Jet2 Com Limited v Blackpool Airport [2012] EWCA Civ 417

The Court considered the meaning of "best endeavours" in a countersigned letter agreement which contained the following at clause 1:

" and BAL will co-operate together and use their best endeavours to promote's low costs services from BA and BAL will use all reasonable endeavours to provide a costs base that will facilitate's low cost pricing." 

Jet2, a low-cost airline, entered a 15-year contract with BAL, the owner and operator of Blackpool Airport, to operate flights there. 

Clause 2 of the letter agreement dealt with operational matters, but said nothing about opening hours. For the first four years of the contract, BAL allowed to arrive and depart outside of its published opening hours and BAL ran at a loss. BAL then gave one week to change its schedules so as to conform with BAL's published opening hours.

Jet2 sued for breach of contract, having first obtained an interim injunction against BAL, which allowed Jet2 to continue operating its schedule. In its defence, BAL argued that its duties to use best or all reasonable endeavours did not require it to act against its own commercial interests. It was agreed that best and all reasonable endeavours, in the context of this case, meant the same thing. The question which arose was whether, in light of the language in clause 1, BAL was under an implied obligation to accept arrivals and departures of Jet2's aircraft outside of normal opening hours.  

At first instance, the Commercial Court held that the best endeavours duty included an obligation to provide flexible opening hours. The performance of this duty did not allow scope for BAL to consider its own commercial interests. The Commercial Court did not, however, go as far as specifying the operating hours that BAL must provide for the remainder of the contract in satisfaction of that duty.

The Court of Appeal upheld the decision with the majority rejecting the argument that the best endeavours clause was too uncertain to be upheld. The nature of a low cost airline is such that it depends on early morning and late night operating schedules and the evidence before the Court supported the finding that the parties agreed and understood that. Moreover, the parties had intended to enter into a binding agreement on the terms set out in the letter of agreement. It was held that BAL's losses did not justify its actions: the very fact that a party has agreed to use best endeavours pre-supposes that it may be put to some financial cost. However, the extent to which a party can have regard to its own financial interests will depend upon the nature of the particular contract. 

On the one hand, an endeavours clause could be too uncertain to enforce where a contract provided no objective criteria by which to judge whether a party's endeavours were adequate. However, this was not the case where the obligations gave rise to a clear binding obligation but the precise limits of the obligation were unclear. Such a distinction was not made by the dissenting Judge. Here, the Judge found that where a contract is silent on a particular issue (i.e. the issue of keeping the airport open to's operating requirements), the default position must be that the issue was not covered, and the clause was too uncertain to be enforceable in that respect.

However, the decision serves to reinforce the principle that endeavours clauses will, when possible, be upheld. Nonetheless, the parties should be clear as to what the objective of such a clause is: if that is unclear, or if there is nothing against which to measure a party's attempt to achieve the objective, the clause may well be deemed too uncertain to enforce.