Intent and the “Four-Corners Rule”

At the core of contract interpretation is a simple question: what did the parties actually agree to at the time they signed the contract? Courts focus on what’s written, not what someone later says they meant. This begins a multi-part series where I share fundamental contact principles to educate 

• Plain meaning controls. If the language of a contract is clear on its face, courts enforce it as written.

• Four-corners rule. When the text is unambiguous, courts look only at the contract itself—the “four corners” of the document—and will not consider outside evidence like emails or after-the-fact explanations.

• Objective perspective. The contract is read as a reasonable person in the parties’ position would understand it, not based on anyone’s private or unspoken expectations.

• Reading the Contract as a Whole
  Courts do not read contracts line by line in isolation. Instead, they look at how the provisions work together.

• No wasted words. Courts avoid interpretations that make any term meaningless or redundant. Every word is assumed to have been included for a reason.

• Provisions must be harmonized. If two sections appear to conflict, courts try to reconcile them so both can be given effect—unless doing so would undermine the contract’s overall structure.

• Related agreements are read together. When multiple agreements are signed as part of the same transaction and serve the same purpose, they are interpreted together, not piecemeal.
  

  Common Rules Courts Use to Resolve Conflicts

• When provisions point in different directions, courts rely on established interpretive rules to resolve the tension.

• Specific beats general. Detailed, concrete language outweighs broad or preliminary statements.

• What’s listed matters. If a contract expressly includes certain items, courts usually assume unlisted items were intentionally excluded

• General terms take their meaning from specifics. Broad language following specific examples is limited to things similar to those examples.

• Ambiguities are construed against the drafter. If the language is genuinely unclear and can’t be resolved, it is typically interpreted against the party that drafted the agreement—especially where the other party had little or no bargaining power.
  

3. Vesting and Termination Mechanics

• Equity rights often rise or fall based on how vesting and termination provisions are written—and followed.

• Vesting defines ownership. A vesting schedule determines when equity fully belongs to the holder.

• Termination triggers matter. Repurchase rights are typically tied to the termination of “continuous service,” not merely dissatisfaction or internal decisions.

• Process matters. Failures such as not providing written notice or not identifying a clear termination date can be fatal to an attempted repurchase.

• Silence isn’t consent. Courts do not infer vesting or forfeiture from silence. There must be affirmative, documentary evidence showing that result was intended.