The Parol Evidence Rule

Effect of Integrated Agreement on Prior Agreements (Parol Evidence Rule) 1) A binding integrated agreement discharges prior agreements to the extent that it is inconsistent with them. 2) A binding completely integrated agreement discharges prior agreements to the extent that they are within its scope. 3) An integrated agreement that is not binding or that is voidable and avoided does not discharge a prior agreement. But an integrated agreement, even though not binding, may be effective to render inoperative a term which would have been part of the agreement if it had not been integrated.

Integrated Agreements1) An integrated agreement is a writing or writings constituting a final expression of one or more terms of an agreement. 2) Whether there is an integrated agreement is to be determined by the court as a question preliminary to determination of a question of interpretation or to application of the parol evidence rule. 3) Where the parties reduce an agreement to a writing which in view of its completeness and specificity reasonably appears to be a complete agreement, it is taken to be an integrated agreement unless it is established by other evidence that the writing did not constitute a final expression.

Completely and Partially Integrated Agreements1) A completely integrated agreement is an integrated agreement adopted by the parties as a complete and exclusive statement of the terms of the agreement. 2) A partially integrated agreement is an integrated agreement other than a completely integrated agreement. 3)Whether an agreement is completely or partially integrated is to be determined by the court as a question preliminary to determination of a question of interpretation or to application of the parol evidence rule.

1. Is the writing a "final expression" of one or more terms of an agreement?
1. No writing? Rule does not apply.
2. If there is a writing…

Then the writing is an integrated agreement and then

2. Has the writing been adopted by the parties as a complete and exclusive statement of the terms of the agreement?
1. If not then "partially integrated agreement"
1. If yes then "completely integrated agreement" (may not say that part)

2) Whether there is an integrated agreement is to be determined by the court as a question preliminary to determination of a question of interpretation or to application of the parol evidence rule. 3)Whether an agreement is completely or partially integrated is to be determined by the court as a question preliminary to determination of a question of interpretation or to application of the parol evidence rule.

Consistent Additional Terms1) Evidence of a consistent additional term is admissible to supplement an integrated agreement unless the court finds that the agreement was completely integrated. 2) An agreement is not completely integrated if the writing omits a consistent additional agreed term which is (a) agreed to for separate consideration, or (b) such a term as in the circumstances might naturally be omitted from the writing.

Permits proof of a collateral agreement if such an agreement would be naturally made by parties similarly situated as were the parties to the written agreement.

Final Written Expression: Parol or Extrinsic Evidence
Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented
(a) by course of dealing or usage of trade (Section 1-205) or by course of performance (Section 2-208); and (b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.