Astor Management AG & Anr v Atalaya Mining Plc & Others

[2017] EWHC 425 (Comm)

This was a case where there was discussion about whether an undertaking to use reasonable endeavours (or “all reasonable endeavours” or “best endeavours”) to enter into an agreement with a third party was enforceable. It was also held that in addition to the suggestion that Atalaya was in breach of their obligation to use all reasonable endeavours to obtain a senior debt facility, they also owed implied obligations of good faith to do so. Mr Justice Leggatt disagreed. Such a requirement would be subsumed within the express obligation to use all reasonable endeavours. The Judge said that:

“A duty to act in good faith, where it exists, is a modest requirement. It does no more than reflect the expectation that a contracting party will act honestly towards the other party and will not conduct itself in a way which is calculated to frustrate the purpose of the contract or which would be regarded as commercially unacceptable by reasonable and honest people. This is a lesser duty than the positive obligation to use all reasonable endeavours to achieve a specified result which the contract in this case imposed.”