medium · LSAT Reading Comprehension
The Parol Evidence Rule governs the extent to which parties to a written contract may introduce extrinsic evidence—such as prior negotiations or oral agreements—to contradict or supplement the written terms. The rule's application hinges on whether the contract is 'integrated.' A fully integrated agreement is intended by the parties as the final and complete expression of their deal. In such cases, no outside evidence is admissible to change the terms. However, if an agreement is only partially integrated, outside evidence may be admitted to supplement the writing, though not to contradict it. Courts often look for a 'merger clause' to determine integration, which explicitly states that the document is the entire agreement. Critics argue the rule creates injustice when one party relies on an oral promise not included in the final draft. Proponents maintain that without the rule, the stability of written commercial transactions would vanish, as every contract would be subject to the faulty memories or outright perjury of the contracting parties regarding what was said before the ink dried.
Based on the passage, if a contract contains a merger clause and a party later attempts to prove that the other side orally promised a discount during negotiations, how would a court most likely rule?
- It would refuse to consider the alleged oral discount, since the merger clause marks the writing as the parties' complete and final agreement.
- It would admit the oral discount only if the promise does not directly contradict the written price.
- It would bar the evidence because oral agreements carry no force in any commercial setting.
- It would admit the evidence provided the party shows it relied on the oral promise to its detriment.
- It would admit the evidence to supplement, though not contradict, the written terms.
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