Is there a distinction in civil law between the concepts of
"best efforts" and "reasonable efforts"? Many
lawyers have had this discussion when negotiating various
commercial agreements. It must be said that there is much less case
law on this subject in Quebec than in the other Canadian
In December 2014, however, in Cemar Electro Inc. v.
Grob Textile AG1, the Superior Court confirmed
that in Quebec civil law, there is in fact a distinction between
these two concepts. This decision of the Superior Court is
therefore consistent with the common law decisions on the
The facts of the case relate to an action in damages on the
grounds that the defendant company, Grob Textile AG (Grob), had not
used its best efforts in promoting the products of Cemar Electro
Inc. (Cemar). The parties had entered into an exclusive
distribution contract containing the following clause:
4.1 The parties agree that during
the term of this Agreement, the DISTRIBUTOR shall:
4.1.1 use its best efforts to
advertise and promote the sale of the Products in the Territory and
to make regular and sufficient contact with the present and
potential customers of the DISTRIBUTOR;
The issue was therefore whether Grob had used its best efforts
in performing its obligation to promote the sale of Cemar
Having read the various provisions of the contract in issue, the
Superior Court held that Grob had indeed agreed to use its best
efforts. The judge pointed out that sales could have increased if
Grob had made "more" or "better" efforts.
The decision states that if Grob had not wanted to use its best
efforts to promote Cemar products, it should simply have terminated
the contract in accordance with its provisions.
The Court awarded damages corresponding to the profits lost by
Cemar, after estimating the sales that would have resulted had Grob
used its "best efforts" as the contract required.
In the decision, the Superior Court specified that an obligation
to use "best efforts" is more onerous on the party having
undertaken it than the obligation to use "reasonable
Accordingly, in negotiations and discussions concerning the
drafting of various commercial contracts, we must keep in mind that
contracts governed by Quebec law will have to be tailored to the
clearly stated needs and expectations of each of the parties. We
must be careful to use the concept of "reasonable
efforts" or "best efforts" judiciously in situations
involving obligations of means. The distinction may be very
important, depending on the context.
1. 2014 QCCS 5814.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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