I’m still in the weeds on efforts, so please indulge me. Consider the following (emphasis added):
- In UBH (Mechanical Services) Ltd v. Standard Life Assurance Co. T.L.R., 13 Nov. 1986 (Q.B.)., the court said that “the phrase ‘all reasonable endeavours’ is probably a middle position somewhere between the other two, implying something more than reasonable endeavours but less than best endeavours.”
- In Rhodia Int’l Holdings Ltd v. Huntsman Int’l LLC [2007] EWHC 292 (Comm), the court said, “An obligation to use reasonable endeavours to achieve the aim probably only requires a party to take one reasonable course, not all of them, whereas an obligation to use best endeavours probably requires a party to take all the reasonable courses he can.”
- And this is from Kim Lewison, The Interpretation of Contracts § 16.07 (6th ed. 2017): “Although the content of such an obligation is a question of interpretation of the contract in question, it is probable that an obligation to use best endeavours is more onerous than an obligation to use reasonable endeavours.”
What do all these quotations share? Use of the word probably or probable.
I don’t understand it. To quote a useful English authority, Richard Calnan, Principles of Contractual Interpretation 13 (2d ed. 2017), “The purpose of contractual interpretation is to establish the intention of the parties to the contract. This is done objectively: what would a reasonable person understand their common intention to be from what they have written?”
You won’t find in Calnan’s book, or any other authority I’ve looked at, anything suggesting that contract interpretation is a function of the probability of a given meaning.
Can anyone explain this?
The explanation is that the courts and commentators are grasping at straws trying to infer a subjective intention on the parties’ part in the total absence of real evidence that there was any. Courts start with the proposition that words mean what they ordinarily mean unless there’s another (subjective) intent in evidence. The only word in any of these terms that has an objective meaning, vague as it is, is “reasonable.” Since all the other constructs are capable of multiple meanings depending on the linguistic context, as you have so eloquently demonstrated, a court has nothing to go by except what it thinks the parties actually *did* mean (“probably” here, um, probably meaning more than 50% likely). What they should do, of course, in the total absence of evidence on a (mutual) subjective understanding of the language, is default to the only measurable standard, which is “reasonable,” and leave the rest to fall away into the abyss of superfluous babble. In the US that is by and large what has happened; it is the peculiar curse of the English legal profession (noble mavericks like Mark Anderson excepted) that they cannot break out from the box of categorical reasoning mocked by Charles Dickens among many others.
I think that sums it up nicely!
I won’t defend gradations of endeavours; I am with you on that. A drafter should either define the levels of effort required, or set a cap, a floor, or both, or leave the whole thing to vague ‘reasonableness’ (implicit in ‘efforts’, explicit in ‘reasonable efforts’).
But I fear drawing an oversharp distinction between ‘objective’ and ‘subjective’ meanings. In practice the distinction amounts to which nonparties’ understanding will be decisive.
If two parties contract about a widget, and each has a different understanding of what ‘widget’ means, a court can (1) find no contract (minds failed to meet), or (2) rule for a meaning supported by other ‘subjects’ whose consensus will be labeled ‘objective’ (eg authors of The Widget Industry Enchiridion).
In short, one can call a purported meaning ‘objective’, but it is still a meaning held by one or more persons at one or more places for one or more periods of time, whose view a person appointed to decide the dispute deems authoritative and imposes on the parties over the protests of one or both.
Defining the level of effort required may well be wise, particularly if you are demading an uncommonly high level of effort. (“Party A shall spend as much money and as much time as is necessary to….”)
Ken:
Putting a litigator’s hat one for a moment, suppose that the contract in question requires the seller to make “all reasonable efforts” to deliver electronic widgets. Assume that the evidence shows that there are exactly two reasonable ways to deliver the electronic widgets; that is, each method is reasonable standing on its own. Now assume that the evidence also shows that using both methods (including using a second after the first fails) is not reasonable, but could have been rendered reasonable by a change in the economics of the deal — such as by increasing the price.
That feels to me, from an after-the-fact litigator’s perspective, that maybe there’s a function that could be ascribed to the word “all.” That after-the-fact perspective is what judges must endure, so I feel for them. But from a before-the-fact drafter’s perspective, that’s just too much burden for one little three-letter word to bear. If you, as the buyer, expect me to fail over to a second delivery method, we ought to contract for that expressly, and not leave it to such a weak instrument.
Chris
The judges are so caught up in the “different words MUST mean different
things” canon that they’re unable to say “these are all sloppy ways of saying
the same thing and the lawyers did a mediocre job of drawing different lines if that’s what they meant to do.”