Supp. To § 1.1 The Main Purpose of Contract Law Is the Realization of Reasonable Expectations Induced by Promises

[Go To Main]

(A) The following case cites this section:

(1) Ronan Assocs. v. Local 94-94A-94B, 24 F.3d 447, 146 L.R.R.M. 2445 (2d Cir. 1994) (manifest, not undisclosed intention, controls contract formation; the principal purpose of the law of contracts is ''the realization of reasonable expectations that have been induced by the making of a promise,'' quoting Corbin).

(2) Andrews 44 Coffee Shops Inc. v. TST/TMW 405 Lexington, L.P., 837 N.Y.S. 2d 634, 2007 N.Y. App. Div. LEXIS 6525 (2007) . The court cited Corbin's analysis of the generally accepted rule that a court aims for a practical interpretation of the expressions of the parties to the end that there be a realization of reasonable expectations.

(B) The following cases cited the predecessor to this section:

(1) Partrick v. Guarniere, 204 A.D.2d 702, 612 N.Y.S.2d 630 (2d Dep't 1994) (agreement extending the time for purchaser of real property to obtain a zoning change as a condition precedent to sale did not give seller the unilateral power to extend the time further, since seller could then effectively negate purchaser's power to cancel; though the contract did not specifically state that purchaser must request or consent to extensions, the parties conducted their dealings with that understanding).

(2) Civil Serv. Employees Ass'n v. Patchogue-Medford Sch. Dist., 2 A.D.3d 848, 769 N.Y.S.2d 401 (App. Div. 2003) . The plaintiff employee association alleged that the defendant school district violated the parties' collective bargaining agreement by transferring an employee from a daytime position at a high school to a nighttime position at an elementary school after an altercation with a student. The court allowed the transfer based on its interpretation of the contract, citing Corbin for the general rule that the aim of the court is to give fair meaning to all of the language of a contract and to reach an interpretation of the contract which gives realization to the parties' reasonable expectations.

Supplement to Notes in Main Volume

7. Ohio- Andersen v. Highland House Co., 93 Ohio St. 3d 547, 757 N.E.2d 329 (2001) . The Supreme Court of Ohio held that language in an insurance policy did not clearly, specifically and unambiguously state that coverage for residential carbon monoxide poisoning was excluded. While the court refrained from making a determination on the merits of the ''reasonable expectations'' doctrine that has been adopted by numerous courts in determining the enforceability of terms in insurance policies which may be ambiguous or masked by technical or obscure language (see, e.g., Max True Plastering Co. v. United States Fid. & Guar. Co., 912 P.2d 861 (Okla. 1996) , and cases cited therein), the court suggested that the rationale of that doctrine could apply to the case before it, quoting from Restatement (Second) of Contracts, § 211, comment f ( 757 N.E.2d at 333 ). Parties are not bound by unknown terms in standardized agreements that are beyond the range of reasonable expectation. Similarly, a party who adheres to the other party's standard terms does not assent to a term if the other party has reason to believe that the adhering party would not have accepted the agreement if he had known that the agreement contained the particular term. Reason to believe may be inferred from the fact that the term is bizarre or oppressive, from the fact that it eviscerates the non-standard terms explicitly agreed to, or from the fact that it eliminates the dominant purpose of the transaction.