contract content & meaning Flashcards
In a contract drafted by the owner of a commercial fishing company, the company agreed to provide a specified quantity of fresh tuna to a seafood cannery each week during the “summer season” at an agreed-upon rate. The owner of the fishing company honestly understood “summer season” to mean June 15 to September 15. The cannery’s president honestly understood the term to mean May 15 to September 15, as It is understood according to trade usage in the parties’ industry.
The parties have now discovered that they attach different meanings to the term “summer season”
How would a court likely resolve the different meanings attached to the term by the parties?
B/c the fishing company works in the industry, it will be bound by the meaning supplied by trade usage.
The meaning of a term supplied by usage of trade will be observed with respect to a transaction between members of the trade even if one of the parties is not aware of that usage. Here, the commercial fishing company is a member of the trade and will be bound to provide tuna for the “summer season” as defined by trade usage.
Misunderstanding applies when each party attaches a different reasonable meaning to a term. here, the reasonable meaning is supplied by trade usage, not the parties.
