Leasing License Practice Exam

What rule states that oral statements can support written contracts but cannot contradict them?

1. Parol evidence rule

2. Statute of Frauds

3. Implied Warranty Rule

4. Doctrine of Merger

The correct answer is: Parol evidence rule

The Parol Evidence Rule is a fundamental principle in contract law that addresses how parties can use oral statements or agreements in relation to written contracts. This rule allows for the possibility that oral statements made during negotiations can help to interpret a written agreement, but it strictly prohibits any oral statements from undermining or contradicting the written terms of the contract. The essence of the Parol Evidence Rule is that once parties have finalized a written contract and it is deemed complete, they cannot introduce prior oral or written statements that alter, contradict, or dispute the written document. This rule aims to maintain the integrity of the written agreement, as it serves as the definitive record of the parties' intentions and obligations. It also protects against misunderstandings and disputes over terms that may have been discussed but not included in the final contract. In contrast, the Statute of Frauds pertains to specific types of contracts that must be in writing to be enforceable, rather than addressing how oral agreements interact with written contracts. The Implied Warranty Rule refers to the assurance that a product will work as expected, and the Doctrine of Merger involves the idea that once a contract is executed, it supersedes all previous negotiations or agreements. Understanding the Parol Evidence Rule is crucial for anyone involved in