parol evidence rule in Michigan

1999Ditzik v. Schaffer Lumber Co., 139 Mich.App. 81, 87-88 , 360 N.W.2d 876 (1984), citing NAG Enterprises, Inc. v. All State Industries, Inc., 407 Mich. 407, 410 , 285 N.W.2d 770 (1979). [4] For the narrowly drawn fraud and "incompleteness on its face" exceptions to the parol evidence rule, see 3 Corbin, Contracts, § 578, pp. 402-411, cited at UAW, supra at 494-495 , 579 N.W.2d 411 .

1999Ditzik v. Schaffer Lumber Co., 139 Mich.App. 81, 87-88 , 360 N.W.2d 876 (1984), citing NAG Enterprises, Inc. v. All State Industries, Inc., 407 Mich. 407, 410 , 285 N.W.2d 770 (1979). [4] For the narrowly drawn fraud and "incompleteness on its face" exceptions to the parol evidence rule, see 3 Corbin, Contracts, § 578, pp. 402-411, cited at UAW, supra at 494-495 , 579 N.W.2d 411 .

1988It was noted in Goodwin, Inc v Orson E Coe Pontiac, Inc, 392 Mich 195, 204 ; 220 NW2d 664 (1974), and NAG Enterprises, Inc v All State Industries, Inc, 407 Mich 407, 410-411 ; 285 NW2d 770 (1979), that there are a number of exceptions to the parol evidence rule.

1988It was noted in Goodwin, Inc v Orson E Coe Pontiac, Inc, 392 Mich 195, 204 ; 220 NW2d 664 (1974), and NAG Enterprises, Inc v All State Industries, Inc, 407 Mich 407, 410-411 ; 285 NW2d 770 (1979), that there are a number of exceptions to the parol evidence rule.

2025PAROL-EVIDENCE RULE “The parol evidence rule may be summarized as follows: [p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.” Hamade v Sunoco, Inc, 271 Mich App 145, 166 ; 721 NW2d 233 (2006) (quotation marks and citation omitted).

2024In other words, the parol evidence rule addresses the fact that disappointed parties will have a great incentive to describe circumstances in ways that escape the explicit terms of their contracts. [Hamade v Sunoco, Inc, 271 Mich App 145, 166-167 ; 721 NW2d 233 (2006) (quotation marks and citations omitted; alterations in original).] In this case, Lammers argues that the trial court improperly considered parol evidence by referring to the FEMA Declaration and Release that Lammers signed on the day of the closing.

2025PAROL-EVIDENCE RULE “The parol evidence rule may be summarized as follows: [p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.” Hamade v Sunoco, Inc, 271 Mich App 145, 166 ; 721 NW2d 233 (2006) (quotation marks and citation omitted).

2024In other words, the parol evidence rule addresses the fact that disappointed parties will have a great incentive to describe circumstances in ways that escape the explicit terms of their contracts. [Hamade v Sunoco, Inc, 271 Mich App 145, 166-167 ; 721 NW2d 233 (2006) (quotation marks and citations omitted; alterations in original).] In this case, Lammers argues that the trial court improperly considered parol evidence by referring to the FEMA Declaration and Release that Lammers signed on the day of the closing.

1986Because the parol evidence rule is a rule of substantive law as well as a rule of evidence, Salzman v Maldaver, 315 Mich 403, 412 ; 24 NW2d 161 (1946), its applicability may be considered even if the parol testimony is admitted in evidence without objection.

1986Because the parol evidence rule is a rule of substantive law as well as a rule of evidence, Salzman v Maldaver, 315 Mich 403, 412 ; 24 NW2d 161 (1946), its applicability may be considered even if the parol testimony is admitted in evidence without objection.

2022See Archambo v Lawyers Title Ins Corp, 466 Mich 402 , 413- 414; 646 NW2d 170 (2002); Blackledge v Allison, 431 US 63 , 75 n 6; 97 S Ct 1621 ; 52 L Ed 2d 136 (1977); Central Transport, Inc v Fruehauf Corp, 139 Mich App 536, 539 ; 362 NW2d 823 (1984); Ditzik v Schaffer Lumber Co, 139 Mich App 81, 83-84 ; 360 NW2d 876 (1984), -6- Therefore, as a general matter, evidence from outside the four corners of the purchase agreement is limited by the parol evidence rule.

2022See Archambo v Lawyers Title Ins Corp, 466 Mich 402 , 413- 414; 646 NW2d 170 (2002); Blackledge v Allison, 431 US 63 , 75 n 6; 97 S Ct 1621 ; 52 L Ed 2d 136 (1977); Central Transport, Inc v Fruehauf Corp, 139 Mich App 536, 539 ; 362 NW2d 823 (1984); Ditzik v Schaffer Lumber Co, 139 Mich App 81, 83-84 ; 360 NW2d 876 (1984), -6- Therefore, as a general matter, evidence from outside the four corners of the purchase agreement is limited by the parol evidence rule.

2022See Archambo v Lawyers Title Ins Corp, 466 Mich 402 , 413- 414; 646 NW2d 170 (2002); Blackledge v Allison, 431 US 63 , 75 n 6; 97 S Ct 1621 ; 52 L Ed 2d 136 (1977); Central Transport, Inc v Fruehauf Corp, 139 Mich App 536, 539 ; 362 NW2d 823 (1984); Ditzik v Schaffer Lumber Co, 139 Mich App 81, 83-84 ; 360 NW2d 876 (1984), -6- Therefore, as a general matter, evidence from outside the four corners of the purchase agreement is limited by the parol evidence rule.

2022See Archambo v Lawyers Title Ins Corp, 466 Mich 402 , 413- 414; 646 NW2d 170 (2002); Blackledge v Allison, 431 US 63 , 75 n 6; 97 S Ct 1621 ; 52 L Ed 2d 136 (1977); Central Transport, Inc v Fruehauf Corp, 139 Mich App 536, 539 ; 362 NW2d 823 (1984); Ditzik v Schaffer Lumber Co, 139 Mich App 81, 83-84 ; 360 NW2d 876 (1984), -6- Therefore, as a general matter, evidence from outside the four corners of the purchase agreement is limited by the parol evidence rule.

2006This rule recognizes that in “[black of nearly every written instrument lies a parol agreement, merged therein.” Lee State Bank v McElheny, 227 Mich 322, 327 ; 198 NW 928 (1924).

2006This rule recognizes that in “[black of nearly every written instrument lies a parol agreement, merged therein.” Lee State Bank v McElheny, 227 Mich 322, 327 ; 198 NW 928 (1924).

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328

1974This Court speaking through Justice Edwards so interpreted the phrase and repeated with approval ( 365 Mich 389, 395 ) the following language of Justice Talbot Smith in the majority opinion of In re Traub Estate (it is interesting to note Chief Justice Dethmers signed this opinion although he dissented in Traub presumably on the facts): "By way of preface we should say that in event of ambiguity in an instrument we make use of all possible *208 aids in construction, the parol evidence rule to the contrary notwithstanding. 3 Corbin, Contracts, § 579, p 250, states the principle with clarity: "

1970It is generally recognized that: “In event of ambiguity in an instrument we make use of all possible aids in construction, the parol evidence rule to the contrary notwithstanding. 3 Cor-bin, Contracts, § 579, p 250, states the principle with clarity: “ ‘As long as the court is aware that there may be doubt and ambiguity and uncertainty in the meaning and application of agreed language, it will welcome testimony as to antecedent agreements, communications, and other factors that may help decide the issue.’ ” In re Traub Estate (1958), 354 Mich 263, 280 .

2018He cites Randazzo v Kroenke, 373 Mich 61 ; 127 NW2d 880 (1964) in support of his position that the Settlement Agreement did not -6- need to specifically name Goldberg’s designee to be valid and that parol evidence could be used to establish that all parties to the Settlement Agreement were expressly aware of, and expressly consented to the designation of a Hertzberg entity as purchaser.

2018He cites Randazzo v Kroenke, 373 Mich 61 ; 127 NW2d 880 (1964) in support of his position that the Settlement Agreement did not -6- need to specifically name Goldberg’s designee to be valid and that parol evidence could be used to establish that all parties to the Settlement Agreement were expressly aware of, and expressly consented to the designation of a Hertzberg entity as purchaser.

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

2017“The parol evidence rule may be summarized as follows: ‘[p]arol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ”19 “ ‘The practical justification for the rule lies in the stability that it gives to written contracts; for otherwise either party might 14 Samuel D Begola Servs, Inc v Wild Bros, 210 Mich App 636, 639 ; 534 NW2d 217 (1995). 15 Custom Data Solutions, Inc v Preferred Capital, Inc, 274 Mich App 239, 243 ; 733 NW2d 102 (2006). 16

1968The Court in In re Traub Estate (1958), 354 Mich 263 found an agreement to make a will leaving certain shares of stock to “Robert Traub” ambiguous on the issue whether Robert’s daughter was entitled to the stock if he predeceased the contracting testator, declaring, p 280: “in event of ambiguity in an instrument we make use of all possible aids in construction, the parol evidence rule to the contrary notwithstanding. 3 Corbin, Contracts, § 579, p 250 [pp 420, 421 in 1960 ed] states the principle with clarity: “ ‘As long as the court is aware that there may be doubt and ambiguity and uncertaint

1968The Court in In re Traub Estate (1958), 354 Mich 263 found an agreement to make a will leaving certain shares of stock to "Robert Traub" ambiguous on the issue whether Robert's daughter was entitled to the stock if he predeceased the contracting testator, declaring, p 280: "in event of ambiguity in an instrument we make use of all possible aids in construction, the parol evidence rule to the contrary notwithstanding. 3 Corbin, Contracts, § 579, p 250 [pp 420, 421 in 1960 ed] states the principle with clarity: "`As long as the court is aware that there may be doubt and ambiguity and uncertainty

2003As this Court explained in Penzien v Dielectric Products Engineering Co, Inc, 374 Mich 444, 449 ; 132 NW2d 130 (1965): “If the contract in question were ambiguous or ‘doubtful,’ extrinsic evidence, particularly evidence which would indicate the contemporaneous understanding of the parties, would be admissible as an aid in construction of the disputed terms.” “The law is clear that where the language of the contract is ambiguous, the court can look to such extrinsic evidence as the parties’ conduct, the statements of its representatives, and past practice to aid in interpretation.” [Citations o

2003As this Court explained in Penzien v Dielectric Products Engineering Co, Inc, 374 Mich 444, 449 ; 132 NW2d 130 (1965): “If the contract in question were ambiguous or ‘doubtful,’ extrinsic evidence, particularly evidence which would indicate the contemporaneous understanding of the parties, would be admissible as an aid in construction of the disputed terms.” “The law is clear that where the language of the contract is ambiguous, the court can look to such extrinsic evidence as the parties’ conduct, the statements of its representatives, and past practice to aid in interpretation.” [Citations o

1983Cited approvingly at Corbin, supra, § 582, p 451, is Yezbak v Croce, 370 Pa 263, 266; 88 A2d 80 (1952) which stated: "The parol evidence rule is based on the assumption that the written contract contains the full and exact agreement of the parties but where admittedly it does not, the reason for the rule ceases.” In the instant case, it is clear from the face of the writing that it did not contain the complete agreement as assented to by the parties.

1983Cited approvingly at Corbin, supra, § 582, p 451, is Yezbak v Croce, 370 Pa 263, 266; 88 A2d 80 (1952) which stated: "The parol evidence rule is based on the assumption that the written contract contains the full and exact agreement of the parties but where admittedly it does not, the reason for the rule ceases." In the instant case, it is clear from the face of the writing that it did not contain the complete agreement as assented to by the parties.

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328

1979For example, the rule does not preclude admission of extrinsic evidence showing: that the writing was a sham, not intended to create legal relations, Tepsich v Howe Construction Co, 377 Mich 18, 23-25 ; *411 138 NW2d 376 (1965); that the contract has no efficacy or effect because of fraud, illegality, or mistake, Rood v Midwest Matrix Mart, Inc, 350 Mich 559, 564-567 ; 87 NW2d 186 (1957); Schupp v Davey Tree Expert Co, 235 Mich 268, 271 ; 209 NW 85 (1926); that the parties did not 'integrate’ their agreement, or assent to it as the final embodiment of their understanding, Mardon v Ferris, 328