Legal Definitions - ambiguity doctrine

The ambiguity doctrine, also known by its Latin name contra proferentem, is a fundamental principle in contract law. It dictates that if a term or provision within a contract is unclear, vague, or can be reasonably interpreted in more than one way, a court will typically interpret that ambiguous language against the party who drafted the contract. The purpose of this doctrine is to encourage parties to draft contracts with precision and clarity, and to protect parties who may have less bargaining power or were not responsible for the confusing language.

Here are some examples illustrating how the ambiguity doctrine applies:

• Business Lease Agreement: Imagine a small business leases office space. The lease agreement, drafted by the landlord, states that the tenant is responsible for "all utility costs associated with the premises." After a year, the landlord presents a bill for a portion of the building's common area electricity (e.g., hallway lights, elevator), arguing it's "associated with the premises." The tenant argues "utility costs associated with the premises" only refers to utilities directly metered to their specific office suite.

  How the doctrine applies: The phrase "all utility costs associated with the premises" is ambiguous. It could mean only utilities directly used by the tenant's specific office, or it could broadly include a share of common area utilities. Since the landlord drafted the lease, a court applying the ambiguity doctrine would likely interpret this provision in favor of the tenant, meaning the tenant would only be responsible for utilities directly attributable to their leased office space, not a share of common area utilities.

• Insurance Policy: Consider a homeowner's insurance policy, drafted by the insurance company, which includes a clause stating that damage caused by "water intrusion" is excluded. The homeowner experiences damage when heavy rain causes water to seep through a faulty window seal. The insurance company denies the claim, arguing it's "water intrusion." The homeowner argues "water intrusion" typically refers to events like floods or burst pipes, not gradual seepage from a defect.

  How the doctrine applies: The term "water intrusion" is ambiguous. It could be interpreted broadly to cover any entry of water, or more narrowly to specific types of water damage. Since the insurance company drafted the policy, a court applying the ambiguity doctrine would likely interpret "water intrusion" narrowly, in favor of the homeowner, meaning the damage from the faulty window seal would likely be covered, as it doesn't fall under the narrower interpretation of the exclusion.

• Software Terms of Service: A user signs up for a new cloud storage service. The Terms of Service (TOS), drafted by the service provider, state that the company reserves the right to "modify service features at any time without prior notice." Later, the company removes a popular feature that was advertised as a core benefit when the user signed up. The user complains, arguing that "modify service features" implies minor adjustments, not the removal of a core, advertised feature.

  How the doctrine applies: The phrase "modify service features" is ambiguous. It could mean any change, including removal of major features, or it could imply only minor enhancements or adjustments. Since the service provider drafted the TOS, a court applying the ambiguity doctrine would likely interpret "modify service features" in favor of the user, potentially ruling that the removal of a core, advertised feature without specific notice or compensation was a breach, as it goes beyond a reasonable interpretation of "modification."