On the traditional grounds that it was a mere ‘agreement to agree’ in Shaker v Vistajet Group Holding SA, [2012] EWHC 1329 (Comm). The letter of intent in question related to a potential purchase of aircraft, under which a deposit would be repaid if the parties failed ‘despite the exercise of good faith and reasonable endeavours’ to conclude a final deal.

The LOI stated that it was non-binding, for one thing, but Teare J of the Commercial Court went further: agreements to negotiate in good faith or to make best efforts to reach an agreement cannot be enforceable because there are generally no objective criteria by which reasonableness can be assessed (the parties themselves may have differing views on it) and because acting in good faith is ‘inherently inconsistent with the position of a negotiating party’. Objective criteria to assess reasonableness could exist (as in Petromec Inc v Petroleo Brasileiro SA, [2005] EWCA Civ 891), but did not in this case.

[Links available here and here].