Government Contracting Database
Standards of Contract Interpretation
The interpretation of contracts follows a general set of rules in order to determine if the interpretation is reasonable and logical. That generally accepted set of rules, in descending order of importance and application is:
- Read the contract as a whole, giving meaning to each and every part of the document.
- Apply the common meaning to the words in question.
- Apply the order of precedence clause in the contract to determine which provisions take priority over other provisions.
- Determine what interpretation has been given to the provision or term through a prior course of dealing.
- Determine what is the trade, custom, or industry usage of the provision in question.
Updated: July 24, 2018