Reference no: EM133812269

Question

Ann bought a car from the Used Car Agency under a written contract. She purchased the car in reliance upon the dealership's representation that the car had never been wrecked and could be driven at least 2,000 miles without adding oil. Thereafter Ann discovered that the car had, in fact, been previously wrecked and rebuilt, that it used excessive quantities of oil, and that Used Car was aware of these facts when the car was sold. Ann brings an action to rescind the contract and recover the purchase price. Used Car objects to the introduction of oral testimony concerning representations of its agents, claiming the protection of the Parol Evidence Rule. Does the rule apply in this case? Explain. The Parol Evidence rule states that once an agreement is in writing and appears complete, no evidence outside the writing will be admitted at trial to vary the terms of the written agreement. One big exception to the rule is if the outside evidence relates not to the terms, but to the validity of the agreement. i.e. was the agreement entered as a result of fraud, duress, undue influence, mistake etc. If the evidence relates to the validity of the contract rather than to terms (e. g. price, quantity, delivery date etc.) then the outside evidence is admissible.