Ambiguities in Construction Contracts
How Does a Court Interpret Ambiguities in Construction Contracts?
In the recent case of Daake v. Decks N Such Marine, Inc., 201 So. 3d 179 (Fla. 1st DCA 2016), the First District Court of Appeal analyzed who were the correct parties to an ambiguous construction contract.
In this case, Decks N Such Marine (“DNS”) entered into a contract to construct a seawall on real property owned by Daake Family Trust. The contract’s first page stated that the agreement was between Thomas and Adele Drake as Owner and DNS as contractor. The first page did not mention the Family Trust. However, in the signature section, Thomas and Adele Drake executed in their corporate capacity as members of the Family Trust.
The Court held that the conflict between the drafted provision and the handwritten notation on the signature created an ambiguity as to who was a party to the seawall contract. The Court applied the following rules of contract construction:
- The primary rule of contract construction is to ascertain the intention of the parties;
- Courts must give contractual language its plain meaning;
- If there is an ambiguity between printed words and written words, the written words ordinarily prevail;
- Ambiguities are construed against the drafter of the contract; and
- A contract must be interpreted in a manner that does not render any provision meaningless and arrive at a reasonable interpretation of the entire agreement to accomplish its stated meaning and purpose.
The Court held that applying the rules of contract construction, the handwritten notation on the signature should prevail as a clear expression of the Family Trust’s intention to enter into the contract. The Family Trust was the owner of the property. The agreement had a provision giving consent by the owner to the recording of construction liens. If the agreement was not with the Family Trust, this provision would have been meaningless. Therefore, the trial court correctly found that the contract with DNS was with the Family Trust and not Thomas and Adele Drake individually.
It is important to ensure that your construction contracts are clear and unambiguous. This provides certainty in contracting. If the agreement is ambiguous, the contract will be construed and interpreted in accordance with the above-stated rules.share