Conscious Ambiguity: Slaying Cerberus in the Interpretation of Contractual Inconsistencies

47 Pages Posted: 28 Aug 2009 Last revised: 6 Sep 2011

Date Written: 2009

Abstract

In United Rentals, Inc. v. RAM Holdings, Inc., Vice Chancellor Chandler rejected conscious ambiguity as a drafting principle. In the face of seemingly inconsistent provisions in the merger agreement between United Rentals and Cerberus, Vice Chancellor Chandler denied United Rentals specific performance because the equipment lessor knew that Cerberus did not think there was a specific performance remedy in the agreement and, therefore, United Rentals was not a forthright negotiator. But underlying the opinion was a message to lawyers that they have a professional and ethical obligation to draft contracts clearly. “Conscious ambiguity” undermines those obligations and is inconsistent with a consent theory of contract. This Article ends by calling for more empirical study of the ethical obligations of lawyers in drafting contracts.

Keywords: Cerberus, United Rentals, RAM Holdings, Conscious Ambiguity. Contract Drafting, Contra Proferentem, Four Corners Rule. Drafting Ethics, Contractual Inconsistencies, Contract Interpretation

Suggested Citation

Duhl, Gregory M., Conscious Ambiguity: Slaying Cerberus in the Interpretation of Contractual Inconsistencies (2009). University of Pittsburgh Law Review, Vol. 71, 2009; William Mitchell Legal Studies Research Paper No. 120. Available at SSRN: https://ssrn.com/abstract=1462213

Gregory M. Duhl (Contact Author)

William Mitchell College of Law ( email )

875 Summit Ave
St. Paul, MN 55105-3076
United States
(651) 290-6409 (Phone)

Register to save articles to
your library

Register

Paper statistics

Downloads
479
Abstract Views
1,848
rank
59,014
PlumX Metrics