Opinion ID: 701799
Heading Depth: 4
Heading Rank: 1

Heading: The CPC Agreement

Text: 21 Ohio law governs the construction of the CPC agreement. In Ohio, the court must determine from the four corners of the contract whether any terms in the contract are ambiguous. Shifrin, 597 N.E.2d at 501. Ohio has established the following test to determine whether a contract term is ambiguous: Common words appearing in a written instrument will be given their ordinary meaning unless manifest absurdity results, or unless some other meaning is clearly evidenced from the face or overall contents of the instrument. Id. (internal quotation and citation omitted). In other words, a contract term is ambiguous if its meaning cannot be discerned from the four corners of the contract, or the term is susceptible of two or more reasonable interpretations. Potti, 938 F.2d at 647. Ohio does not allow the introduction of parol evidence to prove a contract term is ambiguous if that ambiguity is not apparent on the face of the contract. Shifrin, 597 N.E.2d at 501. 22 We agree with the district court's conclusion that the term orders accepted prior to [Aerotronics'] termination in paragraph 11 is ambiguous. Although the CPC agreement defines many of the terms utilized in the agreement, it does not define order, purchase order or business booked. Order, purchase order and business booked may be used interchangeably throughout the agreement or they may have meanings that are distinct from one another; however, the CPC agreement offers no instruction as to this point. Upon viewing the agreement as a whole, we believe that the term order set forth in paragraph 11 is reasonably susceptible of two differing interpretations: (1) it may refer to a request to supply goods as Pneumo argues, or (2) it may refer to the acceptance of an initial development program as Aerotronics argues. See Yoder v. Columbus & S. Ohio Elec. Co., 39 Ohio App.2d 113, 316 N.E.2d 477, 480 (1974) (contract term is ambiguous if it is susceptible of two different meanings). For example, paragraph 7B provides that Aerotronics will receive 50% of its regular commission when an order originates within its territory and is subsequently transferred outside of its territory, for so long as the product remains on a purchase order with the Company that was obtained by [Aerotronics]. In the context of paragraph 7B, it appears that order refers to acceptance of an initial development program, whereas purchase order appears to refer to a request to supply goods, the definition that Pneumo argues is the plain meaning of the term order. 23 Thus, it is not plain that the term order, as used in paragraph 11, means a request to supply goods. Accordingly, paragraph 11 is ambiguous and the district court did not err in admitting parol evidence to determine the intent of the parties. 24