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GLOSSARY

Reasonable (or all reasonable) endeavours definition

Published by a LexisNexis Commercial expert

What does Reasonable (or all reasonable) endeavours mean?

This is frequently used in drafting commercial agreements. The term may be the result of considerable negotiation and often represents a compromise.

The terms 'best endeavours', 'reasonable endeavours' and the variations 'all reasonable endeavours', 'commercially reasonable endeavours' or 'reasonably commercial endeavours' and 'utmost endeavours' are frequently used. The precise obligations imposed by each of these terms is far from certain and have frequently been the subject of judicial interpretation with varying results.

These terms represent a range of obligations at different ends of the spectrum. The most onerous obligation which can be imposed is a strict or absolute obligation. Next is the obligation of best endeavours followed by all reasonable endeavours. At the other end of the spectrum is the obligation to use reasonable endeavours.

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Reasonable and best endeavours

This Practice Note considers the terms ‘best endeavours’, ‘all reasonable endeavours’ and ‘reasonable endeavours’ which are frequently used in commercial agreements.Contracting parties usually have a polarised approach to ‘endeavours’ terms, with one party seeking to impose the most onerous form of the obligation on the other party, and the other party trying to resist it. The final position is usually reached following considerable negotiation and often represents a compromise where one party has argued that it is not reasonable for it to be placed under an absolute obligation.This Practice Note considers the relevant case law and the meanings that have been given to the terms:•best endeavours•all reasonable endeavours, and•reasonable endeavoursIt also provides guidance for commercial lawyers to consider when drafting and negotiating such obligations. See: Drafting endeavours clauses below.Absolute obligations compared to ‘endeavours’ obligationsThe most onerous obligation which can be imposed in an agreement is an absolute obligation to do something. An example would be ‘the Seller will deliver the goods’, which will be breached if the obligation is not...

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