Final answer:
The canons of contract construction are a set of principles that guide the interpretation and understanding of contracts. The 8 principles include the plain meaning rule, parol evidence rule, contra proferentem rule, objective theory of contract, interpretation in light of circumstances, custom and usage in trade, maximizing effectiveness, and good faith and fair dealing.
Step-by-step explanation:
The canons of contract construction are a set of principles that guide the interpretation and understanding of contracts. These principles help determine the rights and obligations of the parties involved in a contract. The 8 principles are:
- Plain meaning rule: The words in a contract are given their ordinary and plain meaning.
- Parol evidence rule: Oral or written evidence outside of the contract cannot be used to contradict or add terms to the contract.
- Contra proferentem rule: Ambiguous contract language is interpreted against the party who drafted the contract.
- Objective theory of contract: The intention of the parties is determined by focusing on their outward behavior and the objective meaning of their words.
- Interpretation in light of circumstances: Contracts are interpreted in light of the circumstances existing at the time the contract was made.
- Custom and usage in trade: Customary practices and trade usage are taken into account in interpreting contracts.
- Maximizing effectiveness: The courts will interpret the contract to give it the most effective operation possible.
- Good faith and fair dealing: The parties to a contract are expected to act in good faith and deal fairly with each other.