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For years, courts and commentators have debated the circumstances under which extrinsic evidence should be admitted when interpreting contracts.
According to the "plain meaning" school of thought endorsed by acclaimed contract expert Samuel Williston, extrinsic evidence should be admitted to aid construction of a contract only if the document appeared ambiguous on its face. (See Samuel Williston, A TREATISE ON THE LAW OF CONTRACTS, §§ 610, 618 (3d. ed. 1961).)
By contrast, Williston's contemporary, Arthur Linton Corbin, advocated that even the most apparently plain and clear language should be interpreted in light of the circumstances that surrounded the inception of an agreement. (3 Arthur Linton Corbin, CORBIN ON CONTRACTS, § 579 (1960).) Under this approach, any kind of relevant evidence, including extrinsic evidence, may be used to prove the interceding and surrounding circumstances that might shed light on the meaning each party knew the other would impute to the words.
As Corbin recognized, the plain meaning rule merely supplants the extrinsic evidence of the parties with that of the court. That is, the court is "making an interpretation on the sole basis of the extrinsic evidence of its own linguistic experience and education, of which it merely takes judicial notice." (Arthur Linton Corbin, The Interpretation of Words and the Parol Evidence Rule, 50 CORNELL L. Q. 161 at 189 (1965).) The Corbin approach advocates instead that language is malleable and the meaning of a word depends on its context.
Even Oliver Wendell Holmes, often thought of as a plain meaning champion, noted more than a century ago: "It is not true that in practice (and I know no reason why theory should disagree with the facts) a given word or even a given collocation of words has one meaning and no other. A word generally has several meanings, even in the dictionary." (Oliver Wendell Holmes, The Theory of Legal Interpretation, 12 HARV. L. REV. 417 at 417 (1899). See also, Towne v. Eisner, 245 U.S. 418 at 425 (1918): "A word is not a crystal, transparent and unchanged, it is the skin of a living thought and may vary greatly in color and content according to the circumstances and the time in which it is used.") (Holmes, J.).)
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Admitting Extrinsic Evidence in California
February 2008
For years, courts and commentators have debated the circumstances under which extrinsic evidence should be admitted when interpreting contracts.
According to the "plain meaning" school of thought endorsed by acclaimed contract expert Samuel Williston, extrinsic evidence should be admitted to aid construction of a contract only if the document appeared ambiguous on its face. (See Samuel Williston, A TREATISE ON THE LAW OF CONTRACTS, §§ 610, 618 (3d. ed. 1961).)
By contrast, Williston's contemporary, Arthur Linton Corbin, advocated that even the most apparently plain and clear language should be interpreted in light of the circumstances that surrounded the inception of an agreement. (3 Arthur Linton Corbin, CORBIN ON CONTRACTS, § 579 (1960).) Under this approach, any kind of relevant evidence, including extrinsic evidence, may be used to prove the interceding and surrounding circumstances that might shed light on the meaning each party knew the other would impute to the words.
As Corbin recognized, the plain meaning rule merely supplants the extrinsic evidence of the parties with that of the court. That is, the court is "making an interpretation on the sole basis of the extrinsic evidence of its own linguistic experience and education, of which it merely takes judicial notice." (Arthur Linton Corbin, The Interpretation of Words and the Parol Evidence Rule, 50 CORNELL L. Q. 161 at 189 (1965).) The Corbin approach advocates instead that language is malleable and the meaning of a word depends on its context.
Even Oliver Wendell Holmes, often thought of as a plain meaning champion, noted more than a century ago: "It is not true that in practice (and I know no reason why theory should disagree with the facts) a given word or even a given collocation of words has one meaning and no other. A word generally has several meanings, even in the dictionary." (Oliver Wendell Holmes, The Theory of Legal Interpretation, 12 HARV. L. REV. 417 at 417 (1899). See also, Towne v. Eisner, 245 U.S. 418 at 425 (1918): "A word is not a crystal, transparent and unchanged, it is the skin of a living thought and may vary greatly in color and content according to the circumstances and the time in which it is used.") (Holmes, J.).)
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