Most contract disputes involve issues of interpretation. Even seemingly innocuous contract language can give rise to vehement disagreements over its proper meaning. Indeed, one famous American contractual interpretation case began with the sentence, "The issue is, what is chicken?": Frigaliment Importing Co. v. B.N.S. International Sales Corp. What followed was a comprehensive examination of the meaning of the word "chicken" — a word which would hardly seem to be one that could engender much debate — in the context of the particular agreement.
Resolving questions of contractual interpretation is everyday work for the courts, which face such issues far more often than they face issues of substantive contract law. Doctrines such as offer and acceptance, consideration and unconscionability may be standard fare in first-year contracts courses in law school, but they rarely arise in practice. For the parties, the financial stakes of an interpretation case can be enormous: consider, for example, the famous "Rogers comma," in which a $2-million dispute turned on the effect of a comma.
Yet until now no book has focused exclusively on contractual interpretation by Canadian courts. This void in the legal literature has now been filled by Geoff R. Hall, a litigation partner in the firm’s Toronto office (and also the Editor-in-Chief of this publication), who has authored Canadian Contractual Interpretation Law, published by LexisNexis Canada Inc. in October 2007.
Canadian Contractual Interpretation Law undertakes a thorough overview of the law of contractual interpretation in all common law provinces. It begins with an examination of certain fundamental precepts which are the cornerstone of contractual interpretation in all cases, including the factual matrix, commercial efficacy, the parol evidence rule and the contra proferentem rule. It then considers a number of other elements of contractual interpretation, such as whether prior drafts, subsequent conduct and dictionaries can be considered by a court when interpreting a contract. It discusses the interpretation of a number of different types of contracts (such as employment contracts, guarantees and releases) and the interpretation of a number of different types of clauses (such as arbitration clauses, best efforts clauses, entire agreement clauses, exemption clauses and time-is-of-the-essence clauses). It also reviews implied terms, agreements to agree, rectification and the ever-confusing duty of good faith in the performance of contractual obligations.