Key Takeaways

  • Conflicting contract terms arise when provisions contradict each other, leading to potential legal disputes.
  • Courts analyze conflicting clauses by considering intent, precedence, and external evidence.
  • Drafting contracts with clarity, consistency, and precise language helps prevent inconsistencies.
  • Resolution strategies include applying contract interpretation principles, consulting legal experts, and maintaining clear documentation.
  • Specific clauses such as precedence clauses and dispute resolution mechanisms can help mitigate conflicts.

Conflicting terms in a contract occur when there are terms within the contract that cannot be met or adhered to, because of conflicts that would be created within the contract, as a whole. Additionally, conflicting terms in a contract may exist if there are certain terms or definitions that are inconsistent throughout the contract.

Situations in which conflicting terms may occur include:

  • When there are multiple parties drafting the contract
  • The involved parties are not thoroughly clear on the terms or any revisions being made to the contract
  • Terminology is being used that may be familiar to those who work within a specific industry, but may not be familiar to, “lay people”
  • Terms and conditions of the contract are not being clearly spelled out to all of the necessary parties

To help avoid some of these issues, it is best to ensure that the contract is being drafted by someone who is well-versed in contract law and the appropriate language necessary, and who can also ensure that it is being written in common, everyday language. Additionally, a well-crafted contract will often contain language on how to address any conflicting terms, should they occur. Some things to consider in having a contract drafted, to ensure there are no conflicting terms are:

  • Both parties must be in agreement as to the terms and conditions of the contract, provided that the activities stated within the contract are lawful
  • The entire contract should be either agreed upon or denied, rather than attempting to piecemeal those parts of the contract that are amenable to all parties
  • Should there be more than one contract between the same parties, all of the contracts should be taken as one
  • Despite any vagueness that may exist, the contract will only apply to those mutually agreed upon terms and conditions
  • The language used in the contract should be clear and simple, understood by people not working in the industry which the contract covers
  • Any technical or industry-specific language that is used in the contract should be defined in clear terms

While it may seem as though conflicting terms in a contract could create a “deal-breaker” scenario, that does not have to be the case, provided that all parties involved are on board with ensuring that the contract is being drawn-up by someone knowledgeable in contract creation.

How to Resolve Conflicting Terms in a Contract

It is crucial to know how to best resolve issues around conflicting terms in a contract, as issues surrounding conflicting terms are now some of the primary reasons as to why parties involved in contract disputes take legal action against one another.

One reason as to why this may be the case is due to more and more people choosing to draft contracts themselves, trusting the, “good faith” relationship they may have with the other parties and assumptions of understanding the various terms and conditions, rather than utilizing the sources of an expert. While this may seem like a great way to make the process of drafting a contract less expensive, quicker and easier, in the long run, the opposite may prove to be true, as a qualified attorney will have the background as to how best write a legally-binding, equitable and easily understood contract.

It is worth noting that while the internet can be wonderful tool for finding pre-written contracts or templates, wherein the respective parties simply need to plug in pertinent details, because of the ambiguity that these templates can create, most courts will value the legality of a handwritten or typed contract, over one that is a pre-designed from the internet.

In addition to hiring a qualified attorney or contract expert to draft your documents, other steps you can take include:

  • Be specific. Specific terms and language are given far more credence than general ones. It is harder to argue any lack of clarity or understanding if the contract is as specific as possible.
  • Keep records. Should there be revisions to the contract made before all parties are in agreement, make sure that you are retaining dated copies of the previous copies, with notes as to why it was not accepted. Keeping these records can be beneficial to a judge in seeing the negotiation process, should you still find yourself in a position of there being a dispute over the contract.
  • Don’t sign or agree to anything which you are not completely clear on. While this may mean additional rewrites, costing more time, it can ensure that down the road, there is no confusion as to the terms and conditions of the contract

While it may not always be possible to avoid issues of conflicting terms in a contract, by taking the right steps, you can ensure that those times are the exception and not the rule.

How Courts Interpret Conflicting Contract Terms

Courts use various principles when determining how to interpret and resolve conflicting terms in a contract. These include:

  1. Hierarchy of Clauses – If a contract includes a "precedence clause" that defines which terms prevail in the event of a contradiction, courts will enforce that clause.
  2. Specific Over General – When a general term and a specific term are in conflict, courts usually prioritize the specific provision as it more precisely addresses the issue.
  3. Handwritten or Typed Provisions Over Standard Templates – If a dispute involves preprinted forms and manually inserted terms, courts typically give more weight to handwritten or typed additions.
  4. Parol Evidence Rule – If the contract language is ambiguous or inconsistent, courts may allow external evidence, such as prior negotiations or industry norms, to clarify intent.
  5. Interpretation Against the Drafter – If an ambiguity exists and one party was responsible for drafting the contract, courts may interpret the terms in favor of the non-drafting party.
  6. Good Faith and Commercial Reasonableness – Courts consider the fairness and practicality of interpretations, particularly in commercial agreements.

By understanding these principles, businesses, and individuals can anticipate how a contract might be enforced and draft their agreements accordingly.

Common Causes of Conflicting Terms in Contracts

Conflicting contract terms arise from a variety of drafting errors or oversights. The most common causes include:

  • Multiple Authors or Revisions – When different parties contribute to a contract without careful coordination, inconsistencies can arise.
  • Failure to Update Clauses – Adjusting one section of a contract without revising related sections can create contradictions.
  • Industry-Specific Jargon – Contracts using specialized terminology without clear definitions may lead to differing interpretations.
  • Integration of Multiple Contracts – When multiple contracts exist between the same parties, conflicts can emerge if they are not drafted to complement each other.
  • Use of Prewritten Templates – Many businesses use online templates, which may include provisions that conflict with custom-added terms.

To minimize these risks, contracts should undergo thorough review by legal professionals who specialize in contract law.

Best Practices to Avoid Conflicting Terms in Contracts

Preventing conflicts from arising in a contract is far more efficient than resolving disputes later. Best practices include:

  1. Clear and Consistent Definitions – Define key terms explicitly and ensure their meaning remains consistent throughout the contract.
  2. Hierarchy or Order of Precedence Clauses – Explicitly state which sections take priority in case of conflicts.
  3. Thorough Proofreading and Legal Review – Have legal professionals review contracts for clarity and internal consistency.
  4. Use of Numbering and Cross-References – Structure contracts logically, with clear references to related sections to avoid contradictions.
  5. Avoid Overly Complex or Unnecessary Legalese – Contracts should be as clear as possible to prevent misinterpretation.
  6. Regular Updates and Revisions – Contracts should be reviewed periodically to ensure they remain applicable to the latest legal standards and business practices.
  7. Mutual Agreement on Terms – Ensure that all parties fully understand and agree to the terms before signing.

By following these strategies, parties can create contracts that reduce the likelihood of internal conflicts and disputes.

Steps to Take When You Discover a Contract Contradiction

If a contract contradicts itself, taking immediate action can help mitigate risks. Here’s what to do:

  1. Review the Entire Contract – Identify all areas where contradictions exist and assess their impact on the overall agreement.
  2. Consult Legal Counsel – Seek legal advice to determine the best course of action based on contract law principles.
  3. Negotiate Amendments – If possible, work with the other party to clarify and modify conflicting terms through a formal amendment.
  4. Rely on Precedence Clauses – If the contract includes an order of precedence clause, use it to determine which terms should prevail.
  5. Use Alternative Dispute Resolution (ADR) – If conflicts lead to a dispute, mediation or arbitration may be a more efficient resolution method than litigation.
  6. Document Any Clarifications – Keep a written record of how ambiguities were addressed to avoid future disputes.

Addressing contradictions proactively can help parties maintain a functional and enforceable contract.

Frequently Asked Questions

1. What happens if a contract contradicts itself? Courts analyze conflicting provisions using legal interpretation principles, such as prioritizing specific clauses over general ones, applying order of precedence clauses, and considering external evidence if necessary.

2. Can a contradictory contract still be legally binding? Yes, but contradictions may lead to disputes and legal challenges. Courts aim to enforce the contract by determining the parties’ intent and applying relevant legal principles.

3. How can businesses avoid drafting conflicting contract terms? Businesses should use clear language, define key terms consistently, include precedence clauses, and have contracts reviewed by legal professionals before finalization.

4. What legal options exist if a contract’s contradictions cause a dispute? Options include contract renegotiation, mediation, arbitration, or litigation. Many contracts include dispute resolution clauses specifying the preferred method.

5. Are handwritten changes in a contract more enforceable than preprinted text? Yes, courts typically give greater weight to handwritten or manually inserted provisions over standard preprinted text if contradictions arise.

If you need help with conflicting terms in a contract, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.