(b) Ambiguity

Principle. A contract drafter should at all times avoid creating ambiguity.

Almost every contract contains ambiguities if only as a result of the trade off against the other drafting principles of being concise, using plain language and writing short sentences. This is a paradox because ambiguity is often the result of a drafter’s attempt to accurately capture all circumstances and exceptions potentially applicable in the context. Nevertheless, if it is clear that the scope of a provision does not cover a particular fact or event, it is counterproductive to include an exception. In­cluding the exception permits an argu­ment to be made that the scope of the provision is really intended to be broader than it appears; otherwise why would the exception be included?

Grouping exceptions. An inconsistent use of excep­tions, limitations and qualifications in one sentence may create ambiguity. For example:

Except as … X …, Seller shall not increase the salaries of any employee (other than Y…) above the lev­els in effect on the Signing Date, provided that in­creases may be made when … Z …

The sentence consists of three positions where exceptions are created. In the case of short exceptions, it will read much better if they are placed at the beginning of the sentence. Conversely, if exceptions are voluminous, it is better to place the main point of the cove­nant (i.e. that Seller shall not increase salaries) at the beginning and all the exceptions are consistently placed together in a series at the end or in a separate sentence:

Seller shall not increase the salaries of any em­ployee above the levels in effect on the Signing Date, except that Seller may (a) … X …, (b) increase the salary of Y…, and (c) provide for increases when … Z …

Visual enumeration. If the series is subdivided into enumerated subparagraphs, it would also be possible to create exceptions on exceptions (as would often be necessary, but create an additional source of ambiguity).

Bargaining power. Finally, not clarifying ambiguity may be a drafting strategy favouring the party who will most likely enjoy the benefit of such ambiguity: in the uncertainty about the precise meaning of an ambiguous contract provision, this is often the performing party or otherwise the stronger party. When the performing party and the stronger party are presumably one and the same, not clarifying (or even creating) ambiguities may be a drafting strategy (whatever you think about it).