In leases and contract wording, the term ‘Endeavours’ has several applications – parties should adopt the correct wording for the correct purpose and care is needed to get this right to avoid disputes later on…
“Endeavours” are usually referred to by parties in leases and contracts when it is not possible for them to foresee exactly what kind of action will need to be taken in order to fulfil the aim that they are trying to achieve. For example, a lease may state that a party has to use their endeavours to maintain common parts of the land. However, there will be a precise level of endeavours required in order to achieve this; these levels are split up into the following – “best”, “all reasonable” and “reasonable”.
Reasonable endeavours
Reasonable endeavours are the least onerous form of endeavours required within a contract. These require the party who is agreeing to the obligation to take a reasonable course of action to fulfil the aim they are trying to achieve, as long as this is not harmful to their own commercial interests. If the party can show that they have taken a reasonable course of action, there is unlikely to be any further obligation on them to achieve the aim, even if there are other avenues available to do so.
Best endeavours
Contrastingly, best endeavours are the most onerous standards to be met. For this, the party in question must use everything in their power to achieve the desired results in the circumstances. In this instance, the steps taken must be sensible, determined and those which a reasonable person, acting in their own interests to achieve that result, would take. Unlike reasonable endeavours, everything possible must be done by the party for the purposes of best endeavours, even if this is to their own detriment.
All reasonable endeavours
All reasonable endeavours are seen as a compromise between best endeavours and reasonable endeavours. However, as the use of this term can be varied, the overall interpretation of it is open to uncertainty. On the whole, a party obligated to meet this term will have to explore all reasonable courses of action available to it. Unlike with best endeavours, a party will generally not be required to sacrifice their own commercial interests, unless the contract itself states otherwise.
Overall, it is therefore prudent for parties to consider which of these terms is best suited, and achievable, to them when negotiating the terms of a contract or lease. Terms should be precise and set out the exact nature of the obligation and parties to commercial contracts and leases should seek legal advice before agreeing to by bound by such obligations. If there is a contractual dispute, the matter could be taken to court and become subject the interpretation of a judge so it is vitally important for parties to understand what their obligations are as well as the consequences that can arise from a failure to do so.
Lawson West has extensive experience in acting for parties in commercial property leases and contracts.
For more information, please contact commercial property solicitor, Rebecca Beswick, on 0116 212 1021 or email rbeswick@lawson-west.co.uk.
Read more about the Lawson West Commercial Property team here.
Please note that this is a basic overview only and should not be construed or relied upon as advice. This summary is strictly confidential and should not be released to any third party without our express written consent, except in circumstances where required by applicable laws or regulation. Lawson West Solicitors Limited accepts no duty of care to any third party in connection with this summary.
