "The Belfry" and none to "The De Vere Belfry". Quinn's complaint about the new hotel logo is that it devalues the "Belfry" brand and promotes the "De Vere" brand. The text of the brochure itself, which is what the ordinary reader is interested in, in fact does the reverse: the hotel is there referred to simply as "The Belfry".
30. I find that no-one reading this brochure would conclude that the name of the hotel was or is other than simply "The Belfry" or perhaps "The De Vere Belfry". In the context in which it is used, the ordinary reader would interpret the hotel logo as merely conveying the message that De Vere provides the experience to be found at the particular hotel so named.

The De Vere website

31. On 15 March 2006 De Vere launched a revised website. It introduced its chain of hotels with the Hotels & Resorts logo. It identified the location of its hotels on a map, The Belfry being there described as "The De Vere Belfry." Its section on The Belfry was introduced with a photograph of the hotel, above which was the new hotel logo. The text about the hotel referred to it either as "The De Vere Belfry" or "The Belfry." I find that nothing on the website would convey the message that the hotel was now called either "De Vere at The Belfry" or simply "De Vere".

The Saga brochure

32. In early May 2006 De Vere mailed to customers 100,000 of the 150,000 Saga brochures it had produced. The title on the cover sheet is the Hotels & Resorts logo, above the words "in association with Saga". The opening pages list the De Vere hotels with their usual names, including "The De Vere Belfry". The golf section is in essentially the same format as in the new Leisure Breaks brochure. Each hotel is introduced in its individual section with the hotel logo. The text of The Belfry section then twice refers to "The De Vere Belfry", once to "De Vere Belfry" and twice to "the Belfry". There is also a photograph of the hotel with a printed caption in the sky reading "De Vere at The Belfry". Despite this, I find that no-one reading this brochure would conclude that the hotel was called or being designated other than "The De Vere Belfry" or simply "The Belfry".

Golf Leisure Breaks Brochure

33. A 2004 brochure is notable for another occasional use on the cover page of the bell logo. It is on a picture of a green fee ticket attached to a golf bag, to which are also attached like tickets for seven other De Vere golf hotels, each ticket bearing (mutatis mutandis) a like mark. The section on The Belfry describes it as "The De Vere Belfry".
34. In May 2006 De Vere sent 16,600 of its 46,000 new Golf Leisure Break brochures to customers. The cover page has the Hotels & Resorts logo, the main title being a flamboyant manuscript "Golf", the bottom of the page informing the reader that it is about "Golf Leisure Breaks". The opening pages list the De Vere golf hotels with their usual names (there are also separate references to the British Masters being held at "The De Vere Belfry" in 2006 and the Ryder Cup having been held four times at "The De Vere Belfry"). The separate section on The Belfry introduces it, like the other brochures, with the hotel logo. The text then refers to "The De Vere Belfry" four times. No-one reading this brochure could conclude that the De Vere hotel at Wishaw is called other than "The De Vere Belfry".

Use of "De Vere at The Belfry" in caption form

35. In addition to the relatively minor use already mentioned, De Vere has also made certain further use of "De Vere at The Belfry" in caption form. It first used it in its 2006 CD box calendars sent to business contacts and customers in December 2005 or January 2006. 6,000 calendars were distributed. On the top right-hand corner of each month is the Hotels & Resorts logo. Different months feature pictures of different De Vere hotels, each bearing in print the caption "De Vere at [the hotel]" but also adding some geographical identification. For example, April 2006 is the turn of the University Arms in Cambridge, the caption reading "De Vere at University Arms, Cambridge". August 2006 is The Belfry's month, the caption reading "De Vere at The Belfry, Nth Warwickshire".
36. On 7 and 28 April 2006 De Vere campaigned 34,000 customers on its database. The Belfry page (focusing on the golfing opportunities at the hotel) bore the Hotels & Resorts logo, a picture of The Belfry with the caption "De Vere at The Belfry, North Warwickshire" and the same page (after inviting a telephone call to the hotel directly) referred to it as "The De Vere Belfry" and provided the number.
37. During the week commencing 8 May 2006 De Vere mailed 100,000 copies of its "Escape" mailing. One page invited the reader to "Find De Vere at" and there followed a list of its hotels, with abbreviated names and a general address: for example, "Carden Park, near Chester" – and "The Belfry, West Midlands". The page included a photograph of The Belfry with the caption "De Vere at The Belfry."
38. On 23 March 2006 De Vere placed an advertisement in "Dial" magazine (produced by Expotel, a conference agent). It advertised the De Vere chain, with the Hotels & Resorts logo and included photographs of the hotels at Loch Lomond, Brighton and Wishaw, with the printed captions "De Vere at Cameron House, Loch Lomond", "De Vere at The Grand, Brighton" and "De Vere at The Belfry, North Warks" respectively. In the week commencing 24 April 2006 De Vere placed a similar advertisement in a magazine produced by Prestige Reservations (another conference agent) which goes out to 5,000 of its corporate customers. It advertised the De Vere chain and included photographs of The Belfry and Carden Park with, respectively, the captions "De Vere at The Belfry" and "De Vere at Carden Park". In April and May 2006 De Vere placed a series of online banner advertisements on Carlson Wagonlits' website. These advertised Cameron House and The Belfry with the words "De Vere at …", once in caption form and once in logo form.

Material specific to The Belfry

39. De Vere has plans to change its hotel specific material, including that relating to The Belfry, to incorporate the use of the "De Vere at …" logo in signage, but (apart from the guest satisfaction surveys) has refrained from implementing it because of Quinn's refusal to discuss it and its complaints in this litigation. In particular, it had plans to use the new Belfry hotel logo at the gates and entrance to the hotel. The sign at present at The Belfry's gates is "The De Vere Belfry", with lions rampant on either side (each word starting with a capital letter with the rest in lower case). De Vere's plans with regard to signage go back to about the end of July 2005, when it instructed a firm called Endpoint to do an audit on signage at The Belfry and three or four other De Vere hotels. Endpoint's recommendation was that De Vere needed to improve and replace some of its signage. A property meeting was held on 8 December 2005 at Daresbury Park at which De Vere considered various photographic and computer-generated mock-up signs that Endpoint had produced for De Vere's hotels, including for The Belfry.

Any other use of the new hotel logo in relation to The Belfry?

40. There is no evidence that De Vere has used the "De Vere at …." construct other than in the logo form and in the captions to hotel photographs I have summarised. The decision to use the construct in caption form was made by Gaynor Black, De Vere's brand manager. Mr Rogers discussed this use with her after he had realised it had happened: his understanding was that the construct was to be used only in logo form and he considered its use in text would be cumbersome: it was "not a natural way of expressing something". Ms Black's response was that it enforced the core idea behind the brand and Mr Rogers did not feel strongly enough about it to overrule her. Mr Leaver's evidence was that he agreed with Mr Rogers about the use of the "De Vere at …" construct as a caption to photographs, and was unaware at the time that it was being, or had been, so used. Mr Webster, the General Manager of The Belfry, was also unaware of such use. Most people would, I consider, instinctively agree with Mr Rogers's and Mr Leaver's reservations about Ms Black's thoughts on the matter. The "De Vere at …" construct may work in the logo form. But it is difficult to identify any obviously rational basis for using it in caption form as (apparently) a description of a picture of a hotel.
41. There is also evidence that Corporate Edge had produced guidelines recommending that the concierges at the De Vere hotels should welcome guests with the greeting "Welcome to De Vere at [the hotel]". There is no evidence that any such practice has been adopted at The Belfry or at any other De Vere hotel, and Mr Rogers's evidence was that De Vere had no plans, and had taken no steps, to ensure that guests were so welcomed. He said "it would feel odd" and would be a bit of a mouthful. Mr Leaver agreed, saying he would be amazed if any De Vere concierge used that form of welcome (he also pointed out that The Belfry has no concierge) and it had never been his understanding that such words of welcome would or might be used. He could not explain the different understanding expressed in evidence by Lord Daresbury (the former non-executive chairman of De Vere, who stood down on 3 April 2006, for reasons unrelated to the dispute with Quinn) that this form of welcome was to be used. As between the different understanding on this of Mr Leaver and Lord Daresbury, I have no hesitation in preferring Mr Leaver's evidence. Lord Daresbury made it clear that he had no responsibility for the day-to-day running of the De Vere business, I would not expect him to have any reliable knowledge of a matter of detail of this sort and I find he did not. Ms Black appears, as they say, to have cascaded the guidelines to the De Vere hotels, saying it was important that all users comply with them, although her accompanying email appears to show that what she had primarily in mind was the use of the new logos in written form. One of her bullet points was that the hotels would continue to be listed in copy as currently "with the exception of image captions which should always be De Vere at … There will be no change … to how hotels are written in copy, i.e. The De Vere Belfry". Mr Rogers was firm in his evidence that the name of De Vere's Wishaw hotel remains "The De Vere Belfry" despite the introduction of the new hotel logo. So was Mr Leaver, who said:

"As a form of words it [the hotel logo] is capable of being a name of a hotel, yes, but it is not and the reason it is not – I mean, it is very clear to me that it is not because in all of the script, all of the text, we do not refer to it in that way and the reason that it is not referred to in that way is it is not the name of the hotel and I am very happy that it is not the name of the hotel because it is a mouthful."

42. Few would, I consider, disagree with his last sentiment: and I am inclined to think that some might favour the view that the notion that a hotel might be called "De Vere at The Belfry" has something of the absurd about it.

Communication between De Vere and Quinn about the re-branding

43. There was a good deal of evidence about the extent to which De Vere had or had not informed Quinn about its plans to re-brand itself. Its relevance or otherwise turns on an issue arising under the management agreement, to which I will come, but I first summarise the evidence.
44. There was a meeting at The Belfry on 10 January 2005 to discuss its possible sale to Quinn. Mr Leaver attended on behalf of De Vere, as did Roger Stubbs, De Vere's then finance director, and David Edwards, who is the company secretary of De Vere and De Vere Group plc as well as being the legal adviser to the latter company. Quinn was represented by Sean Quinn, Liam McCaffrey (Quinn's Chief Executive) and Alan Hynes (Quinn's Hotel Operations Director). Mr Leaver offered to show Mr Quinn round the hotel, having organised such a tour, but Mr Quinn declined. Mr Leaver had also prepared a Powerpoint presentation on the four-part strategy of the De Vere group, one part of which was its brand strategy. De Vere had stipulated in advance that it would only sell if it could manage The Belfry as part of its chain, and so Mr Leaver considered this would be of interest to Mr Quinn. Mr Leaver had, however, been told in advance by Mr McCaffrey that Mr Quinn did not like to sit through long, formal presentations, and so he prepared a shortened version of the proposed presentation, with printouts rather than projections on to a screen. Mr Quinn was still not prepared to participate in the exercise, which Mr Leaver explained in evidence was now essentially intended to be in the nature of a proposed discussion around a table of De Vere's strategy, with limited materials providing a structure to the discussion. Mr Quinn was not prepared to discuss the De Vere group's strategy or the De Vere brand within it. The De Vere evidence about Mr Quinn (who chose not to give evidence) suggests that he has a perhaps over-developed sense of his own importance and that he expects things to be done his way, as they were on this occasion. The result was that there was no presentation. Mr Leaver said that Mr Quinn gave the impression that he wanted to be a "hands-off" owner and that De Vere would be left to get on with its job of managing the hotel. Mr McCaffrey disagreed that Mr Quinn had declined to participate in Mr Leaver's revised form of presentation, but I prefer, and accept, Mr Leaver's evidence about all this, whom I have no doubt has a clear recollection of how he wanted, and how in the event he was not allowed, to present The Belfry to Quinn. I add that Mr Rogers had little contact with Quinn at the time of the sale and recalled no discussions with any Quinn representative about branding issues at or about that time. I find that he too had none.
45. Following the purchase, De Vere claims Quinn maintained its perceived "hands-off" interest in The Belfry. Peter Manby, De Vere's Operations Director, telephoned Mr Hynes to arrange a meeting, agree communication methods for the future in relation to trading reviews and to discuss capital investment (De Vere was about to start a bedroom refurbishment). Mr Hynes agreed but said that Mr Manby would have to go to Dublin. Mr Manby did so, to be told that Mr Hynes had no agenda. Mr Hynes asked him what he wanted to talk about, and Mr Manby concluded that there was nothing that Mr Hynes wanted to discuss. Mr Manby proposed dates for monthly meetings, to which the response was that Quinn did not plan ahead, "we'll let you know."
46. Mr Hynes and others did, however, come over on 12 April 2005 to agree meeting dates, although Mr Manby said Mr Hynes's main objective turned out to be to agree discounted room rates for Quinn family members and employees, Mr Hynes explaining that the 20 Quinn family members would not be paying for the rooms as Quinn owned the hotel (presumably with, in consequence, the tiniest pin-prick of a dent in De Vere's percentage). This meeting was also attended by Paul Morgan, who was employed by Quinn from February 2005 to April 2006 as Finance Controller for Quinn's Hospitality Division. Until November 2005 it was he who attended all the monthly trading review meetings, and he reported to Mr Hynes. He explained in cross-examination that the idea at the outset was that he was to assume the responsibility of attending these meetings and that Mr Hynes would spend more time in Ireland. He gave a rather fuller account of this meeting in his evidence, saying it was at this meeting that Quinn laid down what it expected to be provided with at each monthly trading meeting, namely a management pack comprising profit and loss accounts for each business sector, "key performance indicators" for each area, and various heads of operational information.
47. The first monthly trading review meeting was on 23 May 2005, the De Vere evidence being that the Quinn focus was on cost and stock. Mr Manby's evidence was that Quinn displayed little or no interest in the sales and marketing strategy of The Belfry and that this was the pattern of the monthly reviews held over the first six months of Quinn's ownership. Mr Leaver made the point in his evidence that for Quinn to place so much focus on cost issues was short-sighted: The Belfry does not achieve its enormous profits because of any tight control on costs, but because its revenue significantly outstrips that of any hotel outside London, the volume of revenue being attributable to a variety of factors. Mr Manby's evidence was that he sought to broaden the discussions to the revenue side, the generation of sales and how to deliver the business but that Mr Hynes's response was that Quinn understood that De Vere was doing a good job on revenue and its generation, and that Quinn's primary concern was to examine the costs side, Quinn having apparently had some bad costs experiences in relation to certain of its other business interests. Quinn's evidence, in particular from Mr Morgan, was to the effect that the monthly trading reviews ranged more widely than Mr Manby suggested, and he explained in detail how Quinn became concerned about various aspects of De Vere's management of the hotel. It is unnecessary to explore these matters in any depth or to make any findings on the differences between both sides. It was not explored at the trial, and whatever the precise position may have been as to the topics covered by the monthly meetings, it is not directly relevant to the issues raised by Quinn's present claim.
48. What is, however, clear is that relations between Quinn and De Vere quickly went sour. On 7 June 2005 Mr Quinn wrote to Mr Leaver referring to a meeting he had had on 2 June with Lord Daresbury at which he had raised a number of operational complaints. Mr Quinn listed six issues on which he was disappointed: (i) the general upkeep of the entire complex, (ii) management attention to detail, (iii) high staffing levels and their motivation, (iv) standards being "a long way short of what, the public now rightfully require", (v) De Vere's ability to address these issues, and (vi) the apparent lack of a 3-5 year plan to develop the complex to satisfy future needs. He expressed particular concern at what he had seen on a ride round the PGA and Derby golf courses. He was apparently shocked at the state of the Derby course, but did not wish to detail the causes of his shock beyond "a few things I have never seen on a golf course before", namely (i) 40mm stones in bunkers, (ii) unraked sand in bunkers, and (iii) smelly material dumped alongside the course. He said he had purchased The Belfry to help enhance Quinn's reputation and now found he was ashamed of it. He was no doubt kicking himself for not allowing Mr Leaver to show him round this reputation-enhancing asset on 10 January 2005: and certain of his points would suggest that Quinn's pre-purchase investigations fell materially short of what might be expected of a careful purchaser. Mr McCAffrey explained that Quinn devoted just two weeks to a due diligence exercise by its accountants and that it does not usually waste much time on pre-purchase due diligence: "… that is how Quinn operate. Once we have made a decision to proceed in a certain way, we carry out that decision quickly." Mr Quinn asked for an opportunity "for a discussion or proposal on how we take this relationship forward." Mr Manby, for one, considered he had been making efforts in that direction as from day one.
49. On 15 June 2005 Mr Leaver and Mr Manby visited Mr Quinn in Ireland to discuss areas of De Vere's operating practice with which Quinn was dissatisfied – and Mr Leaver accepted in evidence that they included real points. He also explained that Mr Quinn opened the meeting by saying he had no confidence in De Vere and made it plain he wanted to part company with it. He offered £20m to buy De Vere out of the management agreement, which was refused. They then discussed the operational matters Mr Quinn had raised and the future of The Belfry. On 17 June Mr Leaver wrote to Mr Quinn saying he was:

"… absolutely committed to proving to you that De Vere is the right brand and operating partner for The Belfry. We are well progressed on putting into place a first class management team to provide the leadership and direction needed to address the operational issues that you have identified. As you know we had initiated this process ahead of your acquisition of the hotel and I appreciate your support in giving the new team the time that they will need to drive standards across the business."

50. On 9 August 2005 Mr Quinn wrote to Lord Daresbury referring to Quinn's claimed concerns over De Vere's ability to manage The Belfry: he could not see "what competence De Vere Group adds to the management of the Complex." He identified particular matters of complaint (including that a house providing staff accommodation was overcrowded and ignored basic health and safety issues, a justified complaint that had been promptly corrected once identified). He offered £25m to buy out the management agreement. The offer was not accepted. Lord Daresbury wrote a letter in response on 2 September 2005 (it was drafted by Mr Leaver) explaining his belief that De Vere added and would continue to add considerable value to The Belfry's management. He explained that De Vere had made its management agreement a condition of the sale to Quinn "because of the Belfry's importance to the Group as a whole and because we regarded it as integral to the successful development of the De Vere brand. This remains our position …." There was no response to that letter.
51. At the trading review meeting on 22 September 2005 Quinn was represented by Mr Hynes, Mr Morgan and Nigel Gray. Mr Gray is Quinn's Operations Manager for UK Hotels, who was responsible for three Quinn hotel properties, including The Belfry, and his role was one of liaison between Quinn and De Vere: he would visit The Belfry two or three times a week. Mr Manby produced an agenda directed at giving broader information about De Vere's success. He explained that De Vere had been placed top in two recent surveys, and that it was about to start a programme of cultural change and customer focus, including so-called "Touchpoints". (Touchpoints had emerged in the summer of 2005; they were eventually reduced to some 12 to 14 in number, and covered such revolutionary matters as the notion that the guest should have a good night's sleep, proper room service, a great sense of arrival and so on). Touchpoints was later broadened into "Shine", described by Mr Manby as "a philosophy used to denote the operational execution of De Vere's strategy to deliver service to the De Vere's customer base whilst understanding the portfolio of De Vere hotels and their customers." It was launched with a programme to be attended by De Vere's managers and executive teams and was then to be "rolled down into the business". It involved team-building exercises (which Mr Manby conceded sounded a bit naff) devoted to delivering to the customer what he wants. The Shine programme started on about 20 September 2005. Mr Morgan's evidence was that he and the other Quinn representatives had no idea what Touchpoints was about and that at this meeting Mr Manby agreed to make a presentation about it at the next monthly trading review meeting.
52. No mention of re-branding was raised by Mr Manby at this meeting. The De Vere board had by then approved the proposed new hotel logo in principle, but he was not aware of that. He was, however, aware that the "De Vere at …" construct was one of the matters introduced to the De Vere personnel at the Shine events that were held at about then, if only briefly. He also said (in effect) that logos did not interest him ("It leaves me cold, to be honest"), and that he was more interested in the customer and the employees.
53. During the last week of September 2005 Mr Gray proposed a meeting with Mr Leaver and Mr Manby directed at helping to improve the Quinn/De Vere relationship. It took place on 30 September. Mr Leaver said that Mr Gray acknowledged that Quinn was placing a disproportionate focus on cost and that De Vere was not being given an opportunity to demonstrate what it was doing to drive sales; and he suggested that if De Vere presented its data to Quinn in a more proactive way, wider issues could be discussed. Mr Gray expressed the view that Mr Manby's broadened agenda for the meeting of 22 September had been good and had helped Quinn understand more about De Vere. Mr Leaver agreed with this approach.
54. Mr Leaver acknowledged that by the time of this meeting the "De Vere at …" construct was going to be used in De Vere's re-branding, and that he did not inform Mr Gray of De Vere's proposals. He also said that the re-branding proposals were no secret and that the proposed hotel logo had not yet been finalised but was still being worked on, as it continued to be until 2006; and that two months later Quinn were the first people to be informed of the new hotel logo, although they did not know of it by 30 September. Mr Leaver disagreed with Lord Daresbury's evidence that at about this time he had any discussions with him as to how to disclose the new branding to Quinn in a way most likely to obtain approval and least likely to provoke an adverse reaction. In so far as Lord Daresbury had made such a suggestion in his evidence, Mr Leaver suggested that he was confused about the dates and may have had in mind the later discussions he had with Mr Leaver following the expressions of complaint from Quinn in December 2005. In so far as there was any difference of recollection on this as between Lord Daresbury and Mr Leaver, I again prefer and accept Mr Leaver's evidence. He was the man with primary executive responsibility for what was going on at any time, and I have no doubt that his evidence on the topic was more reliable than Lord Daresbury's.
55. During the latter part of 2005 there were negotiations for the amendment of the management agreement relating to the fee structure and performance test in the event that Quinn decided to build a new hotel in place of The Belfry: this had arisen because shortly after the purchase Quinn had decided it wanted to demolish and rebuild it (Mr McCaffrey denied that Quinn had had any thought at all of this before it bought). De Vere admits the matter of the new logo was not raised with Quinn during these negotiations but says it was not material to the matters being re-negotiated. Mr Leaver's position is, again, that the re-branding exercise was anyway no secret but said it was just the sort of matter that Mr Quinn had previously demonstrated that he was not interested in, a reference to the meeting of 10 January 2005. In the event the existence of the proposed new logo was disclosed to Quinn whilst the new management agreement was still being negotiated and (as I shall explain) Quinn itself apparently regarded it as immaterial to the negotiations.
56. The next trade review meeting was held on 24 October 2005, but Mr Manby could not be present and so the promised Touchpoints presentation was not made. David Webster attended for De Vere. He was the General Manager of The Belfry, having taken up that position on 4 July 2005. Mr Morgan and Mr Gray attended for Quinn. Mr Webster showed them a working draft of a new wedding brochure which was to be specific to a proposed promotion at The Belfry. He sought their views on it but was not asking their permission to proceed with it. Mr Morgan thought it was a good idea and Mr Gray also said it was an impressive document. Mr Webster made no mention at this meeting of any intention by De Vere to re-brand the hotel or the De Vere chain. Mr Morgan of course also knew that De Vere produced brochures which promoted the hotels in its chain (such as, for example, the Leisure Breaks brochure) and he accepted that the content of these brochures was never discussed at the monthly trade review meetings: as he said, Quinn was only interested in The Belfry.
57. A trade review meeting was held on 24 November 2005. The agenda for the meeting included the "De Vere Brand Touchpoints". Mr Morgan and Mr Gray attended for Quinn, and Mr Manby and Mr Webster for De Vere. Mr Manby and Mr Webster gave a presentation focusing on what De Vere's customers wanted and how De Vere delivered it. The presentation that Mr Manby said he made comprised certain slides with the word "Shine" on the bottom right-hand corner. He said that the presentation was not directed to the re-branding going on at De Vere, but was orientated to Touchpoints, values, customer interface and brand positioning. One of the slides shown did, however, refer to the three elements of the new brand: engineered, flair and wit (the sort of points that might perhaps be missed if not explained); another was a slide with "De Vere at …" on it, but not in logo form; and another was a slide showing (in logo form) the new Hotels & Resorts logo. Mr Manby was confident in his evidence that the presentation did not include a slide showing the new hotel logo (either in relation to The Belfry or any other De Vere hotel); or any discussion as to how the Hotels & Resorts logo might be used in relation to individual hotels. By 19 December 2005 Mr Gray had in fact drawn his own representation of the new hotel logo, but Mr Manby was equally confident that his understanding of it did not derive from the meeting on 24 November. He said Mr Gray would have had other opportunities in the meantime to have seen the form of the hotel logo. The essence of Mr Manby's evidence in cross-examination was that the presentation of the new logo occupied a mere trice in the course of a 45 minute meeting, and he disclaims that the proposed new hotel logo was actually presented.
58. By contrast, Mr Morgan's evidence was that at this presentation he was shown a slide that indicated that De Vere was proposing a change from its lion logo; that he was not sure he was shown the Hotels & Resorts logo; and that he thought that the final slide shown was an example of a new hotel logo to be used throughout the De Vere chain, including The Belfry. Whilst he was less than positive about it, he said in his witness statement that he was fairly certain that he was shown an example of the logo incorporating the words "De Vere at [hotel]" and he stood by that in cross-examination, although he was still less than positive about having seen such a slide. He said this slide appeared out of the blue, at which point Quinn became very interested in the presentation. He said that down to that point the presentation had not involved any references to logos or to re-branding the De Vere chain, and that this was the first time there had been any mention of a re-branding. Mr Morgan's evidence was that Mr Manby further explained that there would be new signage at and around The Belfry. Mr Morgan said that his, deliberately understated, response was that this sounded as if it could be a problem for Quinn. His evidence was that "At this time, the meetings were all somewhat negative and we did not want every comment we made on De Vere's initiatives to appear entirely negative." Mr Morgan said that, when he left the meeting, he was still unaware that De Vere was proposing a complete re-branding of their chain, including The Belfry: De Vere had produced simply a single slide relating to re-branding. Nevertheless he still felt able to say in his witness statement that this sudden indication of an intention to re-brand "without any detail of how, when, the scope of the re-branding and how it would be conducted in relation to a hotel they did not own (i.e. The Belfry), was a complete shock to Nigel and I [sic]." Mr Gray confirmed in his evidence the personal shock that he suffered. Their several shock was apparently such that they found themselves unable to ask any questions about the re-branding at the meeting, although Mr Morgan also accepted that neither displayed any outward signs of shock; and neither Mr Manby nor Mr Webster perceived any evidence of it. Mr Morgan said that his decision at the time was to keep his thoughts to himself and discuss the matter with Mr Hynes and Mr McCaffrey.
59. Mr Gray's evidence was similar to Mr Morgan's. In his witness statement he said they were shown a slide indicating a new logo to be put in place across the entire chain. He did not recall that this was the Hotels & Resorts logo, but thought he was shown a hard copy in print form of the hotel logo as it would apply to Cameron House (thus "De Vere at Cameron House" in logo form). He also says that this was the same hotel logo as was later shown to him at the De Vere presentation on 21 December 2005. In cross-examination, he repeated his doubt that he had been shown the Hotels & Resorts logo and confirmed his belief that he had been shown a hard copy of the hotel logo.
60. Mr Manby's evidence in his witness statement was that, at the end of the presentation, Mr Gray and Mr Morgan "shook their heads and smiled at each other, saying 'they won't like this in Ireland.'" That evidence appears to be consistent with Mr Morgan's and Mr Gray's evidence; and if his own account of the meeting is right, it is not entirely obvious what he could have regarded it as referring to, although I understood it to be his perceived understanding that Quinn had reservations about the colour of the Hotels & Resorts logo, or perhaps because they did not like the "D" of the De Vere signature in that logo: that had apparently been the type of adverse feedback that came from those who had seen that logo whilst being Shined (or should it be Shone?). On the face of it, that understanding makes little sense: why should Quinn be concerned about the colour or format of the Hotels & Resorts logo or its proposed introduction? They would, however, be likely to be interested in the introduction of a new hotel logo relating to The Belfry. Mr Gray also attributes to Mr Manby the statement at this meeting that De Vere would maintain the bell logo for golf at The Belfry. Mr Manby does not recall saying that but accepts that it reflected De Vere's intentions. Mr Gray's recollection is consistent with there having been at least a reference at this meeting to the proposal to introduce the new hotel logo, whether or not an example of it was actually produced.
61. There is therefore a conflict as to precisely what Mr Morgan and Mr Gray were shown at the meeting on 24 November. I infer, and find, (as is supported by Mr Morgan's letter of 7 December 2005, to which I shall come), that there was obviously rather more discussion about new logos at the meeting of 24 November 2005 than Mr Manby had expressly recalled. One matter that I find was mentioned was that De Vere had produced a new hotel logo. Mr Manby agreed he must have mentioned that but denied that he had made any suggestion as to when it was to be rolled out over the De Vere properties. To the question in cross-examination whether the Quinn representatives asked him what it was like, Mr Manby replied "No. Well they had seen it." But, according to him, all they had seen was the Hotels & Resorts logo. They had not, according to Mr Manby, seen a "De Vere at The Belfry" logo or even a like hotel logo relating to another hotel.
62. Following this meeting, Mr Morgan explained to Mr Hynes and Mr McCaffrey what was apparently happening on the re-branding front. They decided they needed more information before they could consider it in detail or make any decisions about it. They decided they should send De Vere what Mr Morgan described as a "friendly, inquisitive letter." This turned out to be Mr Morgan's letter of 7 December 2005 (copied to Mr McCaffrey, Mr Gray and Mr Hynes). It was headed "De Vere Re Branding" and read:

"Thank you for the presentation at our most recent trading review meeting of the De Vere Brand and Touchpoints. It was both interesting and useful. As part of the presentation you mentioned that De Vere have produced a new logo and the intention was to roll this out across all the De Vere properties shortly. This will obviously have an impact on the Belfry property. Before any changes to the current signage, stationery etc are implemented we would obviously wish to get a clear proposal from De Vere so we can consider it fully before we can agree to any changes. We would obviously be very interested in every detail of the proposed changes from logos, stationery, signage and cost etc.

When would you be in a position to make a detailed presentation to the Quinn Group on De Vere's proposal in this regard?

63. The inference from that letter, as I have found, is that there had at least been a discussion about the proposal for a new form of hotel logo. The letter further suggests that Quinn had not been shown a picture of it at the meeting, which is consistent with Mr Manby's evidence although inconsistent with the Quinn evidence. I find also that the primary concern expressed in that letter was as to how the re-branding would be implemented at The Belfry, and Mr Morgan confirmed in cross-examination that that was the focus of the letter. Mr Gray also confirmed in cross-examination that at the meeting on 24 November his concern was focused solely on The Belfry. I find that both Mr Morgan and Mr Gray were wrong in their recollection that they were shown a picture of the new hotel logo at the meeting on 24 November: I prefer the view that Mr Manby retained a more reliable recollection of what was in the presentation that he made. I find that the only image they saw which gave a clue to the form of the new hotel logo was the Hotels & Resorts logo, but I also find that they were told about the proposed hotel logo and about its essential form. The purpose of Mr Morgan's letter was to obtain full details about it, in particular about its proposed implementation at The Belfry. It is also relevant to note that what Quinn was there asking for was "a detailed presentation" of "every detail of the proposed changes". They did not yet know enough about what was proposed and wanted to find out what it was. At least on the face of it, they were not rushing to ill-informed judgment on the matter.
64. I have earlier mentioned the Endpoint signage audit of August 2005 and the follow-up property meeting about signage held on 8 December 2005. Quinn was not informed of either event. Mr Rogers's explanation for that was that it was only appropriate to involve Quinn in any consultation process about signage when De Vere had a solid proposition that it was happy with and wanted to carry forward. That stage had certainly not been reached at the stage of the audit nor had it even been reached by December 2005, and I so find.
65. Mr Manby only received Mr Morgan's letter on 14 December 2005 (the delay in its delivery prompted him to ask Quinn to use email in future). On 15 December he responded to Mr Morgan by proposing a detailed presentation on branding and signage at the trade review meeting fixed at The Belfry for 22 December. That was just what Quinn had requested and it was being promptly offered. At the same time he asked Mr Rogers to present De Vere's branding proposals and explain its reasons for the new hotel logo (branding and signage were his field). Mr Rogers prepared a presentation. Mr Gray was at The Belfry on 15 December for a meeting concerning the British Masters tournament due to be held there in May 2006. He said in his witness statement that he asked Mr Webster for a copy of the presentation made on 24 November "and, in particular, the logo." Mr Webster said he could not release it to him without permission from Mr Manby.
66. On 16 December Mr Gray therefore telephoned Mr Manby and asked for a copy of the proposed logo. Mr Manby declined this request, reminding him that a formal presentation had been fixed for 22 December and that he would be given copies of the logo then. He explained that he did not want Quinn to take the new logo out of context: he wanted Quinn to be given a full explanation as to the brand position strategy and rationale. There were then anyway only three clear working days (Monday 19 to Wednesday 21 December) before the presentation. Mr Gray's response was that, as Mr Manby was not prepared to give him a copy of the logo, Mr McCaffrey would telephone Mr Leaver and ask him for a copy. Mr Manby told Mr Leaver to expect a call from Mr McCaffrey and explained the background. Mr Leaver told Mr Manby that he agreed with how he had responded to Mr Gray.
67. On about 19 December Mr McCaffrey telephoned Mr Leaver and asked for a copy of the proposed hotel logo. Mr Leaver repeated what Mr Manby had told Mr Gray, namely that Quinn would be given a copy at the presentation on 22 December. He told him that Quinn appeared to be reacting negatively to De Vere's proposed brand strategy and that he wanted to make sure they were given a full explanation that included mock-ups of proposed signage.
68. Quinn cancelled the presentation. Mr Manby was concerned that this might have been a direct response to his refusal of Mr Gray's request. He telephoned Mr Gray, who assured him it was not and said it was because of conflicting schedules. Mr Manby asked Mr Gray when De Vere could give the presentation at least to him and Mr Gray agreed to attend a meeting at De Vere's offices on 21 December for that purpose. Mr Rogers's evidence is that De Vere had been very keen to make the presentation and that there had been talk within De Vere of a trip, at short notice, to Ireland to do so.
69. Mr Morgan's evidence was that by the time of the meeting on 21 December he had already discussed with Mr Gray Quinn's concerns "regarding the proposal we had seen". According to his evidence that can only have been based on the single image he said he was shown on 24 November (but which I have found he was not); and of course his own letter of 7 December conveyed material ignorance of what De Vere was proposing and itself suggested he had not yet seen the new hotel logo. His letter had asked for a detailed presentation, which had been offered but which Quinn had cancelled; yet by 21 December (even before Mr Gray attended the presentation on his own, as Mr Morgan confirmed in cross-examination) he was able to say in his witness statement that he and Mr Gray felt that the proposal (i) devalued the "Belfry" brand, focusing all attention on De Vere, (ii) would compromise the perception of the hotel in the eyes of guests and staff, (iii) in failing to include the "iconic" bell logo would undermine the hotel's character and heritage (there had been no suggestion by De Vere that the bell logo was to be dropped, nor has it ever suggested that), (iv) would damage its international recognition, (v) ignored the value and goodwill in the hotel trade marks and brands (which Mr Morgan was unable to identify in cross-examination, but he said this would have been Mr Gray's point), and (vi) could be costly to Quinn in terms of having to pay for signage at The Belfry but also in the long-term loss of goodwill and reputation of The Belfry. This reflects pretty advanced thinking from someone whose knowledge of the proposed re-branding was as limited as that reflected in the letter of 7 December. Mr Morgan's evidence in his witness statement was also to the effect that, whilst the meeting fixed for 22 December was cancelled because of clashing schedules, the cancellation was also motivated by the opportunity it would give Quinn to consider the material Mr Gray "had obtained" on 21 December. That was wrong, as I understood Mr Morgan to accept in cross-examination: the cancellation had been effected before it had been agreed that Mr Gray would attend a presentation on his own on 21 December.
70. The presentation went ahead on 21 December simply with Mr Gray. Mr Rogers gave the presentation, with Mr Manby and Mr Webster also present. Mr Rogers took Mr Gray through a deck of paper copies of slides he had prepared and Mr Gray took copies away with him. The presentation lasted about an hour.
71. Mr Gray's evidence is that he turned up at this meeting having previously prepared a note of Quinn's concerns about the re-branding, although he accepted in cross-examination that he did not refer to his note at the meeting. Bearing in mind, as I have found, he had not yet seen the logo, and anyway did not have a copy of it to show to anyone else at Quinn (he had of course been pressing for a copy during the preceding days), his list of concerns was also impressive. By contrast with its position as reflected in Mr Morgan's letter of 7 December, Quinn seems by now to have been keen to rush to judgment. The first six concerns were the same as Mr Morgan's, but Mr Gray added two more, namely (vii) Quinn had not been told about the re-branding before, and (viii) if the new logo was publicised at the British Masters, it would be a huge advertising boost for De Vere, which would thereby be capitalising on Quinn's investment in the tournament. Quinn did not want the public to know that The Belfry was part of the De Vere chain.
72. Mr Rogers does not recall Mr Gray raising these points. Mr Manby recalled Mr Gray saying that the new logo raised De Vere's profile, but recalled no suggestion that it devalued The Belfry brand or would cause a loss of reputation and goodwill to Quinn; and nor did Mr Webster recall that. Mr Webster did not recall Mr Gray saying he thought the re-brand would compromise guest perception and staff perceptions, who would ordinarily have a great deal of loyalty towards The Belfry. He did recall Mr Gray saying that Quinn had concerns about the new logo, but that he could understand why De Vere was doing what it was doing. Mr Rogers's evidence is that at the end Mr Gray said he understood De Vere's thinking but expressed concern about the balance between the "De Vere" signature and the "at The Belfry" elements of the logo. Mr Rogers also recalled that Mr Gray said Quinn would be concerned about the impact internationally on The Belfry name in golfing circles. They discussed the bell logo. Mr Rogers said in cross-examination that he understood Mr Gray was concerned that it was to be dropped, and he said they told him that De Vere still wanted to use it for golf. Mr Gray also raised costs issues about the new hotel logo. As to this, the costs of De Vere group collateral are borne by De Vere, and the costs of hotel specific collateral are borne by the particular hotel. Mr Gray also expressed concern that Quinn would not be happy if banners showing the new hotel logo were visible at the British Masters Tournament due to be held at The Belfry in May 2006, which was being sponsored by Quinn. Mr Rogers's evidence was (but Mr Manby and Mr Gray did not recall) that Mr Gray asked if the re-branding was a fait accompli, to which he said Mr Manby replied that it represented the overall direction that De Vere was going in, but that De Vere was keen to discuss its hotel specific implementation at The Belfry. Mr Gray's evidence in his witness statement is that Mr Webster asked Mr Manby whether the re-branding and logo proposals were a fait accompli and he says that Mr Manby responded that they were but that the re-branding was not about to happen "any time soon." Mr Rogers agreed in cross-examination that by then it would have been very difficult to move on the "De Vere at …" construct, but he was then and still is willing to discuss how it is used in signage at the hotel. Mr Gray could not recall in cross-examination whether Mr Rogers made it clear to him that he wanted to discuss further the implementation of the re-branding at The Belfry, but he accepted that he might have done. Mr Gray said in cross-examination that the discussion was full and frank.
73. It was at about this time that the calendar was going out. Mr Manby said he was unaware of that, as he was also unaware of the existence of the signage mock-ups that had been produced for the meeting on 8 December.
74. On 22 December Mr Gray reported on the re-branding matter to Mr McCaffrey. His reaction is said to have been one of shock at such a radical departure and (according to Mr Gray) at the "apparent change in the name of the Hotel." Mr McCaffrey was against the proposals since his view was that De Vere was promoting its own name at the expense of the goodwill in The Belfry name, logos and trade marks. Mr McCaffrey confirmed in his own evidence how shocked he was and he made it clear that Quinn:

"… decided that we could no longer tolerate the behaviour of De Vere in this regard. I was shocked by the proposals and by De Vere's failure to keep us informed of them. It was clear to me that the proposed re-branding would be damaging to The Belfry name, logos and trade marks. The re-branding accentuated the De Vere brand at the expense of The Belfry brand and made the name of the Hotel appear as 'De Vere' with 'The Belfry' tacked on as a mere address. We had not been consulted by De Vere on any of this and they appeared to be taking advantage of Quinn. Sean's [Mr Quinn's] reactions and thoughts regarding the 're-branding' were very similar to mine."

75. On 23 December, two days after the presentation, Mr Leaver met Mr Gray at De Vere's head office. Mr Gray was there to sign sponsor contracts for the Quinn Direct British Masters. They had a conversation. Mr Leaver said it was held close to Mr Manby's desk and that Mr Manby was also present for most of it (Mr Manby says about 80%, but how can he know?). Mr Gray's evidence is that only he and Mr Leaver were parties to the conversation, no-one else was there. He said he wanted to take steps to minimise the coverage of the new hotel logo at the British Masters tournament. He told Mr Leaver he was disappointed that Mr Leaver had not raised the re-branding matter either with him or with Mr McCaffrey when the management agreement was being re-negotiated. He said that Mr Leaver apologised and said it was an unfortunate oversight. Mr Leaver, however, denies having said any such thing. He says he told Mr Gray he had been taken aback by Quinn's reaction (and Mr Gray agrees with that) although he accepts he may have said the situation was regrettable. Mr Manby's evidence is that he did not hear any apology from Mr Leaver, but did hear him say that he had not thought that Quinn would react in the way they had done and that, had he foreseen this, De Vere could perhaps have dealt with things differently. Mr Edwards's evidence (he says he was also there) was that what Mr Leaver said was that if Quinn felt De Vere had not properly consulted them regarding the new logo, Mr Leaver would be happy to apologise; and that he emphasised there had been no deliberate policy not to consult with Quinn.
76. Mr Leaver gave Mr Gray a copy of the latest version of the hotel logo, the main difference in it being that it had increased the size of the words "at The Belfry". He told him that De Vere was firm on the direction of the new logo, but was still looking at the detail of the relative sizes of the "De Vere" signature and the "at The Belfry". He explained that the whole point was to strengthen the De Vere brand and so drive more value to The Belfry. Mr Gray responded that he understood this, although he says that he also said the copy logo he had been handed still did not address Quinn's concerns. Mr Manby's recollection is that Mr Leaver asked Mr Gray if a plan of the proposed signage at The Belfry, with visuals, would help, which De Vere would arrange at its cost. Mr Gray said it might and, in his presence, Mr Leaver asked Mr Manby to arrange this through Mr Rogers, which he did. Mr Gray agreed in cross-examination that a keenness to discuss the re-branding and take it forward was displayed at this meeting, although he also said that he left the meeting with an understanding that the re-branding was a fait accompli. Mr Gray accepted that De Vere was at that stage displaying a willingness to consult and communicate further with Quinn over the implementation of the re-branding at The Belfry.
77. Over the Christmas period Mr Rogers prepared from scratch the visuals for a further presentation: no use was made of the material used at the meeting held on 8 December. Mr Edwards's evidence was that his impression was that Mr Gray was supportive of the changes De Vere had made, but he also knew that they had not found favour in Ireland.
78. By 23 December, however, as Mr McCaffrey accepted in cross-examination, Quinn had decided that the situation with De Vere was irretrievable and that it wanted to terminate the management agreement. On that day Mr Quinn wrote to Lord Daresbury, with a copy to Mr Leaver. The second to fifth paragraphs were devoted to Quinn's alleged concern as to De Vere's ability to manage The Belfry, and referred to certain specific matters of such concern. Mr Quinn then wrote:

"In short, it was my view that De Vere Group did not possess the competence to manage this property to any level of recognised standard. However, in recognition of the fact that this was your only management contract and that it may take you some time to develop this arm of the business, I agreed with Liam [Mr McCaffrey] that he would negotiate a contract with Carl [Mr Leaver] to allow your Group to develop necessary competences and allow the relationship space and time to develop.

You can imagine my surprise when I discovered that during negotiations on the revised contract De Vere Group were in the course of finalising a complete re-branding. This re-branding as regards the Belfry hugely enhances the De Vere brand at the expense of the Belfry brand including for example the removal of the bell from the Belfry signage. This was not pointed out to us during contract re-negotiation, and we have subsequently discovered it was approved by your Board and presented to the City without any consultation with our Group.

As we are a major partner in what has, over the past few months, been a sensitive relationship, I find this incredible. I know that all of our team also feels that this is a huge breach of trust. Any relationship must be founded on open communication, mutual respect and trust. Unfortunately these appear to be totally lacking.

There appears to be a deficit in the standards and level of professional leadership in your Group which means that we are no longer prepared to continue to overlook the inability of De Vere Group to manage this property. I am therefore suggesting that we terminate the Management Contract and while we could consider some form of financial compensation to your Group it could not be at the levels previously indicated.

I would appreciate if you could respond to this letter by 13^th January 2006. If we cannot reach an agreement at this point I will be instructing our solicitors to issue proceedings to seek the termination of the agreement. I look forward to hearing from you."

79. The suggestion in the first quoted paragraph that the point there made formed any part of the re-negotiation of the management agreement following the demolition proposal is roundly denied by De Vere. There was of course no evidence on this from Mr Quinn, and the high point of Mr McCaffrey's oral offering in support of the point was that he believed he told Mr Leaver that the renegotiation was to allow De Vere to develop the necessary competences but he was unable to identify any document supporting the assertion. All he could say was that Quinn had written letters pointing out De Vere's alleged management weaknesses, and he conceded that he "did not expect De Vere to agree this interpretation of it, but we were fairly clear in our thought process." I find that the first quoted paragraph was a disingenuous distortion of the true position and was included as a false platform on which to found the main thrust of the subsequent paragraphs. Moreover, if Mr McCaffrey had regarded the re-branding matter (of which he had learnt shortly after the meeting of 24 November) as material to the renegotiations he would have raised it. He did not. For example, on 5 December he wrote to Mr Edwards about amendments the latter had made to the amended agreement, but he made no reference to the re-branding matter. Mr McCaffrey's remarkable explanation for that is that he did not want to "do anything unreasonable" to jeopardise the negotiations. Quinn, it appears, wants it both ways: it criticises De Vere for not raising the re-branding matter in the context of these negotiations and accuses it of breach of trust - even though Quinn already knew of the existence of the re-branding proposals during the negotiations and deliberately decided not to raise the matter itself. The inevitable inference is that, contrary to Quinn's protestations, Quinn did not regard the re-branding matter as material to the negotiations, and of course De Vere's position is that they were not.
80. Mr Leaver's reaction to Mr Quinn's letter of 23 December was reflected in an email he then sent to all members of the main board on about the same day. He wrote:

Secondly, and much more importantly, Quinn have reacted very strongly against the new brand logo. They regard it as giving prominence to the De Vere brand at the expense of The Belfry brand. They are furious that we did not consult them ahead of signing the logo off at the Board and regard this as demonstrating a complete lack of respect for their position. The long-and-short is that they believe they should have an input into (even right of veto over) our brand strategy. Remember that the context for this is that they would prefer that the De Vere brand was not in evidence at all at The Belfry! In any case, they feel 'betrayed' and do not believe that there is now any prospect of an effective working relationship going forward.

It is also very obvious from recent conversations that they see the nature of the relationship very differently from that set out in the contract [the management agreement]. The contract is written around a passive property owner and brand operator with extensive rights of control. Although this is what they signed, they describe the relationship as a 'partnership', where the dividing line between the responsibilities of each party is much more blurred."

81. Mr Leaver said in cross-examination that in that email he was responding to what he understood to be Quinn's perceived concern in relation to signage at The Belfry and damage to the goodwill in the bell logo. In referring to their strong reaction to "the new brand logo" he was referring to their reaction in relation to its use in signage. Whilst he accepts he did not spell that out, he said that is the reaction Quinn had made apparent. No-one at Quinn had voiced any objection to the new Hotel & Resorts logo or to the use of the new hotel logo in relation to any other De Vere hotel. Mr Leaver said that when he sent this email he understood that Quinn had no concern over the use of the hotel logo in relation to The Belfry in De Vere chain marketing materials.
82. Whilst I accept that Mr Leaver was thereby making an honest reconstruction of his thought processes at the time, I do not accept that evidence in its entirety. It is, so I find, clear that Quinn was particularly interested in how the brand changes would impact at The Belfry itself, in particular in relation to signage, and I have no doubt that this was foremost in Mr Leaver's mind. But Quinn had also made known its interest in the new hotel logo in relation to The Belfry (Mr Leaver had just given Mr Gray the latest version), and had by no means given it a green light. There was in my view no basis on which Mr Leaver could at that stage have concluded that Quinn was tacitly approving the use of the new hotel logo in relation to The Belfry in its chain collateral – although it is another matter whether it had any right to object to such use.
83. On 12 January 2006 there was to be a media launch in relation to the Quinn Direct British Masters tournament, due to take place in May 2006. Mr Webster's evidence in his witness statement is that shortly before this Mr Gray instructed Louise Blythe (The Belfry's Director of Marketing) to remove all De Vere's Leisure Breaks brochures from the hotel: they would normally be displayed in and around the reception area and the guest services' desk. Ms Blythe carried out Mr Gray's instruction, but Mr Webster countermanded it and instructed her to replace all the brochures. He regarded the instruction as having been wholly inappropriate. (Those were of course the old brochures: they did not contain the new Hotels & Resorts logo or the new hotel logos). In cross-examination Mr Webster accepted, however, that Mr Gray's instruction may have been confined to the brochures in the Warwick Suite, which Quinn had hired for a Quinn marketing exercise; and that there may have been a failure of communication between Mr Gray and Ms Blythe.
84. On 12 January 2006 Lord Daresbury replied to Mr Quinn's letter of 23 December 2005. His letter was drafted by Mr Leaver. It explained that the re-branding was not a new idea, but had been in consideration since 2004; that it had been highlighted in the presentation that Mr Leaver wanted to make to Mr Quinn in January 2005, which Mr Quinn had declined to sit through; that Mr Manby had presented the new logo to a Quinn team on 24 November 2005, which was before it was revealed to the City; that Mr Morgan had written in response to that presentation on 7 December 2005 in terms which gave no indication of any alleged breach of trust by De Vere; that the new hotel logo was settled only after lengthy and detailed market research, working with Corporate Edge, with a key part of the brief being that the new treatment must preserve the independent identities of the individual hotels and that the customer research showed that the new logo achieves this; that whatever the signage on the gates (at present "The De Vere Belfry" and lions), The Belfry would always be known as such: Lord Daresbury had tried unsuccessfully to get the BBC and Sky to refer to it as "The De Vere Belfry" in successive golf tournaments; that De Vere had always intended to consult with Quinn on implementation of the new logo at The Belfry, and that it intended to retain the bell logo for golf and golfing apparel; that De Vere had asked Endpoint to produce photo mock-ups of signage at The Belfry; that De Vere had no intention of terminating the management contract; that De Vere's clear goal was to drive customer loyalty in order to drive financial performance, so that Quinn's and De Vere's interests were fundamentally aligned:

"De Vere as a whole and The Belfry in particular has a strong track record for growing revenues ahead of the market over many years and this can only be achieved by giving customers what they want. Our performance in this regard is clearly demonstrated by impartial external customer surveys, the most recent of which showing that our customer satisfaction is the highest of any hotel brand in Europe (jointly with Hyatt). This survey was based on 8,500 customer responses."

85. That letter did not impress Quinn. Mr Quinn replied on 13 January, saying he was convinced that De Vere had had no intention of taking Quinn's comments on board before commencing its re-branding. Quinn remained of the view that De Vere was incompetent to manage The Belfry and would be instructing solicitors to sue De Vere, a decision which, I find, it had made in December. Mr Leaver's evidence is that De Vere most certainly did intend to consult with Quinn over the re-branding, at any rate to the extent that it related to signage at The Belfry, which is what Lord Daresbury had referred to in the point about consultation in his letter.
86. On 17 January there was a trading review meeting with Quinn at which Mr Manby intended to give a presentation on the proposed signage at The Belfry and discuss it with Quinn. Mr Webster was also present for De Vere. The presentation had been prepared by Mr Rogers following the meeting between Mr Leaver and Mr Gray on 23 December 2005. Kieran Leonard (Quinn's Group Support Executive) was there for Quinn, in place of Alan Hynes, but he did not give evidence. So were Mr Morgan and Mr Gray. The De Vere evidence is that Quinn made it plain it was not prepared to listen to the presentation, and Mr Webster recalled that Mr Leonard said it would be a waste of his time. Mr Morgan's evidence is that the Quinn representatives had agreed in advance that they would be prepared to listen to what De Vere had to say about re-branding, and that Mr Leonard would do all the talking. I interpret Mr Gray's slightly guarded evidence in cross-examination to be to the effect that his task was to say nothing at the meeting and that any talking would be done by Mr Leonard. I interpret him as also accepting that Mr Leonard displayed reluctance to allow the presentation to proceed, on grounds that to listen to it might prejudice Quinn's then proposed legal proceedings. Mr Morgan explained in cross-examination that by then Quinn was obtaining legal advice on its position vis-à-vis De Vere and that "we did not want to prejudice our position." Mr McCaffrey confirmed in cross-examination that Quinn's "initial strategy" for this meeting was that "the question of rebranding would only be on the agenda if De Vere indicated some willingness not to progress with the rebranding." He agreed that the essence of that strategy was a condition that any discussion about re-branding was De Vere's agreement to abandon it, in which event there would have been no need for any discussion at all. Mr Manby insisted, however, that Quinn should listen to his presentation, it being his responsibility to ensure that they had all the information relating to De Vere's brand strategy upon which they would then be able to comment. He said the point of the presentation was to get their feedback so that De Vere could consider it.
87. After some persuasion, Mr Leonard agreed to the presentation being made, but on terms that the Quinn representatives could not be expected to comment on it and that their silence should not be understood to reflect agreement (and, at least as to that, there is broad agreement). Mr Manby gave the presentation. The Quinn representatives made no comment, merely thanking Mr Manby for his efforts and asking for copies, which were provided to Mr Leonard. Mr Manby asked them to forward any feedback, but heard nothing. At this stage, nothing final had been decided about signage: De Vere had not yet decided on colour, the relative size of the words to be used or the materials to be used. Mr Morgan and Mr Gray said in their evidence that at this meeting Mr Manby agreed that De Vere would not proceed with its re-branding without Quinn's prior approval. Mr Manby denied that in his witness statement (and was not challenged on that in cross-examination) and said that De Vere intended to consult with Quinn about changes to the signage at The Belfry. Mr Webster put it slightly differently in his witness statement saying that Mr Manby did say De Vere would not proceed without consulting Quinn, but was there referring only to signage. He was not challenged on that in cross-examination. Following the meeting Mr Gray bumped into Mr Leaver, who gave him a revised version of the new hotel logo for The Belfry, with the words "The Belfry" increased in size.
88. On 18 January Mr Leaver replied to Mr Quinn's letter of 13 January, Lord Daresbury being out of the country. He said he considered there was no basis on which Quinn was entitled to terminate the management agreement and any proceedings would be defended. He again proposed a discussion with Mr Quinn, and told him that signage mock-ups had been presented to his team, a reference to the meeting the previous day. He said De Vere was proposing to use the new logo in only two places on the complex and that he believed the improvement was dramatic. He pointed out that the bell logo was not used at The Belfry's entrance and that it was predominantly only used on directional signage. Quinn has continued to refuse to discuss signage at The Belfry and so progress on it has come to a halt: De Vere has not implemented any changes.
89. Mr Rogers said that he, Mr Leaver, Mr Manby and Mr Edwards had a meeting in January/February 2006 at which they decided to proceed with the group re-branding collateral, but would put The Belfry specific collateral (including signage) on hold until they had sorted it out with Quinn. He said their reasons were (i) they thought they were entitled to proceed with their plans and (ii) the bell logo, which was used on Belfry specific collateral, did not feature in the chain collateral (I have referred to the isolated occasions on which it had been so used) and so no change was being made to that position. Mr Rogers said, and confirmed in cross-examination, that he still thought that Quinn's concern was about a cessation of use of the bell logo in Belfry collateral. He said De Vere had no thought that there was a concern that the re-branding involved a change of The Belfry's name, which he says De Vere was not doing. Quinn suggested this for the first time only after they had made it clear that they wanted to sue De Vere. De Vere proceeded with its re-branding in its chain collateral and I have explained what it has done.
90. Quinn issued proceedings on 2 May 2006. At the British Masters tournament also held in May Quinn made apparent its anxiety to minimise any publicity for De Vere. A tented village housed exhibition stands, one of which was devised by The Belfry's marketing staff for the hotel's stand. The signage they devised for it was "The De Vere Belfry" in capitals and in bold print. De Vere submitted this to the promoters engaged by Quinn, but they sent back a different one, comprising three mini-versions of the bell logo: the promoters informed De Vere that this had been the work of Mr Gray, carried out without any consultation with De Vere. Mr Webster remonstrated with Mr Quinn about this, who in turn said Quinn would not agree to the original banner and that it could take away De Vere's retail space. In the end there was a compromise, with the fascia board simply reading "The Belfry". Quinn would not agree to the inclusion of "De Vere". Quinn's attitude in this respect was reflected in the tournament events programme, in which the hotel was referred to simply as "The Belfry" and Quinn also refused to permit the hotel to put up any advertising boards around the golf course.

The issues

91. I come to the 25-year management agreement dated 9 February 2005 between Quinn and De Vere. It is a long document which opens by reciting that "The Owner [Quinn] wishes to turn over to the Operator [De Vere] the operation, marketing, management and supervision of the Hotel [The Belfry] on the terms set out below." One area of dispute between the parties, which is relevant to a consideration of the terms of the management agreement, is whose business De Vere is thereby managing. Quinn's position is that the business and goodwill of the hotel belong exclusively to Quinn and that De Vere's function and duty was to manage that business for Quinn as its agent. That is essentially correct, at least to the extent that the hotel and its business undoubtedly belong exclusively to Quinn and De Vere is accountable to Quinn for every penny of turnover it achieves at The Belfry, with its only direct financial return from its efforts at The Belfry being the fees and incentive payments to which it is entitled under the management agreement.
92. But there is this important qualification, which is one that gives De Vere a greater interest in the goodwill of The Belfry than that of a mere managing agent. That is that the hotel – The De Vere Belfry – had always been part of the De Vere chain of hotels and there is no dispute that it was to continue to be managed by De Vere as part of that chain. That was a condition of the sale to Quinn. The agreement itself gives De Vere the widest discretion and control both in relation to its management and marketing of The Belfry and also in relation to the promotion of the De Vere chain. The hotel is called "The De Vere Belfry". It is not called "The Quinn Belfry".
93. Thus, as regards the hotel, clause 3 provides:

"3.2 Except as otherwise specifically provided in this Agreement, the Operator shall have exclusive control and discretion in the operation, direction, marketing, management and supervision of the Hotel during the Operating Term.

3.3 Without limiting the rights otherwise provided to the Owner under this Agreement, the Owner shall not interfere in the day-to-day operation of the Hotel during the Operating Term and acknowledges the Operator's total control of operational activities during the Operating Term."

94. As regards the De Vere chain, clause 7.9 requires De Vere to advertise, market and promote its chain as it thinks fit but also requires it to include The Belfry in all such exercises as are relevant to it. De Vere is therefore not just entitled to market The Belfry as part of its chain of hotels; it is obliged to do so. The underlying theory of the agreement is, I find, that (a) to the extent that the goodwill generated by De Vere's management of The Belfry enhances the goodwill of other De Vere hotels (because patrons of The Belfry are so delighted with it that they decide to patronise those other hotels as well), De Vere is exclusively entitled as against Quinn to enjoy the financial benefit resulting from that enhanced goodwill; and (b) Quinn is exclusively entitled (subject only to De Vere's entitlements under the management agreement) to the financial benefit of any enhanced goodwill flowing to The Belfry as a result of the goodwill attaching to other De Vere hotels and to the De Vere brand generally (because patrons of those hotels are so delighted with them that they decide to patronise The Belfry). In my judgment, therefore, it is inaccurate, as Quinn would have it, to regard the relationship between Quinn and De Vere simply as that of owner and managing agent. That is a distortion of the position, one which is highlighted by the fact that the name of Quinn's hotel actually includes that of De Vere, which is well known as the operator of its hotel chain. I agree with Mr Baldwin QC, for De Vere, that the purpose of the managing agreement is in part to define the relationship between two interconnecting businesses, De Vere's business being to operate The Belfry not just as agent for Quinn but also as part of its own chain of hotels. That is what Quinn bought into when it bought The Belfry on the terms it did, and it cannot now complain about it.
95. I come now to the particular issues raised by the claim. The first is, in short, whether De Vere has changed the hotel's name or designated it by an additional name.

Has De Vere changed the name of the hotel or designated it by an additional name?

96. This turns on clause 5.1 of the agreement, which reads:

"5.1 As of the Effective Date and throughout the Operating Term the Hotel shall be known and designated as 'The De Vere, Belfry' or such other name as may be designated by the Operator from time to time with the consent of the Owner. Notwithstanding the previous sentence, the Operator may from time to time alter the name of the Hotel without the consent of the Owner, provided that any such change is limited to inserting, removing or altering a word or words with which the Operator intends to identify the Hotel as part of the Chain, providing that such change is made to all Chain Hotels."

97. Quinn's pleaded case is that the hotel's only permitted name or names is or are one or more or all of (it appears Quinn does not know which): (i) "The De Vere Belfry", (ii) "The Belfry" or (iii) "De Vere The Belfry". That provokes the tiniest of smiles since none of them is expressly legitimated by clause 5.1, the clause which Quinn claims has been breached. Alternative (i) is the closest to what is found in clause 5.1, but it does not include the comma. The apparent effect of the comma is to reduce The Belfry to a mere address, a criticism Quinn levels at the new De Vere hotel logo.
98. De Vere has, however, taken no point on the comma and has argued its corner on the basis that "The De Vere Belfry" both has been and still is the only name of the hotel, which has also been and still is familiarly (and legitimately) known more shortly simply as "The Belfry". It is agreed that there is no objection to the use of either that formal name or its abbreviation (save perhaps at international golf functions, when Quinn would prefer De Vere to stick to "The Belfry"). The case was, therefore, argued on the basis that clause 5.1 should be read as if its first sentence legitimated both the formal name and its abbreviation.
99. Quinn's alternative (iii) is interesting but was not the subject of discussion during the trial. There is, I believe, no evidence that anyone or any document has ever called the hotel "De Vere The Belfry" – save only (perhaps) the famous bell logo, although that depends on how it is to be read. Quinn has made it clear how attached it is to this so-called iconic logo and I infer that its alternative (iii) is based on the possibility that that is what the bell logo calls the hotel. Another interpretation of that logo is of course that the hotel is called "De Vere", with "The Belfry" element being simply its address – so achieving the like result as the clause 5.1 comma. That is an interpretation which Quinn would not embrace, although the evidence it adduced from members of the public (to which I will come) suggests that that is how at least a material section of the public might read it (in particular, those who associate The Belfry exclusively with a golf course, but not with a hotel). I reject the suggestion that the hotel has ever been called "De Vere The Belfry". I approach the name-change issue on the basis that the only name legitimated by the first sentence of clause 5.1 is "The De Vere Belfry" or its abbreviation, "The Belfry". In what follows I shall treat these two alternatives as representing the single name permitted by the first sentence of clause 5.1.
100. Until the trial Quinn's complaint was that De Vere had changed that name to "De Vere at The Belfry". By a re-amendment made at the trial Quinn advanced an alternative complaint that the name change was to "De Vere at The Belfry and/or De Vere" (on one interpretation Quinn was therefore asserting a change to two new names, which might be thought to be unlikely). Apparently a change to the latter alternative had not previously occurred to Quinn but it latched on to the point in the light of the results of an online survey that it commissioned, the majority view of those who responded being that the new name is "De Vere". For reasons I will come to, I regard the survey as having been valueless for the purpose for which it was used and I propose to ignore the evidence resulting from it, which I anyway regard as inadmissible.
101. Reverting to clause 5.1, on which this part of the argument turned, I consider first its first sentence. That sentence plainly imposes an obligation on De Vere and the obligation so imposed appears to be of a dual nature: that the hotel shall (i) "be known" as [the permitted name] and (ii) shall "be designated as" [the permitted name]. It is obvious that in both respects the clause is focusing solely on what is within De Vere's power: if, for example, and for eccentric reasons entirely of his own, a third party were to decide to refer to the hotel by some different name, that could not be something for which De Vere could be answerable under either of the two limbs of the first sentence. To the extent that the sentence imposes a positive obligation on De Vere, it is not easy to define what its limits might be, but that does not arise for consideration. But it also appears clear (and I did not understand this to be disputed) that although the sentence is expressed only in positive terms, it also impliedly imposes negative obligations upon De Vere prohibiting it from (i) either causing the hotel to be known by a name other than its permitted name, or (ii) designating it by such a name.
102. So far so good. More difficult is to know what the difference between these two negative obligations is. If, for example, De Vere were to publish a brochure describing its Wishaw hotel exclusively as The De Vere Imperial, I would consider that it had both caused the hotel to be so known and had also designated it as such. It may perhaps be that obligation (i) would extend to, and embrace, purely oral descriptions of the hotel, whereas obligation (ii) would extend only to written descriptions. If so, then as the complaints in the present case are limited to De Vere's written publications about the hotel, it is only the latter obligation with which I am concerned; and Mr Bloch QC advanced Quinn's argument on the basis that De Vere's publications had amounted to a designation of the hotel by a prohibited name. I am disposed to agree with him that the question I have to decide arises only under obligation (ii) of the dual obligation. That is how I propose to approach the factual question arising under the first sentence of clause 5.1.
103. Has De Vere designated the hotel as either "De Vere at The Belfry" or simply "De Vere" or both? Quinn's case relies on (i) the introduction into De Vere's chain and hotel collateral of the new hotel logo "De Vere at The Belfry" and (ii) the use of the words of that logo in printed captions to photographs of the hotel. As regards (i), it is important to remember that the form of the hotel logo is a flamboyant "De Vere" in cursive manuscript immediately above a printed "at The Belfry". There is no doubt (or at any rate I find) that the "De Vere" element of the hotel logo is the dominant part of it, and it is that which catches the eye. As regards (ii), it should be noted that the printed caption uses the words "De Vere at The Belfry" in uniform print without any element of the caption enjoying a position of dominance. Has the manner in which De Vere has used its hotel logo and the printed captions in its publications involved a designation of the hotel by a name other than The De Vere Belfry or The Belfry?
104. The answer to that, as to most questions arising in the field of law, depends on context. It is, therefore, pointless to take the hotel logo in isolation, as the online survey did, because De Vere has not used it in isolation. In so far as it is said that the hotel logo has designated the hotel by a prohibited name, it is essential to consider the hotel logo in the context in which De Vere has used it and I have explained that context earlier when describing the way in which De Vere has used the new logo in its brochures and other publications. Even Quinn's own branding expert, Peter Matthews, acknowledged in cross-examination that it is very important when considering logos to consider them in the context in which they are used, although he nonetheless did not do so when preparing his own report. I consider that the use made by De Vere of the printed captions must also be taken in the context of the publications in which they appear.
105. I do not propose to repeat here the evidence relating to De Vere's brochures and publications. I will here simply summarise my findings. (a) I find that the ordinary reader of the 2006 Planner Brochure would conclude that the name of De Vere's Wishaw hotel is The De Vere Belfry or, more shortly, simply The Belfry. He would not conclude that it is called either De Vere or De Vere at The Belfry. He would interpret the sense of each hotel logo as referring to the experience that De Vere provides at the particular hotel referred to in it (that is the interpretation that Mr Matthews applied to the use of the hotel logo in De Vere's new Leisure Breaks brochure, and I find it equally applicable here). I find that the use of the hotel logo in this publication did not designate the hotel as either De Vere or De Vere at The Belfry. (b) I find that the ordinary reader of the De Vere's 2006 Mini Hotel Directory would draw a like conclusion, namely that the hotel is called The De Vere Belfry. The position here is not as clear as in the case of the Planner Brochure, because of De Vere's use of the printed caption "De Vere at The Belfry" on the photograph of The Belfry on page 9 and the unusual use of the hotel logo to identify the map location of The Belfry. I nevertheless find that the ordinary reader would understand from the context of the brochure that the sense of the hotel logo was again simply referring to the De Vere experience at each hotel and that he would interpret the caption to the photograph of The Belfry in the like manner: he would not interpret it as giving The Belfry an alternative name (particularly one as odd as "De Vere at The Belfry"). I find, therefore, that this brochure did not designate the hotel as either De Vere or De Vere at The Belfry. (c) I find that the ordinary reader of the Guest Satisfaction Survey he would find in his room at The Belfry would interpret the hotel logo as simply conveying that The Belfry was a hotel in the De Vere chain. He would not read it as telling him that the hotel he was staying in was called either De Vere or De Vere at The Belfry. I find that this survey form did not designate the hotel as either De Vere or De Vere at The Belfry. (d) I find that the ordinary reader of the Leisure Breaks Brochure would conclude that the name of De Vere's Wishaw hotel is either The De Vere Belfry, or perhaps simply The Belfry, the shorter version being the chosen description in the section devoted to The Belfry. He would interpret the hotel logo as simply conveying that De Vere provides the experience to be found at the hotel named in it. I find that this brochure did not designate the hotel as either De Vere or De Vere at The Belfry. (e) I find that the ordinary reader of De Vere's revised website would not conclude from it other than that the name of the Wishaw hotel is either The De Vere Belfry or just The Belfry. I find that it did not designate the hotel as either De Vere or De Vere at The Belfry. (f) As for the Saga brochures, despite the aerial printed caption in the photograph of The Belfry, I again find that the ordinary reader would conclude from this brochure that the Wishaw hotel is called either The De Vere Belfry, or just The Belfry, and that the caption would not cause him to conclude otherwise. I find that this brochure did not designate the hotel as either De Vere or De Vere at The Belfry. (g) I find that the ordinary reader of the Golf Leisure Breaks brochure would conclude that the name of the Wishaw hotel is The De Vere Belfry. I find, therefore, that none of these brochures or other publications provides any basis for a conclusion that De Vere has changed the name of the hotel to, or designated it as, De Vere at The Belfry or simply De Vere.
106. That is not the end of the first sentence of clause 5.1 because, in addition to the relatively minor (and, in the context, in my view immaterial) use in those brochures of "De Vere at The Belfry" in printed caption form, I have earlier also summarised the wider use that De Vere has made of that caption in other of its publications. The position in relation to certain of these appears to me to be different. Thus, in the case of the calendar, no use is made of the hotel logo, nor does The Belfry page include a separate description of the hotel by its permitted name. All the reader sees is a picture of The Belfry with a caption reading "De Vere at The Belfry, Nth Warwickshire". The evidence is that the calendars were sent to De Vere's business contacts and customers, who are said to be presumed to know the name of the hotel. No doubt most do. But the calendar is also likely to be viewed by others who may not and anyone looking at August who was not already familiar with the De Vere set up, might be forgiven for thinking that the hotel he was staring at was called "De Vere at The Belfry", however weird a name he might think it was. I find that the calendar did designate the hotel as "De Vere at The Belfry". Whether that involved a breach of clause 5.1 depends on whether such designation was saved by the second sentence, which I will consider later.
107. Turning to De Vere's April campaign of 34,000 of its customers, the position is less clear. The customer is given three messages (i) the De Vere Hotels & Resorts logo, (ii) "De Vere at The Belfry, North Warwickshire" as a printed caption in a picture of The Belfry, and (iii) a clear indication that the name of the hotel is "The De Vere Belfry", plus a telephone number to make his booking (and also a list of the other De Vere golf hotels with telephone numbers). In my view that raises the question of whether the customer would read the caption as providing an alternative name to, or designation of, the hotel. In my judgment he would not. He will know, or will at least infer, from the Hotels & Resorts logo that De Vere has a chain of hotels. That would be confirmed by the list of its hotels that is provided. He would read the caption as simply attempting the not very skilful job of telling him that the photograph was a picture of what the De Vere group provides at The De Vere Belfry. If asked the name of De Vere's Wishaw hotel, I find that he would conclude it was The De Vere Belfry. I find that this publication did not designate the hotel as either De Vere or De Vere at The Belfry.
108. As for De Vere's May 2006 "Escape" mailing, I find that the reader would presume from (a) the instruction to "Find De Vere at" the listed abbreviated names, coupled with (b) the adjoining picture captioned "De Vere at The Belfry" that the name of De Vere's Wishaw hotel is De Vere at The Belfry. I find that this publication also designated the hotel as De Vere at The Belfry. I will consider later whether this amounted to a breach of clause 5.1, or whether De Vere is saved by the second sentence of clause 5.1.
109. I find that the advertisement in "Dial" magazine, which included a picture of The Belfry and the printed caption "De Vere at The Belfry, North Warwickshre" but no reference to the hotel's permitted name, would have conveyed to the ordinary reader that the name of the Wishaw hotel is "De Vere at The Belfry". This advertisement also designated the hotel as such. For like reasons so did the Prestige Reservations and Carlson Wagonlits advertisements. I will similarly consider later whether these advertisements involved a breach of clause 5.1.
110. I conclude, therefore, that De Vere's use of the hotel logo in caption form has in the cases of the particular publications I have identified involved a designation of the hotel as bearing a name other than its permitted name. I will later refer to these publications as "the calendar and the advertisements".

The online survey

111. Quinn's case that the use of the hotel logo, in logo form, by itself involved a designation of the hotel as either De Vere or De Vere at The Belfry depended in part on the results of an online survey carried out by Philip Malivoire, a director of the Consumer Services division of Gfk NOP (which was founded in 1957 as National Opinion Polls). I have explained briefly why I have disregarded this evidence in coming to my above conclusions. I should, however, describe the nature of the survey and the results it achieved.
112. The survey was by way of email invitation to 7,500 members of a larger panel who had agreed to take part in online market research surveys. The chosen panellists were aged 30 to 60 with a household income of at least £48,000 a year. The emails were sent on 22 May 2006. The questionnaire explained that it was about hotels. It set out four hotel logos, of which one was De Vere at The Belfry in logo form. It invited answers to the same set of questions for each logo. Before coming to what might be regarded as the questions themselves, there was a box above which was written "(A) Name of hotel:", which the panellist was impliedly invited to complete. There then followed the first question, which was "What market sector or sectors do you think this hotel is aimed at?", the offered alternatives being (i) conference destinations, (ii) leisure and weekend breaks and (iii) family holidays. The panellist was next asked "Have you ever heard of this hotel?", and was helpfully given yes and no boxes to tick. Finally, it was pointed out that the results of the survey might be used "in a legal case" and the panellist was asked if he would be willing to be re-contacted regarding his answers.
113. The result of the survey was that some 977 panellists responded to the questions relating to the De Vere hotel logo. Of those, 601 (or some 62%) named the hotel as De Vere alone; 263 (or some 27%) named it as De Vere at The Belfry, De Vere The Belfry or De Vere Belfry; and 113 (or some 12%) named it Belfry or The Belfry.
114. Mr Malivoire agreed in cross-examination that he had been asked to design a survey to identify how members of the public referred to, or identified, a particular hotel logo. He agreed that his method of distinguishing between the responses to the logos was to ask the panellist to name the particular hotel he was referring to. He agreed it was implicit in the survey that the name of a hotel could be determined from looking merely at its logo: and of course each logo was shown in isolation and out of any context in which it might normally be used. He was taken through the latest De Vere Leisure Breaks brochure and, although he appeared to struggle a bit in its interpretation, he eventually agreed that if the panellists who had responded to the online survey had also had the benefit of a sight of it – and had been given Mr Baldwin's "kind help" in the tour through it - "they could well have given a different answer" as to the name of the hotel. I have already indicated that I consider the ordinary reader would do so.
115. I regard this survey as having been a valueless exercise. First, it can be said that the request for the "Name of hotel" was no more than a request to identify to which of the four logos the panellist's various answers were respectively directed. It may, therefore, have been interpreted at least by some of the panellists merely as an exercise in logo identification, not in name identification. Second, even if it were interpreted in the latter sense (as some witnesses said they did interpret it) the exercise would essentially be one of guesswork and it was pointless to expect that the panellists could reliably assess the name of a hotel merely on the basis of its logo. There can be no presumption that a hotel logo taken in isolation will itself provide conclusive information as to what the hotel's name is. If, for example, instead of using the hotel logo relating to The Belfry, Mr Malivoire had used the bell logo to which Quinn is so attached, it is quite possible that the answers to the "Name of hotel" part of his survey would or might have been "De Vere", "The Belfry" or "De Vere The Belfry" or perhaps other combinations of these, either with or without the inclusion of one or more stars and/or backward slashes. The first and third answers would be wrong (no one suggested that during the pre-Quinn period the hotel bore either name), and the second answer would not give the hotel's correct name, which is The De Vere Belfry. The evidence of those panellists who gave evidence showed that some of them associated The Belfry exclusively with golf, and not with a hotel, and those in that category might well deduce from the bell logo that the name of the hotel was De Vere.
116. Quite apart from these considerations I anyway do not regard the views of the public as to the name of the hotel as admissible evidence for the purposes of the court's decision as to whether De Vere has designated the hotel by a name other than its permitted name. That issue is one that the court has to decide on the basis of the evidence as to what De Vere has done, an exercise which requires a consideration by the court of the various types of material it has published in relation to the hotel. The court's task is to consider that material and then make its own finding on whether De Vere has designated the hotel in a way which amounts to an infringement of the first sentence of clause 5.1, and that is what I have done. It is not assisted in that by the opinions of a random selection of members of the public as to what they think the hotel is called on being shown no more than the De Vere's hotel logo. Any opinion so formed is necessarily based on incomplete information taken out of context and (as the evidence showed) the responses were also conditioned according to any background knowledge that the panellist had of the set-up at Wishaw. Civil courts sitting without a jury do not usually decide questions of fact by reference to opinions on them from random members of the public who have only been given a mere snippet of the relevant evidence, and this case is no exception.
117. I heard oral evidence from nine panellists who had made witness statements and were also cross-examined, and I should summarise it. William Egerton said in his statement that he thought the hotel was called De Vere because he knows De Vere is a hotel chain. He had heard of "The Belfry", but appears to have believed it was simply a golf course. In cross-examination he said he did not normally stay in chain hotels. He was shown the latest De Vere Leisure Breaks brochure and agreed it made plain what the names of the hotels were, by which I understood him to accept that the hotel was known as The De Vere Belfry, or perhaps just The Belfry. He said that when he filled in the survey he "assumed that the name De Vere would figure in all the names of the [chain] hotels", an answer suggesting that he in fact understood De Vere was not a name all on its own: and he had referred in his witness statement to "the De Vere Shaw Ridge", the De Vere hotel in Swindon that he already knew.
118. Maria Amaro said in her witness statement that she answered "De Vere" in the survey because she thought that was the hotel's name. This is because she knew De Vere was a hotel chain, having stayed in one of its hotels recently. She had also heard of "the Belfry Hotel", having lunched there in the past (although the hotel has never been known as "the Belfry Hotel"). She inferred from the logo that perhaps De Vere had taken it over, or else that it had changed its name. In cross-examination she explained that she normally stayed in chain hotels, her hotel visits usually being work-related. She was shown the Leisure Breaks brochure in cross-examination from which she appreciated that The Belfry is in fact part of the De Vere chain. Her answers perhaps suggested that when responding to the "Name of hotel" part of the survey she was doing no more than identifying which of the four hotels she was referring to.
119. Zoe Branfoot said in her witness statement that she responded as follows when identifying the hotel she was referring to: "(A) gargyle [sic]; (B) Devere [sic]; (iii) Swissotel; and (D) westcliff [sic]." At least the first quarter of that – a wild shot at identifying the logo bearing the words "The Carlyle, A Rosewood Hotel, New York" - shows how carefully she read her statement before signing it. She said she wrote "Devere" because that is what she thought it was called. That is odd because "Devere" as such does not feature in the hotel logo. Ms Branfoot said this was the more eye-catching part of the logo, the rest of which "seemed to suggest a location." She had not previously heard of "Devere" but thought she had heard of "the Belfry" but could not remember where or when. In cross-examination, she explained that she stayed in different types of accommodation when away from home, depending on the circumstances of the outing. She would choose a hotel in the desired location, with the required facilities and in the right price range and would make the choice by using brochures, the internet or friends' recommendations. She agreed that it was apparent from the Leisure Breaks brochure that the hotels in the De Vere chain were called "De Vere this, De Vere that …" but added that "when I did the survey, I just thought it was market research, I read it, just from glancing at it, as I would do if I was walking past somewhere, I would read it as 'The De Vere hotel at The Belfry' and 'The Belfry' would be a location." She also agreed that when she was filling in the name of the hotel in the survey, she was distinguishing the four logos one from another. When she was later asked about her response by Quinn's solicitors, her thought process was that the De Vere (or the Devere?) was possibly a restaurant in The Belfry Hotel. That reflects that her thought processes had changed – but the name could not have changed.
120. Nigel Cooper said in his witness statement that he responded to the relevant part of the survey as follows: "(A) devere; (B) carlyle; (C) howard; and (D) westcliff. Like Ms Branfoot he elided the "De Vere" and then used his own lower case "d", so arriving at a hotel name which could not be said to derive from the logo. He expanded on his thought process by saying he wrote what he did because he thought the hotel was called "devere". He said he knew "DeVere" (one word) was a chain of hotels and he "did not think that the name 'devere' is normally tagged on to anything except perhaps the place name or the town in which that particular DeVere hotel is situated." Mr Cooper explained in cross-examination that his own choice of hotels was usually prompted by a consideration of the Saga brochures which fall on to his doormat. He had stayed at two De Vere hotels, which he recalled as "The De Vere Grand at Brighton and the Maritime at Southampton." That answer shows that he knows that in relation to its hotel in Brighton "De Vere" is tagged on to "Grand", which is neither a place name nor a town; and that he had forgotten the name of De Vere's Southampton hotel, which is De Vere Grand Harbour. He agreed that the Leisure Breaks brochure made it plain that the name of the hotel is The Belfry. He agreed that in completing the name in the hotel box in the survey what he was doing was distinguishing between the four logos. He agreed that the brochure showed that the names of all the De Vere hotels included the words De Vere with something tagged on.
121. Jennifer Smith explained in her witness statement how she identified the four hotels in the survey as (A) The Carlyle; (B) DeVere; (C) swissotel; and (D) The Westcliff. She said she typed in "DeVere" because that is what she thought it was called. She had heard of De Vere and knew the Belfry was a golf course and so assumed that DeVere was the name of the hotel at the golf course. In cross-examination Ms Smith said she knew De Vere was a chain of hotels. She normally stayed in chain hotels, the Marriott being her favourite. If, for example, she was looking for a hotel in Brighton, she would look on the internet to see what was available. She was familiar with hotel brochures such as the De Vere Leisure Breaks brochure, but had not seen that particular one before. When being taken through it, she had no difficulty in identifying the hotel described on pages 49, 50 and 51 as "The Belfry". She also identified De Vere's hotel in Cambridge as the University Arms.
122. Michael Coleman filled in the "Name of hotel" part of the survey as follows: (A) The Carlyle; (B) DeVere; (C) The Howard; and (D) The Westcliff. He said he wrote "devere" [sic] because he thought the hotel was called that. That was because he associated the name Belfry "with the golf course and associated complex. The name De Vere points towards the hotel and the name Belfry points towards the golf course." Mr Coleman explained that he had stayed at the De Vere Daresbury Park several times. When first asked he too had no difficulty in identifying the name of the De Vere hotel described on pages 49 to 51 of the Leisure Breaks brochure as The Belfry. He added, however, that The Belfry meant to him a golf course and he also said that he had stayed at the hotel there two or three times in the 1990s, although he did not appear to know the name of the hotel at which he had so stayed. To the question as to the name of the building, he replied "I have only ever thought of it as The Belfry Golf Course and what was attached to it as being The Belfry." He apparently could not, however, quite bring himself to say that the hotel was called The Belfry. When asked for a second time the name of the hotel identified on page 51 of the brochure, he replied "I would say it is the De Vere because it is specifying Belfry as a place. It says 'at The Belfry'". Since he also regarded Daresbury Park as an area, one might therefore have expected him to hold the view that the hotel there was also called De Vere. When first asked that question he said that it was called Daresbury Park, and he disclaimed the suggestion that it was called De Vere. When he was later asked the name of the hotel represented by the logo "De Vere at Daresbury Park" he said, inconsistently with his previous evidence, that he would have said De Vere. Reverting to Wishaw, Mr Coleman said that "to me The Belfry was always a golf course". As far as he was concerned, The Belfry was a place (in particular a golf course complex) and the hotel logo "De Vere at The Belfry" conveyed to him that De Vere was the name of the hotel at that place. The logo "De Vere at The Cavendish" would have conveyed to him that the name of the hotel was The Cavendish.
123. Charmaine Beakley explained in her witness statement that she answered the "name of hotel" part of the survey as follows: (A) the Carlyle; (B) De Vere; (C) the howard; and (D) the Westcliffe. She said she wrote "DeVere" [sic] because she thought it was called DeVere. This was because she knows De Vere is a hotel chain and she recognised the Belfry as the golf course. She assumed that De Vere was the hotel at the Belfry golf course. Her approach was therefore similar to Mr Coleman's. She explained in cross-examination that she had never stayed in a De Vere hotel. When she did want to choose a hotel to stay in, she normally used the internet. She had seen hotel brochures in the past, but not De Vere's. When asked to identify the hotel on page 51 of the Leisure Breaks brochure she replied that it was "The Belfry". To the question why (so it appeared) it had ceased in her assessment to be called De Vere she explained that it was "Because this is all De Vere hotels and these are specific ones in different places but if – I live in Gloucester and there is a hotel near me called The Crest Moathouse but everyone knows it as The Crest. So it is known by its – I do not know what it is called – the main bit above the specific building, if you like."
124. Benita Hewitt identified the name of the Wishaw hotel on the survey as De Vere. She wrote that name down because she thought the hotel was called that. That was because she knew De Vere was a chain of hotels and that the Belfry is a golf course. She assumed that De Vere was the name of the hotel at the golf course and that the Belfry was its location. That too was the same approach as that favoured by Mr Coleman and Ms Beakley. In cross-examination she explained that she usually stayed in chain hotels, and had stayed in De Vere, Hilton and Holiday Inn hotels. Most of her hotel stays are work-related. When she goes away for leisure the accommodation is of secondary importance: it would be just a place to sleep and the activities and location would be the main consideration. When shown the brochure, she thought she might have stayed at De Vere Oulton Hall. When asked to identify the hotel on page 51 she replied that it was De Vere at The Belfry. It was put to her that the brochure showed that the name of the hotel was The Belfry to which she responded that she was not clear as to whether The Belfry was the name of the hotel or the name of the golf course. She said the form of the logo conveyed to her that the brochure was referring to the De Vere hotel at The Belfry, and she drew support from the other brochure references to De Vere at Mottram Hall, De Vere at Carden Park and De Vere at St David's Park. She did, however, then agree – albeit with perhaps a little reluctance – that, for example, the De Vere hotel at Mottram Hall was called Mottram Hall, that its hotel in Cheshire was called Carden Park and that one of its hotels near Chester was called St David's Park (although of course the formal name of each has a "De Vere" tacked on to the front). She also assumed that the De Vere Daresbury Park was referred to as "Daresbury Park". On being re-invited to consider the name of the hotel on page 51, she agreed that the intelligence she had derived from the brochure (which she did not have when responding to the survey) showed her that it was called The Belfry. It was put to her that when being invited in that survey to name the hotel she was being asked to do no more than distinguish between the four logos. She agreed but added – no doubt with the benefit of her own experience as a market researcher – that she had spotted that the survey was also seeking to know what the panellists assumed would be the name of the hotel.
125. Nicola Hemming said she responded as follows when asked to identify the hotel she was referring to: (A) Carlyle; (B) devere; (C) the howard; and (D) the westcliff. She chose the name "devere" (not to be found in the logo in that form) because she thought that was its name – because "I know that De Vere is a chain of hotels and I assumed that 'The Belfry' is the name of a restaurant at the hotel." That makes no very obvious sense to me. In cross-examination Ms Hemming said she knew at least one De Vere hotel, namely one she called The University Arms, because she was originally from Cambridge. She identified the hotel at pages 25 to 27 of the brochure as "Oulton Hall" (even though it bore the hotel logo "De Vere at Oulton Hall" at the top of the introduction), the hotel at page 61 as "The University Arms" (even though it was introduced by a like logo) but identified the hotel at page 51 as "De Vere at The Belfry". However, on being gently led by Mr Baldwin she agreed that its name was The Belfry.
126. In addition to the evidence of these nine witnesses, Quinn also adduced in evidence the statements of 11 other panellists who had responded to the survey, but none of them attended for cross-examination. They had also all responded to the survey by naming the hotel behind the logo as De Vere, DeVere, devere or de vere. Ms Hills's illuminating explanation was that she thought the hotel was called "Devere" because "the design of the logo shown to me made it look like DeVere was the name of the hotel." Why did she not write "DeVere" down then? Mr Arnold thought it was called "DeVere" because he knows the Belfry is a golf course and he assumed that DeVere was the name of the hotel at, or affiliated to, the golf course. Mr Hamilton thought the hotel was called "De Vere". His reasoning was that he knows De Vere is a hotel chain and he knows "the De Vere Whites in Bolton. Although I know each hotel has another name I refer to all the hotels as 'De Veres' and I presumed this was another in the chain." His presumption was correct, as was his knowledge that "each hotel has another name". It is surprising that he did not have a shot at guessing that other name in the instant case. Mr Gouldsborough thought the name was "DeVere … because the design of the logo shown to me made it look like 'DeVere' was the name of the hotel and I thought that the hotel at the Belfry Golf Course was called 'DeVere'". Ms Ellis thought the hotel was called "De Vere" because that was "the part [of the logo] that stood out to me …". Ms Johnson thought the name was "devere". This was "because in the purple square 'DeVere' was the most prominent part and I do not tend to read the small writing." Ms Fraser thought the hotel was called "DeVere". This was because it was the bold part of the logo, which stood out. Mr Johnson thought the hotel was called "De Vere". He knows that "the Belfry is a golf course and assumed that DeVere is the name of the hotel at the golf course." Mr Kiely thought the hotel was called "Devere". This was "because I thought the logo looked like it was part of the DeVere chain. I thought that it looked like The Belfry had been taken over by DeVere as DeVere is the part which stands out." Ms Kelly thought the hotel was called "de vere". That was because "looking at the logo, it certainly seemed that 'de vere' was the name of the hotel." Ms Barrett also thought the hotel was called "de vere". This was "because from looking at the logo, 'de vere' was the name of the hotel."

Is De Vere's use of the printed captions saved by the second sentence of clause 5.1?

127. The second sentence of clause 5.1 provides a saving proviso to certain unauthorised name changes. I now consider whether that proviso protects De Vere from infringement of clause 5.1 by reason of the use of the hotel logo in caption form in the calendar and the advertisements.
128. The second sentence applies to "alterations" of the hotel's name. The theory of it is that, even if the name change has not first been consented to by Quinn, De Vere can lawfully change the name of the hotel "provided that any such change is limited to [a verbal alteration by which De Vere] intends to identify the Hotel as part of the [De Vere] Chain, providing that such change is made to all Chain hotels."
129. In my judgment this proviso does not save De Vere's designation of the hotel as "De Vere at The Belfry" in the captions in the calendar and advertisements from constituting a breach of the first sentence of clause 5.1. The purpose of the proviso is to permit a name change to the hotel which will identify it as part of the De Vere chain of hotels. As the current permitted name already so identifies it – and the parties must be taken to have been aware of that when they signed the agreement – the proviso is perhaps a surprising one (just like the famous comma). It must, however, be given some meaning and it appears to me that the best way to give sense to it is to interpret the words "intends to identify" as meaning "intends to re-identify".
130. If this is right, I cannot see how the proviso can legitimate De Vere's use of the logo in caption form. I find as a fact that De Vere has not changed the hotel's name and has no present intention of doing so. It has introduced a new hotel logo as part of its re-branding exercise, but it is no part of that re-branding to change the hotel's name; and I have found that no ordinary reader of the context in which De Vere uses that logo would conclude that the hotel's name had been changed. I have, however, also found that De Vere's use of the hotel logo in caption form in the calendar and the advertisements did amount to a designation of the hotel by a name other than its permitted name. This was not, however, part of any overall strategy to change the hotel's name, there being no such strategy. It seems to have been fruit of a trail trodden by Ms Black on a personal frolic, she appearing to have become carried away with the supposed magic of the component words in the hotel logo without standing back and realising the apparent oddity of their use in caption form. It cannot, in my judgment, be said that such use has anything to do with the type of situation that the second sentence of clause 5.1 has in mind. I find that the caption use in the calendar and the advertisements amounted to a breach of the first sentence of clause 5.1.

Has De Vere breached clause 6.2.4.2 of the management agreement?

131. Clause 6.2 permits De Vere to use what are described as "the Hotel Marks" for the purposes of operating and marketing the hotel. There is a list of them in Schedule 5 but the only marks relevant to the argument are those comprising the words "The Belfry". By clause 6.2.4.2 De Vere undertakes to Quinn that:

"It will not use the trade marks within the Hotel Marks in a manner which is reasonably likely to cause material harm to the goodwill attaching to those trade marks and shall not do anything which is reasonably likely to prejudice [Quinn's] rights in and to those trade marks."

132. There is a similar provision in clause 4.1.2 of the trade mark agreement which the parties also entered into. There is no need to consider that separately, since no separate argument was founded on it. Quinn asserts that De Vere has breached both provisions. It is either right on both or wrong on both.
133. Quinn's case is that De Vere's introduction and publication in its brochures of the new hotel logo in relation to The Belfry was a course of conduct likely to cause material harm to the goodwill attaching to the Belfry marks. The point made is that the new logo gives dominance to the De Vere element (in the form of a flamboyant signature) and demotes The Belfry element (in printed form below the signature). The effect, it is said, is that value is likely to pour out of The Belfry brand and into the De Vere brand. The end result, it is said, is that the goodwill attaching to The Belfry name, and therefore to the hotel, is likely to be damaged. Quinn's assertion is that De Vere's re-branding exercise is likely over time to result in the De Vere brand gaining at the expense of The Belfry brand and to result in the erosion of the goodwill attaching to that brand.
134. De Vere's re-branding was, I find, a bona fide commercial exercise carried out on the basis of skilled (and expensive) specialist advice as to the manner in which it could best promote all the hotels in its chain, including The Belfry. It was motivated by the intention to strengthen the De Vere brand as an indicator of a consistent level of service across its entire hotel chain, whilst at the same time maintaining an emphasis on the individuality of the hotels. The exercise was one directed at driving people through the doors of all its hotels and at encouraging them to make repeat visits and so increasing the goodwill attaching to all of them. It was an exercise that De Vere was entitled to carry out under clause 7.9.1.1 and in which, under clause 7.9.1.2, it was obliged to include The Belfry. I find that, looked at in context, the use of the new hotel logo in De Vere's brochures in no manner diminishes the standing of The Belfry name. Anyone reading the new Leisure Breaks brochure, for example, will see that it gives far more prominence to that name (as opposed to The De Vere Belfry name) than did its predecessors, as Mr Matthews acknowledged in cross-examination. He also acknowledged that the new brochure benefited The Belfry name, although he also said that only the De Vere brand featured in the brochure, but not The Belfry brand. He also agreed that nor had The Belfry brand featured in the previous brochure. He was there referring to the bell logo, which De Vere has hardly ever used in any of its brochures (I have listed the rare occasions when it has used it). Mr McCaffrey advanced a complaint in his evidence that the re-branding did not present The Belfry as a famous landmark hotel, but as just another hotel in a chain. But there is nothing in that since De Vere's publicity material has always presented The Belfry as one of its chain hotels. Nothing in the management agreement required De Vere to change its policy in this respect and single The Belfry out for special treatment.
135. Mr Matthews described a "brand" as a collection of perceptions that exist in the mind of a consumer. He said that brand value represents the premium that the customer is prepared to pay for a particular brand compared to an alternative brand because the collection of perceptions creates preferences. He went on to explain that this value:

"… is created, grown or diminished through the individual 'experiences' that customers have with a 'brand' – including advertising, press coverage, contact with employees, signage, environments, visiting a website and actual experience using a branded product or service."

136. It is to be noted that "actual experience" of the branded product or service features last on Mr Matthews's list. He referred in his evidence to the previous version of The Belfry's brand identity as represented by the bell logo, with The Belfry as the main typographic element, De Vere appearing in smaller words above. His opinion was that in that logo The Belfry was the primary visual force. He said that "the current rendition of the brand identity had changed this significantly". That was a reference to the new De Vere hotel logo, which he said gave the primary visual focus to De Vere and demoted The Belfry to the same level of emphasis as other hotels in the De Vere chain. He added that the bell logo was redundant in the new system. The effect was, he said, to reverse the relationship of the words De Vere and The Belfry in terms of visual impact, with the result that "The Belfry now qualifies where the De Vere is, rather than being the dominant brand name." Reduced to its essentials, Mr Matthews' point was that the new hotel logo had been introduced by De Vere in exclusive substitution for the bell logo (although he had not been told that that was De Vere's plan, nor was it or is it) and had the effect of reversing the brand status which that logo had given to the De Vere brand and The Belfry brand respectively. His assessment of the effect of that change on the goodwill attaching to The Belfry brand was as follows:

"In the short term, golf enthusiasts and those familiar with the hotel may not be affected by the change in the brand as its name and reputation probably remains strong enough to remain foremost in their minds. However, over time, with the increased level of emphasis on the De Vere brand, awareness of The Belfry brand, and consequently its value, will certainly diminish."

137. As I understood Mr Matthews's explanation in cross-examination he arrived at that conclusion simply by comparing the two brand marks in isolation– the bell logo and the new hotel logo. He said that is what he was asked to do. He made no assessment of the context in which the new hotel logo was to be used. But his opinion was that – apparently regardless of that context - over time the use by De Vere of its new hotel logo in relation to The Belfry will certainly cause an erosion of goodwill attaching to the Belfry brand. Once he was invited in cross-examination to enter the real world and consider the use of the new logo in context (as used in the latest Leisure Breaks brochure), he agreed that that brochure did not "demote" The Belfry in any way as compared with the previous brochure. It would seem, therefore, that his theory would only work as regards the impact of the new logo in that brochure if its readers focus exclusively on the logo and do not allow their eyes to stray to the substance of the brochure itself – which is of course what they are interested in.
138. I found Mr Matthews's evidence unconvincing, and at least a little remarkable, and I do not accept his last-quoted opinion, which appears to me (a) to have been based on a valueless exercise of comparing two logos in isolation, without any regard to the context and manner in which in practice they are used, (b) to advance a proposition which owes everything to theory and little to an understanding of how human beings actually behave. Juliet would not have been convinced by it either, favouring as she did a radical view of brand psychology at which experts like Mr Matthews would no doubt shake their heads in disbelief: "What's in a name?", she asked. "That which we call a rose by any other word would smell as sweet." This case does not, however, put Juliet's proposition to the test, because there is no question of De Vere re-naming the rose. All it has done is to re-draw its brand image across its whole range of hotels, with all the hotels retaining their names. I accept that its new hotel logo gives a primary emphasis to De Vere rather than to the particular hotel named in the logo. But the notion, apparently favoured by Mr Matthews, that logos alone put (or do not put) bodies in, at or on hotel beds, dining tables or golf tees is, I find, unsound. Not one of the panellists whom Quinn called as witnesses suggested that their choice of a hotel was influenced by a logo, and it is obvious that it would not. Of course they, or certain of them, were influenced in their choice by their knowledge of a particular hotel brand, which will or may be represented by a logo, but that is another matter: the key question there is why are they so influenced?
139. De Vere called Piers Schmidt as their brand expert. Mr Schmidt plainly had a thoroughly sound understanding of the hotel industry and explained his opinions on the relevant topics with such lucidity and articulate eloquence that I have cautioned myself against having been persuaded by his presentation rather than by its underlying substance; but having done so, I have no hesitation in preferring Mr Schmidt's approach, which appeared to me to have the distinct advantage of being founded on an understanding of the real world. He agreed that the dominant branding element in the bell logo was The Belfry and that the new hotel logo gave De Vere a greater relative emphasis. His opinion expressed in his report was, however, that "… in what's now acknowledged as an 'Experience Economy' a brand is only ever as good as the last experience it provided to its most recent consumer." He developed that in his explanations in cross-examination, which I propose to set out in part:

"… we live in a much more transparent economy where devices such as the internet, proliferation of the media, the exploration of interest in marketing and brands has made us all incredibly savvy; we understand how marketing works, we are not just blind consumers … the hotel brand is at the forefront of an experience economy because you are not buying a car or a can of beans that largely performs through its product formulation, you are buying the way you are treated, you are buying the way people speak to you, you are buying the heat of the food on the plate, you are buying the comfort of the bed but not just the comfort of the bed but the way the bed was turned down that night, the way the loo roll was folded in the bathroom. So all of these things add up to a sensory impression and experience of the brand. That in a very short summary is the experience economy. You can have an experience at Claridges and the Dorchester and The Belfry tonight and have another one next week and you will update your opinion of the brand. Your impression or your goodwill towards it can be radically different one week to another. That is my point about it is only really as good as the last experience it provided to its most recent consumer, and I was saying this because I believe there was an over-emphasis in a lot of material that I was provided with on the look of the logo as being the driver of opinion and goodwill in relation to the brand. So whilst it represents that brand, it is actually the experience, the time, the stay the guest has at the property that is actually the dominant driver of that reputation and therefore in time of the goodwill. … My point being that of much greater influence to the long-term goodwill of The Belfry brand is the quality of the stay that people have at the hotel on an ongoing basis. It is of much greater importance and influence on that impression of the brand than the logo and the relative size of the words 'The Belfry' and the words 'De Vere' … Again [in reference to the new hotel logo] I can see no precedent in my experience of branding at all, let alone in this industry, where this arrangement of graphics could be deemed to have been calculated to transfer equity. It is just not how equity is created. Brand equity is not created by choice of typeface and relative size between chain brand and property name…."

140. In my judgment Mr Schmidt's approach is to be preferred to Mr Matthews's and I do prefer it. He recognised and articulated the obvious point that brand images in service industries such as the hotel industry are not made or lost on logos alone. They may represent the brand but the goodwill attaching to the brand is dependent on so much more. People do not choose to stay at a hotel because of a brand logo. They stay at it because, for example, they enjoyed their last stay there; because they have been seduced by its brochures; because their friends have told them how good it is; or because their stay at one hotel in a chain so impressed them that they wish to sample another chain hotel.
141. Quinn's case is, however, that the likely effect of the new hotel logo is that over a period of time a material part of the goodwill attaching to The Belfry name, and therefore to The Belfry itself, will migrate to De Vere so that when in 24 years' time De Vere's tenure comes to an end Quinn will find itself saddled with a hotel which was a mere shadow of its once famous former self. In my judgment there is no evidential basis whatsoever for such an assertion; and to attempt to mount it on the introduction of the new De Vere hotel logo in the context in which that logo has been used is to build a case on sand. The facts are that over its 35 years of ownership De Vere's skill at hotel management created a flagship hotel of national and international renown known as The De Vere Belfry, which by early 2005 Quinn had identified as a "landmark and quintessentially English property" (even better than Wentworth) that it had no hesitation in buying with minimal prior due diligence. It was De Vere's management and marketing expertise which had created such a must-have asset. Its re-branding exercise (the proposals for which Mr Quinn would have learnt about at the time of purchase if he had had the patience to listen to what Mr Leaver wanted to tell him about The Belfry and De Vere) is simply a continuing manifestation of De Vere's marketing initiatives, directed at enhancing the profile of the De Vere chain and of all the hotels in it (including The De Vere Belfry), emphasising the quality of the De Vere management provided at all its hotels (including The De Vere Belfry) and so increasing the goodwill attaching to all those hotels (including The De Vere Belfry). Whether the re-branding will in fact have this commercial consequence is something which the court cannot know, although if I were required to assess its likelihood, I would regard it as more likely than not. The only question that in this context the court is asked to decide is whether De Vere's use of The Belfry marks in its new logo in the type of context in which De Vere has to date so used those marks is "reasonably likely to cause material harm to the goodwill attaching to those trade marks." The burden of proving that is on Quinn and I find that Quinn has not begun to discharge it. The evidence it has adduced consists of the, I find, valueless evidence of Mr Matthews coupled with groundless assertions to the same effect advanced by Quinn. That evidence does not prove the case, and Mr Schmidt's evidence satisfied me that, as matters stand at present, there is nothing in Quinn's case.
142. I add that in so far as it is part of Quinn's complaint that the new material does not make use of the bell logo, I consider there is nothing in the complaint. Virtually no use of that mark was made in De Vere's previous brochures and there is no basis for any suggestion that since March 2005 De Vere has breached some obligation requiring it to give the bell logo more exposure than it has. I record that De Vere is fully aware that it must at least make sufficient use of the bell logo during any five-year period not to incur the risk of its becoming vulnerable to attack based on non-use. I also record Mr Schmidt's opinion that the bell logo is conceptually a mess and that in De Vere's new hotel logo "actually The Belfry speaks more clearly albeit it does not have a fancy typeface." That is, though, of course a matter of opinion, and Quinn is entitled to disagree with it. I also find that there is no evidence that De Vere's re-branding exercise is reasonably likely to cause material harm attaching to the bell logo. Since the use of that logo in De Vere's chain collateral has previously been so minimal, there is no basis for any conclusion that its new chain collateral will somehow damage that mark. The bell logo continues to be used at the hotel itself, where it is prominently in evidence, and it is in particular used in connection with golf activities at the hotel. There is no evidence that De Vere intends to let the bell logo fall into disuse and I find that it does not. I find that there is no basis for any conclusion that De Vere's re-branding exercise will be likely to harm the goodwill attaching to The Belfry name or to The Belfry itself, and so I can similarly also identify no basis on which the re-branding is likely to harm the goodwill attaching to the bell logo.
143. I find that Quinn has failed to establish any breach of clause 6.2.4.2 of the management agreement or of its equivalent in the trade mark agreement.

Has De Vere breached clause 7.3.5 of the management agreement?

144. Clause 7.3 imposes several separate obligations upon De Vere. Clause 7.3.1 requires De Vere to "use" the hotel solely for "the operation of a hotel" and certain further specified purposes. No breach of that obligation is alleged. Clause 7.3.2 requires De Vere (in short) to "establish" all prices, charges, terms and conditions of use for all hotel areas. No breach of that is alleged. Clause 7.3.3 requires De Vere to negotiate and enter into on behalf of Quinn various types of contract related to "the operation of the hotel." No breach of that is alleged. Clause 7.3.4 requires De Vere to supervise, direct and control the collection of income derived from "the operation of the hotel." No breach of that is alleged.
145. Clause 7.3.5, which Quinn does allege De Vere has breached, requires De Vere to:

"keep [Quinn] informed and advised of all material financial and other matters concerning the operation of the Hotel."

146. Quinn's case on this is (i) that De Vere's re-branding exercise was a matter covered by that duty to "inform and advise" and (ii) that De Vere failed to discharge that duty.
147. The first question is whether Quinn is right on point (i). That raises a question of interpretation. As shown by my summary, clauses 7.3.1 to 7.3.4 inclusive are directed at matters concerning "the operation" of the hotel (only clause 7.3.2 does not use such words, although I consider they are implicit). In particular, those sub-clauses concern: (i) the hotel's use, (ii) the prices charged for what it offers, (iii) contracts relating to its operation, and (iv) the collection of income from such operations. Clause 7.3.5 then imposes upon De Vere a duty to inform and advise Quinn of "all material financial and other matters concerning the operation of the Hotel." Clause 7.3.5 is not in the nature of a mere sweeping-up clause because (a) each of the prior clauses is concerned to impose obligations of, as between themselves, a different nature, and (b) it imposes another, again different, obligation. But the common thread linking all five sub-clauses is that they relate to matters concerning "the operation of the hotel". Those words are plainly focusing on what is happening within the hotel itself. They refer to the day-to-day running of its business. In my judgment, it is only "material financial and other matters" which so refer that are subject to De Vere's duty to inform and advise under clause 7.3.5.
148. That being so, I find that De Vere was under no obligation to inform or advise Quinn about its proposal and decision to re-brand itself across its chain of hotels, or to publish new chain collateral reflecting such re-branding and including its new logo. That is because that exercise cannot be regarded as a matter "concerning the operation of the Hotel" within the natural sense of those words in clause 7.3.5 read in the context of clause 7.3 as a whole. I accept that that re-branding had as its objective an intention to increase the goodwill attaching to The Belfry (and of course to all the other chain hotels) and, in consequence, to achieve more business at it. But I do not regard that as sufficient to bring the re-branding proposal within the purview of clause 7.3.5. Why should it? Why should the relatively narrow language of clause 7.3, with its repeated focus on matters relating to "the operation of the hotel" embrace De Vere's marketing policies in relation to its chain hotels as a whole? The sub-clause certainly cannot be said unambiguously so to extend the "inform and advise" obligations; and, if this had been the intention of the agreement, I consider that the provision in which it would be found is clause 7.9, which makes clear that De Vere can market the chain in such way as it from time to time sees fit but also requires it to include The Belfry in any such marketing relevant to The Belfry. If Quinn had required a preview of what De Vere was proposing and planning in that department, that is where the disclosure obligation would have been imposed. None was.
149. On the other hand, this does not dispose of the clause 7.3.5 point, since to the extent that any re-branding involved material "hotel specific" changes (for which Quinn would be paying) I accept and hold that this would relate to the "operation of the Hotel." I find, therefore, that there was a duty upon De Vere to inform and advise Quinn about its proposal to introduce any such material hotel specific changes. I consider that that would extend to the introduction of new signage at the hotel, since I consider that this would be likely to represent a material cost to Quinn relating to the operation of the hotel. It can also be said that, cost apart, the signage is there for the purpose of having an impact upon the guests, and conveying a message to them about the hotel, throughout their stay there so that its mere presence relates to the hotel's operation.
150. The only other hotel specific material is the guest satisfaction surveys, De Vere's new version of which in February 2006 included the new hotel logo. There is no evidence satisfying me that the production of the new forms involved a "material" financial cost, although by like reasoning as that relating to signage, it might be said that the inclusion of the hotel logo on to the new forms would also have an impact on guests during their stay, and therefore can similarly be said to concern the operation of the hotel. I have concluded, however, that this does not follow. The content of the survey forms is of course directed at gathering information which relates to the operation of the hotel. The only thing new about the new survey forms introduced in February 2006 was the change of format I have described, including the new hotel logo. I have found that that change of format did not convey any message to the guest that the name of the hotel had either changed or been re-designated: it merely reminded him of that which he would anyway have known, namely that The Belfry was a hotel in the De Vere chain. It is that change which is the matter about which Quinn is so aggrieved – although I have also found that there is no sound basis for their grievance – but I decline to find that the introduction of that change can be said to concern "the operation of the Hotel." I therefore find that there was no obligation upon De Vere to inform and advise Quinn about the introduction of the new guest satisfaction surveys.
151. The second question that arises is whether De Vere has breached its clause 7.3.5 obligation. For the reasons given, I consider that strictly the only relevant question is whether De Vere breached its obligation to inform and advise Quinn about its signage proposals at The Belfry. But in practice it could not explain those proposals without doing so in the context of the De Vere re-branding as a whole, even if strictly it may not have been required to tell Quinn about the latter. Because of this practical consideration, and in case I am wrong in my conclusion that it had no like obligation in relation to its re-branding as reflected in its chain collateral or in relation to the guest satisfaction surveys, I will assume that it did have a like obligation and will make findings of fact accordingly.
152. There is a fundamental difference of approach with regard to this question. Quinn's position appears to be that De Vere had to tell them all about its re-branding proposals almost before the ink (actual or notional) was dry on any such proposal. Its stance appears to be that De Vere should have informed and consulted it at the earliest possible stage. It also appears to assume that it had some relevant voice in the matter, although I cannot see how that can be derived from clause 7.3.5, which does no more than require De Vere to "inform and advise" of relevant matters: it does not also require it to obtain Quinn's consent before implementing them, and I cannot see that clause 7.3.5 gives Quinn any sort of veto. If Mr Quinn had been prepared to listen to Mr Leaver on 10 January 2005, he would, I find, have been told that De Vere was engaged in consideration of a re-branding exercise, but he chose not to do so.
153. 2005 rolled on and by the late summer Quinn had developed an attitude of palpable hostility towards De Vere. It wanted to terminate the management agreement. De Vere was still proceeding with its re-branding proposals, which by then were well advanced, although they were not yet finalised. The "De Vere at …" construct was in principle decided upon, although its final design (in particular the relative sizes of the two component parts) continued to be worked on until into 2006. De Vere considered questions of signage at its hotels in July and August 2005, when the Endpoint audit was commissioned. But nothing final about signage was decided upon then; nor was it at the property meeting held on 8 December 2005, which related to all the chain hotels, not just The Belfry.
154. I find that no mention of the re-branding exercise was made to Quinn until 24 November 2005, when (so I find) Mr Manby told Quinn of the proposal to introduce a new hotel logo in the "De Vere at …" construct. I find that on that occasion Mr Morgan and Mr Gray saw the Hotels & Resorts logo, which gave them an idea as to how it would work, but (contrary to their evidence) I find they did not actually see either a hard or soft copy of an image of the proposed new hotel logo although I find that Mr Manby explained its nature and the proposal to introduce it. I find that De Vere's omission to inform Quinn of the re-branding proposals before then was not referable to any decision to try and keep it secret, with a longer-term view of springing it on Quinn when it was a fait accompli. If this had been the plan, Mr Manby would not have made the presentation that he did on 24 November or said what he did about the re-branding proposals. I find that the omission to refer to the matter earlier was probably (a) because of (I find) a natural wish to defer informing Quinn of the proposals until they were in a final shape that De Vere was satisfied with, and (perhaps), (b) because there was no meeting before then at which the raising of the re-branding proposals naturally formed any part of the agenda. I reject Quinn's suggestion that the matter ought to have been raised during the negotiations for the amendment of the management agreement, and I have made my findings about that. I find that point (a) had particular application to the signage proposals at The Belfry. Even by early December 2005 De Vere had made no decision about that.
155. The outcome of the meeting of 24 November 2005 was that Quinn was interested in the re-branding proposal and wanted full details by a way of a full presentation. It was primarily interested in how the changes would affect The Belfry itself, in relation to matters such as signage. That was a reasonable viewpoint, which it conveyed by Mr Morgan's letter of 7 December 2005. De Vere received that letter on 14 December 2005 and its immediate response was to offer the requested presentation on 22 December 2005: it was not showing any coyness about telling all. Quinn then decided that it could not wait until then but wanted a preview of the hotel logo and made requests for it, which were refused on the grounds that (a) the presentation was but a few days away, and (b) De Vere wanted Quinn to understand the full brand strategy and its rationale in the proper context, which it would if it could be so patient as to wait for the presentation: De Vere did not want Quinn to jump to erroneous conclusions by looking at the new logo in isolation (as Mr Matthews and Mr Malivoire's panellists were later to do). Quinn then cancelled the presentation, which was instead given to Mr Gray alone on 21 December 2005.
156. In fact, even before the presentation was made to Mr Gray, he and Mr Morgan had already formed their own negative views about the re-branding proposal. They had jumped to the false conclusion that the bell logo was to go and had effectively given a joint thumbs-down to the proposal. This was, I find, an astonishing way to approach the matter. They had been told of the re-branding proposals on 24 November, but had not however then been given full details; they asked for a presentation so that they could be explained to them; and then, before it had been given, they formed the preliminary negative conclusions that I have earlier outlined.
157. The presentation to Mr Gray then went ahead, and there was some difference as to the parties' recollections as to exactly what was or was not said. It is unnecessary to make any detailed findings on that. What I do find is that it was a full and open presentation by De Vere of its re-branding proposals, promptly followed by De Vere's offer to make a further full presentation to Quinn specifically on its signage proposals for The Belfry. That presentation took place on 17 January 2006.
158. The latter exercise proved to be a pointless farce. By 23 December 2005 Quinn's senior management had decided that the re-branding matter was a last straw so shocking that it manifested a breach of trust of dimensions such that Quinn could not continue to be associated with De Vere. This was conveyed by Mr Quinn's letter of 23 December, which I have found to be disingenuous. As from then, De Vere was wasting its time in preparing the signage presentation, because Quinn was simply not interested. Quinn's policy at that meeting was, I find, to play no part in a discussion about De Vere's proposals. It had decided to sue De Vere and was terrified that anything that it might do or say at that stage could weaken its position. Despite this Mr Manby forced the Quinn representatives to listen to his presentation, but reaction to it came there none.
159. In these circumstances, has De Vere failed to discharge its clause 7.3.5 obligation to "inform and advise" Quinn of its re-branding proposals and, in particular (for reasons given), of its signage proposals? In my judgment the answer to that is clear. De Vere's obligation was no more than one requiring it to "inform and advise" and I have explained how it did (or was overtly willing to do) just that, although its discharge of that obligation in relation to signage was not easy, Quinn having decided to make De Vere's performance of that obligation as difficult as it could.
160. I add that there is nothing in clause 7.3.5 as to the time by which such information and advice had to be given. As no signage changes have been effected at The Belfry, there is no rational basis on which Quinn can complain that De Vere did not provide it in proper time (despite Quinn's endeavours to frustrate De Vere's efforts) with proper information and advice about the signage proposals. I find that it is probable that at least some calendars were sent out in December 2005 (perhaps before the presentation to Mr Gray on 21 December), but this was a circulation of material in the nature of chain collateral, and I have given my reasons why De Vere did not have to tell Quinn anything about this anyway.
161. I find, therefore, that De Vere properly discharged its duty under clause 7.3.5 and I reject Quinn's claim that De Vere has breached that duty.
162. In case I am wrong that De Vere had no duty also to inform and advise Quinn about its proposal to introduce the new guest satisfaction surveys in February 2006, I find that De Vere did not make a specific disclosure of this to Quinn in advance. I have considerable sympathy with the view that, after 17 January 2006, they had no duty to do so anyway. By then Quinn was, for practical purposes, refusing to talk to De Vere about re-branding matters, including Belfry specific matters: it was too worried about spoiling its proposed legal action. A duty to inform and advise is, in my judgment, not an entirely unilateral matter. It is, I consider, implicit in such a duty that the party who is entitled to be so informed and advised remains ready and willing to receive such information and advice. If, for example, De Vere had told Quinn that it wanted to discuss the introduction of new survey forms into the hotel incorporating the new hotel logo, and Quinn had said it was not prepared to discuss it, would De Vere have been under an obligation nevertheless to write to Quinn spelling out its proposals? Why should it have to waste its time telling Quinn something that Quinn was closing its mind to? In Mackay v. Dick and Another (1881) 6 App Cas 251, Lord Blackburn (drawing upon the ancient case of 1469 about the great bell of Mildenhall – perhaps in those bygone times as famous as that at The Belfry) said, at 263:

"I think I may safely say, as a general rule, that where in a written contract it appears that both parties have agreed that something shall be done, which cannot effectually be done unless both concur in doing it, the construction of the contract is that each agrees to do all that is necessary to be done on his part for the carrying out of that thing , though there may be no express words to that effect."

163. In my judgment, there is much to be said for the view that, once Quinn adopted its "don't want to play" attitude on 17 January 2006, De Vere was entitled to conclude that it need waste no more time on trying to inform or advise Quinn what it was doing in relation to such a (relatively trifling) matter as the introduction of the slightly changed form of the new guest satisfaction survey. But if I am wrong on that, and De Vere had a duty specifically to inform and advise Quinn – by letter, if Quinn was not prepared to talk – of the proposed introduction of that minor change, then I find that whilst it amounted to a breach of clause 7.3.5, it was a breach of a trivial nature.
164. I find that Quinn has failed to prove any breach by De Vere of clause 7.3.5. I reject Quinn's claim under this head.

Has De Vere breached clause 7.1.1 of the management agreement?

165. Clause 7.1.1 requires De Vere to "perform its duties and responsibilities under this Agreement diligently and faithfully;"
166. I do not understand the sense of this obligation. If De Vere duly performs its obligations under the agreement, on what factual basis might Quinn be able to prove that it had done so otherwise than diligently and faithfully? If De Vere does not perform any of its duties and responsibilities under the agreement, then it has breached them. But how does the non-performance of a contractual duty and responsibility amount to a breach of an obligation to perform the same "diligently and faithfully"?
167. This is all beyond me, but I do not propose to waste any more time on it. I find that De Vere has committed no material breaches of the agreement at all. I have found it has at most committed certain breaches of the clause 5.1 obligation in relation to the use of the hotel logo in printed caption form on the calendar and the advertisements. That appears to have been the result of a somewhat surprising decision by Ms Black. It was not the result of a policy decision by De Vere higher up the hierarchy, the use has stopped and Mr Leaver made it clear in his evidence that he was content for De Vere to abandon any such caption use in the future. I decline to find that De Vere's use of the hotel logo in printed caption form (which, for reasons I will come to later, I regard as having amounted to an immaterial breach) somehow constituted a breach of the clause 7.1.1 obligation. I reject this part of Quinn's claim as well.

Has De Vere infringed any registered trade marks?

168. I am not sure whether any assertion by Quinn to this effect is still alive, but I say shortly that I find that there is nothing in it and I reject it. I find that De Vere has not infringed any trade marks.

Is Quinn entitled to terminate the management agreement?

169. Clause 15 of the agreement contains the termination provisions. Its scheme is first to list so-called "events of default", one of which is explained as follows in clause 15.1.1.14, which provides so far as material as follows:

"the failure of either the Owner or the Operator to perform, keep or fulfil any of its material covenants, undertakings, obligations or conditions set out in this Agreement, and (where such material default is remediable) the continuance of such material default for a period of twenty one (21) days after written notice is given by the other specifying the material failure and requiring it to be remedied …"

170. Under clause 15.1.3 the commission of an event of default by De Vere entitles Quinn to give notice of intention to terminate the agreement. Quinn served a so-called "cure notice" under clause 15.1.1.14 on De Vere on 2 May 2006, requiring it to remedy the breaches identified in it. Whilst De Vere took the view that it had not been in breach at all, it incurred considerable expense in complying with the notice and putting a stop to any further dissemination of material of which Quinn was complaining. I am not sure whether the evidence proves precisely what De Vere has done in that respect, but I need not be concerned with it since in his closing submissions for Quinn Mr Bloch conceded that Quinn could not contend that the breaches complained of in the notice had not been cured. He therefore abandoned any claim that there was any non-compliance with that notice sufficient to entitle Quinn to terminate the agreement. I record that Quinn also served further notices on 10 May and 2 June, but no separate reliance was placed on them as entitling Quinn to succeed in its claim that it is entitled to terminate, or has validly already terminated, the management agreement.
171. Instead Mr Bloch advanced the submission that this was a case where the court could and should (a) be satisfied that De Vere was in default of clause 15.1.1.15 (another event of default clause) and (b) declare that Quinn is entitled to serve a notice terminating the agreement. Clause 15.1.1.15 reads:

"any party has committed any material breach of this Agreement and/or any other agreement between the relevant parties which is not capable of remedy and/or any material breach which, although capable of remedy, is a persistent breach."

172. There was some debate about whether, having first nailed its colours to the "cure notice" mast, it was open to Quinn to run this alternative argument under clause 15.1.1.15, and there was discussion about estoppel and election and so on. I consider, for what little help it may be to Quinn, that it is in principle open to Quinn to rely on this alternative argument. It appeared to be part of Mr Bloch's argument that De Vere's alleged breaches were irremediable ones, although if so it is not easy to understand his concession that De Vere had cured the breaches identified in the cure notice. It was a further part of it that the breaches were persistent ones. And of course it was also part of it that they were material ones.
173. I reject Quinn's case based on clause 15.1.1.15. The only breaches of the agreement that I have found to have been committed by De Vere were the designation of the hotel as De Vere at The Belfry by using the printed caption form of the hotel logo in the calendar and the advertisements. Such use of the hotel logo was the result of a decision apparently made by Ms Black. She does not appear to have consulted anyone else before making that decision. There is no evidence that anyone was misled by any of these publications into believing that De Vere had changed the name of the hotel, and the calendar went out to existing contacts and customers who would anyway know its name. There is no evidence that these publications have caused any damage to the goodwill attaching to The Belfry and it has not been proved that they are likely to have caused, or to cause, any such damage. The use has stopped and Mr Leaver made it plain in his evidence that use of the hotel logo in caption form, with which he anyway did not sympathise, will not be repeated. I find that these breaches of clause 5.1 were not material breaches, and so did not fall within clause 15.1.1.15 at all. If I am wrong on that, I find that they were capable of being remedied by being stopped and that they have been so remedied (Akici v. L R Butlin Ltd [2006] 1 WLR 201 shows that the classes of irremediable breaches are becoming ever narrower: see paragraphs 64 and 65 of Neuberger LJ's judgment). If I am wrong on that, I anyway decline to characterise these isolated breaches as persistent breaches. If I am wrong in my conclusion that the omission to inform and advise Quinn of the proposal to introduce the new guest satisfaction surveys to the hotel was not a breach, I also conclude that it was not a material breach entitling Quinn to rely on clause 15.1.1.15.

Result

174. My conclusion is that Quinn is not entitled to any of the relief it claims against De Vere, and my provisional view is that I should simply dismiss its (or, more accurately, Bouverie 1's) claim. I will, however, hear counsel on the form of the order I should make.