May I still be held liable for a misworded section of a fraternity contract?

You did not submit your excuse 24 hours before the event. The council fined you in accordance with the code of conduct. If you had submitted 24 hours before the event, the council could have accepted or rejected your excuse. That is their perogative. Sumbit an excuse at least 24 hours in advance or don't bother submitting it. Nothing misworded here.