Contra Proferentem

Definition - What does Contra Proferentem mean?

Contra proferentem is a Latin term that is used in contract law and means that ambiguous clauses in contracts are ruled in favor of the party that did not include them. So, often, parties that include ambiguous clauses in contracts see them not enforced during lawsuits due to contra proferentem.

Justipedia explains Contra Proferentem

The principle of contra proferentem is often relevant in insurance lawsuits. Because insurance companies typically create insurance contracts and policyholders do not, it is often the insurance companies that lose lawsuits when a vague clause is the subject of the suit.

Essentially, contra proferentem protects people from being held responsible for meeting contractual obligations that are too vague. For this reason, it is important that people or companies that create contracts make sure that no clause on the contract is vague.

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