December 6 – Interpreting a Contract

“It is well-established that the test for interpretation and certainty of the terms of a contract is objective. One party’s views about the agreement, or how it would later work, not agreed to by the other side, is irrelevant. See Ko v. Hillview Homes Ltd. 2012 ABCA 245 (CanLII), 2012 CarswellAlta 1759 (Alta. C.A.) at para. 26, citing, among other cases, Eli Lilly & Co. v Novopharm 1998 CanLII 791 (SCC), [1998] 2 SCR 129.

The case of Neher v. Kossowan, 2008 CarswellAlta 847 (Alta QB) confirmed that when construing an agreement, the court must give effect to the plain meaning of the words used unless it would result in an absurdity to do so. Words other than terms of art are to be construed in their ordinary and natural sense.  It is also noted that the same rules govern the interpretation of domestic contracts as govern the interpretation of contracts generally (see Krone v. Krone, 2011 CarswellNfld 67, at para. 112 quoting  James G. McLeod & Alfred A. Mamo, Annual Review of Family Law, (Toronto: Thomson Carswell, 2008) at page 625.)”

Carrigan v Brewer, 2012 ONSC 6952 (CanLII) at 21 and 25