Investors Compensation Scheme Ltd v West Bromwich Building Society
[1998] 1 WLR 896
判决理由
Contractual interpretation is an objective exercise ascertaining the meaning a reasonable person with all the background knowledge available to the parties would give to the language used. The background includes anything that would have affected the way the language would have been understood by a reasonable man, but excludes prior negotiations and declarations of subjective intent.
事实
Investors who had been badly advised to enter 'home income plans' had claims both against the building society and against their solicitors and others. Under a scheme run by the Investors Compensation Scheme (ICS), each investor assigned their claims to the ICS in return for compensation, but the assignment reserved certain claims to the investor. A dispute arose over the true meaning of the badly drafted assignment clause — in particular whether a particular claim had been assigned to the ICS or retained by the investor.
判决摘要
The House of Lords, in a much-cited speech by Lord Hoffmann, restated the modern principles of contractual and documentary interpretation, holding that a clause which, read literally, produced a nonsensical result should be read to give effect to what a reasonable reader would understand the parties to have meant. Lord Hoffmann set out five principles: (1) interpretation is the ascertainment of the meaning the document would convey to a reasonable person having all the relevant background knowledge available to the parties; (2) that background — the 'matrix of fact' — includes anything that would have affected the way the language would have been understood by a reasonable person; (3) but it excludes the parties' previous negotiations and declarations of subjective intent (admissible only in a claim for rectification); (4) the meaning of a document is not the same as the meaning of its words, since words can be construed against their background to yield a meaning the parties could not have intended literally; and (5) while people are not readily taken to have made linguistic mistakes, especially in formal documents, where something has clearly gone wrong with the language the law does not require judges to attribute to the parties an intention they plainly could not have had. The case is the leading modern restatement of interpretation, later refined in Rainy Sky v Kookmin Bank and Arnold v Britton.
关键引述
"Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties."
— Lord Hoffmann
后续处理
The leading restatement of interpretation principles, refined in Rainy Sky v Kookmin Bank and Arnold v Britton.
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