Does our integration clause keep the other side's emails and drafts out?
Not from the interpretation stage. New Jersey permits a broad use of extrinsic evidence to achieve the ultimate goal of discovering the intent of the parties; extrinsic evidence may be used to uncover the true meaning of contractual terms, and it is only AFTER the meaning of the contract is discerned that the parol evidence rule comes into play to prohibit extrinsic evidence offered to vary the terms. For a sale of goods, § 12A:2-202 lets a final written expression be explained or supplemented by course of dealing, usage of trade or course of performance, and by consistent additional terms unless the court finds the writing was intended as a complete and exclusive statement; those three terms are defined in § 12A:1-303.
The trap
New Jersey is on the opposite side of the split from states that stop at the four corners when the text reads clearly. Conway allowed extrinsic evidence to explain a retainer bonus provision whose written terms 'appear to be clear', and the dissent's complaint (that the majority used extrinsic evidence to generate an ambiguity and then to cure it) is the practical warning. Conway involved no merger clause; its holding, extrinsic evidence admissible to interpret even terms that appear clear, makes an early ruling on meaning harder to obtain. An integration clause still does work against ADDITIONAL or CONTRADICTORY terms, and under § 12A:2-202(b) a court finding of complete-and-exclusive intent is what shuts out consistent additional terms, so the merger clause earns its keep there rather than at interpretation.
6 authorities
The words that state the rule
In sum, we permit a broad use of extrinsic evidence to achieve the ultimate goal of discovering the intent of the parties. Extrinsic evidence may be used to uncover the true meaning of contractual terms. It is only after the meaning of the contract is discerned that the parol evidence rule comes into play to prohibit the introduction of extrinsic evidence to vary the terms of the contract.
The words that state the rule
The issue presented is whether the parol evidence rule bars admission of extrinsic evidence to explain the meaning of a bonus provision in a lawyer's retainer agreement when the written terms of the agreement appear to be clear. In the first trial of this matter, the court denied admission of extrinsic evidence to interpret the terms of the retainer agreement and found that the condition requiring a bonus, a zoning change, was satisfied. The Appellate Division reversed and held that the *343 trial court should have considered extrinsic evidence of the parties' intent. At the second trial, the court concluded that the parties intended that to earn the bonus both a zoning change and access to the property were required. The Appellate Division affirmed. We hold that extrinsic evidence was properly admitted to explain the meaning of the bonus provision and affirm the judgment of the Appellate Division.
The words that state the rule
In sum, the evidence clearly established that the parties intended the bonus would be earned only if Conway were successful in obtaining both a zoning change and access to the property to permit development. Because access to the property was not attained, the bonus was not earned. IV. The judgment of the Appellate Division is affirmed.
- statuteN.J. Stat. Ann. § 12A:2-202enactment date not established
The words that state the rule
Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented (a) by course of dealing or usage of trade (12A:1-205) or by course of performance (12A:2-208); and (b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.
The words that state the rule
Justice RIVERA-SOTO, dissenting. Applying a two-step analysis, the majority first reviews extrinsic evidence to interpret a written retainer agreement negotiated between sophisticated partiesone of whom was a lawyer and the other was represented by its own counseland, based on that extrinsic evidence, determines that the written retainer agreement is ambiguous. As a result, the majority requires that the same extrinsic evidence used to create the ambiguity be used to cure it.
- statuteN.J. Stat. Ann. § 12A:1-303enactment date not established
The words that state the rule
a. A "course of performance" is a sequence of conduct between the parties to a particular transaction that exists if: (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and (2) the other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection. b. A "course of dealing" is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct. c. A "usage of trade" is any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.