Each week we select a legal term or phrase that’s commonly misunderstood, interesting, or makes your spellchecker freak out. This week’s word is the latter.

Written by: Tracy Frazier

Imagine, if you will, two dapper businessmen in their fine wool suits negotiating a contract as to who can grow his hair the longest without getting fired.  As their lawyers scramble to capture the terms that are flying out of their mouths, certain elements of their agreement go unrecorded and are left hanging in the air.

Some time passes and one of the businessmen is fired for his unruly mane.  As he dejectedly meanders out of his building, he sees the other businessman on the street and notices that his hair is slicked back with an obscene amount of Aquanet.  Peeved, he marches straight to his home filing cabinet and pulls out the dusty contract.  He scans the paragraphs again and again, searching for the line of the contract that bans the use of such styling products.  Much to his chagrin, the terms are simply missing from the document.  After an angry phone call to the other businessman (who denies having ever agreed to this “Aquanet clause”), this unemployed chap calls his lawyer and explains the situation: “I’m suing that swindler for breach of contract.  Will we be able to get this missing Aquanet clause into court?”  His lawyer sighs and responds “maybe.”

What his lawyer means is that the clause will be admissible if the courts sees fit.  This oral clause is parol evidence.  Parol is derived from the Latin word to speak.  This term is drawn from the same word as parole, which means to be released from prison “on your good word.”  These homonyms are not used interchangeably, however, so wipe the image of evidence strolling out of a jail from your mind.

Parol evidence is additional or contradictive terms that for some reason were not memorialized in the writing of the contract.  Under both the Uniform Commercial Code (”UCC”) and common law, parol evidence is a mechanism a court can use to limit how much outside of the written terms of the contract they will consider.

Traditionally, courts would not admit any undocumented terms of the contact into the trial.  But as time progressed, courts began to see the injustice that this strict doctrine could bring.  Therefore, modern courts will generally allow parol evidence insofar that it does not mislead the trier of fact (normally the judge or jury).  Under the UCC, additional or contradictory terms may only be admissible to explain or supplement, and not to contradict the terms of the contract. U.C.C. § 2-202

What is easy to forget is that parol evidence does not determine the outcome of a case.  Rather, it allows the extrinsic evidence to be considered so that the court may grasp the entire picture.  Therefore, overcoming the doctrine of parol evidence is a hurdle that our businessman must leap over if he wants the court to hear about his Aquanet clause.