[Updated 19 Dec. 2021: I belatedly realized I misunderstood the holding of the English case!]
Thanks to this blog post by Mark Anderson, I learned of a new English court opinion on endeavours provisions in a case before the Technology and Construction Court. O frabjous day! (Not really.)
The opinion in question is CIS General Insurance Ltd v IBM United Kingdom Ltd [2021] EWHC 347 (TCC) (here). At issue was whether someone had taken “all reasonable steps.” The syllogism one of the litigants argued for was that all reasonable steps is the same as all reasonable endeavours which is the same as best endeavours.
Here’s what Mrs Justice O’Farrell had to say about that:
Although an obligation to use best endeavours is likely to encompass all reasonable steps that could be taken, it might extend to more than an accumulation of moderate or sensible steps. It is conceivable that the circumstances of a particular case could require the party with such an obligation to go further, such as taking steps that were against his own financial interests, or steps that required extraordinary efforts. Such steps are unlikely to fall within the scope of a ‘reasonable endeavours’ obligation.
That’s as clear a mud, so I’ll take Mark’s word on this:
In other words, “all reasonable endeavours” is a variant of “reasonable endeavours”, and case law on reasonable endeavours is relevant, rather than case law on best endeavours.
I suppose we can count it as a modest victory that the judge apparently didn’t attribute any particular significance to all in this context. Here’s what my 2019 law-review article on efforts (and endeavours) provisions says about all (footnotes omitted):
Despite caselaw suggesting otherwise, in the phrase all reasonable efforts the word all is a rhetorical flourish. Like the word best in best efforts, the word all is delexicalized in all reasonable efforts and so does not affect meaning. The same is true of use of all in with all due respect and all best wishes. When the U.S. Supreme Court used the phrase “all deliberate speed” in Brown v. Board of Education to direct how quickly schools had to integrate, no one suggested that the word all affected its meaning. It’s not surprising that all is prone to being delexicalized—it’s the 43rd most common word in modern English.
But beyond that, the judge sticks with addled English orthodoxy—best endeavours is a more onerous standard than is reasonable endeavours.
Why do I persist in poking my nose into English handling of endeavours? Because efforts is used to the same effect in the US as endeavours is used in England. The drastic difference between US and English caselaw is entirely a legal construct and can be attributed to the legalistic bent of English courts. That tendency is also on display in how English courts approach the phrase represents and warrants (see this 2015 law-review article), their position on nominal consideration (see this 2016 blog post), and the significance attributed to condition and warranty (see this 2018 blog post).
Maybe one day an audacious English barrister will introduce an English court to my 2019 article. That’s perhaps less crazy than it appears, as the influential Delaware Chancery Court called my article “The most thorough analytical treatment of efforts clauses” and called me “The leading commentator on efforts clauses.” See this 2019 blog post.
Meanwhile, how do drafters stay out of trouble? Easy—stick with just reasonable efforts (or the stodgy endeavours, if you insist). No all, no commercially, no other accretions. See my 2019 article for more on that.
By the way, I applaud Mark on an adept juggling act. He offers a just-the-facts analysis while gently distancing himself from the entire edifice. Bravo!
Ken:
You’ve said this before, but if a drafter really wants to have a reliable hierarchy of efforts provisions, they really ought to define the terms that they use. I did this recently in a contract where I wanted to allow efforts that were less than what a reasonable person under similar circumstances would have done. I could have just said “good-faith efforts,” but I would have doubted whether that would have carried my meaning. The other side had no objection.
So under your guidance, a drafter who really wants all reasonable efforts to mean something different than reasonable efforts like this court did, they should you’ll come up with something explicit, like the compilation of efforts where each effort, standing alone, would be a reasonable effort, even though, taken together, those efforts are more than reasonable efforts. Or if they want best efforts, maybe they want all reasonable efforts together with any additional efforts that the party in question has ever used under similar circumstances.
But whatever it is, they ought to draft it, not just rely on wooly notions that there’s a difference. And this case shows how dangerous is can be to rely on what you think is settled law endorsing such wooly notions.
Specificity = best effort to avoid drafter / counselor malpractice claims? Seriously, why not advocate an Exhibit detail what efforts are and are not expected (perhaps elaborated further, describing triggers or necessary contexts), and/or assumptions? I’ve done and seen such. Particularly useful in industries (pun alert:) exhibiting rapid change and/or variations in vocabulary and/or behaviors in different segments and/or geo-regions (e.g., IT/software?).