Terms of the Contract/ Interpretation

Question 1

Parol Evidence Rule Under Common Law

Answer 1

Under the parol evidence rule, evidence of other prior or contemporaneous agreements may not be introduced to vary or contradict the terms of a fully integrated writing. The purpose of the parol evidence rule is to prevent fraudulent claims.

Question 2

Parol Evidence Rule Under UCC

Answer 2

The parol evidence rule bars the use of prior or contemporaneous agreements to vary or interpret the terms of the fully integrated contract.

Question 3

Merger Clause

Answer 3

Merger clause (states agreement is complete on its face) is evidence of full integration

Question 4

Ambiguous Terms

Answer 4

Extrinsic evidence will be allowed to interpret the terms of the contract even in a fully integrated agreement.

Question 5

Plain Meaning

Answer 5

If a term has a plain meaning, then no extrinsic evidence is required to interpret the a term within an agreement.

Question 6

Issues to cover in TERMS OF THE CONTRACT

Answer 6

1. TERMS OF THE CONTRACT
   
   1. Interpretation of terms
      
      1. Custom and usage in the industry
      2. Course of dealing between the parties
   2. Mistake and ambiguous terms
   3. Parol Evidence Rule
   4. Modification
      
      1. Additional consideration needed under the common law
      2. Under UCC, no consideration needed so long as in good faith
      3. Modification may need to satisfy Statute of Frauds

Question 7

Interpretations of Terms

Gap Fillers

Answer 7

Words or Conduct as a source of K terms to fill in gaps. Cts look these (below) in order:

1. Course of performance
2. Course of dealing b/t the parties
3. Custom and usage in the industry

Question 8

Course of Performance

Answer 8

1. Interpretation of terms—Words or Conduct as a source of K terms to fill in gaps. Cts look these (below) in order:
   
   1. Course of performance – same people, same contract (B never complained about boiling hens before)

Question 9

Course of Dealing

Answer 9

1. Interpretation of terms—Words or Conduct as a source of K terms to fill in gaps. Cts look these (below) in order:
   
   1. Course of performance
   2. Course of dealing b/t the parties – same people, different but similar contract

Question 10

Custom and Usage in the Industry

Answer 10

1. Interpretation of terms—Words or Conduct as a source of K terms to fill in gaps. Cts look these (below) in order:
   
   1. Course of performance
   2. Course of dealing b/t the parties
   3. Custom and usage in the industry – different but similar people, different but similar K (customarily = boiling)

Question 11

Modification

Answer 11

1. Modification
   
   1. Additional consideration needed under the common law
   2. Under UCC, no consideration needed so long as in good faith
   3. Modification may need to satisfy Statute of Frauds