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From http://www.jcsisle.com/royall.html:
Around the year 1000 AD, those in attendance to the king of a country (these might be personal servants, bodyguards or gentlemen and ladies attached to the royal court for various reasons of state or the personal preference of the king or queen) were known as "ye royal families" or "ye familie royal". This title applied only to those who lived in the residence of the king or who attended him on his missions. A son of royal blood would be Prince John. He might have a personal servant or bodyguard by the name of John. This John became: John of ye royal familie". If he were freed by the king or became a freeman by wars or acts, he would still go by the only name he knew, only he dropped part of his title. He became: john royal (no capital letters). He was not of the so called royal blood and this caused confusion and bitter resentment among the nobility. By kingly decree, the family was ordered to spell their name differently and they did this by adding an additional L to royal.