The rule prohibits only extrinsic evidence that seeks to vary, contradict, or add to an integration. Other types of extrinsic evidence may be admitted where they do not bring about this result.
A party to a written contract can attack the validity of the agreement. The party acknowledges that the writing reflects the agreement but asserts, most frequently, that the agreement never came into being because of any of the following:
(1) formation defects such as fraud, duress, mistake, illegality;
(2) conditions precedent -- where a party asserts that there was an oral agreement that the contract would not become effective until a condition occured, all evidence of the understanding may be offered and received. Parole evidence of such a condition precedent will not be admitted if it contradicts the express language of the written contract.
If there is uncertainty or ambiguity in the written agreement's terms or a dispute as to the meaning of those terms, parol evidence can be received to aid the fact-finder. If the meaning of the agreement is plain, parol evidence is inadmissible.
The parole evidence rule will not bar extrinsic evidence showing the true consideration paid.
- Parol evidence is often said to be admissible if the alleged parol agreement is collateral to the written obligation and does not conflict with it. This collateral agreement doctrine is hard to apply because it is conclusory. The restatement of contracts approach is the naturally omitted terms doctine, which allows evidence of terms that would naturally be omitted from the written agreement. A term would naturally be omitted if:
- (1) it does not conflict with the written integration; and
- (2) it concerns a subject that similarly situated parties would not ordinarily be expected to include in the written instrument.
Parol evidence can be used to show subsequent modifications of a written contract, because the parol evidence rule applies only to prior or contemporaneous negotiations.