Doctrine of Contra Proferentum in Contract Interpretation Disputes

March 5, 2026 Sareesh Rawat, Esq.

The interpretation of government contracts begins with the plain language of the contract, with meaning assigned to all clauses within the context of the contract as a whole. When contract language is susceptible to more than one interpretation falling within the zone of reasonableness, an ambiguity exists that may be resolved by considering extrinsic evidence. If the ambiguity is still not resolved, the doctrine of contra proferentum is applied for interpretation. Under the doctrine, the ambiguity is resolved in favor of the non-drafting party, which is typically the contractor. However, for contra proferentum to apply, the ambiguity must be latent rather than a patent ambiguity. That is, the ambiguity must not be so glaring or obvious as to place upon the non-drafting party the duty to inquire before contract formation. Under this exception to the contra proferentum doctrine, if the non-drafting party fails to timely inquire about a patent ambiguity, the ambiguity is resolved against it. Furthermore, contractors seeking application of contra proferentum must show that they relied on their reasonable interpretation of the ambiguity in developing their offer.

In Armed Services Board of Contract Appeals (ASBCA) 62422, a decision issued on March 29, 2023, the Board determined that, in case an ambiguity was present in the contract, contra proferentum would be applied to construe the disputed language against the government as the party that drafted the relevant language. The United States Army Corps of Engineers (USACE) issued the underlying task order for the installation of a cooling-tower upgrade system at Maxwell Air Force Base in Alabama. The dispute concerned a Direct Digital Control (DDC) system, with the contractor contending that, per its interpretation of the relevant language in the task order, the government was responsible for providing the DDC system through its separate contract with a specialized provider. Meanwhile, the government maintained that it was the contractor’s responsibility under the existing scope of the task order to provide the DDC system by subcontracting with the government’s specialized Building Automation System (BAS) service provider.

Notably, the task order did not expressly state that the contractor was required to provide the DDC system. Rather, the relevant specifications stated that the government maintained a contract with a BAS service provider, and all installations, connections of new equipment, and maintenance of those systems were to be conducted solely by the government’s provider. The RFP also did not identify the government’s BAS service provider and did not provide information on how an offeror bidding on the task order could obtain the specialized provider's identity. In its proposal, the contractor indicated that it intended to self-perform 100% of the work and did not obtain any subcontractor quotations for providing the DDC system. Following the award, the contractor requested the contact information for the government’s BAS service provider and, upon receiving specific government instructions, furnished the DDC system by subcontracting with the government’s provider. The contractor later requested an equitable adjustment of $326,865, consistent with the subcontract quotation received from the BAS provider and 15.5% overhead and profit.

The contracting officer (CO) issued a final decision denying the claim, concluding that the requirement to provide the DDC system through the government’s specialized BAS provider was within the scope of the task order and therefore should have been priced by the contractor in its initial offer. In the appeal that followed, the ASBCA disagreed with the government’s interpretation, holding that the most natural reading of the relevant task order language indicated that the DDC controls had to be provided by the government by utilizing its separate contract with the BAS provider, with the task order contractor forbidden from performing that work. The ASBCA explained that it was unusual for the government to direct the use of a particular subcontractor, especially without identifying the mandatory subcontractor by name. Consequently, the Board concluded that the task order did not require the contractor to provide the DDC system. Its conclusion notwithstanding, the ASBCA also reviewed relevant extrinsic evidence and determined that it supported the interpretation that the task order contractor was not required to provide the DDC system.

Next, the ASBCA analyzed the application of the doctrine of contra proferentum by assuming that the relevant language was ambiguous and that any extrinsic evidence did not resolve the ambiguity. The Board noted that the application of the doctrine was particularly apt in this case, as the USACE could have easily made its supposed intentions plain in the RFP that the task order contractor was required to provide the DDC system through a subcontract with the government’s specialized BAS service provider. Furthermore, the contractor’s interpretation that USACE was responsible for providing the DDC system through its separate contract with the BAS provider was reasonable, and the contractor relied upon this interpretation in submitting its offer. Finally, the patent ambiguity exception to the doctrine would not apply because any ambiguity in the task order concerning the DDC system was not so glaring or obvious that the contractor would be required to raise it before submitting its proposal. Consequently, the Board determined that the doctrine of contra proferentum would place the adverse consequences of the USACE’s poor drafting on the government, not the contractor, in these circumstances.

Under the doctrine of contra proferentum, the ambiguity is resolved against the party that drafted the contract or the relevant disputed language. The doctrine is an interpretative rule of last resort, applied when the contract language is susceptible to more than one reasonable interpretation and when consideration of relevant extrinsic evidence does not resolve the ambiguity. Conversely, the doctrine is inapplicable if the parties’ intentions can be determined by a plain reading of the contract as a whole or through the consideration of extrinsic evidence. Since the government typically drafts government contracts, the doctrine of contra proferentum usually applies in favor of the contractor as the non-drafting party. However, contractors should be mindful of the patent ambiguity exception to the doctrine. Under this exception, if the ambiguity is so glaring or obvious that it triggers the contractor’s duty to inquire about it before contract formation, the government’s interpretation is favored if the contractor fails to inquire about the patent ambiguity. In addition to satisfying this duty to inquire, the contractor must also demonstrate that it relied on its reasonable interpretation during the preparation of its offer to benefit from the application of contra proferentum.

This Federal Contract Claims Insight is provided as a general summary of the applicable law in the practice area and does not constitute legal advice. Contractors wishing to learn more are encouraged to consult the TILLIT LAW PLLC Client Portal or Contact Us to determine how the law would apply in a specific situation.

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Extrinsic Evidence in the Solicitation Phase

In resolving the meaning of ambiguous terms in case of interpretive disputes in federal contracts, adjudicative forums often look to the discussions between the government and prospective contractors in the solicitation phase of the procurement. Statements made by government officials during their interactions with prospective contractors at pre-proposal conferences, industry days, or pre-award testing may be used as evidence in contract interpretations as long as such statements do not directly contradict the contract language. As with other extrinsic evidence in the context of contract interpretation, written communications, such as handouts and meeting minutes, generally hold much more weight than oral statements made by government officials.

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Doctrine of Contra Proferentum in Contract Interpretation Disputes

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