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Grammatical wonkery: the art of avoiding costly mistakes
Absent rare exceptions, courts will enforce written contracts the way they are written. As a recent Florida Supreme Court opinion shows, an imprecise sentence in a contract could mean the vast difference between litigating in a Florida court a dispute that arose in Colombia (the country) and litigating that dispute in a Colombian court using Florida law.
In the case Tribeca Asset Mgmt., Inc. v. Ancla Int’l, S.A., SC21-24, 2022 WL 869780 (Fla. Mar. 24, 2022), a Colombian brewery petitioned a Florida court to compel arbitration of a dispute with a Panamanian investment company over an alleged breach of contract that occurred in Colombia. The agreement included the following clause:
SEVENTH. APPLICABLE LAW. This agreement will be governed by the laws of the State of Florida of the United States of America (USA), a jurisdiction accepted by the parties irrespective of the fact that the principal activity of the beer project will be conducted in Colombia.
The plaintiff argued that pursuant to this clause, Florida was the “jurisdiction accepted by the parties,” and therefore, Florida courts had jurisdiction to enforce the agreement. The Florida Supreme Court rejected this argument based on a rule of grammatical construction known as the “doctrine of the last antecedent.”
This grammar rule provides that “relative and qualifying words, phrases and clauses are to be applied to the words or phrase immediately preceding, and are not to be construed as extending to, or including, others more remote.” Kasischke v. State, 991 So. 2d 803, 811 (Fla. 2008). Consider the difference between these two statements:
“The US Men’s National Team has an English Premier League winner goalkeeper, a Spanish Cup winner right-back, a Champions League winner right winger, and two young top Bundesliga attacking players who score goals regularly.”
“The US Men’s National Team has an English Premier League winner goalkeeper, a Spanish Cup winner right-back, a Champions League winner right winger, and two young top Bundesliga attacking players, who score goals regularly.”
The first statement conveys that only the attacking players scope goals regularly. The latter statement conveys that all five players do so. The difference in drafting is a single comma, but the difference in meaning is vast and obvious to spot.
The same was true of the contract clause in Tribeca. Expanding on the Florida Supreme Court’s explanation, in the opening statement “This agreement will be governed by the laws of the State of Florida of the United States of America (USA),” the word “laws” is modified by the phrase “the State of Florida of the United States of America (USA).” This means that the parties stipulated that Florida law would govern this agreement. The word “jurisdiction” (and even the phrase, “a jurisdiction accepted by the parties irrespective of the fact that the principal activity of the beer project will be conducted in Colombia”) is modifying the antecedent noun phrase “the laws of the State of Florida of the United States of America (USA).” The word “jurisdiction” therefore merely clarifies that the parties had chosen the location of Florida as the source of the law governing the agreement notwithstanding that the subject of the contract was to take place in Colombia.
Accordingly, the Court concluded that the agreement did not provide for arbitration in Florida, only that Florida law would be used in litigating the dispute (presumably in Colombia).
This may sound like grammatical wonkery, but this costly real-life example highlights the importance of employing highly-skilled counsel with keen attention to detail and learned in the art of grammar.