Belize Telecom Case Comment: Implied Essay

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The context and even what should be considered as part of the context in which courts are able to read, interpret, and respond to legal documents including contracts, company constitutions, and pieces of legislation were all at issue in this case and are addressed in Hoffmann's decision. Though the question at the heart of the case is itself highly specific to the situation, the implications of the Privy Council's ruling in this matter are very far reaching and will affect the legal processes surrounding all of these documents, their creation, and their interpretation.

That the Privy Council determined that the directors in question should be removed and that the company's constitution could not be construed as giving these directors perpetual tenure is not nearly as significant as why the Privy Council ruled in this manner. The initial court reviewing the matter had determined that this was the proper course of action because it interpreted the company's constitution as implying that in the scenario that unfolded this would be the proper course of action -- it ruled, in essence, that this was the implied intention of the authors of the constitution. Two courts hearing the case on appeals disagreed with this initial court, finding that it was beyond the scope of judicial power to read this implication into the company's constitution and that to guess at the intentions of the authors represented an illegal addition into the constitution of a provision that simply wasn't there -- and if it wasn't there, no action could be taken based on it. Lord Hoffmann agreed that in most cases the lack of a provision means there simply is no provision and therefore no action to be taken, but that in some cases an omitted provision clearly called for action.

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The determining factor was not the author's intention, either, but rather the meaning of the company constitution (or more broadly, the contract or legislation) was whatever a "reasonable man" would conclude the constitution to mean given the full set of facts and context for the quandary. It would be entirely unreasonable to insist that the two directors in question were to hold perpetual and irrevocable directorship, according to Lord Hoffmann, yet reasonable to assume that when the authority that appointed the two directors is vacated their directorship will also be vacated.

The implications of this ruling are tremendously far-reaching, not only affecting the case at hand and similar disputes over company constitutions but impacting the interpretation of any legal document. Authorial intention no longer being a benchmark of any sort and the interpretation of a "reasonable man" given the relevant set of facts does not necessarily clear up any ambiguities, as one can imagine a case with less extreme alternatives than the case at hand where a "reasonable man" might just as easily choose one alternative as another, however it solves the even more fruitless problem of trying to parse language in an effort to concretely establish un-said portions of the text. Lord Hoffmann's tone is almost tongue-in-cheek when he comments that the Privy Council is not in a position to correct the company's constitution (or any other legal document) to make a clear and concrete provision for all eventualities, but the need to do so is made quite evident in the ruling. Every contract drafted since this ruling ought to be far more mindful of future contexts….....

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