American Contract Law for a Global Age, 2017a

Unit 17
__________________________________________________________________
TERMS AND INTERPRETATION
Part One
__________________________________________________________________
The Parol Evidence Rule
FOCUS OF THIS UNIT
Written Contracts with Oral Terms? Contracts come in many forms. Some are
simple and oral. Some are complex and written. Some involve both oral and written
terms. If a contract is completely written out and intended by the parties to be the
expression of their final deal—a complex, negotiated merger deal between
multinational corporations, for example—the natural tendency is to rely solely on the
writing. On the other hand, if there is no writing at all, oral testimony or other
evidence is necessary to prove the nature of the deal. But what about situations where
some parts of the deal are in writing and some are not?
You have experienced this directly. When you buy something at a local store
and sign a receipt, there is a writing that shows at least the price of the item. But
most of the other terms of the deal—can you carry it out or will it be delivered, what
warranty does it carry, can it be returned to the store, and so forth—will either have
been discussed orally or not discussed at all. If the goods turn out to be defective, you
will have a contract and there will be a writing evidencing it—but all the rest of the
terms will have to be supplied by oral testimony or other evidence—categories that
the law traditionally calls “parol evidence.”
Parol is for Contracts; Parole is for Convicts. The word “parol” —please note
the lack of a final “e” 1 so you can avoid looking silly to other lawyers—is a French
term for “oral.” Nonetheless, parol evidence as used in contract law does not solely
mean “oral” evidence, it means any evidence other than what is in the written
1 [The English word “parole,” despite its different meaning, is also related to the French word
for “oral.” The term in criminal law came from the oral promises that soldiers or prisoners would make
to their captors if they were released, such as a promise not to engage in future hostilities, or to act on
good behavior, hence being “out on parole.” Now that you know the difference, we beg you not to
embarrass us by referring to a “parole evidence rule” in contract law. No such thing exists.—Eds.]
______________________________________________________________________________
UNIT 17: THE PAROL EVIDENCE RULE 337