The High Court considers the meaning of “reasonable endeavours”: Electricity Generation Corp v Woodside Energy Ltd

The High Court in Electricity Generation Corp v Woodside Energy Ltd [2014] HCA 7 considered the contractual obligation to use reasonable endeavours. The court decided by a majority of four to one that various sellers of natural gas had complied with their obligation to use reasonable endeavours to supply gas to an electricity generator, despite not actually supplying the gas when the sellers had capacity to do so. The majority judgment provides some useful observations about the use of reasonable endeavours obligations and underscores the court's objective approach to construing commercial contracts.