The objective approach focuses on external manifestation of intention rather than internal subjective states. This method prioritizes the meaning that reasonable persons would attribute to the words used in the contract.
The subjective approach, reflected in the UNIDROIT Principles and European Principles, seeks to ascertain the actual common intention of the parties, looking beyond the literal text when necessary.
"A contract shall be interpreted according to the common intention of the parties."
The Objective Approach
The objective approach focuses on external manifestation of intention rather than internal subjective states. This method prioritizes the meaning that reasonable persons would attribute to the words used in the contract.
The Subjective Approach
The subjective approach, reflected in the UNIDROIT Principles and European Principles, seeks to ascertain the actual common intention of the parties, looking beyond the literal text when necessary.
"A contract shall be interpreted according to the common intention of the parties."