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Admissibility of Parol Evidence in an Action for Compensation

Parol evidence is admissible to prove a subsequent verbal agreement modifying or even abrogating a written contract, if the contract is not one required by law to be in writing.  Where a contract is ambiguous, a court can receive extrinsic evidence which would put the court in the position of the parties, and enable the court to determine the intention of the parties, and the evidence which would explain the meaning of the contract.[i]

However, in the absence of fraud, parol testimony of  prior or contemporaneous oral agreements which would vary the terms of a valid written contract is incompetent.  The purpose of the parol evidence rule is to exclude only such evidence intended to supersede and destroy the clear intentions of the parties set forth in the written agreement, and not to exclude all extrinsic evidence in general.[ii]

[i] Pedersen v. Fiksdal, 185 Cal. App. 2d 30 (Cal. App. 2d Dist. 1960)

[ii] SDR & R, Inc. v. JMS Constr. Co., 1991 Ohio App. LEXIS 360 (Ohio Ct. App., Cuyahoga County Jan. 31, 1991)


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