Article by: Nick Bullard – Partner at Dorsey & Whitney LLP Familiarize yourself with the rules of contract interpretation (often called “canons”), if, like me, you didn’t learn them in law school.
Courts rely on these default rules to interpret contracts and statutes. Effective lawyers know the rules and use them to their clients’ advantage—both in drafting and litigation.
Below, I’ve summarized some of the most common rules of interpretation, but there are many others.
Note, these “rules” aren’t absolute; they are more like rough guides.
◼ No Surplusage Rule
– Give meaning to every word and provision. No interpretation should leave a provision without meaning.
◼ Harmonize If Possible Rule
– Interpret provisions in way that makes them compatible, not contradictory.
◼ Negative Implication Rule (“expresio unius”)
– The expression of one thing implies the exclusion of other.
◼ Specific over the General Rule.
– If a general provision conflicts with a specific provision, the specific prevails
◼ Of the Same Kind Rule (“ejusdem generis”)
– Where a general word or phrase follows a list of specific terms, the general word includes only items similar to the specific terms listed.
◼ Against the Drafter Rule (“contra proferentum”)
– Ambiguous contract terms often are construed against the party who drafted them.
◼ Consistent Usage Rule
– The same word or phrase appearing in different parts of a contract has the same meaning throughout.
◼ Fixed Meaning Rule
– Give contract terms the meaning they had when they the contract was executed.
◼ Last Antecedent Rule
– A qualifying clause refers to the immediately prior words or phrases.
◼ Series Qualifier Rule
– When there is a list of nouns or verbs in a series, a modifier at the end of the list usually applies to the entire series.
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