Opinion ID: 71015
Heading Depth: 2
Heading Rank: 1

Heading: Is the Written Agreement Ambiguous?

Text: 19 Under Alabama law, extrinsic evidence relating to the alleged true intent of the parties is not admissible if the written document is clear and unambiguous. See, e.g., Kerrigan v. Sherrer, 535 So.2d 74, 75-76 (Ala.1988) ([A]bsent a finding of ambiguity, it was improper for the trial court to consider evidence ... [of the alleged] true intentions of the parties....); Darling Shop of Birmingham v. Nelson Realty Co., 52 So.2d 211 (Ala.1951) ([I]n the absence of ambiguity the court cannot interpret the contract but must take it as it is written.). However, resort to parol evidence is proper to show that the contract language contains a latent ambiguity. Cathbake Investment Co. v. Fisk Electric Co., Inc., 700 F.2d 654, 656 (11th Cir.1983) (applying Alabama law). An ambiguity is latent when the language employed is clear and intelligible and suggests but a single meaning, but some extrinsic fact or extraneous evidence creates a necessity for interpretation or a choice among two or more possible meanings. Thomas v. Principal Financial Group, 566 So.2d 735 (Ala.1990). If a latent ambiguity exists, parol evidence may be admitted for the purpose of explaining or clarifying the language revealed to be ambiguous, but not for the purpose of uncovering the parties' alleged true intent. See Gafford v. Kirby, 512 So.2d 1356, 1363 (Ala.1987) (where a latent ambiguity exists, parol evidence is admissible to clear up that ambiguity). As the Supreme Court of Alabama explained: 20 Such evidence is received, not for the purpose of importing into the writing an intention not expressed therein, but simply with the intention of elucidating the meaning of the words employed; and in its admission, the line which separates evidence which aids the interpretation of what is in the instrument, from direct evidence of intention independent of the instrument, must be kept steadily in view; the duty of the court being, to declare the meaning of what is written in the instrument, not of what was intended to be written. 21 Gibson v. Anderson, 265 Ala. 553, 92 So.2d 692, 695 (1957) (quotations omitted). 22 Whether a written contract is ambiguous is a question of law for the court, subject to de novo review. Vulcan Painters, Inc. v. MCI Constructors, Inc., 41 F.3d 1457, 1460 (11th Cir.1995); Wayne J. Griffin Elec., Inc. v. Dunn Constr. Co., 622 So.2d 314, 316 (Ala.1993). In the instant case, Moore can point to no language in the written document which is revealed to be ambiguous by the extrinsic evidence. Nor did the district court point to any such language, either in its rulings or in its instructions to the jury. Our review of the written agreement persuades us that there is no language therein which the extrinsic evidence reveals to be ambiguous. Moreover, the interpretation urged by Moore is unreasonable. See Orkin Exterminating Co., Inc. v. F.T.C., 849 F.2d 1354, 1362 (11th Cir.1988) (explaining that [n]o latent ambiguity exists unless the contract is actually susceptible to the meaning contended for by a party and rejecting an unreasonable interpretation of a written contract), cert. denied, 488 U.S. 1041, 109 S.Ct. 865, 102 L.Ed.2d 989 (1989). Any interpretation of the contract prohibiting Penn Castle from drilling in the Field is unreasonable in light of the plain language of the written agreement, which leaves to Penn Castle the final decision for location with respect to four of the wells. It is also unreasonable to interpret the contract as prohibiting Penn Castle from ever drilling more than six wells on the Moore property. The obvious purpose of the agreement is to prevent Moore from suing in tort for any damage caused by the drilling of six wells, not to eliminate Penn Castle's common-law right to make reasonable use of Moore's land in the extraction of subsurface minerals. We readily conclude that the latent ambiguity exception to the parol evidence rule does not apply. 23