V.1. 1. What Is The Fundamental Principle Of New York Law Concerning Contract Language?

• Jurisdiction: New York

1. What Is the Fundamental Principle of New York Law Concerning Contract Language?

The fundamental, neutral precept of New York Contract Law is that contract language is construed in accordance with the parties’ intent.³⁰⁰ The best evidence of that intent is the parties’ executed written contract. A deliberately prepared and executed agreement is assumed to reflect the parties’ intent³⁰¹ which should be gleaned from the document.³⁰² When contract language is clear and unambiguous, the parties’ intent should be found in the language they used and not through evidence concerning their intentions or actions.³⁰³ This sensible proposition of law, that the language of the contract controls, imparts stability to commercial transactions by safeguarding against fraudulent claims, perjury, death of witnesses and infirmity of memory.³⁰⁴ Unless statutory language or public policy dictates otherwise, the terms of a clear and unambiguous written agreement define the parties’ rights and obligations. ³⁰⁵

A court must give effect to the parties’ intent as manifested in the words they chose to use. The court’s role is to ascertain that intent at the time the parties entered into their contract.³⁰⁶ The court initially determines that intent from the language the parties expressed in their contract. ³⁰⁷

If a contract is clear and unambiguous, a court must take care not to alter or go beyond the express terms of the agreement. Terms should not be added to those agreed upon by the parties.³⁰⁸ The court may not impose obligations on the parties that are not mandated by their agreement. The court should be...