Parol Evidence Rule

See R.2d §§ 209-217, Farnsworth Suppl. p. 219 (UCC 2-202)

  • Substantive rule of state law, not really a rule of evidence.
  • Encourages reliance on writing and putting K’s in writing, preserve integrity
  • Refers to discussions/negotiations prior to K.
  • K supersedes everything that happened before (writing excludes that).
    • Excludes previous stuff, including evidence of prior or contemporaneous negotiations, agreements or concessions when such evidence is offered to alter written agreement.
  • Only applicable if there is a writing
    • Then "parol" (note spelling!) has to do with "extrinsic"/informal evidence of contracts not within the contract itself.
  • Only accidental overlap with Statute of Frauds
  • Subsequent modifications NOT covered by parol evidence rule.
Questions to ask:
  • Is there an integration (writing)? (§ 209)—expressly reserved as a matter of law for the judge
    • if NO, end of discussion.
  • YES: §§ 214, 215 (what’s OK and not OK with parol evidence)
  • Partial or complete? (§ 210, also reserved as matter of law)
    • Partial?
      • Example:IOU $500 with date, left out details of interest, etc.
      • Can add "consistent additional terms" (§ 216)
    • Complete? I.e., exhausted subject matter...
      • THEN CANNOT ADD (§ 213)
Gianni v. R. Russel & Co.
  • Operated store, entered into a new lease
  • Oral agreement granted exclusive right, but not in written contract between parties.
  • Is oral agreement outside of contract but contemporaneous?
    • Rrial court found for plaintiff, appeals court reversed:
      • "written contract = best evidence."
  • Tried to argue that withholding tobacco was a separate agreement, but court doesn't agree.
  • Rule that favors writing favors the repeat player who does contracts regularly.
  • Nothing in contract will foreclose equitable override by court if court so desires
  • Consideration alleged was in main agreement but what he wants was not in that agreement.
MCC-Marble: reference to CISG, discards parol evidence rule in that context.

Bollinger v. Central Pennsylvania Quarry
  • Alleged mutual mistake (paragraph they thought was in the contract to be reformed to add that)
    • equitable remedy
  • Contractor had been doing what they asked, then stopped, had also done it for neighbor
  • A contract only has force of law by parties assent
    • Thus, modifications by mutual agreement can change contract.
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