Often when parties are involved in litigation regarding an alleged breach of contract, the outcome of the litigation hinges on the court’s interpretation a written agreement. While the courts seek to strictly adhere to the contract language and enforce its provisions and the intent of the parties, it is sometimes difficult to determine exactly what the parties intended when they entered into the agreement. In other words, the contract language is ambiguous.
In Guerrant v. Roth, a law firm brought suit against a former client, asserting it was due additional fees under its legal fee agreement. The parties disagreed as to which expenses were recoverable by the firm. Specifically, the parties disagreed as to the interpretation of a provision in the contract which stated, “these expenses include court reporting services, expert witness fees, reasonable travel expenses, if any, fees paid to trial witnesses and the cost to create demonstrative trial exhibits.” The firm argued the items following the word “include” were merely illustrations, and not limitations as to which costs were recoverable. Its former client, on the other hand, argued that any item not specifically enumerated in this list was not included in the contract, and, therefore, not recoverable.
In evaluating the terms of the contract, the court noted that it will find a contract ambiguous if it is subject to more than one interpretation. In this case, the court decided the legal fee agreement was subject to different interpretations and, therefore, the agreement was ambiguous. Following a long line of established Illinois case law, the court construed the agreement against the drafter. The court stated the reasoning behind this rule: the party preparing the agreement is deemed to be more knowledgeable as to the expressed intent of the parties.
In those few instances when the intent of the parties cannot be clearly expressed, possibly because of a highly complex or technical subject matter, or as a result of an omitted comma or misplaced modifier, the preparer of a contract can prevent a later determination of ambiguity from being construed against it by insertion of the following provision: the parties to this contract jointly participated in the preparation of this contract. Hence, ambiguities should not be attributed to either party.
If you have questions regarding the interpretation of a contract or are considering becoming a party to a contract, please contact a member of the firm.