Example 7.4

Takeaway point 7.4: Construe disputed contract clauses by using both general and subject-specific canons.

The techniques that lawyers use to construe statutes often apply to contracts, too.

On April 20, 2010, the Deepwater Horizon drilling unit exploded in the Gulf of Mexico. Eleven workers died, the rig sank, and millions of gallons of oil spewed into the Gulf. More than 200,000 plaintiffs filed lawsuits against the companies involved in the botched drilling effort, which caused the disaster. Two of the primary defendants were BP, which supervised the drilling of the oil well, and Transocean, owner of the drilling unit (which is like a mobile oil platform). Transocean potentially faced billions of dollars in liability, but it argued in a pretrial motion that the parties’ contract required BP to indemnify (i.e., reimburse) Transocean for all of its liability. Below, BP acknowledges that the contract requires it to indemnify Transocean if Transocean acted negligently. But BP denies that it had any obligation to indemnify Transocean for gross negligence or for strict liability. The outcome of this contractual skirmish would shift billions of dollars from one party to the other.

Source: BP’s Cross-Motion for Partial Summary Judgment, In re Deepwater Horizon, 2:10-md-02179- CJB-SS Dock. 4827-1 (E.D. La. Dec. 7, 2011) (altering the name of a BP affiliate from "BPAP" to "BP").

Just as Example 7.1 argued that the plain meaning of “individual” was unambiguous, BP argues that the contract is crystal clear.

This section begins with a long sentence. The point is complicated, so the lawyers might have benefited from breaking the sentence into small pieces. The frenzied pace of high-stakes trial litigation affords less time for editing than when preparing appellate briefs. Thus, commit to muscle memory the writing principles discussed in Chapter 16.

Passages that rely on textual arguments tend to emphasize more words than other passages because lawyers want to be especially sure that judges focus on the right words.

Notice that all three cases cited here involved oil companies. Short explanatory parentheticals might have been helpful.

We see here an interpretive technique that mirrors the way that litigants help courts to construe a statute, as Example 7.2 demonstrated.

BP uses the district court judge’s own words from an earlier stage of the lawsuit to advance its argument. This powerful trick can be effective when used gently — to remind the Court of its own conclusions. BP uses the you-already-decided-this-issue technique again later in the same paragraph.

BP invokes a subject-specific canon that governs maritime disputes. Consult treatises and cases (and previous motions and briefs) that relate to the subject of your dispute to ensure that you do not overlook helpful interpretive tools. The lawyers’ expertise is on display here.

When a contract or statute is silent, lawyers fight to show that the default rule (about how to construe that provision) favors their client.