Interpretation of Conflicting Clauses in a Contract Uk
06.12.2021 by lozontaInterpreting conflicting clauses in a contract in the UK can be a complicated task. It requires a thorough understanding of the legal principles that govern the interpretation of contracts. Conflicting clauses in a contract often arise when two or more provisions appear to contradict each other. The challenge for the parties involved is to determine which clause takes precedence.
The first step in interpreting conflicting clauses is to examine the language used in the contract. The words used in a contract are crucial in determining the intention of the parties. A court will typically give effect to the plain and ordinary meaning of the words used. If the meaning of the words is clear and unambiguous, that meaning must be given effect.
However, when there are conflicting clauses in a contract, it is possible that the language used is not clear and unambiguous. In such cases, the courts will look beyond the words themselves and consider the surrounding circumstances. This approach is known as the `factual matrix` or `contextual approach.`
Under this approach, the courts will consider the commercial context in which the contract was formed. This includes the background, the purpose of the contract, and any known negotiations between the parties. If a particular interpretation of the contract would lead to a commercially absurd result, the court may reject that interpretation in favor of one that is more commercially reasonable.
Another factor that courts will consider when interpreting conflicting clauses is the order of precedence. Some contracts will include a provision that sets out a hierarchy of clauses. For example, a contract may state that in the event of a conflict between a general provision and a specific provision, the specific provision takes precedence.
Ultimately, the goal of interpreting conflicting clauses in a contract is to give effect to the intention of the parties. If the parties intended for a particular clause to take precedence over another, that intention should be given effect. However, if the intention is not clear, the courts will use various tools to determine the most commercially reasonable interpretation.
In conclusion, interpreting conflicting clauses in a contract in the UK requires a thorough understanding of the legal principles that govern contract interpretation. The language used in the contract, the factual matrix, the commercial context, and any hierarchy of clauses will all be important factors in determining which clause takes precedence. Overall, the goal of contract interpretation should be to give effect to the intention of the parties, while also ensuring that the interpretation is commercially reasonable.