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Contracts/Contra proferentem
Template:ContractLaw Construction contra proferentum is the rule of contract interpretation that where a provision's meaning is ambiguous, it should be read against the party who wrote it. That is, the preferred interpretation will be the one that helps the party who drafted it the least.
The reasoning behind this rule is to encourage the drafter of a contract to be as clear and explicit as possible and to take into account as many foreseeable situations as he can.
Additionally, the rule reflects the court's inherent dislike of standard-form take-it-or-leave-it contracts (e.g., standard form agreements all club members must sign). The court perceives such contracts as displaying an unfair or uneven bargaining position. To compensate for this, the court applies contra proferentem to take a strict approach and at times, striking down the terms to the favour of the other party.
Contra proferentem also places the cost of losses on the party who was in the best position to avoid the harm. This is generally the person who drafted the contract. An example of this is the insurance contract, a great example of the contract of adhesion, above. There, the insurance company is the party that is completely in control of the terms of the contract and is generally in a better position to, for example, avoid contractual forfeiture. This is a principle of long standing. See, for example, California Civil Code §1654 (“In cases of uncertainty . . . the language of a contract should be interpreted most strongly against the party who caused the uncertainty to exist." California enacted this section in 1872. Numerous other states have codified the rule as well.
