(i. e., a specialty) if it is adopted by the parties as a memorial of their agreement, the standard of interpretation changes. When A makes a covenant under seal to B in consideration of a covenant by B to him, it makes no difference so far as the formation of a contract is concerned how different may have been the sense which A or B attached to the words of the covenant, or how reasonable may have been the belief of each. Their assent to the execution of that instrument is the only assent necessary to bind them. It is true that if they acted under such misapprehension, as courts of equity regard as sufficient basis for relief, the contract may be avoided; but it is important to observe a distinction between a contract voidable on equitable grounds and no contract at all. The same is true of a negotiable instrument. 12 Even in case of a writing wholly informal in character, but which nevertheless was adopted by the parties as a statement of their bargain, the same principle is applicable. The parties have assented to those words as binding upon them. In an ordinary oral contract or one made by correspondence, the minds of the parties are not primarily addressed to the symbols which they are using; they are considering the things for which the symbols stand. Where, however, they incorporate their agreement into a writing they have attempted more than to assent by means of symbols to certain things, they have assented to the writing as the adequate expression of the things to which they agree. Therefore a contract may be created though each party attached a different meaning to the language used, if he had no reason to suppose that his own meaning was not shared by the other party.13

12 The theoretically possible case of an oral promise where it is agreed that the particular spoken words, whatever their legal meaning may be, shall fix the rights of the party is so unusual that it is here disregarded.

13 In Sawyer v. Hovey, 3 Allen, 331, 333, 81 Am. Dec. 659, the court said: "If parties understand an agreement differently, and neither of them makes known to the other his construction of it, and it is afterwards reduced to

writing and duly executed, they are bound, in equity, as well as at law, by the terms of the written instrument, which in such cases is to be construed by the court." See also Bentley v. Mackay, 4 De J. F. & J. 279, 285; Arnold v. Arnold, 14 Ch. D. 270, 274; Deutsch v. Pratt, 149 Mass. 415, 420, 21 N. E. 1072; Woburn Nat. Bank v. Woods, 77 N. H. 172, 89 Atl. 491; Phillip v. Gallant, 62 N. Y. 256; Rickerson v. Insurance Co., 149 N. Y. 307,

It should be observed that a written contract may fail to be enforceable for other reasons than for lack of consideration or mutual assent-notably because the promise can have no application to existing facts. This situation arises frequently under insurance policies. Where the insurer warrants the present existence of a situation of fact, which in truth does not exist, the risk never attaches and the policy never becomes an obligation. This, however, is not because the parties had failed to come to an agreement but because they have agreed that under the facts which exist there shall be no liability. Thus when an insurance policy describes the insured property as a dwelling house, when in fact the lower storey of the building is occupied as a shop, the risk never attaches. 14 The difficulty with the plaintiff's case here is not lack of mutual assent. The parties have agreed to the terms of the policy as an integration of their agreement; not is there any difficulty in identifying a particular building as that to which the writing relates. If the bargain were a written contract to buy and sell, providing that the goods should be delivered at the buyer's "dwelling house" there would be no difficulty in enforcing the contract because the lower storey of the buyer's dwelling house was used as a shop. In the insurance cases, however, the extent of the risk depends upon the nature of the property insured; and "dwelling house" acquires a narrower meaning on this account. It is not enough for the insured to give a description which will enable the court to determine the subject-matter which is to be insured; the insurer must be apprised of the character of the property. The terms of the bargain are fixed on the assumption that he is so apprised. The insured, therefore, warrants that his description is accurate sufficiently to indicate the character of the risk. A breach of this warranty avoids liability on the insurer's promise and if, as in the case

43 N. E. 856; Johnston v. Patterson, 114 Pa. 398, 6 Atl. 746; Clark v. Lillie, 39 Vt. 405, and cases in the following section.

14 Bowditch v. Norwich Union Fire Ins. Co., 193 Mass. 565, 79 N. E. 788; Dougherty v. Greenwich Ins. Co., 64 N. J. L. 716, 42 Atl. 485, 46 Atl. 1099.

So in Thomas v. Commercial Union Assur. Co., 162 Mass. 29, 37 N. E. 672, 44 Am. St. Rep. 323, a building properly described as a hotel was held not covered by insurance which described it as a dwelling house. See also Harris v. St. Paul F. & M. Ins. Co., 126 N. Y. S. 118.

supposed, the warranty is broken at the time when the agreement is made, no risk ever attaches. If the error of description involved no increase of risk on the part of the insurer, the result would be different. A misdescription in some particular would not preclude recovery.

15

§ 607. Standard of interpretation where a writing has been adopted.

According to the weight of authority and on principle, where the parties have assented to a writing as an expression of their agreement, or where a writing is required by law, the standard of interpretation is the local standard; that is, the natural meaning of the writing to parties of the kind who contracted at the time and place where the contract was made, and with such circumstances as surrounded its making. The question is obscured by the somewhat inexact expressions often found in cases whose decision did not require a careful discrimination between an individual standard, a local standard, and a normal standard; because whichever standard was adopted, the result in the particular case would be the same. Moreover there is much to show that in the early law, the normal standard of language was that adopted. In any endeavor to show that the local standard is that now applicable, its validity must be defended on the one hand against the normal standard, and on the other hand against such an individual standard as is permissible in informal contacts. This will be done in the following sections. It may be noted that the results reached by applying the local standard are the same as would be reached by applying the standard applicable where no memorial is made of the agreement, or apparent agreement, except in two cases—

(1) Where there is such a justifiable difference of belief concerning the sense in which the parties used the words as would prevent the existence of a contract had the negotiations been informal.

(2) Where the sense which the promisor reasonably supposed the other party would attach to his words is one which neither normal usage, nor local or technical usage justifies.

The first of these exceptions results from the considerations

15 Locke v. Royal Ins. Co., 220 Mass. 202, 107 N. E. 911.

discussed in the preceding section. The second exception is based on policy.

Aside from these exceptional cases, it will be true that in written as in oral contracts, language is to be given the meaning which the one using it apprehended or should have apprehended that the other party would give to it. 16 Pollock indeed says that "every question which can arise on the interpretation of a contract may be brought as the last resort under this general form." 17 But the meaning of a written promise is not necessarily what the promisor supposes or has any reason to suppose the promisee will attach to the words. The promisor's justifiable suppositions are not the standard which the law seeks to apply, but are the basis of one of the secondary rules of interpretation applicable only when the meaning of the writing is ambiguous under the standard which the law adopts.18 If the promisor's justifiable belief were the standard

16 Ardis v. Grand Rapids &c. Ry. Co., 200 Mich. 400, 167 N. W. 5; McMillin v. Titus, 222 Pa. 500, 502, 72 Atl. 240.

17 Wald's Pollock on Contracts (3d ed.), page 308, and there is judicial support for his statement. "In all deeds and instruments the language used by one party is to be construed in the sense in which it would be reasonably understood by the other." Blackburn, J., in Fowkes v. Manchester, etc., Assoc., 3 B. & S. 917.

18 In Inman Mfg. Co. v. Cereal Co., 133 Iowa, 71, 73, 110 N. W. 287, 8 L. R. A. (N. S.) 1140, McClain, J., said: "The theory contended for by the appellee on the trial, and accepted by the trial court, was that it was competent to establish these facts under the provision of Code, section 4617, that: 'When the terms of an agreement have been intended in a different sense by the parties to it, that sense is to prevail against either party in which he had reason to suppose the other understood it.' The first recognition of any such proposition as a specific rule of evidence, so far as we have been able

to discover it, is in Potter v. Ontario
& L. Mut. Ins. Co. (1843), 5 Hill,
147, where Judge Bronson of the New
York Supreme Court quotes it in the
following language from Dr. Paley
without specific reference: 'Where the
terms of a promise admit of more senses
than one, the promise is to be per-
formed in that sense in which the
promisor apprehended at the time the
promisee received it.
The rule

next appears as the first portion of
section 1697 of the Code of Civil Pro-
cedure of New York, as recommended
for adoption in the final and complete
report of the commissioners on prac-
tice and pleading of that State made
in 1849. The Legislature of that State
had previously adopted a Code of
Civil Procedure reported by the same
commissioners (appointed in 1847)
which is generally known as the 'New
York Code of Civil Procedure of 1848'
(see Hepburn, Development of Code
Pleading, 83); but in their final report
of 1849 (drafted by Mr. David Dudley
Field, one of their number), they added
Part IV, of Evidence, which had not
been covered by the Code as previously

which the law adopted it would be applicable to every case. That it is not is evident from the two exceptional cases above mentioned. In each of those cases a meaning will be given to