Best Endeavours Clauses – No Longer a Bridge too Far
Journal article | December 2014 | Available for purchase & free for members
On 5 March 2014 the High Court of Australia held that the nature and extent of a best endeavours clause in a commercial agreement was necessarily conditioned by what is reasonable in the circumstances and that an obligor’s freedom to act in its own best interests, in matters to which the agreement relates, is not necessarily foreclosed or to be sacrificed by an obligation to use reasonable endeavours to achieve the contractual object. This holding substantially waters down over a century of learning to the effect that ‘best endeavours’ meant leaving no stone unturned to achieve the contractual object. Scope now exists for the obligor under a best endeavours clause to keep an eye to the protection of its own interests and still be compliant with the obligation.
We thank the author of this article Dr Josh Wilson QC and the journal editor Russell Thirgood for their contribution to this journal.