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Editing Contracts/Parol evidence rule
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The '''parol evidence rule''' prevents parties who have reduced their agreement to a final written document from later introducing other evidence, such as the content of <span style="background:orange">oral discussions</span> from earlier in the negotiation process, as evidence of a different intent as to the terms of the contract. The rule provides that "<span style="background:yellow">extrinsic evidence is inadmissible to vary a written contract</span>". | The '''parol evidence rule''' prevents parties who have reduced their agreement to a final written document from later introducing other evidence, such as the content of <span style="background:orange">oral discussions</span> from earlier in the negotiation process, as evidence of a different intent as to the terms of the contract. The rule provides that "<span style="background:yellow">extrinsic evidence is inadmissible to vary a written contract</span>". | ||
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The precise extent of the rule varies from jurisdiction to jurisdiction. As a preliminary or threshold issue, the court may first determine if the agreement was in fact totally reduced to a written document or (in US terminology) fully "integrated". In the case of ''State Rail Authority of New South Wales v Heath Outdoor Pty Ltd'' [[Michael McHugh (judge)|McHugh J]] held the parol evidence rule has 'no operation until it is first determined' that all the terms of the contract are in writing.<ref name="SRA v Heath">''State Rail Authority of New South Wales v Heath Outdoor Pty Ltd'' (1986) 7 [[NSW Law Reports|NSWLR]] 170 at 191, [[NSW Court of Appeal]] [http://www.austlii.edu.au/cgi-bin/LawCite?cit=7+NSWLR+170 LawCite records].</ref> This threshold question applies even in those jurisdictions that apply a very strong form of the parol evidence rule, called the "[[Four Corners (law)|Four Corners Rule]]". | The precise extent of the rule varies from jurisdiction to jurisdiction. As a preliminary or threshold issue, the court may first determine if the agreement was in fact totally reduced to a written document or (in US terminology) fully "integrated". In the case of ''State Rail Authority of New South Wales v Heath Outdoor Pty Ltd'' [[Michael McHugh (judge)|McHugh J]] held the parol evidence rule has 'no operation until it is first determined' that all the terms of the contract are in writing.<ref name="SRA v Heath">''State Rail Authority of New South Wales v Heath Outdoor Pty Ltd'' (1986) 7 [[NSW Law Reports|NSWLR]] 170 at 191, [[NSW Court of Appeal]] [http://www.austlii.edu.au/cgi-bin/LawCite?cit=7+NSWLR+170 LawCite records].</ref> This threshold question applies even in those jurisdictions that apply a very strong form of the parol evidence rule, called the "[[Four Corners (law)|Four Corners Rule]]". | ||
Beyond that, the | Beyond that, the exceptions to the parol evidence rule vary between jurisdictions. Examples of circumstances where <span style="background:yellow">extrinsic evidence</span> may be admissible in different jurisdictions include: | ||
* To prove the parties to a contract. A written agreement to sell land signed by Mrs Kenny at times made reference to Mr Kenny, and the court held that oral evidence was admissible and that she was signing for herself and as an agent for her husband.<ref name="Gilberto v Kenny">''Gilberto v Kenny'' (1983) 155 [[Commonwealth Law Reports|CLR]] 691 (15 February 1983) [[High Court of Australia|High Court]] (Australia).</ref> | * To prove the parties to a contract. A written agreement to sell land signed by Mrs Kenny at times made reference to Mr Kenny, and the court held that oral evidence was admissible and that she was signing for herself and as an agent for her husband.<ref name="Gilberto v Kenny">''Gilberto v Kenny'' (1983) 155 [[Commonwealth Law Reports|CLR]] 691 (15 February 1983) [[High Court of Australia|High Court]] (Australia).</ref> | ||
* To prove a condition precedent. In ''Pym v Campbell'' (1865) 119 ER 903, Pym entered into a written contract with Campbell to sell an interest in an invention. The court allowed Campbell to include the oral terms of acknowledgement that the sale was subject to an inspection and approval by an engineer. The engineer did not approve the invention. | * To prove a condition precedent. In ''Pym v Campbell'' (1865) 119 ER 903, Pym entered into a written contract with Campbell to sell an interest in an invention. The court allowed Campbell to include the oral terms of acknowledgement that the sale was subject to an inspection and approval by an engineer. The engineer did not approve the invention. | ||
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Parol evidence may be used to decide whether a remedy should be granted or denied to one of the parties. | Parol evidence may be used to decide whether a remedy should be granted or denied to one of the parties. | ||
==See also== | ==See also== |