Approaches to Interpretation of Contract: Contextualism and Textualism by an Emphasis on the Intent of the Parties

One of the most important issues in contract law is the interpretation of contracts. The parties to the contract may have disagreements in the meaning of the terms and phrases of the contract. The disagreement in the contact faces an obstacle in the fulfilment of contractual obligations and the courts must interpret the contract in order to the settlement of disputes and fulfilment of contractual obligations. The most important purpose of interpretation is exploring the common intent of the parties. Textualists and contextualists both claim to discover the intent of the parties. Textualists take consider intention as the real and true intention of the parties and search for it in the context of the contract. In contrast, contextualists consider subjective intention to be the real and genuine will of the parties to the contract and consider the text of the contract as an incomplete resource regardless of the context in which the contract is formed. Exploring the real intention under the principle of freedom and principle of voluntarism is assumed as one of the most important values of legal systems in the field of contract law in this article. Therefore, the main criterion for evaluating each of these approaches is the ability to achieve the actual intention. The contextualism approach has more ability and accuracy in exploring the real intention of the parties by using extensive evidence. Although the textualism approach is consistent with the real intention of the parties in some cases, it is not very successful in exploring the real intent of the parties due to the limitation of the cited sources. It can be said in this research by relying on descriptive-analytical method and by evaluating the rules of each of these approaches that systems that consider contract as merely a tool to realize economic values in transactions are more inclined to textualism approach; in contrast, in systems in which the contract itself has intrinsic value and the realization of the parties’ intentions has relevance regardless of economic values are more likely to adopt a contextualism approach. Accordingly, in the author’s opinion, ending the unfinished textualism and contextualism struggle depends on examining the value priorities of a legal system in the field of contract law which has been neglected in the research of the last two decades.