Construing Terms – Structure of Answer
Textbook: 309, Q & A: ?, Study Guide: 101
Admissibility of Evidence
1. When interpreting the meaning of terms implied or imported into contracts, the
significance of those terms becomes the focus of the court.
2. Admissible evidence:
a. The factual matrix, the surrounding circumstances
b. Evidence to resolve ambiguity
c. Evidence to identify the subject matter
d. Evidence to identify the parties, their relationship or capacity
e. Evidence to identify the real consideration
f. Evidence of custom or usage of words in the agreement
g. Evidence to rectify the parties intentions if mutual agreement of parties that
the contract does not accurately record their intentions.
3. Inadmissible evidence:
a. Subjective intention of the parties
b. Prior negotiations
c. Subsequent conduct, although some disparity in Australia (pg 320 TB)
1. Two types of contingencies, conditions precedent and conditions subsequent.
a. Condition precedent will prevent K from coming into existence until such time
as the condition is fulfilled (Perri v Coolangatta Investments)
i. Subject to contract is condition precedent, see Masters v Cameron
b. Condition subsequent will not prevent a K from coming into existence
i. A party may waive a condition subsequent that is solely for his or her
benefit (Meehan v Jones)
ii. Subject to finance agreements are conditions subsequent
1. Does the exemption clause form part of the contract?
a. Refer to notes on incorporation
2. Does the clause cover the damage suffered?
a. Canada Steamship rules of construction
i. If the clause expressly provides indemnity for the person in whose
favour it is made for the consequence of negligence of that person,
effect must be given to it.
ii. If there is no express reference to negligence, the court must consider
whether the words used are wide enough to cover negligence. If there
is any doubt, it must be resol