December 1999

Letters

In a letter from Judge Jeanette Burrage printed in the November issue of Bar News [p. 7], the phrase "although I applaud those who do volunteer their time and encourage others to do the same" was omitted at the end of the third paragraph.

We apologize for the error.

Editor:

I read with interest the article titled "Dr. Strangelaw or How I Learned to Love the Berg" [Bar News, September 1999]. Mr. Reisler concludes that the adoption of the subjective view of contract interpretation by the court in Berg v. Hudesman, 115 Wash.2d 657, 801 P.2d 222 (1990), should be hailed by all except those who wish to obtain "a literal, absurd and unfair result." WSBN at 29.

The debate over whether contract language is to be viewed "objectively" (thus denying the introduction of parol evidence to create an ambiguity where none appears from the face of the contract) or "subjectively" (thus admitting parol evidence to create an ambiguity) is not new. Williston opposed it, while Corbin advocated it.

However, the recent results of the courts' work in this area (i.e., adopting the "subjective" position) has been harmful to commercial interests generally, while very beneficial to the legal profession through the creation of much litigation.

The best judicial exchange in this debate is the adoption of the subjective view in California by Justice Traynor in Pacific Gas & Electric Co. v. G. W. Thomas Drayage & Rigging Co., 442 P.2d 641, 642-46 (Cal. 1968) and the criticism of it by Judge Kozinski in Trident Center v. Conn. Gen. Life Ins. Co., 847 F.2d 564, 568-70 (9th Cir. 1988).

In Pacific Gas, Justice Traynor tells us that language is inherently ambiguous, and that the objective view of contract interpretation "reflects a judicial belief in the possibility of perfect verbal expression. This belief is a remnant of a primitive faith in the inherent potency and inherent meaning of words." 442 P.2d at 643-44. Since no one wants to be labeled "primitive," the only proper thing is to permit extrinsic evidence where it "is relevant to prove a meaning to which the language of the instrument is reasonably susceptible." 442 P.2d at 644. Since "reasonableness" is in the eye of the beholder, it is the poor commercial litigator who cannot state a claim of ambiguity, which survives the inevitable motions to dismiss, and for summary judgment.

In Trident, Judge Kozinski wonders whether this method really gets to the true intentions of the parties better than the objective method: "Under Pacific Gas, it matters not how clearly a contract is written, nor how completely it is integrated, nor how carefully it is negotiated, nor how squarely it addresses the issue before the court: the contract cannot be rendered impervious to attack by parol evidence. If one side is willing to claim that the parties intended one thing but the agreement provides for another, the court must consider extrinsic evidence of possible ambiguity. If that evidence raises the specter of ambiguity where there was none before, the contract language is displaced and the intention of the parties must be divined from self-serving testimony offered by partisan witnesses whose recollection is hazy from passage of time and colored by their conflicting interests. (citation omitted.) We question whether this approach is more likely to divulge the original intention of the parties than reliance on the seemingly clear words they agreed upon at the time." 847 F.2d at 569.

As Judge Kozinski correctly notes, "Pacific Gas casts a long shadow of uncertainty over all transactions negotiated and executed under the law of California. As this case illustrates, even when the transaction is very sizeable, even if it involves only sophisticated parties, even if it was negotiated with the aid of counsel, even if it results in contract language that is devoid of ambiguity, costly and protracted litigation cannot be avoided if one party has a strong enough motive for challenging the contract. While this rule creates much business for lawyers and an occasional windfall to some clients, it leads only to frustration and delay for most litigants and clogs already overburdened courts." Id.

There was, and is, a reason for the parol evidence rule: Each party to a contract should be required to insert his intentions clearly in the instrument which is designed to capture the mutual intentions of the parties. If he fails in getting the other parties to agree to his intentions by writing them in the contract, he may not later be heard to argue that his intentions were really those of all parties, but unfortunately were not included in the written instrument. This is not the subjective view, however, and today the only purpose of a written contract is use as a foil during negotiations to try to provoke each party into explicitly stating hidden or assumed intentions so as to know whether one ought to enter the bargain at all. Savvy commercial lawyers must now, more than ever, advise their clients that they are much better to deal with a trustworthy party than to have any particular language in a written contract. A trustworthy person will honor a bargain even if the bargain turns out badly for him, while an untrustworthy person will seek to escape the downside of even a clear expression of the parties' intentions.

These cases pose a legal issue larger than contract interpretation. Judges ought to be most careful when they claim that words are inherently ambiguous, thus allowing the consideration of evidence extrinsic to the documents which house those words. While extrinsic materials may be helpful in illuminating the meaning of the words under scrutiny, one cannot posit a just legal system where all words in all documents are open to individual interpretation, including the potential contradiction of the apparently clear terms by the proferred testimony of an interested party seeking his own gain. How can president, a governor, an agency, a legislature, or a court presume to require a citizen to follow any particular ordinance, decree, law, regulation, or order, when the English language is incapable of making mere words into a clear direction?

Judge Kozinski noted this in Trident: "[The subjective view] also chips away at the foundation of our legal system. By giving credence to the idea that words are inadequate to express concepts, Pacific Gas undermines the basic principle that language provides a meaningful constraint on public and private conduct. If we are unwilling to say that parties, dealing face to face, can come up with language that binds them, how can we send anyone to jail for violating statutes consisting of mere words lacking 'absolute and constant referents'? How can courts ever enforce decrees, not written in language understandable to all, but encoded in a dialect reflecting only the 'linguistic background of the judge'? Can lower courts ever be faulted for failing to carry out the mandate of higher courts when 'perfect verbal expression' is impossible? Are all attempts to develop the law in a reasoned and principled fashion doomed to failure as 'remnant[s] of a primitive faith in the inherent potency and inherent meaning of words'?" Id.

The subjective interpretation of contracts is really not justice at all. Rather, it is the prideful substitution of the judge's view of "fairness" or "absurdity" for the parties' clear words which define their own view of what is right in the circumstance. Mr. Reisler's praise for Berg and its progeny is misplaced. He ought to be lamenting the death of written language as a sufficient vehicle for guiding courts, and the substitutionary decisions now emanating from our judiciary. One judge's view of "fairness" or "absurdity" is an insufficient basis for disturbing the clear language chosen by equals at a bargaining table. The right to compel a person to perform the literal obligation of a contract (initially thought to be preserved in Article I, Section 10, of our Constitution) is nearly dead.

Justice Mosk concurred in Pacific Gas and another 1968 opinion adopting the subjective view. Having had his fill of the doctrine's results, he reversed course towards the end of 1968, dissenting in Delta Dynamics, Inc. v. Arioto, 446 P.2d 785, 789-90 (Cal. 1968). He caught the essence of the problem which Pacific Gas, Berg, and their ilk cause in the day-to-day affairs of commercial attorneys like me: "It can be contended that there may be no evil per se in considering testimony about every discussion and conversation prior to and contemporaneous with the signing of a written instrument and that social utility may result in some circumstances. The problem, however, is that which devolves upon members of the bar who are commissioned by clients to prepare a written instrument able to withstand future assaults. Given two experienced businessmen dealing at arm's length, both represented by competent counsel, it has become virtually impossible under recently evolving rules of evidence to draft a written contract that will produce predictable results in court. The written word, heretofore deemed immutable, is now at all times subject to alteration by self-serving recitals based upon fading memories of antecedent events. This, I submit, is a serious impediment to the certainty required in commercial transactions."

PS: I can't help but note that the last 40 years of contract jurisprudence coincides with another rather frightening development, commonly called "post-modernism" or "moral relativism." It is now very popular to take the position that there is no absolute truth. Tolerance is now defined not as acceptance of the diverse opinions found along the road in the great search for truth. Rather, one is required to accept a diverse opinion as being "right" for each holder of the opinion. In such a world, one must accept that Hitler's internment and killing of the Jews was "right for him," that Stalin's Gulag was his "truth," and that Mao's slaughter of Chinese in the Great Leap Forward and the Cultural Revolution was "appropriate for Mao." That is a scary world indeed.

I suggest those who waiver on the question of language and moral relativism

read popular books like Relativism: Feet Firmly Planted in Mid-Air (1998) by Francis J. Beckwith and Gregory Koukl; The New Absolutes (1996) by William Watkins; The New Tolerance (1998) by Josh McDowell, Bob Hoste and Bob Hostetler; and The Death of Truth: What's Wrong with Multiculturalism, the Rejection of Reason and the New Postmodern Diversity (1996) by Dennis McCallum.

Editor:

Congratulations on a great Bar News. I spent more time reading it than I have on any issue in the last 20 years. I enjoyed your article on our new President. Sounds like a good guy. I always enjoy Jeff Tolman. He's my small-town practice hero. I noted with interest the picture of those in practice for 50 years. One woman and no apparent ethnic diversity. We've come a long way!

But my reason in writing was to get the following message to our President. "Thank you! Thank you! Thank you!" I'm sooooo tired of stupid jokes and nitwit talk show people. He put it right and I'm waiting for more. Maybe the insurance companies will sit down and shut up now that State Farm has shown its colors, thanks to some great lawyering by plaintiffs' lawyers.

Years ago . . . 20 maybe . . . I regularly volunteered for committees. Always, the committees I volunteered for were full, year after year. (We always blame Seattle lawyers for such things.) I am still available if anyone were interested, but still pouting about prior rejections.

Keep up the good work. I enjoyed Lauren Bain's letter to the editor [October, p. 7]. What about more articles on: how to make clients happy; how to make more money; how to avoid malpractice; things we can do to get our Bar Association on our side to make it at least feel like the Association isn't our adversary; we're from the Bar Association, we're here to help you? (Might be the fourth biggest lie.)

Just some thoughts. Remember, "Illigitimus noncarborundum."

 Jerome L. Buzzard, Esq.
Olympia

Feedback from Law School on Tolman Article

Editor:

Recently [Bar News, October 99, Editor's Page] you poked fun at law school deans who name particular spaces in their law schools for donors who generously help defray the cost of building. When you finally exhausted your witty riffs on incongruous naming possibilities, you revealed your basic charge: the practice commercializes lady justice.

Let me respond. I admit the practice but plead not guilty to commercializing lady justice. First, the charge is so vague as to leave unclear precisely what the crime is. Would the crime of "commercializing lady justice" include, for example, the practice of personal injury attorneys refusing to represent injured plaintiffs unless they fork over to their attorney 25 to 50 percent of any recovery? Some might think that practice commercializes lady justice. And while I don't share that view, I'd understand why someone who didn't know how the system worked might make that mistake.

But perhaps your charge, though too vague, nevertheless has a nugget of truth. So let me give you a chance to amend your indictment to state a more plausible offense. Perhaps you meant to charge that the practice has the appearance of impropriety because it suggests someone (presumably the donor) gets something that she or he doesn't deserve. Certainly your colorful examples suggest that concern. But law schools aren't courts of law, dispensing justice with a blind eye toward the litigants' wealth and power. The only thing law schools sell is education; and I've never had a donor ask for legal education as a quid pro quo for a gift; and if one had, I would have refused it.

What most donors want is recognition — and more often than not — for someone else. One of our donors wanted to name a classroom for the nanny who reared their children. Another son and mother asked to name a study room for their father and husband, a distinguished member of the bar. Another group of donors wanted to recognize a recently retired Justice of the Washington Supreme Court, whose contributions to our state's legal and political life are legendary. Our moot courtroom will bear the name of another Supreme Court Justice because his family wanted to memorialize his substantial achievements in the way. My wife and I asked that our gift memorialize the service of our recently retired law librarian, who became director when the library was a hole in the ground on South Tacoma Way and over the next quarter century built our present 200,000-volume collection. Surely, you don't object to our and the donors' recognition of such accomplishments as in any way improper.

Or perhaps you meant to charge both the donors and the law school with tasteless conduct, a kind of shameless self-promotion in which the law school is an implicit co-conspirator in the donors' preening. I can understand that concern because ours is unfortunately a profession in which many do hawk their services in ways that might make corporate America blush. But I assure you our recognition signage is very discreet — no neon lights, no cheesy jingles, no touched-up portraits. Moreover, the truth is that most donors do not seek any public recognition at all. I had to encourage those donors to let us publicly acknowledge their generosity, and I did so for one reason. Ours is a working-class law school; many of our students are the first in their family to attend law school. They need role models, and I want them to know that others just like them have graduated from this law school and gone on to achieve professional success. Ours is not a "top 50" law school, either. Some of our students applied to, and were rejected by, those law schools; and they often enter law school feeling that they're second class. I want them to know that our law school produces first-class lawyers, and so I seize every opportunity to showcase our most successful graduates. While donor recognition is just one of the ways in which I can do that, it is a very important one.

But what about institutional donors, you may ask? Many of our institutional donors, like many of our private donors, sought no recognition and insisted on anonymity. The fact that Boeing, The Seattle Times, and Safeco allowed us to use their names hardly suggests corporate preening on their part. The fact is that they are good corporate citizens, and we would be less than polite if we did not publicly acknowledge their generosity.

One final probability is that persons who have some beef with a particular donor will feel uncomfortable in the space, and that we can therefore be charged with having created a hostile environment. You yourself can test the reasonableness of this charge. On more than one occasion you have spoken to our students in the Weyerhaeuser Lounge of the old Norton Clapp Law Center. Did you feel sickened? Compromised? Outraged? If you did, you didn't mention it; and, as always, you did a great job.

Perhaps you would better understand the practice of naming spaces for donors (which, incidentally, is not new and is in fact quite widespread, from Duke to Stanford, both of which are named for founding or rescuing donors) if you came to the law school someday and allowed me to show you around Sullivan Hall (named for a Jesuit priest who had no money to give us but whose whole life was dedicated to the greater glory of God). And on that day, I'd like to show you the art collection that now adorns our walls. It is intended to celebrate the human spirit in all its manifold dimensions. Many of the pieces were purchased with the gifts of donors who share our belief that lawyers need to understand the diversity, the richness and the complexity of humanity. Just this week, for example, I received a gift from one of our first graduates, who asked that it be used to purchase a work of art for the James Beaver Faculty Alcove, a space named for the founding member of our faculty, who was himself a man of many parts.

Perhaps we could linger in front of Fay Jones' The Jury, which depicts twelve jurors, each seeming at first to represent a stereotype but who, upon closer examination, appear to be quite unique, from the cynical to the idealistic, from the innocent to the experienced, from the gullible to the wary, from the self-confident to the mistaken. We could have a lot of fun deciding which juror each of us would be.James Bond
Seattle

Readers are invited to submit letters of reasonable length to the editor. They should be typed on letterhead, signed and, if possible, also provided on disk in any conventional format. Letters may also be sent via e-mail to comm@wsba.org. Due date is the 10th of the month for the second issue following. The editor reserves the right to select excerpts for publication or edit them as may be appropriate. Signatures in excess of three names will be printed only in exceptional circumstances, at the sole discretion of the editor.

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