PAROL EVIDENCE AND INTERPRETATION

1. Effect of the rule: The “parol evidence rule,” whose precise formulation varies from one authority to another, attempts to answer this question. In its more strict forms, the parol evidence rule results in barring from the factfinder’s consideration all evidence of certain preliminary agreements that are not contained in the final writing, even though this evidence might persuasively establish that the preliminary agreement did in fact take place and that the parties intended it to remain part of their deal despite its absence from the writing.

II. TOTAL AND PARTIAL INTEGRATION

A. The concept of “integration”: A written document does not always represent a deal that the parties consider final. The writing may, for instance, be intended only as a tentative draft of their agreement. But if the parties do intend a document to represent the final expression of their agreement, the document is said to be an “integration” of their agreement. The parol evidence rule applies, as we shall see, only to documents which are integrations, i.e., final expressions of agreement.

B. “Partial” vs. “total” integrations: Once it is determined that a document is an integration (i.e., a final expression of agreement), it must be determined whether the parties intended that integration to contain all of the details of their agreement, or only some of these details. If the document is intended only as a memorandum of the agreement, it may state only the most important details, and leave the others to the parties’ recollection.

1. Partial integration: If the document is not intended by the parties to include all details of their agreement, it is said to be a “partial” integration.

2. Total integration: If, on the other hand, the document is intended by the parties to include all the details of their agreement, it is called a “total” integration.

C. Statement of the parol evidence rule: Having defined the concepts of “partial integration” and “total integration,” we are now ready to state the parol evidence rule. The rule has, in effect, two parts, one dealing with partial integrations, and the other with total integrations. The rule provides as follows:

[1] Partial integration: When a writing is a partial integration, no evidence of prior or contemporaneous agreements or negotiations (oral or written) may be admitted if this evidence would contradict a term of the writing.

[2] Total integration: When a document is a total integration, no evidence of prior or contemporaneous agreements or negotiations (oral or written) may be admitted which would either contradict or even add to the writing.