Contracts-Contracts Content & Meaning

Question 1

Parol Evidence Rule (PER)

Answer 1

PER limits the extent to which evidence of discussions or writings made prior to or contemporaneous with the signed written K can be admitted and considered as part of the agreement.

Question 2

Partial vs Total Integration

Answer 2

Partial Integration: is one intended to be the final expression of the agreement, but NOT intended to include all details of the parties’ agreement. PER does NOT allowed the extrinsic evidence to contradict/materially alter but DOES allow it to SUPPLEMENT a term in a partially integrated K.
Total Integration: is the final expression of the agreement, and is also intended to include all details of the agreement. PER does NOT allow extrinsic term in a totally integrated K.

Question 3

Intent of the Parties used to determine integration

Answer 3

Common law - four-corners rule: look within the “four corners” of the document for evidence of intent. Merger clause = complete/total integration
R2d rule: if, under the circumstances, an extrinsic term of an agreement would “naturally be omitted” from a writing, then that term can be introduced, so long as it does not contradict the writing.
UCC rule: presumes that a written K = partial integration & allows additional consistent terms unless a ct concludes that the parties “certainly” would have included the term in the written K.

Question 4

PER Exceptions (when will PER not apply?)

Answer 4

1. K formation OR enforcement defect/defense (e.g., fraud, mistake, duress, etc.)
2. Conditions precedent to the K’s effectiveness
3. Interpreting an ambiguity (incl. course of performance, course of dealing, and usage of trade)
4. Separate or subsequent agreements