Contracts Law. The “parol evidence rule” is a principle in contracts law which seeks to protect the integrity of written contracts by prohibiting extrinsic evidence of prior oral or written representations that contradict the terms of a final written contract.
The parol evidence rule bars evidence of additional terms to a written contract, when that contract is a complete integration of the agreement of the parties. The parol evidence rule bars the admission of evidence from outside the contract’s four corners (called “parol evidence”) to vary or contradict that unambiguous language.
Where the parties have made a contract and have expressed it in writing to which they both assented as the complete and accurate integration of that contract, evidence, whether parol or otherwise, of antecedent understanding and negotiations will not be admitted for the purpose of varying or contradicting the writing.
In California, the parol evidence rule is codified in subdivision (a) of Code of Civil Procedure section 1856, which reads:
Terms set forth in a writing intended by the parties as a final expression of their agreement with respect to the terms included therein may not be contradicted by evidence of a prior agreement or of a contemporaneous oral agreement
Cal. Code Civ. Proc., § 1856, subd. (a); see also Cal. Civ. Code, § 1625 (“The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the negotiations or stipulations concerning its matter which preceded or accompanied the execution of the instrument”)
The parol evidence rule is not merely an evidentiary rule, but is a rule of substantive law.
Exceptions to the Parol Evidence Rule
Over the years, courts have recognized several exceptions to the parol evidence rule.
For instance, it is now generally accepted that if a written agreement is not fully integrated, evidence of a prior oral agreement can be introduced to the extent that it is not inconsistent with the terms of the the written agreement.
Courts also have permitted extrinsic evidence to be introduced to explain the meaning of certain ambiguous term of a written agreement as long as the meaning urged is one to which the written contract term is reasonably susceptible.
Finally, courts also have permitted a party to present extrinsic evidence to show that the written agreement was tainted by fraud.