The parol evidence rule tells us the circumstances under which a written agreement (which may consist of one or more documents) discharges and bars introduction of evidence of prior agreements (either written or oral) or contemporaneous oral agreements. It does not address the enforceability of agreements made thereafter (modifications) and is distinct from the question of whether a writing of some sort is required for the enforceability of an agreement (Statute of Frauds).

    The justification for the rule, in part, is a distrust of the ability of juries to determine whether someone is fabricating the existence of an oral agreement that either contradicts or supplements a written agreement. Given our trust of juries to determine truth telling in other contexts, the justification seems unpersuasive. Another justification may be that we should afford parties the ability to use the vehicle of a written agreement to say, in effect: "Forget everything else we have agreed on previously. This (the written agreement) is it." This justification does not, however, justify the rule’s application to contemporaneous oral agreements.

    I find the following approach useful to resolve parol evidence issues:

    1. Ask what the evidence (prior written or oral agreements or contemporaneous oral agreements) is offered to prove.

        a. If the offered evidence contradicts a provision in the written agreement, the parol evidence rule will preclude use of the evidence if the written agreement is partially integrated (i.e. if the parties intended the written agreement to be final with respect to the terms included in the written agreement), but will not preclude use of the evidence if the written agreement is not (even) partially integrated.

        b. If the offered evidence adds a provision to the written agreement, the parol evidence rule will preclude use of the evidence if the written agreement is completely integrated (i.e. if the parties intended the written agreement to be not only final with respect the terms included in the written agreement but also a complete and exclusive statement of the terms of their agreement). Remember that in this context the words "final" and "complete" are not synonymous.

    2. After determining whether you need to know if the written agreement was partially or if you need to know if the written agreement was completely integrated, apply rules which tell you how to "construct" the intention of the parties. We will explore both the "narrower" Williston rule (construct the intent by looking only within the four corners of the written agreement) and the "broader" rule (construct the intent by looking at all relevant evidence, including the written agreement, the context of and circumstances under which the agreement was entered, and the parol evidence itself). Applying these rules to construct the intent is typically the most critical part of a parol evidence analysis.

    3. If the parol evidence is admissible, the trier of fact must still evaluate all of the evidence (including any contradictory evidence offered by an adversary, e.g. "We did not agree to any such thing") before reaching a conclusion that the parol evidence establishes the existence of provisions of the contractual relationship between the parties.

    4. Remember that a different analysis is required if the parol evidence is offered to help interpret the meaning of terms of a written agreement (Tahoe National Bank v. Phillips).

    5. Remember that the parol evidence rule does not preclude introduction of evidence to show that: misrepresentation, duress, or mistake induced the formation of a contract; there was a condition precedent to formation of a contract.

    Relevant sections of the Restatement of Contracts 2d are 209-217.