Chapter 87

COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 1CHAPTER 87 INTERPRET ATION OF CONTRACTS § 87101. Uniformity of Interpretation. § 87102. How Contracts are Interpreted. § 87103. Intention of Parties Ascertained. § 87104. Intention from Language. § 87105. Interpretation of W ritten Contracts. § 87106. When Writing to be Disregarded. § 87107. Effect to be Given Every Part. § 87108. Several Contracts Together . § 87109. Interpretation on Favor or Contract. § 87110. Words in Usual Sense. § 87111. Technical W ords. § 87112. Law of Place. § 87113. Contra cts Explained by Circumstances. § 87114. Contracts Restricted to Evident Object. § 87115. Interpretation of Sense Intended. § 87116. Particular Clauses Subject to General Intent. § 87117. Contract: Part Written, Part Printed. § 87118. Repugnances Reconc iled. § 87119. Inconsistent W ords Rejected. § 87120. Against Whom W ords are to be T aken. § 87121. Reasonable Stipulations Implied. § 87122. Necessary Incidents Implied. § 87123. Time of Performance, Contract. § 87124. When Joint, Several. § 87125. Execut ed, Executory Distinguished. § 87101. Uniformity of Interpretation.

mplied. § 87122. Necessary Incidents Implied. § 87123. Time of Performance, Contract. § 87124. When Joint, Several. § 87125. Execut ed, Executory Distinguished. § 87101. Uniformity of Interpretation. All con tracts, whether public or private, are to be inter preted by the same rules except as other wise provided by this Title and Titles 19, 20 and 21 of this Code. SOURCE: CC § 1635. COMMENT : The original section refers only to 'this Code'. This Guam Code Annotated titles referred to here are those containing what was the Civil Code of Guam. § 87102. How Contracts are Interpreted. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 2A contract must be so interpreted as to give effec t to the mutual intention of the parties as it existed at the time of contracting, so far as the same is ascertainable and lawful. SOURCE: CC § 1636. § 87103. Intention of Parties Ascertained. For the purpose of ascertaining the intention of the parties to a contract, if otherwise doubtful, the rules given in this Chapter are to be applied. SOURCE: CC § 1637. § 87104. Intention from Language.

the purpose of ascertaining the intention of the parties to a contract, if otherwise doubtful, the rules given in this Chapter are to be applied. SOURCE: CC § 1637. § 87104. Intention from Language. The lan guage of a contract is to govern its interpreta tion, if the lan - guage is clear and explicit, and does not involve an absurdity . SOURCE: CC § 1638. § 87105. Interpretation of Written Contracts. When a contract is reduced to writing, the intention of the parties is to be ascertained from the writing alone, if possible; subject, however, to the other prov isions of this Chapter . SOURCE: CC § 1639. COURT CASES ; See T.S.S. Sportswear , Ltd v . Swank Shop, 380 F .2d 512 (CA 9 1967). § 87106. When Writing to be Disregarded. When through fraud, mistake, or accident, a written contract fails to express the real i ntention of the parties, such intention is to be regarded, and the erroneous parts of the writ ing disre garded. SOURCE: CC § 1640. COURT CASES : See Scharff v . Bank of Hawaii , 432 F .2d 160 (CA9 1974). § 87107. Effect to be Given Every Part. The whole of a contract is to be taken together , so as to give effect to every part, if reasonably practicable, each clause

Hawaii , 432 F .2d 160 (CA9 1974). § 87107. Effect to be Given Every Part. The whole of a contract is to be taken together , so as to give effect to every part, if reasonably practicable, each clause helping to interpret the other . SOURCE: CC § 1641. § 87108. Several Contracts T ogether . COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 3Several contracts relating to the same matters, bet ween the same parties, and made as parts of substan tially one transac tion, are to be taken together . SOURCE: CC § 1642. § 87109. Interpretation on Favor or Contract. A contract must receive such an interpretation as will make it lawful, operative, def inite, rea sonable, and capable of being carried into ef fect, if it can be done without violat ing the intention of the parties. SOURCE: CC § 1643. § 87110. W ords in Usual Sense. The words of a contract are to be understood in their ordinary and popula r sense, rather than according to their strict legal meaning, unless used by the parties in a technical sense, or unless a special meaning is given to them by usage, in which case the latter must be followed. SOURCE: CC § 1644. § 87111. T echnical W ords.

ning, unless used by the parties in a technical sense, or unless a special meaning is given to them by usage, in which case the latter must be followed. SOURCE: CC § 1644. § 87111. T echnical W ords. Technical words are to be interpreted as usually understood by pe rsons in the profession or business to which they relate, unless clearly used in a different sense. SOURCE: CC § 1645. § 87112. Law of Place. A contract is to be inter preted according t o the law and usage of the place where it is to be performed; or , if it does not indicate a place of pe rfor- mance, accord ing to the law and usage of the place where it is made. SOURCE: CC § 1646. § 87113. Contracts Explained by Circumstances. A contrac t may be explained by reference to the cir cumstances under which it was made, and the matter to which it relates. SOURCE: CC § 1647. § 87114. Contracts Restricted to Evident Object. Howev er broad may be the terms of a contract, it ex tends only to tho se things concerning which it appears that the parties intended to contract. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 4SOURCE: CC § 1648. § 87115. Interpretation of Sense Intended.

g which it appears that the parties intended to contract. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 4SOURCE: CC § 1648. § 87115. Interpretation of Sense Intended. If the terms of a promise are ambiguous or uncer tain, it must be interpreted in the sense in which the promisor be lieved, at the time of making it, that the promisee understood it. SOURCE: CC § 1649. § 87116. Particular Clauses Subject to General Intent. Particular clauses of a contract are subordinate to its general intent. SOURCE: CC § 1650. § 87117. Contract: Part Written, Part Printed. Where a contract is partly written and partly printed, or where part of it is written or print ed under the special directions of the parties, and with a special view to their intention, and the remainder is copied from a form originally prepared without special refer ence to the partic ular parties and the particular con tract in ques tion, the written parts control the printed parts, and the parts which are purely original control those which are copied from a form. And if th e two are absolutely repugnant, the latter must be so far disre garded. SOURCE: CC § 1651. § 87118.

arts, and the parts which are purely original control those which are copied from a form. And if th e two are absolutely repugnant, the latter must be so far disre garded. SOURCE: CC § 1651. § 87118. Repugnances Reconciled. Repugnancy in a contract must be reconciled, if possible, by such an interpre tation as will give some effect to the repugnant cl auses, subordinate to the gener al intent and purpose of the whole contract. SOURCE: CC § 1652. § 87119. Inconsistent W ords Rejected. Words in a contract which are wholly inconsistent with its nature, or with the main intention of the parties are to be rejected. SOURCE: CC § 1653. § 87120. Against whom W ords are to be T aken. In cases of uncertainty not removed by the preceding rules, the language of a contract should be interpreted most strongly against the party who caused the uncer tainty to exist. The promisor is presumed to be such COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 5party ; except in a contract between a public officer or body , as such, and a private party , in which it is pre sumed that all uncertainty was caused by private par ty. SOURCE: CC § 1654. § 87121.

5party ; except in a contract between a public officer or body , as such, and a private party , in which it is pre sumed that all uncertainty was caused by private par ty. SOURCE: CC § 1654. § 87121. Reasonable S tipulations Implied. Stipu lations which are necessary to make a contract reason able or conformable to usage, are implied, in respect to matters concerning which the contract mani fests a contrary inten tion. SOURCE: CC § 1655. § 87122. Necessary Incidents Impli ed. All things that in law or usage are considered as incidental to a contract, or as necessary to carry it into effect, are implied therefrom, unle ss some of them are expressly mentioned therein, when all other things of the same class are deemed to be e xclud ed. SOURCE: CC § 1656. § 87123. Time of Performance, Contract. If no time is specified for the performance of an act required to be performed, a reasonable time is allowed. If the act is in its nature capable of being done instantly --as, for exa mple, if it consists in the payment of money only , it must be performed immediately upon the thing to be done being exactly ascertained. SOURCE: CC § 1657. § 87124. When Joint, Several.

-as, for exa mple, if it consists in the payment of money only , it must be performed immediately upon the thing to be done being exactly ascertained. SOURCE: CC § 1657. § 87124. When Joint, Several. (a) Where all the parties who unite in a promise receive some benef it from the consideration, whether past or present, their promise is presumed to be joint and several. (b) A promise made in the singular number, but executed by several persons, is presumed to be joint and several. SOURCE: CC § '1659, 1660 (on the same subject) joined. '1659 is subsection (a) and '1660 is subsec tion (b). § 87125. Executed, Executory Distinguished. An execut ed contract is one, the object of which is fully performed. All others are executory .COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS 6SOURCE: CC § 1661. NOTE: No 1970 Civil Co de '§ 1662 -1666 existed. ----------COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.87INTERPRET ATION OF CONT RACTS