Caselaw

Civil Appeal 4628/93 State of Israel v. Apropim Housing and Development (1991) Ltd. IsrSC 49(2) 265 - part 8

June 4, 1995
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"There are two stations that an interpreter is supposed to pass through when he seeks to assess the opinion of the parties to the contract: the first station is the opinion of the parties as implied by the contract, and the other station is – insofar as their opinion is not implied by the contract – (estimating) the opinion of the parties as it is implied by the circumstances" (my emphasis – A. M.).

  1. In the alternative argument, counsel for the State objected, as will be recalled, that the District Court's conclusion was justified, even if it was found that it was correct in determining that the language of section 6(h)(3) was clear. According to her, the judge should have interpreted the provision of the clause in the spirit of the purpose of the program contract and taking into account the business logic by which the parties must have guided themselves.

This argument is doomed to be rejected.  The rule of section 25(a) of the Contracts Law (General Part) also applies to the interpretation of contracts, which the opinion (the opinion of the interpreter!) gives that the contractors in them had a certain purpose.  This is the case, inter alia, with regard to commercial and business contracts, the interpretation of which is that the court is obligated to apply a standard of business logic.  In this context, the words of Justice Berenson are known:

"We are discussing a commercial transaction and we must try to give it acceptable validity, as businessmen would do in view of all the circumstances of the case" (Civil Appeal 492/62 "Shahaf" Port Shipping Company in Tax Appeal v. Alliance Insurance Company in Tax Appeal et al. [5], at pp. 1901-1902).

 

See also the words of Justice (later the President) Y. Cohen in Other Municipality Applications 464/75 Promotifin in the Tax Appeal v. Calderon et al. [6], at p. 195 opposite footnote 7.  However, this can and should be done only if the language of the contract is likely to be interpreted one way or the other, or to tolerate the interpretation that, according to the interpreter's logic, is appropriate for the probable purpose of a contract of the same type.  This is not the case if the language of the contract is clear to the extent that it leaves no room for doubt as to the meaning of the words; In that case, the opinion of the communicators should be assessed according to what is required by the language they used, and not according to the logic of the interpreter.  This was discussed by Justice Beisky in Other Municipality Motions 406/82 Nachmani v. Galor [7], at p. 499:

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