Staffing Specifix, Inc. v. TempWorks Management Services, Inc.

ROSS, Judge

(concurring specially)

I agree that a new trial is necessary because the district court’s instructions directed the jury to overemphasize one contract interpretation tool over any relevant evidence. I write separately because I believe that the majority’s remedy—announcing a new rule of law that allows the jury to apply the contract interpretation tool only as a last resort—goes beyond the question presented and also tends to un-deremphasize the interpretation tool in a way not required by Minnesota caselaw. I therefore concur in the result but not in the court’s stated new rule of law.

It is true that some commentators and other jurisdictions have described the doctrine of contra proferentem as a doctrine of last resort, as does the majority, to be employed only after exhausting other interpretive tools designed to discern a contract’s meaning. As we explained in Economy Premier Assurance Company v. Western National Mutual Insurance Company, “In the general context of contract law, contra proferentem has historically been regarded as a last resort, used only when other interpretive methods have failed to reveal the parties’ intent.” 839 N.W.2d 749, 754 (Minn. App. 2013) (citing 5 Joseph M. Perillo, Corbin on Contracts § 24.27 (rev. ed. 1998)). But we went on in Economy Premier to report that, at least with regard to insurance contracts in Minnesota (and elsewhere), the doctrine of contra proferentem is often not the last stop but, rather, the first stop in the interpretation of ambiguous contract terms. Id. at 754-55.

And the doctrine has been frequently described by the supreme court, even outside the insurance context and outside the adhesion-contract context, with no hint that it is relegated to the bottom of the interpretive-tool kit. For example, in Turner v. Alpha Phi Sorority House, the court explained without qualification, “Where there are ambiguous terms or the intent is doubtful, it is axiomatic that the contract will be construed against the drafter.” 276 N.W.2d 63, 66 (Minn. 1979). That case involved a dispute having nothing to do with insurance and involved no unfair bargaining power; it resolved indemnification language in a contract between a general contractor and a subcontractor in a sorority-house construction project. Id. at 65 .

Although the Turner court did not decide the appeal based on the doctrine, the opinion is informative for another reason: it implies (without deciding expressly) that a district court need not restrict a jury on its use of contra proferentem. In that case, the district court had instructed the jury about the doctrine without today’s new limitation:

The words of an instrument are to be taken most strongly against the party using them. If a contract is prepared by one of the parties and the language is ambiguous, it should be construed most strongly in favor of the opposing party— but read in the sense in which a prudent *137 and reasonable person would have understood it.

Id. at 66 . The district court had also told jurors to decide meaning based on how the parties used words, instructing, “Words are to be given their ordinary popular meaning unless it is obvious that the parties used them with a different meaning.” Id. at 67 (alternation omitted).

After the jury received both instructions—one allowing it to construe ambiguities against the drafter and the other advising it to consider the meaning the parties had given their words—the jury did not merely default to the contra prof-erentem doctrine but interpreted the contract in a manner that resulted in a verdict favoring the subcontract drafter. Id. at 65 . That the jury was capable of hearing both these instructions (without being limited to apply contra proferentem only if necessary) is consistent with the supreme court’s reasoning: “Although the [contra proferentem rule against the drafter] is generally applied, this does not, as [the appellant] seems to suggest, ineluctably lead to the conclusion that the drafter is to lose.” Id. at 67 . And that explanation in context at once both supports the majority’s conclusion today that the district court misdirected the jury here and my concern that the majority’s new rule overly constrains the jury’s deliberative process.

Although the Turner court refashioned the issue as one of law rather than fact despite the jury’s involvement (because neither party had actually given the jury any parol evidence to help it resolve any ambiguity), nothing in its reasoning suggests that a fact finder may construe ambiguous language against the drafter only after the fact finder has exhausted all other means to resolve ambiguities. See id. at 66 . And we relied expressly on Turner when we affirmed the bench-trial damages findings m a business-ownership contract dispute, in part on the maxim that “if the contract’s terms are in any way ambiguous, that ambiguity must be construed against [the appellant], who drafted the agreement.” Mottaz v. Gadbois, 385 N.W.2d 345, 347 (Minn. App. 1986), review denied (Minn. June 13, 1986).

In sum, I agree with the majority that the district court’s contra proferentem instruction in context implicitly directed the jury to decide fact disputes ignoring any potentially relevant parol evidence, and I agree that this improperly restrained the deliberative fact-finding process. But I do not think either the caselaw or the issue on appeal invites us to impose our own restraint on jurors—to the other extreme— prohibiting them from using the doctrine except as a last resort. I think the doctrine’s place in jury deliberations has not been confined and that we should proscribe the erroneous instruction but go no further. I therefore disagree only with the majority’s new jury instruction.