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THE UNCERTAIN FUTURE OF V.

Lloyd's Maritime and Commercial Law Quarterly

THE UNCERTAIN FUTURE OF WALFORD V. MILES

Alistair Mills and Rebecca Loveridge *

In Walford v. Miles, the House of Lords decided that a contractual clause containing an agreement to agree, or to negotiate in good faith, would not be enforceable. Lord Ackner suggested that there were two reasons for this decision: first, such a clause would be too uncertain to enforce, since the court could not be certain as to what terms to impose; and secondly, such a clause would be out of line with the inherently adversarial position of contracting parties. It is argued that the reasoning in Walford is faulty and that recent decisions of the Court of Appeal and the High Court concerning mediation and the Civil Procedural Rules indicate that the fears of the House of Lords in that case were ill-founded. Furthermore, French courts have not entertained such fears. The decision in Walford pays insufficient respect to the intentions of the parties as enshrined in the text of the written contract.

1. INTRODUCTION

Agreements to use reasonable endeavours to agree, or to negotiate in good faith, were found to be unenforceable in a number of notable decisions, the highest in terms of authority being that of the House of Lords in Walford v. Miles.1 The reasoning behind the decision of the House of Lords in Walford on this point appears to be twofold. First, the courts could never be certain of what constituted reasonable behaviour in a negotiation process and could therefore not determine whether the parties had in fact breached this duty.2 Secondly, the positions of parties negotiating a contract are inherently adversarial and, as such, enforcement of an agreement to negotiate in good faith would be out of line with this.3
This decision has been subject to some refinement and criticism in subsequent cases but, as will be discussed below, its substance remains intact. It will be argued that Lord Ackner’s reasoning was flawed in respect of both of the grounds for his decision. The case
THE UNCERTAIN FUTURE OF WALFORD V. MILES

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