Certified Professional Public Buyer (CPPB) Practice Test

What principle gives priority to the overall meaning of a contract rather than specific sections or clauses?

1. Whole instrument rule

2. Literal interpretation

3. Priority clause

4. Covenant interpretation

The correct answer is: Whole instrument rule

The principle that prioritizes the overall meaning of a contract rather than focusing on individual sections or clauses is known as the whole instrument rule. This rule emphasizes that the contract should be understood in its entirety, recognizing that the different parts of the contract work together to convey a cohesive agreement. By adopting this perspective, it allows for a more comprehensive understanding of the intentions of the parties involved in the contract. This approach is particularly important in contract interpretation, as it prevents an overly narrow focus on specific phrases or provisions that might lead to incomplete or misleading interpretations. The whole instrument rule encourages readers to consider the context and purpose of the entire document, ensuring that the contract is interpreted in a manner consistent with the overall intent of the parties. In contrast, other options like literal interpretation may focus heavily on the specific wording without considering the broader context, which can lead to misunderstandings.