The output of legal interpretation—the meaning ascribed to the
interpretive object—serves as an input for construction. Construction might
take other input as well. A rule of contract construction might, for example,
condition legal effects not only on what the speaker says—the meaning of
her words and actions—but also on who she is, on the form in which she
expresses herself, or on her use of conventional words or acts. And as will
be discussed below, sometimes rule of construction requires no
interpretation, as when parties employ a formality. A rule of construction
maps those inputs onto a legal state of affairs. That is, it identifies their legal
effect.
I will use “exposition” to refer to the entire process of determining
the legal effect of a person or persons’ words or actions. Exposition
commonly involves both interpretation and construction. In the process of
exposition, interpretation comes first, construction second. The reason is
not, as Lieber and Williston suggest, that construction steps in only when
interpretation runs out. It is that one generally must decide what words or
actions mean before one can know their legal effects. As Corbin says, “A
‘meaning’ must be given to the words before determining their legal
operation.”
45
Or as I have put the point, the output of legal interpretation
serves as the input for construction. That said, later parts of this Article
identify other senses in which construction is sometimes or always prior to
interpretation.
Although the interpretation-construction distinction has been
around for over a century and a half, it is often ignored. Many contract
scholars use “interpretation” to refer to the activity of construction. Ian
Ayres: “Algebraically, one could think of interpretation as a function, f(),
that relates actions of contractual parties, a, and the surrounding
circumstances or contexts, c, to particular legal effects, e.”
46
Richard
Posner: “Contract interpretation is the undertaking . . . to figure out what
the terms of a contract are, or should be understood to be.”
47
Alan Schwartz
and Robert Scott: “[A] theory of interpretation . . . ‘maps’ from the semantic
content of the parties' writing to the writing's legal implications.”
48
Contrariwise, and especially among British jurists and scholars, it is not
uncommon to use “construction” to refer to the search for objective
meaning, which is a form of interpretation as I am using the term.
49
45
Corbin (1st ed.) § 534, 8.
46
Ayres, supra note 4 at 2046.
47
Richard A. Posner, The Law and Economics of Contract Interpretation, 83
Tex. L. Rev. 1581, 1582 (2005)
48
Alan Schwartz & Robert E. Scott, Contract Theory and the Limits of
Contract Law, 113 Yale L.J. 541, 547 (2003).
49
For example, in his treatise, The Construction of Commercial Contracts,
J.W. Carter defines “construction” as “the process by which the intention of
the parties to a contract is determined and given effect to,” and argues that