Opinion ID: 356198
Heading Depth: 2
Heading Rank: 1

Heading: Was the Contract Ambiguous?

Text: 12 Appellant challenges the district court's determination that the contract was ambiguous in regard to the method of payment for materials delivered but not yet installed. Such a finding presents a question of law, freely reviewable by this court. United States ex rel. White Masonry, Inc. v. F. D. Rich Co., 434 F.2d 855, 858 (9th Cir. 1970); Clayman v. Goodman Properties, Inc., 171 U.S.App.D.C. 88, 96, 518 F.2d 1026, 1034 (1973). Reviewing the written documents which comprise the contract, we are unable to determine whether any payment for profit and overhead was intended to be included in the payment made for materials delivered but not yet installed. The contract merely specifies that payments relating to such material can be made only after proof of the quality and value of such materials is presented. There is no further specification of how value is to be computed. Neither price to the subcontractor nor price to the prime contractor are unreasonable definitions of value. The general reference to profit and overhead being prorated throughout the life of the contract is also ambiguous as to whether payments made prior to beginning work on the contract are to include allowance for profit and overhead. Thus, we find that the contract is ambiguous as to the amount of the payment due on delivery of material. 3 In this situation it was therefore proper for the district court to hear extrinsic evidence to determine the intent of the parties regarding this issue. 13