The meaning of phrases such as best efforts; reasonable endeavours; commercial practicable efforts pose a challenge to the interpretation of the scope and effect of contractual covenants and obligations contained in written contracts, whether in lease agreements or contract for the provision of services.
In Jet2.com Ltd v. Blackpool Airport Limited¹, the Court of Appeal ordered that the content of a contractual obligation to use “best endeavours to promote” another person’s business was not so uncertain as to be incapable of giving rise to a legally binding obligation, although it might be difficult to determine whether there had been a breach of it.
The judge held that to what extent a person who had undertaken to use his best endeavours could have regard to his own financial interests, would depend very much on the nature and terms of the contract².
The defendant, a regional airport, claimed that it was entitled to refuse to the plaintiffs claim that it accept aircraft movement outside normal operating hours if that caused it to incur a loss. In this instance, scheduling of aircraft movements outside normal hours was seen as essential to the plaintiffs business – a budget airline - and therefore fundamental to the agreement. The object of the endeavours and the range of possible endeavours must be considered together in order to decide whether there was a justiciable obligation.
The impact of this judgement is that obligations, which must be complied with or performed on a best endeavours basis, are not necessarily automatically unenforceable. There is an important difference between a clause whose content is so uncertain that it is incapable of creating a binding obligation, and a clause which give rise to a binding obligation, the precise limits of which are difficult to define in advance. The object of the endeavours and the range of possible endeavours must be considered together in order to decide whether there was a justiciable obligation. In determining “best endeavours”, the judge held the extent to which a person who undertakes to perform certain obligations on this basis can have regard to his own financial interests, will depend very much on the nature and terms of the contract.