An Anniversary in New Jersey Contract Interpretation

On this date in 1956, the Supreme Court decided Newark Publishers’ Ass’n v. Newark Typographical Union, 26 N.J. 419 (1956).  That unanimous opinion by Justice Heher involved whether the Newark Star-Ledger and one of its unions had agreed to arbitrate a particular labor issue.  But the opinion is best known for containing, in a single relatively short ruling, many of the fundamental principles of contract interpretation.  Many of those principles were stated without citation to authority, though those ideas were doubtless settled ones.  The following two-paragraph excerpt contains the meat of the contract interpretation portion of the opinion, a ruling that is still frequently cited today:

Interpretation is the process of giving meaning to the symbols of expression, taken and compared together in the setting of the circumstances.  A subsidiary provision is not so to be interpreted as to conflict with the obvious ‘dominant’ or ‘principal’ purpose of the contract.  We seek for the intention of the parties; and to this end the writing is to have a reasonable interpretation.  Disproportionate emphasis upon a word or clause or a single provision does not serve the purpose of interpretation.  Words and phrases are no to be isolated but related to the context and the contractual scheme as a whole, and given the meaning that comports with the probable intent and purpose; and thus the literal sense of terms may be qualified by the context.  [Citation].  That which is patently and unmistakably implied is a constituent element of the contractual intention, just as much so as that which is explicitly expressed in terms.  Krosnowski v. Krosnowski, lately decided, 23 N.J. 376 (1956). …

Evidence of the circumstances is always admissible in aid of the interpretation of an integrated agreement, even where the contract is free from ambiguity, not for the purpose of changing the writing, but to secure light by which its actual significance may be measured.  Such evidence is adducible simply as a means of interpreting the writing,– not for the purpose of modifying its terms, but to assist in determining the the meaning of what has been said.  So far as the evidence tends to show, not the sense of the writing, but an intention wholly unexpressed, it is irrelevant.  [Citation].  We are not at liberty to introduce and effectuate some supposed unrevealed intention.  The actual intent of the parties is ineffective unless made known in some way in the writing.  It is not the real intent but the intent expressed or apparent in the writing that controls.  [Citation].

Newark Publishers, along with Krosnowski, another opinion by Justice Heher that was issued several weeks before Newark Publishers, contains most of the principles of contract interpretation that are still the law today.  Having those rules all in one (or two) places makes fundamental contract interpretation research easy.

 

 

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  1. […] in 1956, the Supreme Court decided Friedman v. Tappan Development Corp., 22 N.J. 523 (1956).  Like Newark Publishers’ Ass’n v. Newark Typographical Union, 26 N.J. 419 (1956), decided just one week earlier, Friedman was an opinion by Justice Heher that […]

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