When two parties are involved in a misunderstanding as to the meaning of a term of the contract, which of the following is usually applied by the court to settle the matter?
A) The court will find that there is no contract because there is no meeting of the minds.
B) The equitable remedy of rectification
C) Caveat emptor
D) Non est factum
E) The most reasonable interpretation of the terms.

Question

Quizplus · Accepted Answer

When two parties have a disagreement over the meaning of a term in a contract, the court will typically try to determine the most reasonable interpretation of the term based on the language used and the intent of the parties at the time the contract was formed. The court will look for evidence of the parties' intent in the contract itself and in any surrounding circumstances, such as negotiations or prior dealings between the parties. The court will often apply the rule of contra proferentem, which states that any ambiguities or uncertainties in the contract should be resolved against the party that drafted it. This approach helps ensure that both parties are treated fairly and that the contract is interpreted in a way that reflects the parties' true intentions.

When Two Parties Are Involved in a Misunderstanding as to the Meaning