The court considered what were the obligations undertaken by a party contracting to use reasonable endeavours.
Held: The question is one of substance, not form, to be determined objectively. Lewison J said: ‘the essence of the obligation required Yewbelle to use reasonable endeavours to reach an agreement, not with the other party to the contract, but with a third party. To that extent it seems to me that at the very least Phillips is a useful analogy. In using reasonable endeavours towards that end, I do not consider that Yewbelle was required to sacrifice its own commercial interests.
I come back to the question: for how long must the seller continue to use reasonable endeavours to achieve the desired result? In his opening address, Mr Morgan said that the obligation to use reasonable endeavours requires you to go on using endeavours until the point is reached when all reasonable endeavours have been exhausted. You would simply be repeating yourself to go through the same matters again. I am prepared to accept this formulation, subject to the qualification that account must be taken of events as they unfold, including extraordinary events.’
Judges:
Mr Justice Lewison
Citations:
[2006] EWHC 3166 (Ch)
Links:
Jurisdiction:
England and Wales
Cited by:
Cited – Rhodia International Holdings Ltd. Rhodia UK Ltd v Huntsman International Llc ComC 21-Feb-2007
The parties contracted for the sale of a chemical surfactants business.The claimant had contracted to use reasonable endeavours to obtain the consent of a third party for the assignment a a contract to supply energy to the business. The defendant . .
Cited – Irwin v Wilson and Others ChD 23-Feb-2011
The claimant sought a declaration that his contract for the sale of leasehold property to the defendants had been lawfully terminated by a letter from his solicitors. The defendants had moved in before completion, but the claimant found himself . .
Appeal from – Yewbelle Ltd v London Green Developments Ltd and Another CA 23-May-2007
The parties had entered into a contract for the development of land. Two circumstances operated to make it difficult or impossible, and the court was asked whether the contract was frustrated. The vendor was obliged to use all reasonable endeavours . .
Cited – Venture North Sea Gas Ltd v Nuon Exploration and Production UK Ltd Comc 10-Feb-2010
Application for specific performance of contract. . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 08 July 2022; Ref: scu.246976