§ 1.  Generally

Where parties have set down their agreement in a writing which was intended to be complete or integrated, evidence of prior discussions and negotiations which is inconsistent with the original writing is inadmissible.{footnote} [3051]  F.D.I.C. v. Bay Street Development Corp.,  32 F.3d 636 (1st Cir. 1994); Advanced Medical, Inc. v. Arden Medical Systems, Inc., 955 F.2d 188 (3d Cir. 1992) (applying Minnesota law); American Totalisator Co., Inc. v. Fair Grounds Corp., 3 F.3d 810 (5th Cir. 1993) (applying Louisiana law); Thrifty Rent-A-Car Systems, Inc. v. Brown Flight Rental One Corp., 24 F.3d 1190 (10th Cir. 1994) (applying Okla. law); Coca-Cola Bottling Co. of Ogden, Inc. v. Coca-Cola Co., 4 F.3d 930 (10th Cir. 1993) (applying Georgia law); Herson v. Gibraltar Building & Loan Assn., Inc., 864 F.2d 848, 851 (U.S. App. D.C. 1989) (applying Maryland law, finding release unambiguous).
Cal. Civ. Pro. § 1856(a); Cal. Civ. Sec.  1625; Cal. Com. Sec. 2202 (commercial transactions); City of Manhattan Beach v. Sup. Ct., 13 Cal. 4th 232, 238, 52 Cal. Rptr. 2d 82, 86 (1996); FPI Develop., Inc. v. Nakashima, 231 Cal. App. 3d 367, 282 Cal. Rptr. 508 (1991); American Builders Sav. & Loan Ass=n v. South River Landing, 502 A.2d 1096, 1099 (Md. Ct. App. 1986); Craig v. Jo B. Gardner, Inc., 586 S.W.2d 316, 324 (Mo. 1979);.
See also U.C.C. § 2-202 (sales contracts); U.C.C. § 3-119 (commercial paper); Ill. Rev. Stat. ch. 26, & 2-202 (sales contracts); Ill. Rev. Stat. ch. 26, & 3-119 (commercial paper); Restatement of Contracts § 237{/footnote}  Thus, the first issue is whether the written agreement is a complete or integrated agreement (§ 2).  If so, the offered evidence must be consistent with the agreement, either because it sheds light on otherwise ambiguous language in the agreement (§ 3) or because it relates to a collateral oral agreement (§ 4).  Finally, if the offered evidence is inconsistent, the court must determine whether an exception to the parol evidence rule applies (§ 5).
The parol evidence Arule@ is in fact not a true rule of evidence, but rather a substantive doctrine of contract law.{footnote}Petereit v. S.B. Thomas, Inc., 63 F.3d1169 (2d Cir. 1995); AM Intern., Inc. v. Graphic Management Assoc., Inc., 44 F.3d 572 (7th Cir. 1995); Aerotronics, Inc. v. Pneumo Abex Corp., 62 F.3d 1053 (8th Cir. 1995) (applying Ohio and Michigan law); Chavez v. Director, Office of Workers Compensation Programs, 961 F.2d 1409 (9th Cir. 1992).
BMW of No. America, Inc. v. New Motor Veh. Bd., 162 Cal. App. 3d 980, 990, 209 Cal. Rptr. 50, 56 (1984).
Restatement (Second) of Contracts § 213 comment.{/footnote}  As a result, in federal diversity case, state substantive law governs application of this rule.{footnote}Hershon v. Gibraltar Bldg. & Loan Assoc., Inc., 864 F.2d 848, 851 (U.S. App. D.C. 1989).{/footnote}
The rule only applies in suits between the parties to the agreement, including successors and assigns.  Third parties may always introduce parol evidence to vary the terms of an agreement.{footnote} [3054] Mitchell v. Industrial Credit Corp., 898 F. Supp. 1518 (N.D. Ala. 1995); In re Alterman, 127 B.R. 356 (Bktrcy. E.D. Va. 1991).
General Casualty Co. of Wisconsin v. Elam, 289 N.E.2d 699 (Ill. App. Ct. 1972).
Contra Kern County Water Agency v. Belridge Water Storage Dist., 18 Cal. App. 4th 77, 86, 22 Cal. Rptr. 2d 354, 359-360 (1993).{/footnote}  Thus the rule has no application to criminal prosecutions.{footnote}People v. Woolson, 181 Cal. App.2d 657, 668, 5 Cal.Rptr. 766, 775 (1960).{/footnote}
The parol evidence rule extends not only to ordinary contracts for goods or services but also to deeds{footnote}United States v. Baran, 996 F.2d 25 (2d Cir. 1993); Keller v. Bass Pro Shops, Inc., 15 F.3d 122 (8th Cir. 1994).
Cal. Civ. Pro. § 1856(h); City of Manhattan Beach v. Sup. Ct., 13 Cal. 4th 232, 245-46, 52 Cal. Rptr. 2d 82, 91 (1996).{/footnote} and wills.{footnote}Cal. Civ. Pro. § 1856(h); In re MacLeod, 206 Cal.App.3d 1235, 1242, 254 Cal. Rptr. 156, 158 (1988).{/footnote} See WILLS–Parol Evidence.  The rule has even been applied to judgments,{footnote}Harris v. Rivera Cruz, 20 F.3d 507 (1st Cir. 1994).
See also Wackerman Dairy, Inc. v. Wilson, 7 F.3d 891 (9th Cir. 1993) (stipulations contained in decree not ambiguous, therefore extrinsic evidence not required to interpret them).{/footnote} the records of proceedings of public bodies,{footnote}La Crosse County v. Gershman, Brickner & Bratton, Inc., 982 F.2d 1171 (7th Cir. 1993).{/footnote} and corporate audit letters.{footnote}In re Interstate Cigar Co., Inc., 171 B.R. 6 (Bkrtcy. E.D.N.Y. 1994).{/footnote}

§ 2.  Completeness or Integration

The parol evidence rule only applies where there is a final intergrated agreement.{footnote}FDIC v. W.R. Grace & Co., 877 F.2d 614, 620 (7th Cir. 1989) (applying Illinois law; rule inapplicable to letters preliminary to an agreement).
Bowman v. Santa Clara, 153 Cal. App. 2d 707, 315 P.2d 67, 69 (1957) (parol evidence admissible as to terms missing from ditch digging contract).{/footnote}  A writing satisfies this standard if it was intended by the parties as the final, complete and exclusive expression of their agreement.{footnote}  Cal. Civ. Pro. § 1856(a); Wagner v. Glendale Adventist Med. Ctr., 216 Cal. App. 3d 1379, 1386, 265 Cal. Rptr. 412, 416 (1989).{/footnote}
Whether a writing was intended to set forth the parties’ complete agreement is  a preliminary fact question which must be determined by the Court.{footnote} [3063] Cal. Civ. Pro. § 1856(d); Esbensen v. Userware Int=l, Inc., 11 Cal. App. 4th 631, 637, 14 Cal. Rptr. 2d 93, 97, fn. 4 (1992); Brawthen v. H. & R. Block, Inc., 52 Cal. App. 3d 139 (1975).{/footnote}  The majority rule is that the parties’ intentions must be determined strictly from the face of the written instrument.{footnote} [3064] 70 A.L.R. 752.{/footnote}  A merger clause which provides that the writing contains the complete agreement of the parties is considered conclusive evidence by many courts that the writing is an integrated agreement.{footnote}But see Banco do Brasil, S.A. v. Latian, Inc., 234 Cal. App. 3d 973, 1002-1003, 285 Cal. Rptr. 870, 887 (1991) (integration clause Avery persuasive, if not controlling, on the issue.@){/footnote}  The absence of such a clause is not conclusive, but is relevant to the court’s determination.{footnote}Wallis v. Farmer=s Group, Inc., 220 Cal. App. 3d 718, 730, 269 Cal. Rptr. 299, 305 (1990).{/footnote}  A minority of courts admit all relevant extrinsic evidence in determining the parties’ intentions.{footnote} [3067] FDIC v. W.R. Grace & Co., 877 F.2d 614, 620 (7th Cir. 1989) (Illinois law allows all pertinent evidence if agreement ambiguous). Masterson v. Sine, 68 Cal. 2d 222 (1968).{/footnote}
The parol evidence rule also applies to Apartially integrated@ contracts–contracts which were intended to be complete and final as certain terms but not all of the terms of the agreement.  In such cases, inconsistent extrinsic evidence is not permitted as to the terms covered by the partially intergrated contract.{footnote}Wallis v. Farmer=s Group, Inc., 220 Cal. App. 3d 718, 730, 269 Cal. Rptr. 299, 305 (1990).{/footnote}  Extrinsic evidence may be offered as to terms not covered by the contract.{footnote}Hayter Trucking, Inc. v. Shell Western E & P, Inc., 18 Cal. App. 4th 1, 14, 22 Cal. Rptr. 2d 229, 238 (1993).{/footnote}

§ 3.  Interpretation of Ambiguous Terms

If there is an integrated contract (Sec. 2), the extrinsic evidence being offered must be consistent with that contract.  Thus, evidence that the parties did not intend what is expressed in the contract is inadmissible.{footnote}Larsen v. Johannes, 7 Cal. App. 3d 491, 500, 86 Cal. Rptr. 744, 749 (1970).{/footnote}  Extrinsic evidence is consistent with the contract, on the other hand, if it is offered to prove a meaning as to which the language in the contract is ambiguous,{footnote} [3071] Gisborn v. Charter Oak Life Ins. Co., 142 U.S. 326 (___); Bloom v. Hearst Entertainment, Inc., 33 F.3d 518 (5th Cir. 1994) (whether granting clause of book contract included home video rights); John Morrell & Co. v. Local Union 304A of United Food & Commercial Workers, 913 F.2d (8th Cir.  19___).
Kerwin v. Bank of Douglas, 379 P.2d 978 (Ariz. 19–); Friedman v. Virginia Metal Products Corp., 56 So.2d 515 (Fla. 19___); Riemer Bros., Inc. v. Marlis Constr. Co., 380 N.E.2d 1160 (Ill. App. Ct. 19__);  Brauer v. Hobbs, 391 N.W.2d 482 (Mich. App. Ct. 19__); Gentry v. Stevens, 145 App. Div. 2d 532, 536 N.Y.S.2d 89 (19__); In re Estate of Hall,  535 A.2d 47 (Pa. 19___);  Cliff & Co. v.  Anderson, 777 P.2d 595 (Wyo. 19__).
{/footnote} but reasonably susceptible.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568 (2d Cir. 1993).
Pacific Gas & Elec. Co. v. Thomas Drayage & Rigging Co., 69 Cal.2d 33 (1968) (parol evidence as to meaning of Ainjury to property@); Wallis v. Farmer=s Group, Inc., 220 Cal. App. 3d 718, 730, 269 Cal. Rptr. 299, 305 (1990).{/footnote}   Phrased another way, courts will not admit parol evidence as to what parties meant by the terms of their agreement so long as the words used are unambiguous.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568, 573 (2d Cir. 1993); Harley-Davidson, Inc. v. Morris, 19 F.3d 142 (3d Cir. 1994); Rowe v. Chesapeake Mineral Co., 156 F.2d 752 (6th Cir. 1946); Bidlack v. Wheelabrator Corp., 993 F.2d 603, 608 (7th Cir.)  (A[T]here must be either contractual langiage on which to hang the label of ambiguous or some yawning void…that cries out for an implied term.@), cert. denied 510 U.S. 909 (1993); TCBY Systems, Inc,. v. RSP Co., Inc., 33 F.3d 925 (8th Cir. 1994) (Arkansas law); O=Neill v. United States, 50 F.3d 677 (9th Cir. 1995); Coca-Cola Bottling Co. of Ogden, Inc. v. Coca-Cola Co., 4 F.3d 930 (10th Cir. 1993) (applying Georgia law); Vulcan Painters, Inc. v. MCI Constructors, Inc., 41 F.3d 1457 (11th Cir. 1995); Herson v. Gibraltar Building & Loan Assn., Inc., 864 F.2d 848, 851 (U.S. App. D.C. 1989) (applying Maryland law, finding release unambiguous); 4 Williston § 612.
Kasten Constr. Co. v. Rod Enter., 301 A.2d 12, 17-18 (Md. 1073); W.W.W. Assocs. v. Giancontieri, 77 N.Y.2d 157, 162, 565 N.Y.S.2d 440, 566 N.E.2d 639 (1990).
{/footnote} 
AAmbiguous@ language is language which is reasonably susceptible to more than one interpretation, or about which reasonable minds could differ.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568, 573 (2d Cir. 1993).
Van Wagner Advertising Corp. v. S & M Enters., 67 N.Y.2d 186, 191, 501N.Y.S.2d 628, 492 N.E.2d 756 (1986).{/footnote}  An ambiguity may be found either because the language on its face is ambiguous or because there is a latent ambiguity which is revealed when one looks to extrinsic evidence (e.g., the famous Peerless{footnote}Raffles v. Wichelhaus, 2 Hurl. & C. 906, 159 Eng. Rep. 375 (Ex. 1864).{/footnote} case).{footnote}Cal. Civ. Pro. § 1856(g).{/footnote}  Whether a contract is ambiguous is a question of law for the court.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568, 573 (2d Cir. 1993); Herson v. Gibraltar Building & Loan Assn., Inc., 864 F.2d 848, 852 (U.S. App. D.C. 1989).
W.W.W. Assocs. v. Giancontieri, 77 N.Y.2d 157, 162, 565 N.Y.S.2d 440, 566 N.E.2d 639 (1990).{/footnote}  See Sec. 7. Appeal and Waiver. It is often stated that extrinsic evidence cannot be used to create an ambiguity.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568 (2d Cir. 1993); Mustang Tractor & Equipment Co. v. Liberty Mut. Ins. Co., 76 F.3d 89 (5th Cir. 1996) (applying Tex. law); Unigroup, Inc. v. O=Rourke Storage & Transfer Co., 980 F.2d 1217 (8th Cir. 1992) (applying Missouri law); City of Tacoma, Dept. of Public Utilities v. United States, 31 F.3d 1130 (Fed. Cir. 1994).
Harris v. Union Elec. Co., 622 S.W.2d 239, 246 (Mo. App. 1981).{/footnote}  On the other hand, extrinsic evidence may be considered by the court to determine whether a contract contains a latent ambiguity.{footnote}Herson v. Gibraltar Building & Loan Assn., Inc., 864 F.2d 848, 852 (U.S. App. D.C. 1989) (applying Maryland law, finding release unambiguous){/footnote}
In some instances, ambiguities going to the essential terms of a contract may lead to the court to simply reject the contract as incapable of enforcement.  Resolving ambiguities in wills presents some special problems which may prevent introduction of some kinds of parol evidence.  See WILLS–Parol Evidence.

§ 4.  Custom, Usage and Course of Dealings

 Parol evidence is admissible as to the special meaning of a term within the usage of a particular business or trade,{footnote} [3080] United States Naval Institute v. Charter Communications, Inc., 875 F.2d 1044 (2d Cir. 1989) (meaning of "publish" in _____ industry); Prudential Ins. Co. of America v. L.A. Mart, 68 F.3d 370 (9th Cir. 1995).
Cal. Civ. Pro. § 1856(c); Ermolieff v. R.K.O. Radio Pictures, 19 Cal. 2d 543 (1942) ("U.K." as including Ireland in movie industry usage); Ill. Rev. Stat. ch. 26, & 205 (reasonable notice required of intention to introduce); Hayter Trucking, Inc. v. Shell Western E & P, Inc., 18 Cal. App. 4th 1, 20, 22 Cal. Rptr. 2d 229, 238 (1993); 89 A.L.R. 1228; U.C.C. Sec. 2-202 (sale of goods).{/footnote}  or pursuant to a course of dealings between the parties.{footnote} [3081] Havoco of America, Ltd. v. Sumitomo Corp. of America, 971 F.2d 1332 (7th Cir. 1992).
Ill. Rev. Stat. ch. 26, & 205; U.C.C. Sec. 2-202 (sale of goods).{/footnote}  See USAGE; WORDS AND PHRASES.  This rule is incorporated into the Uniform Commercial Code with respect to the sale of goods.{footnote} [3082] U.C.C. § 2-202; Advance Process Supply Co. v. Litton Industries Credit Corp., 745 F.2d 1076 (7th Cir. 1984).{/footnote}  The testimony should be excluded, however, where the terms used in the contract have a separate, distinct and special legal meaning.  See also OPINIONS–Ultimate Issues and Legal Opinions. 

§ 5.  Colleral Agreements

Parol evidence is admissible to show the existence of a collateral oral agreement: an agreement which is not a part of the written instrument and is not inconsistent with the written instrument, expressly or implicitly.{footnote}Brennan v. Carvel Corp., 929 F.2d 801 (1st Cir. 1991).
U.C.C. Sec. 2-202(b); Cal. Civ. Pro. § 1856(b); Banco do Brasil, S.A. v. Latian, Inc., 234 Cal. App. 3d 973, 1002-1003, 285 Cal. Rptr. 870, 887 (1991).{/footnote}  The alleged separate oral agreement must not be so closely related to the subject of the other agreement as to be "part and parcel thereof."{footnote}Beijing Metals & Minerals Import/Export Corp. v. American Business Center, Inc.,  993 F.2d 1178 (5th Cir. 1993).
See also Western Chance No. 2, Inc. v. KFC Corp., 957 F.2d 1538 (9th Cir. 1992); Velten v. RegisB. Lippert, Intercat, Inc., 985 F.2d 1515 (11th Cir. 1993).{/footnote}  Under some authorities, the oral agreement must be of a kind naturally the subject of a separate agreement,{footnote} [3085] Beijing Metals & Minerals Import/Export Corp. v. American Business Center, Inc.,  993 F.2d 1178 (5th Cir. 1993) (collateral agreement  must be made for separate consideration or be of a type naturally made separately from principal contract).
Banco do Brasil, S.A. v. Latian, Inc., 234 Cal. App. 3d 973, 1005-1008, 285 Cal. Rptr. 870, 888-890 (1991); Restatement of Contracts § 240(1)(b).{/footnote} and should be excluded if it would be likely to mislead the jury.{footnote}Banco do Brasil, S.A. v. Latian, Inc., 234 Cal. App. 3d 973, 1008, 285 Cal. Rptr. 870, 890 (1991).{/footnote}  The U.C.C. provides that a collateral terms are admissible unless they "would certainly have been included in the document in the view of the court."{footnote} [3087] U.C.C. § 2-202, comment 3.{/footnote}
Most courts do not require independent consideration for the collateral agreement.{footnote} [3088]  Beijing Metals & Minerals Import/Export Corp. v. American Business Center, Inc.,  993 F.2d 1178 (5th Cir. 1993) (collateral agreement  must be made for separate consideration or be of a type naturally made separately from principal contract).
Contra Restatement of Contracts § 240.{/footnote}

§ 5(a).  Time for Performance

Oral parol agreements as to the time for performance are sometimes held admissible under the collateral agreement exception where the written contract omits this term.{footnote} [3089] American Industrial Sales Corp. v. Airscope, Inc., 44 Cal. 2d 393, 397, 282 P.2d 504, 507 (1955); 85 A.L.R.2d 1369.{/footnote}  Other courts hold that the implied requirement that performance take place within a "reasonable time" operates to exclude any parol evidence on this point.{footnote} [3090] Waterford Irrigation District v. Modesto Irrigation District, 127 Cal. App. 544 (1932).{/footnote}

§ 5(b).  Duration of Employment or Agency Contract

Oral parol agreements as to the term of an employment or agency relationship are admissible under the collateral agreement exception where the written contract is silent as to the term.{footnote} [3091] 85 A.L.R.2d 1331.
But see Bristow v. Drake Street Inc., 41 F.3d 345 (7th Cir. 1994) (applying Illinois law; where contract provided that associate producer for play could only be terminated if convicted of a crime, parol evidence inadmissible to show that producer could be terminated if play did not remain open).{/footnote}  Similarly, parol evidence has been held admissible where an employment or agency  contract is ambiguous as to whether cause is required for termination.{footnote}Wallis v. Farmer=s Group, Inc., 220 Cal. App. 3d 718, 730, 269 Cal. Rptr. 299, 305 (1990) (parol evidence admissible to show that good cause required where agency contract provided that Aagreement may be terminated on 3 months notice@).
But see Gerdlund v. Electronic Dispensers Int=l, 190 Cal. App. 3d 263, 273, 235 Cal. Rptr. 279, 284 (1987) (where employment contract provided that employee could be terminated Afor any reason,@ parol evidence inadmissible to show that good cause was required).{/footnote}

§ 5(c).  Assignability

Collateral parol evidence has been admitted to show an agreement that a contractual right was orally agreed not to be assignable.{footnote} [3093] Masterson v. Sine, 68 Cal. 2d 222 (1968).{/footnote}

§ 6.  Exceptions to the Parol Evidence Rule

§ 6(a).  Validity of the Contract

Where the validity of a contract is disputed, parol evidence is admissible to show that the contract is or is not valid.{footnote}Connors v. Fawn Min. Corp., 30 F.3d 483 (3d Cir. 1994).
Cal. Civ. Pro. § 1856(e) (rule does not exclude evidence on issue of invalidity if disputed); Geffen v. Moss, 53 Cal. App. 3d 215, 222, 125 Cal. Rptr. 687, 690 (1975).{/footnote}
Fraud, Duress and Mistake.  Parol evidence is always admissible to show that an agreement was obtained through fraud,{footnote}Manufacturers Hanover Trust Co. v. Yanakas, 7 F.3d 310 (2d Cir. 1993) (New York law); Connors v. Fawn Min. Corp., 30 F.3d 483 (3d Cir. 1994); Mellon Bank Corp. v. First Union Real Estate Equity and Mortg. Investments, 951 F.2d 1399 (3d Cir. 1991) (Pennsylvania law); Beijing Metals & Minerals Import/Export Corp. v. American Business Center, Inc., 993 F.2d 1178 (5th Cir. 1993) (Texas law); Thompson v. Paasche, 950 F.2d 306 (6th Cir. 1991); Winger v. Winger, 82 F.3d 140 (7th Cir. 1996); Herzog Contracting Corp. v. McGowen Corp., 976 F.2d 1062 (7th Cir. 1992); Keller v. Bass Pro Shops, Inc., 15 F.3d 122 (8th Cir. 1994); Thrifty Rent-A-Car Systems, Inc. v. Brown Flight Rental One Corp., 24 F.3d 1190 (10th Cir. 1994) (Oklahoma law).
Cal. Civ. Pro. § 1856(e); Alling v. Universal Mfg. Corp., 5 Cal. App. 4th 1412, 7 Cal. Rptr. 2d 718, 733 (1992).{/footnote} duress{footnote}Manufacturers Hanover Trust Co. v. Palmer Corp., 798 F. Supp. 161 (S.D.N.Y. 1992).{/footnote} or mistake.{footnote} [3097] Hymel v. UNC, Inc., 994 F.2d 260 (5th Cir. 1993); Armistead v. Vernitron Corp., 944 F.2d 1287 (6th Cir. 1991).
Cal. Civ. Pro. § 1856(e), (g) (rule does not exclude evidence of fraud, mistake or imperfection in writing); Stock v. Meek, 35 Cal. 2d 809, 815-16, 221 P.2d 15, 19-20 (1950).{/footnote}  Provisions which state that both parties acknowledge that no representations or warranties have been made other than those in the contract will not prevent the admission of parol evidence of fraud or mistake.{footnote}Manufacturers Hanover Trust Co. v. Yanakas, 7 F.3d 310 (2d Cir. 1993) (New York law).{/footnote}
Forged, Altered or Sham Agreements.  Parol evidence is always admissible to show that a contract is a forgery, has been altered,{footnote}Smith v. Lagerstrom, 34 Cal. 2d 858, 861, 215 P.2d 450, 451-52 (1950).{/footnote}  or is a sham which was never intended to be binding.{footnote}Herzog Contracting Corp. v. McGowen Corp., 976 F.2d 1062 (7th Cir. 1992).
FPI Develop., Inc. v. Nakashima, 231 Cal. App. 3d 367, 282 Cal. Rptr. 508, 529-30 (1991).{/footnote}
Proof of Actual Consideration.  Most states allow a party to introduce parol evidence as to what the actual consideration for a contract was,{footnote}Childers Oil Co., Inc. v. Exxon Corp., 960 F.2d 1265 (4th Cir. 1992).
Feinberg v. Teitelbaum Furs, 236 Cal. App. 2d 744, 751, 46 Cal.Rptr. 428, 435 (1965); Rinaudo v. Bloom, 120 A.2d 184 (Md. 1956) (recognizing exception to rule to allow party to demonstrate consideration supporting contract); 100 A.L.R. 17; Restatement of Contracts § 82.{/footnote} or that there was no consideration.{footnote} [3102] W.E. Heller Western v. Tecrim Corp., 196 Cal. App. 3d 149, 158, 241 Cal. Rptr. 677, 681 (1987); 100 A.L.R. 17; Restatement of Contracts § 82.{/footnote}   Such evidence may not include allegations of executory promises which are at variance with the contract.{footnote} [3103] Molybdenum Corp. of America v. Kasey, 176 Cal. App. 2d 357, 363, 1 Cal. Rptr.  400, 405 (1959); 29 Cal. L. Rev. 249 (1941).{/footnote}

§ 6(b).  Proof of Condition Precedent

Parol evidence is admissible to show that an agreement was made subject to a condition precedent,{footnote} [3104] Wessels, Arnold & Henderson v. National Medical Waste, Inc., 65 F.3d 1427 (8th Cir. 1995) (applying Minnesota law).
Earp v. Nobmann, 122 Cal. App. 3d 270, 288-89, 175 Cal. Rptr. 767, 777-78 (1981);  Knightsbridge Realty Partners Ltd.-75 v. Pace, 101 Ill. App. 3d 49, 427 N.E.2d 815 (1st Dist. 1981) (parol evidence admissible to prove condition precedent to purchase agreement for real property).
But see FPI Develop., Inc. v. Nakashima, 231 Cal. App. 3d 367, 282 Cal. Rptr. 508, 529-30 (1991) (not recognizing distinction between conditions precedent and subsequent, holding both are subject to rule).{/footnote} except with repect to real estate deeds.{footnote} [3105] But see Knightsbridge Realty Partners Ltd.-75 v. Pace, 101 Ill. App. 3d 49, 427 N.E.2d 815 (1st Dist. 1981)(parol evidence admissible to prove condition precedent to purchase agreement for real property).{/footnote}  Parol evidence is not admissible to show the existence of a condition subsequent.{footnote}Coast Bank v. Holmes, 19 Cal. App. 3d 581, 590, 97 Cal. Rptr. 30, 34 (1971).
{/footnote} 

§ 6(c).  Discharge of Obligation

Parol evidence is admissible to show that an obligation has been discharged or released.{footnote} [3107]  Wigmore sec. 2441.{/footnote}  See also RELEASES.
Agency.  An undisclosed principle seeking to enforce a contract may introduce parol evidence that the party who signed the contract did so as his or her agent. 
Conveyance Intended as Security.  Parol evidence is admissible to show that a deed or conveyance was intended to be security for an indebtedness, rather than absolute.{footnote} [3108] 111 A.L.R. 448.
But see Tahoe Nat=l Bank v. Phillips, 4 Cal. 3d 11, 16-21, 92 Cal. Rptr. 704, 709-712 (1971) (assignment of rents and agreement not to sell or encumber real property could not be shown through extrinsic evidence to have been intended as a mortgage, since document=s language was not reasonably susceptible to this interpretation).{/footnote}
Conveyance Intended as Grant in Trust.  Parol evidence is admissible to show that what appears to be an absolute conveyance of title was intended to be in trust for a third party, unless the property is in the hands of an innocent purchaser for value.  See also DEEDS; TITLE; TRUSTS.

§ 7.  Role of the Jury

Once the court decides to admit parol evidence, it becomes a jury question as to how the parol evidence affects the terms of the written instrument.{footnote}Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d 568, 573 (2d Cir. 1993) (finding ambiguity in letter agreement; summary judgment inappropriate); Seiden Assocs. v. ANC Holdings, Inc., 959 F.2d 425, 428 (2d Cir. 1992).
Brawthen v. H & R Block, Inc., 52 Cal. App. 3d 139, 146, 124 Cal. Rptr. 845, 849-850 (1975); Town of Wilson v. Town of Newfane, 181 A.2d 1045, 1045, 581 N.Y.S.2d 962 (4th Dep=t 1992).{/footnote}

§ 8.  Appeal and Waiver

Whether a trial court is ambiguous so as to permit the admission of parol evidence is a question of law subject to de novo review.{footnote}Herson v. Gibraltar Building & Loan Assn., Inc., 864 F.2d 848, 852 (U.S. App. D.C. 1989).{/footnote}
Most courts regard the parol evidence rule as substantive law which cannot be "waived" through failure to object.  Thus, one may invoke the rule on appeal in these states without having raised it below.{footnote} [3111] Delucchi v. County of Santa Cruz, 179 Cal. App. 3d 814, 824, 225 Cal. Rptr. 43, 49 (1986); 92 A.L.R. 810.{/footnote}