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Unraveling Plain Meaning, Extrinsic Evidence And the Doctrine of Contra Proferentem
As anyone involved with insurance coverage litigation knows, ” contra proferentem” is Latin for “ the insurer loses.” Contra proferentem is a rule of contract interpretation that requires an ambiguous contract term to be construed against the drafter of the contract. 20-129 Appleman on Insurance Law & Practice Archive ' 129.2. Because the insurer is the author or “profferor” of the insurance contract, contra proferentem, when applied, almost always results in a loss for the insurer. That the doctrine is also called the “contra insurer” rule speaks to the fact that, when interpreting insurance policies, courts sometimes forget that general rules of contract construction still apply. But there may be a trend in the right direction.
Specifically, a number of commentators have identified a trend away from strict application of contra proferentem and the “plain meaning rule” and toward the admission of extrinsic evidence, in some states even where a contract is ostensibly unambiguous. This is based on a recognition of the inherent tension between these two rules on one hand, and, on the other hand, the principle that ascertaining the parties' intent in the formation of contract is paramount. The view that extrinsic evidence shall not be considered to resolve ambiguities in a contract is clearly at odds with the goal of ascertaining the parties' intent. This is essentially the view in those states applying the contra proferentem rule as a first resort in cases of ambiguity. The preclusion of extrinsic evidence to answer the question of whether an ambiguity exists in the first instance is also at odds with the goal of ascertaining the parties' intent.
While states do not appear ready to eschew the application of contra proferentem except in limited circumstances, there does appear to be an evolutionary shift toward applying the doctrine as the “last resort” it should be where extrinsic evidence exists regarding the parties' intent. Either way, the role of extrinsic evidence in resolving insurance coverage disputes should not be overlooked by practitioners.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?