The Virginia Business Litigation Blog
Virginia’s parol evidence rule prohibits the use of prior or contemporaneous oral statements or agreements to contradict, modify, or supplement the terms of a written contract that is intended to be a complete and final representation of the parties’ agreement. The rule is designed to protect the integrity of written contracts. It’s based on the premise that when parties have entered into a written agreement, the document itself is the best evidence of the terms of the agreement and the mutual intent of the parties. The parol evidence rule ensures the stability, predictability, and enforceability of finalized written instruments by excluding evidence of the parties’ intent not expressed in the written contract. Memories fade and people lie. Contracting parties need to be able to rely on the written agreement without the prospect of the other party having the ability to claim that certain verbal modifications or additions were made to it.
The parol evidence rule requires a court to construe a document according to its plain terms if it is clear and unambiguous on its face. In such a case, the court will not look for meaning beyond the instrument itself. (See Ott v. L & J Holdings, LLC, 275 Va. 182, 187 (2008)). The rule doesn’t always result in the exclusion of extrinsic evidence, however. There are times when a court may need to consider parol evidence to determine the intent of the parties, such as when the written contract is ambiguous, where it may be subject to a condition precedent, or where the contract was induced by fraud, mistake, or duress. (See Price v. Taylor, 251 Va. 82, 86–87 (1996); Jones v. Franklin, 160 Va. 266, 270 (1933)).