What is the effect of an ambiguity in a contract?

An ambiguity in a contract is when the words of the contract are open to more than one interpretation. This can be caused by unclear wording, failing to include information, or even a simple typo. In Hawaii, an ambiguity in a contract may have a variety of effects. The most common effect of an ambiguity in a contract is that it renders the contract unenforceable. If one party can reasonably argue that the contract means one thing, and the other party can reasonably argue that it means something else, the contract is likely to be deemed unenforceable. This is because the court cannot determine which interpretation is correct. Additionally, an ambiguity in a contract could result in protracted litigation if either party decides to pursue legal action. The parties would be required to spend time and resources attempting to prove which interpretation is the correct one. This can be both time consuming and expensive. Finally, an ambiguity in a contract could lead to a settlement agreement. If the parties are able to agree on a particular interpretation of the ambiguous language, this can be put into a settlement agreement and the case can be closed. Overall, an ambiguity in a contract can have a variety of effects in Hawaii. Ultimately, it is important to be careful when drafting a contract, and use clear language to avoid confusion.

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