MBE 2015 CONTRACTS PAROL EVIDENCE RULE

INTEGRATED CONTRACT OR AGREEMENT

*If K or Agmt is Integrated = Parol Evidence is NOT Admitted* a K or Agmt is Integrated if: the K or Agmt is Intended to be a final & complete statement of the parties agreement. *Integration:* Look for the facts stating: a judge says K is Integrated, or K has a *Merger Clause* or some statement in the K stating no oral evidence will be allowed.

PARTIAL INTEGRATED CONTRACT or AGREEMENT

*Partially Integrated K or Agreement = Parol Evidence will be Allowed* --Allowed Parol Evidence such as: Consistent Additional Terms, i.e. terms that explain or clarify the: how, where, when, what of the K. *BUT NOT ALLOWED:* Information that contradicts or materially alters the K.

THE (PER) HYPO

*a PER problem requires a writing* --so if the fact pattern tells you that it is an oral agreement; then it is a SoF problem NOT PER. --Its usually 2 People who have a valid written K or Agmt & now one of the parties is trying to add terms to the K based on what the parties discussed & talked about. --Is it about an Ambiguity? if yes then PER allowed to clear up the ambiguity only. --If the K is a *Final Integration* then parol evidence will NOT be admissible. --If there is no facts in the MBE stating K or Agmt is a complete or final integration then it is only Partial Integration so Parol Evidence will be allowed.

PAROL EVIDENCE THAT IS ALWAYS ALLOWED

ALWAYS ALLOWED: any Parol Evidence of: *Fraud, Duress, Mistake, Condition, Course of Dealing.*

AMBIGUITY & PER

Ambiguity in an integrated K, if that Ambiguity is fact specific then *Parol Evidence will BE ALLOWED to clear up the ambiguity.*

CONDITION VS PER

An exception to the parol evidence rule applies where the extrinsic evidence is offered to prove that the written agreement is to take effect only upon the occurrence of a *stated condition* (even if the condition is for only one party's benefit). Because the buyer-shareholder agreement will only take effect upon approval by the parent company, extrinsic evidence of this oral understanding is admissible notwithstanding the parol evidence rule.

PAROL EVIDENCE RULE (PER)

Parol Evidence Rule (PER) keeps out evidence of prior or contemporaneous agreement either oral or written that contradicts or changes the terms of the written Integrated contract or agreement.