Contract Ambiguity as a defensive claim

AMBIGUOUS CONTRACT ARGUMENT [Claim that contract sued on is ambiguous as a defense to enforcement of the contract as a matter of law without parol evidence] “Whether a contract is ambiguous is a question of law that must be decided by examining the contract as a whole in light of the circumstances present when the contract was entered.” Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587, 589 (Tex. 1996). Only where a contract is ambiguous may a court consider the parties’ interpretation and “admit extraneous evidence to determine the true meaning of the instrument.” Nat’l Union Fire Ins. Co. of Pittsburgh, Penn. v. CBI Indus., Inc., 907 S.W.2d 517, 520 (Tex. 1995) (per curiam). When is a contract provision ambiguous, and when not? A contract is not ambiguous merely because the parties have conflicting interpretations of the contract. Columbia Gas, 940 S.W.2d at 589. A contract is ambiguous only when its meaning is uncertain or it is reasonably susceptible to more than one meaning. Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). Question of law vs. question of fact precluding summary judgment When a contract is not ambiguous, the construction of the written instrument is a question of law for the court that is reviewed de novo. MCI Telecommunications Corp. v. Texas Utilities Elec. Co., 995 S.W.2d 647, 650-51 (Tex. 1999); Coker, 650 S.W.2d at 393. SOURCE: 04-08-00745-CV (9/9/09) (San Antonio Court of Appeals)