Legal Blog ("Blawg") on Causes of Action and Affirmative Defenses in Texas -- with Caselaw Snippets from Appellate Opinions, and Occasional Commentary on Decisions
Monday, October 5, 2009
Ambiguous vs. Unambiguous Contract: Implications for Summary Judgment, Admissibility of Extrinsic, Parol Evidence
WHEN IS A CONTRACT AMBIGUOUS / UNAMBIGUOUS?
A contract is unambiguous if it can be given a definite legal meaning; if it is subject to two or more reasonable interpretations, it is ambiguous, creating a fact issue on the parties' intent. Webster, 128 S.W.3d at 229; Lopez v. Munoz, Hockema & Reed, L.L.P., 22 S.W.3d 857, 861 (Tex. 2000).
Lack of clarity, however, does not necessarily create an ambiguity, and neither does a mere disagreement between the parties. See Universal Health Servs., Inc. v. Renaissance Women's Group, P.A., 121 S.W.3d 742, 746 (Tex. 2003) (adding that 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"); see also City of The Colony v. N. Tex. Mun. Water Dist., 272 S.W.3d 699, 722 (Tex. App.- Fort Worth 2008, pet. filed) (explaining that when "the meaning of a contract is unambiguous, a party's construction is immaterial").
Question of Law vs. Question of Fact
When a contract contains an ambiguity, the granting of a motion for summary judgment is improper because the interpretation of the instrument becomes a fact issue. Coker v. Coker, 650 S.W.2d 391, 394 (Tex. 1983). Conversely, the interpretation of an unambiguous contract is a matter of law to be determined by the trial court. Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 423 (Tex. 2000).
Effect of Contract Ambiguity (or Absence thereof) on Admissibility of Extrinsic Evidence / Parol Evidence
In its second issue, Vineyard argues that the trial court erred by sustaining Univest's general objection to the purported parol evidence testimony of Collins and by excluding portions of Collins's affidavit because Collins's testimony met the admissibility requirements under the rules of evidence and common law. However, because we have concluded that the terms in the REA are not ambiguous, we must overrule Vineyard's evidentiary issues. See Fiess v. State Farm Lloyds, 202 S.W.3d 744, 747 (Tex. 2006) (recognizing that if the agreement is not ambiguous, courts do not consider extrinsic evidence when interpreting the agreement). Accordingly, we overrule Vineyard's second issue.
SOURCE: 02-08-00496-CV (10/1/09) (Fort Worth Court of Appeals)
Labels:
ambiguity,
parol-evidence-rule
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment