Parol Evidence Rule Flashcards, test questions and answers
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What is Parol Evidence Rule?
The Parol Evidence Rule is a legal principle that states that verbal or written agreements cannot be contradicted by evidence of prior or contemporaneous oral agreements. This rule prevents parties to a contract from using oral testimony to contradict the express provisions of the written contract. The purpose of this rule is to protect the validity and integrity of written contracts, which are generally considered more reliable than oral ones.The Parol Evidence Rule applies when both parties have agreed to an enforceable contract, and when one party attempts to introduce extrinsic evidence (evidence outside the four corners of the agreement) in an effort to vary, add, or contradict its terms. In other words, if there is an existing agreement between two parties and one party attempts to introduce evidence that would change or alter any part of that agreement then the Parol Evidence Rule will apply. Generally speaking, such evidence is not admissible in court and any attempt at relying on it may result in legal proceedings being dismissed.The Parol Evidence Rule can be a powerful tool for businesses looking for certainty with regards to their contractual arrangements as it helps avoid disputes arising from misunderstandings or misrepresentations made during negotiations leading up to signing a contract. It also helps protect businesses from fraudulent claims by ensuring they are not held liable for promises made verbally but not included in writing within the contract itself. In sum, it can be said that the Parol Evidence Rule plays an important role in protecting both parties’ rights when entering into binding agreements by preventing either party from introducing extrinsic evidence intended to modify what has already been agreed upon in writing.