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Contracts • Terms of the Contract
K#086
Legal Definition
The Parol Evidence Rule allows courts to admit evidence of earlier agreements as sources of consistent, additional terms if it finds: (1) the agreement was only a partial integration; or (2) the additional terms would ordinarily be in a separate agreement.
Plain English Explanation
The purpose of the Parol Evidence Rule is to grant a default-level of respect for the terms of a contract and not allow parties to undermine the terms of the contract using previous negotiations or discussions. After all, if a signed contract exists, it means that the parties ultimately said, "This is what we are agreeing to."
However, courts will not allow the Parol Evidence Rule to prevent a party from showing evidence that helps to provide a more clear understanding of what the bargain truly was by providing additional terms that are consistent with the other terms of the contract. Though such evidence would be parol evidence, its purpose would be limited to assist the court in better understanding what was agreed to.
Note that the court will only allow this if the agreement is a partial integration or the additional terms are the types of terms normally included in a separate agreement.
However, courts will not allow the Parol Evidence Rule to prevent a party from showing evidence that helps to provide a more clear understanding of what the bargain truly was by providing additional terms that are consistent with the other terms of the contract. Though such evidence would be parol evidence, its purpose would be limited to assist the court in better understanding what was agreed to.
Note that the court will only allow this if the agreement is a partial integration or the additional terms are the types of terms normally included in a separate agreement.
Visual Aids
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