Parole Evidence, And Interpretation Flashcards
Parole Evidence Rule
When the parties to a contract express their agreement in a writing with the intent that it embody the final expression of their bargain, the writing is an integration. If the writing is not an integration (e.g., non-final expressions such as tentative drafts), the PER does NOT apply. Otherwise, an integration may be complete or partial
Complete Integration.
If the writing completely expresses all of the terms of the parties’ agreement, then it is a complete integration. ALL other expressions or statements, written or oral, made prior to the writing, as well as any oral expressions made contemporaneously with the writing, are inadmissible.
Merger Clause.
A merger clause recites that the agreement is the complete agreement between the parties. This is usually strong evidence that the writing is a complete integration.
Partial Integration.
If the writing sets forth the parties’ agreement about some terms, but not all the terms, then it is a partial integration. Other expressions or statements, written or oral, made prior to the writing, as well as any oral expressions made contemporaneously with the writing, are admissible to supplement the writing so long as the evidence does NOT contradict the terms of the writing.
The PER does NOT apply if any of the following exceptions exist:
Defenses. Extrinsic evidence may be offered to establish a defense to the formation or enforcement of a contract (e.g., incapacity, mistake, duress, lack of consideration, etc.).
Separate Deals. Extrinsic evidence may be offered if it represents a distinct and separate contract.
Condition Precedents. Extrinsic evidence may be offered if a party asserts that there was an oral agreement that the written contract would not become effective until a condition occurred.
Ambiguity and Interpretation. Extrinsic evidence may be offered for the purpose of interpreting or clarifying an ambiguity in the agreement.
The PER does NOT apply to agreements made between the parties AFTER
the execution of the writing. Agreements made after the execution of the writing would be analyzed as contract modifications, and do NOT trigger the PER.
