Quick thread from a practical commercial law perspective on 'best endeavours' clauses

1.

The starting point is a firm obligation

[X] shall do [Y]

In the event that [X] does not do [Y] then [X] will be in breach

An absolute obligation the breach of which triggers a remedy by, ahem, automatic operation of law

2.

But sometimes, [X] is not in control of whether [Y] can be done - it may depend on third parties, or regulatory approval, etc

[X] then has to then decide whether it wants to take the risk of non-performance of an absolute obligation (and back the risk off with insurance etc)

3.

[X] may instead want an 'endeavours' clause instead of a firm commitment

The theory is that this means [X] still has to do everything under its control to meet the obligation, and will not be in breach as long as [X] does do everything it can

4.

As a general rule of thumb - 'best endeavours' is often taken to mean 'everything one can, including at additional expense' and 'reasonable endeavours' means everything one can without going to extra expense

5.

But - that is general theory

In practice, such 'endeavours' clauses are used to evade obligations and are notoriously difficult to enforce, still less litigate

How do you prove, etc?

Litigators love or hate them depending on which side they are on in a dispute

6.

Ideally, a contract should spell out the contingencies that could prevent an obligation being met, and allocate risk accordingly, rather than leave it to the catch-all of an 'endeavours' clause.

The joy of contract law

7 & ends.

ps

An English court would find it hard to accept that an 'endeavours' clause would require you to commit the tort of interfering with another contract https://twitter.com/andrew_dowd/status/1354723653288648704