Should you stay silent on contractual errors that help your client?

06 Dec 22

Consider the following not uncommon scenario: in the payments section of the contract you are negotiating, overdue interest is charged at five percent.  A higher rate is better for your client, and the client wants ten percent, so you redline accordingly. Client ultimately concedes and is willing to accept five. However, the draft from opposing counsel contains the following text:

Overdue interest is chargeable at the rate of five percent (10%).

The number in parentheses erroneously remains at 10. If anything, the discrepancy favors your client, since it leaves open the possibility to argue for application of the 10%.

Do you leave it alone and remain silent?

What if the applicable contractual rule of construction favors the text over the numbers, or the numbers over the text?

Does the answer change depending on the monetary significance of the ambiguity, or the impact on one or both of the parties?

And, how should the law resolve this question?

Join the debate and discussion here.