In interpreting contracts to ascertain the parties’ intended meaning, the contract laws of Iran and England are not restricted to the written text alone, but also consider the surrounding circumstances. However, they fail to adequately address the precise relationship between “context” and “contractual meaning.” Legal scholars generally confine themselves to examining instances of context without answering how each instance contributes to the formation of meaning. Conversely, linguists focus closely on the relationship between context and meaning, determining the role of context (or surrounding circumstances) in creating or discovering meaning. Elucidating this relationship assists judges in decision-making and prevents subjective interpretations, as the exact role of each verbal or non-verbal instance of context is clearly delineated; consequently, the interpreter cannot, under the guise of expediency, fairness, pragmatism, or any relativistic approach, construct a meaning other than that intended by the parties. Adopting a descriptive-analytical method with the objective of providing a practical outcome, this paper concludes that although the approach of these two legal systems toward meaning differs from that of linguistic schools—in that contract law, unlike linguistics, views context as a means for discovering (rather than creating) meaning—linguistics can nonetheless be effectively employed for the proper interpretation of contracts.