You Be the Judge! Interpreting Contract Language at Issue in a Recent Connecticut Case

The following language was at issue in a recent case before the Appellate Court of Connecticut, Loso v. Loso, 132 Conn. App. 257 (2011):

The defendant agrees to pay for one-half the cost of Sarah’s college educational expenses for a four year degree net of scholarships or grants, subject to the limitation that said cost shall not exceed the tuition for a full-time residential student at UCONN-Storrs.

Was the defendant’s liability capped at half the tuition for a full-time residential student at UCONN-Storrs, or was it capped at the full amount of that tuition? Here’s what the court said:

Contrary to the characterization by the court, we conclude that the language in the modified agreement pertaining to the apportionment of Sarah’s college educational expenses between the parties is clear and unambiguous. Because one half the cost of educational expenses at Sacred Heart University is greater than the tuition for a full-time residential student at UCONN-Storrs, there is no doubt that the cap amount applies. Nor is there any doubt that the cap amount is the cost of tuition for a full-time residential student at UCONN-Storrs. The first clause of the provision pertaining to the payment of educational expenses—”[t]he defendant agrees to pay for one-half the cost of Sarah’s college educational expenses for a four year degree net of scholarships or grants”—expressly indicates that the defendant is obligated to pay one half of Sarah’s educational expenses less scholarships and grants. The second clause of that provision, which is the source of the parties’ disagreement, provides that that arrangement is “subject to the limitation that said cost shall not exceed the tuition for a full-time residential student at UCONN-Storrs.” The defendant’s payment obligation is therefore capped at the full amount of tuition for a full-time residential student at UCONN-Storrs.

Yet, the defendant argues that the adjective “one-half” that modifies the noun “cost” in the first clause of the sentence, which determines his obligation when the cap does not apply, simultaneously modifies the noun “tuition” in the second clause of the sentence in which his payment obligation is capped. In this sense, the defendant implicitly asks us to change long settled rules of construction in order to effectuate the modification of a noun by an adjective in an entirely separate clause of the provision. Not even the most generous interpretation of the modified agreement supports the defendant’s contention that his obligation to pay his daughter’s college expenses is capped at one half of the tuition of a full-time residential student at UCONN-Storrs.

I suggest that most readers wouldn’t interpret this provision the way the court did, that instead they’d assume that “said cost” in the second sentence refers to “the cost of Sarah’s college educational expenses for a four year degree net of scholarships or grants.” That would mean that the the defendant shouldn’t have had to pay more than half of the UCONN-Storrs amount. What do you think?

This case should serve as yet another reminder that if your contracts allow for alternative meanings, even ones that aren’t entirely reasonable, you shouldn’t be surprised if a disgruntled contract party picks a fight. And you also shouldn’t be surprised if a court decides to favor the less reasonable meaning.

Here’s how I would have drafted the provision at issue to achieve the meaning sought by the defendant:

The defendant shall pay half the cost of Sarah’s college educational expenses for a four-year degree net of any scholarships and grants, up to an amount equal to half the tuition for a full-time residential student at UCONN-Storrs.

By the way, why bother saying one-half when half works just as well.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.