Neither the partner nor the witness server instance for data...

Question

 I am getting this error while trying to setup mirroring.
"Neither the partner nor the witness server instance for database "shop" is available. Reissue the command when at least one of the instances becomes available. (Microsoft SQL Server, Error: 1431)"

I am just using principal and mirror server, there is no witness server. I have tried fully qualified name and ip for the servers also. I can connect from the principal server to the mirror server using the management studio and it also creates endpoints on prinicipal and witness. But then gives me an error that it cannot find the instance of the mirror server and if I try again it gives the error above. I can also telnet to port 5022.

I have used -T1400 as the startup parameter.

I did the backup and recovery based on this link http://msdn2.microsoft.com/en-us/library/ms189053.aspx and the mirror server is in recovery mode now.