The following Dispute Resolution practice note provides comprehensive and up to date legal information covering:
This Practice Note on rules on interpreting contracts (agreements) (also known as construing or the construction of contracts and contractual terms) considers key cases (Rainy Sky v Kookmin, Arnold v Britton, Wood v Capita) and specific rules (or canons) of construction. It should be read in conjunction with Practice Notes:
Contract interpretation—the guiding principles
How to approach a contractual interpretation dispute—a practical guide
The basic approach of contract interpretation as provided by Lord Hoffmann’s five principles in ICS v West Bromwich Building Society (see Practice Note: Contract interpretation—the guiding principles) is supplemented by general rules or guidelines (also known as 'canons of construction') which can be used to assist in ascertaining the meaning of a written contract. This Practice Note considers the most important of these guidelines, namely:
the whole of the document relevant
commercial sense (business common sense) and avoiding an unreasonable outcome
cutting down rights and remedies
saving the document
consistency of terms
mistakes in the contract
contra proferentem principle
ejusdem generis principle
do express terms negative implied terms when interpreting a contract?
weighing the evidence
no oral modification (NOM) clauses
For related guidance on contract interpretation, see Practice Notes:
Contract interpretation—the parol evidence rule
Contract interpretation—admissibility of pre-contractual negotiations and statements
While the issues in a case may narrow to the interpretation of one specific clause, its interpretation must be
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What is a company's constitution?A company’s 'constitution' is defined under the Companies Act 2006 (CA 2006) as including:•the company’s articles of association, and•any resolutions and agreements affecting a company’s constitutionThe CA 2006 definition of 'constitution' is not exhaustive and also
ContractWhere a contract is made by two or more parties it may contain a promise or obligation made by two or more of those parties. Any such promise may be:•joint•several, or•joint and severalWhether an undertaking is joint, several, or joint and several in contract is a question of construction
This Practice Note identifies the main torts (bar negligence and nuisance, which are covered elsewhere in our related content) and their key characteristics. Specifically:•trespass to land•trespass to the person•privacy/defamation•liability for animals•employers' liability•product
An intention to create legal relations is requiredThere are various situations in which a court will hold that an agreement is not binding because, though supported by consideration, it was made without any intention of creating legal relations (see, eg, Blue v Ashley).Did the parties intend to
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