contradictory. Parol evidence is not admissible in such situations. But in a latent ambiguity, examples of which are the cases first discussed in this sub-section, parol evidence is admissible, as indicated.31

Proof of usage. Although a term is thereby added, or a different meaning is thereby given, evidence of the custom or usage of a trade, or a particular locality, is admissible. For instance, in a contract of marine insurance, there is a warranty of seaworthiness which by custom is always implied.32 In Cooper v. Kane,33 it was held that, where a contract for excavating city lots was silent as to whom the sand and dirt taken out belonged, a well-known custom by which it belonged to the excavator might be shown. The principle permitting the admissibility of proof of such usages is said to rest on the "presumption that in such transactions the parties did not mean to express in writing the whole of the contract by which they intended to be bound, but to contract with reference to those known usages. 1934

In addition to the above, proof of usage and custom is admissible to explain words and phrases, as, for instance, in the use of commercial terms. This evidence is admissible under the rules for explaining terms, already discussed, and because "words perfectly unambiguous in their ordinary meaning are used by the contractors in a different sense from that. * In such cases the evidence neither adds to,

31 Lassing v. James, 107 Cal. 348.

32 Anson, Contracts (Huffcut's 2d ed.), p. 328.

33 19 Wend. 386 (N. Y.).

34 Hutton v. Warren, 1 M. & W. 466 (Eng.); Soutier v. Kellerman, 18 Mo. 509, LEADING ILLUSTRATIVE Cases.

nor qualifies, nor contradicts the written contract; it only ascertains it by expounding the language.” 35 Thus, where the lessee of a rabbit warren agreed to leave 1000 rabbits on the warren, parol evidence was admissible to show that by the local custom 1000 meant 1200.36

In order that a usage may affect a contract, it must meet certain requirements. The usage must not be at variance with a statutory law. Furthermore, the parties may agree that usages shall not enter into the terms of the contract.37 Again, the usage must have been established sufficiently to become generally known; it must be uniform and certain, continued and accepted.38 Although the general rule is that the usage must have been known to the parties, this knowledge will be presumed unless it is affirmatively shown that one party lacked this knowledge.39 Unreasonable or oppressive usages will not be enforced.40 Neither will words of manifest and clear import be given an unnatural meaning.11

Extrinsic evidence in case of mistake. Where an offer has been made through a mistake, or a written agreement is made and through mutual mistake a term of the agreement is contrary to the intention of the parties, it may be shown by parol evidence that the real agreement of the parties was different.42

35 Brown v. Byrne, 3 E. & B. 703 (Eng.). 36 Smith v. Wilson, 3 B. & A. 728 (Eng.).

37 Mansfield v. Stoneham, 15 Gray 149 (Mass.).

38 Dixon v. Dunham, 14 Ill. 324.

39 Nonotuck Silk Co. v. Fair, 112 Mass. 354.

40 Raisin v. Clark, 41 Md. 158.

41 Lawson, Usages and Customs, p. 434.

42 Anson, Contracts (Huffcut's 2d ed.), p. 329.

Courts of equity will rectify a mutual mistake in a deed or writing, and make the document conform to the true intention of the parties. For this purpose, parol evidence is admissible. 43

Thus in Webster v. Cecil,** A offered to X several plots of land for a round sum. Immediately after he dispatched his offer, he discovered that he had made a mistake in adding up the prices. Consequently, the figure was a lower total sum than he had intended. He informed X of the mistake without delay, but not before X had accepted. In resisting a bill for specific performance of the contract in equity, he was permitted to prove the circumstances under which his offer had been made.

Where the mistake is not mutual, extrinsic evidence is admissible in cases where there is an element of fraud, as where the mistake was caused by the party in whose favor it operated and was known to him before the other party changed his position. Usually in such a case a choice is given to the other party of abiding by a corrected contract or having the contract annulled.45

151. Rules of construction.-There are general rules of construction which apply after a contract is proven. Necessarily, if there is no ambiguity and no need of construction, the court may not be called upon to construe the contract.46 On the other hand, in performing their function, courts make use of cer

43 Fowler v. Fowler, 4 De G. & J. 250 (Eng.).

44 30 Beav. 62 (Eng.).

45 Anson, Contracts (Huffcut's 2d ed.), p. 330.

46 Vulcan Iron Works Co. v. Electric Magnetic Gold Mining Co., 99 N. E. 429 (III.), LEADING ILLUSTRAtive Cases.

47

tain rules to aid in determining the intention of the parties. When ascertained, the intention governs, but courts will not necessarily carry out the intent of the individual parties; rather, they will take the intent which is properly construed from the contract itself.48

The first general rule of construction is that words are to be understood in their plain and literal meaning. This rule may lead to consequences the parties did not contemplate. Furthermore, it is subject to the admissibility of evidence of usage. Similarly, technical words are construed in their technical sense.

50

49

The next general rule requires that an agreement receive the construction which will best give effect to the intention of the parties. This is the goal of construction; otherwise, the court would be making the contract, rather than the parties.51

Finally, the intention of the parties is to be ascertained from the whole instrument.

152. Same subject Subsidiary rules.-There are certain rules subsidiary to the three rules indicated. Thus,

(1) Obvious mistakes in writing and grammar will be corrected by the courts. This rule includes another, namely, that the punctuation of a document, though it may aid in determining the meaning, will not control or change a meaning which is plain from

47 Farnham v. Thompkins, 171 Ill. 519.

48 Reed v. Insurance Co., 95 U. S. 23, LEADING ILLUSTRATIVE CASES.

49 Atkinson v. Truesdell, 127 N. Y. 230.

50 Peterson v. Brotherhood, 125 Ia. 562.

51 Ford v. Beech, 11 Q. B. 852 (Eng.); see Wigmore, Evidence, §2462.

a consideration of the whole document and the cir

cumstances.

(2) The court will narrow the meaning of general words by specific and particular descriptions of the subject matter to which they apply.52 In case of conflict between written and printed words, the written words control.5 53

(3) The court will adopt that meaning of a word which will make the instrument valid.5 Similarly, where a contract is susceptible of two constructions, one of which will render it unlawful as being in violation of law or contrary to public policy, that construction will be adopted which will render the contract lawful.55

(4) If possible, without going contrary to the manifest intention of the parties, a contract will be construed so as to render it reasonable rather than unreasonable.56

(5) The court will construe words most strongly against the party who used them. The rule is based on the principle that a man is responsible for ambiguities in his own expressions.57 Thus, words in an offer are construed most strongly against the offerer.

153. Rules as to penalties and liquidated damages. -Where a sum certain is to be paid by A, party of a

52 Philips v. Barber, 5 B. & A. 161 (Eng.); Stettauer v. Hamlin, 97 Ill. 312.

58 Sturm v. Boker, 150 U. S. 312.

54 Anson, Contracts (Huffcut's 2d ed.), § 345; Rankin v. Rankin, 216 Ill. 132.

55 United States v. Central Pac. R. R. Co., 118 U. S. 235.

56 Pressed Steel Car Co. v. Eastern Ry. of Minn., 121 Fed. 609; Gillet v. Bank of America, 160 N. Y. 549.

57 Anson, Contracts (Huffcut's 2d ed.), § 345; American Surety Co. v. Pauly, 170 U. S. 160.