Finally express terms can also be formed orally for

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Finally, express terms can also be formed orally. For example if I agree to pay you to wash my car it is unlikely that we would put our agreement into writing — but there would still be at least two terms coming from our oral conversation; that you would wash my car and that I would pay you for doing it. Both would be legally enforceable. Written contracts With written contracts the problem of whether something that was discussed by the parties during their negotiations has (or has not) become a term is minimised. If the allegedly promissory statement has been incorporated into the written document it will almost invariably be a term and it will be enforceable. If it has not been incorporated there can be problems — particularly if the parties’ versions of what they intended differ. To assist the courts in resolving this possible impasse ‘the parol evidence rule’ was developed. In short, the parol evidence rule says that where a contract has been put into a written form and the writing appears to encompass the parties’ entire agreement, the written document will be assumed to contain all the terms of the agreement and the courts will not admit evidence to add to or vary the written contract in any way. (In this context ‘parol evidence’ refers not only to contradictory oral terms but also to previous drafts of the contract, copies of preliminary agreements and any other record of negotiations. If the parol evidence rule applies, the courts will not use any of those extrinsic sources of evidence to determine the parties’ intention.)
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© Stephen Graw 2012 22 So, if we entered into a detailed and apparently complete written contract setting out all of our respective rights and obligations but you also allege that I promised to do something extra (which I deny), it is most unlikely that the extra ‘promise’ would be regarded as (or enforced as) a term. The court would simply ask itself: if we had intended that supposed extra ‘promise’ (if it was ever made at all) to be enforceable why did we not include it in our otherwise very complete written agreement? Circumventing the ‘parol evidence’ rule The operation of the parol evidence rule can be avoided by proving either that the contract was in fact partly written and partly oral or that a particular term should be implied because of some trade usage or custom. However, it is far preferable to ensure, if a contract is reduced to writing, that all aspects of the agreement are expressly included in the final document. Contracts not wholly in writing If there is no written document (or if there is, but it only records part of the agreement) the courts may have to determine which statements made during negotiations were intended to be promissory (and, therefore, intended to be terms) and which were not. This can be a problem particularly if the parties’ evidence is in conflict — which is often the case. To separate those statements that were made merely to induce the contract from those that
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