Canons of Construction(redirected from Contract Construction)
Canons of Construction
The system of basic rules and maxims applied by a court to aid in its interpretation of a written document, such as a statute or contract.
In the case of a statute, certain canons of construction can help a court ascertain what the drafters of the statute—usually Congress or a state legislature—meant by the language used in the law. When a dispute involves a contract, a court will apply other canons of interpretation, or construction, to help determine what the parties to the agreement intended at the time they made the contract.
When considering a statute, a court will apply rules of construction only when the language contained in the statute is ambiguous. Under the "plain-meaning" rule, if the intention of the legislature is "so apparent from the face of the statute that there can be no question as to its meaning, there is no need for the court to apply canons of construction" (Overseas Education Ass'n v. Federal Labor Relations Authority, 876 F.2d 960 [D.C. Cir. 1989]). Thus, before even considering what canons to apply, the court must first determine whether the statute in question is ambiguous. Courts have generally held that a statute is ambiguous when reasonably well-informed persons could understand the language in either of two or more senses (State ex rel. Neelen v. Lucas, 24 Wis. 2d 262, 128 N.W.2d 425 ).
If a statute is found to be ambiguous, the court then applies a variety of canons, or rules, to help it determine the meaning of the statute. Issues of statutory construction are generally decided by the judge and not by the jury. In interpreting statutes, a judge tries to ascertain the intent of the legislature in enacting the law. By looking to legislative intent, the court attempts to carry out the will of the lawmaking branch of the government. This philosophy has its origins in the English Common Law first established over four hundred years ago. As the legal philosopher Sir Edward Coke wrote in 1584, "[T]he office of all judges is always to make such construction as shall suppress the mischief, advance the remedy, and to suppress subtle invention and evasions for Continuance of the mischief … according to the true intent of the makers of the act" (Heydon's Case, 3 Co. Rep. 7a, 76 Eng. Rep. 637 [King's Bench 1584]). In more contemporary terms, courts consider the history and nature of the subject matter of the statute; the end to be attained by the law; the "mischief," or wrong, sought to be remedied; and the purpose to be accomplished by the law (Crowder v. First Federal Savings & Loan Ass'n of Dallas, 567 S.W.2d 550, Tex. App. 1978). In determining legislative intent courts usually turn to a variety of sources: the language of the statute itself; the Legislative History of prior enactments on a similar subject; the proceedings surrounding the passage of the law, including debates and committee reports; and, if they are available, interpretations of the law by administrative officials.
To aid in the interpretation of an ambiguous law, a court may also look to more "intrinsic" rules not related to the activities preceding the passage of the statute. These rules are applied to help the court analyze the internal structure of the text and the conventional meanings of the terms used in the law. In addition, intrinsic rules may be used when the court has little or no existing legislative history, such as that provided by committee reports or records of other proceedings, to draw on in interpreting the statute.
Some of these canons of construction are expressed in well-known Latin phrases or maxims. Under ejusdem generis (of the same kind, class, or nature), when general words follow specific words in a statute in which several items have been enumerated, the general words are construed to embrace only objects similar in nature to the objects enumerated by the preceding specific words of the statute. Ejusdem generis saves the legislature from having to spell out in advance every contingency to which the statute could apply. For example, in a statute granting a department of conservation the authority to sell "gravel, sand, earth or other material," a court held that "other material" could only be interpreted to include materials of the same general type and did not include commercial timber (Sierra Club v. Kenney, 88 Ill. 2d 110, 57 Ill. Dec. 851, 429 N.E.2d 1214 ). In the opposite situation, where specific words follow general ones, ejusdem generis is also applied; again, the general term embraces only things that are similar to those specifically enumerated.
Another Maxim of statutory construction is expressio unius est exclusio alterius. Roughly translated, this phrase means that whatever is omitted is understood to be excluded. Thus, if a statute provides for a specific sanction for noncompliance with the statute, other sanctions are excluded and cannot be applied (Sprague v. State, 590 P.2d 410 [Alaska 1979]). The maxim is based on the rationale that if the legislature had intended to accommodate a particular remedy or allowance, it would have done so expressly; if the legislature did not provide for such an allowance or event, it should be assumed that it meant not to. The maxim has wide application and has been used by courts to interpret constitutions, treaties, wills, and contracts as well as statutes. Nevertheless, expressio unius est exclusio alterius does have its limitations. Courts have held that the maxim should be disregarded in cases in which an expanded interpretation of a statute will lead to beneficial results or will serve the purpose for which the statute was enacted.
Judges face different challenges when interpreting the terms of a contract. As a result, different canons exist to aid a court in resolving a dispute between the parties to a contract.
As in statutory construction, in a contract dispute the court gives contract terms their plain and ordinary meaning, interpreting them as ordinary, average, or reasonable persons would understand them (Rains v. Becton, Dickinson & Co., 246 Neb. 746, 523 N.W.2d 506 [Neb. 1994]). If the language of the contract is clear and unambiguous, there is no room for further interpretation and the court will enforce the contract as written. By doing so, the court gives effect to the parties' intentions in making the contract and avoids adding its own interpretation to the agreement.
If the contract contains ambiguous terms, however, they are strictly construed against the party who drafted the contract. This rule of Strict Construction is often applied in contracts containing exculpatory clauses, or provisions that attempt to insulate a party, usually the party who drafted the contract, from liability. Thus, when a clause in a contract between a health club and a member, in which the member waived her right to bring legal action for injuries she suffered at the health club, was held to be ambiguous, it was construed strictly against the health club and it was found to be invalid (Nimis v. St. Paul Turners, 521 N.W.2d 54 [Minn. App. 1994]).
A court may look to other canons of construction or interpretation if it determines that the terms of a contract are ambiguous. In business situations, the court may consider the course of dealing or Course of Performance, that is, the pattern of conduct observed in previous transactions between the parties. Such evidence can help the court determine the intent of the parties at the time they entered the contract and provides additional terms that, though they are not expressly contained in the agreement, the court can use to interpret the contract. Thus, where one party to the contract alleges that the other breached the contract by failing to make payment in the proper manner, and the contract contains no express provisions concerning payment, the court can consider how the parties handled the issue of payment in previous transactions to resolve the issue (AROK Construction Co. v. Indian Construction Services, 174 Ariz. 291, 848 P.2d 870 [Ariz. App. 1993]).
A court can also look to usage of trade to aid its interpretation of an ambiguous agreement. A usage of trade is a commercial practice or industry custom "having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to a particular agreement" (Restatement [Second] of Contracts § 222 ). As a result, if a contract is unclear about how shipment of a specific type of goods is to be handled, the court can consider evidence of general industry practice in the area to help determine what the parties intended with respect to shipment.
Ruff, Anne. 1999. Contract Law. London: Sweet and Maxwell.
Spiropoulos, Andrew C. 2001. "Making Laws Moral: A Defense of Substantive Canons of Construction." Utah Law Review (fall): 915–63.