Contracts and Sales Multistate Bar Practice Exam

What does the Parol Evidence Rule state about integrated contracts?

1. Only written contracts can be modified

2. Prior oral agreements can be used to change the terms

3. Prior writings are admissible to clarify terms

4. Evidence cannot contradict the written terms

The correct answer is: Evidence cannot contradict the written terms

The Parol Evidence Rule primarily addresses the admissibility of external evidence in relation to integrated contracts, which are written agreements intended to serve as a complete and final expression of the parties' agreement. According to the rule, once the parties have executed an integrated contract, any prior or contemporaneous oral or written agreements that contradict or modify the terms of that contract are generally not admissible in court. This means that evidence cannot be introduced to challenge or change the established terms of the written contract, reinforcing the integrity and reliability of written agreements. In this context, the correct answer emphasizes that the Parol Evidence Rule prevents evidence from contradicting the written terms of an integrated contract, thus preserving the finality of the agreement the parties have made. This principle helps ensure that all parties have a clear understanding of their rights and obligations as outlined in the written document, minimizing disputes and ambiguities regarding what each party agreed to.