This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
If the contract is one which is in writing, but is not required by law to be in writing, or to be proved by writing, such contract may be modified by a subsequent oral agreement, if such agreement contains within itself the elements of a valid contract.1 Thus, where A agreed in writing to construct a boiler and engine in B's barge within a given time, such contract may be subsequently modified by an oral agreement between A and B, fixing the time at which such barge is to be delivered to A.2 A written contract for the sale of a machine, to be paid for before delivery, may subsequently be modified by the oral agreement of the parties that the vendee shall have the right to make trial of such machine, and to return it if not satisfactory, followed by delivery to vendee of the machine without demanding payment therefor.3 A written agreement by A, an attorney, to manage litigation for B for two and one-half per cent of the amount recovered if the allowance by the viewers is final, and five per cent of the recovery if the case is appealed to the court for trial, may be modified after verdict is obtained in court by an agreement that if A prevents a new trial, and prevents a reduction of the verdict, he shall have everything above a certain sum; that if the verdict is reduced below such sum, and above another sum, A is to receive nothing; and that if the verdict is reduced below such latter sum, B is to take a new trial, and pay A ten per cent of the recovery upon the second trial.4 If a written contract is modified in part by a subsequent oral agreement, it is said, in some jurisdictions, to be reduced entirely to an oral contract.5 The oral agreement to modify the written contract must be made subsequently thereto. If entered into at substantially the same time, it is unenforceable by reason of the parol evidence rule. Thus if a written contract for building a house does not require the contractor to paper the walls, an oral agreement entered into at substantially the same time providing that the contractor shall paper the walls is unenforceable.6 A written contract which has been signed by all the parties thereto, may be modified by a subsequent written contract, agreed to by all the parties, but signed only by the party who surrenders a right or advantage which the original contract gave him.7 The courts which allow an oral contract to modify a prior written contract, hold, nevertheless, that proof of such new oral agreement must be clear.8
3 Crawford v. Gas Co., 183 Pa. St. 227; 38 Atl. 595.
4 Anderson v. Moore, 145 111. 61; 33 N. E. 848.
5 Lee v. Hawks, 68 Miss. 669; 13 L. R. A. 633; 9 So. 828.
1 Teal v. Bilby. 123 U. S. 572; Hull v. Pitrat, 45 Fed. 94; Cumberland, etc., Co. v. Wheatley, 9 App. D. C. 334; Gunby v. Drew, - Fla. - ; 34 So. 305: Robinson v. Hyer. 35 Fla. 544: 17 So. 745; Smith v. Kelley. 115 Mich. 411: 73 N. W. 385; Van Santvoord v. Smith,
79 Minn. 316; 82 N. W. 642; Strahl v. Grocer Co. (Neb.), 98 N. W. 1043; Bryant v. Thesing, 46 Neb. 244; 64 N. W. 967; Solomon v. Val-lette, 152 N. Y. 147; 46 N. E. 324; Beatty v. Larzelere, 194 Pa. St, 605; 45 Atl. 653; Neff's Estate, 18a Pa. St. 98; 39 Atl. S30; Moore v. Carter, 146 Pa. St. 492; 23 Atl. 243; Dignan v. Spurr, 3 Wash. 309; 28 Pac. 529.
2 Manistee Iron Works Co. v. Lumber Co., 92 Wis. 21; 65 N- W. 863.
3 McGregor v. Register Co., 86 Ga. 439; 12 S. E. 683.
4 Beatty v. Larzelere, 194 Pa. St. 605; 45 Atl. 653.
5 Malone v. R. R., 157 Pa. St. 430: 27 Atl. 756.
6 McGuinness v. Shannon. 154 Mass. 86; 27 N. E. 881.
7 Bray v. Loonier. 61 Conn. 450: 23 Atl. 831.
8 Boyes v. Ramsrlen, 34 Or. 253; 55 Pao. 538; Watson v. Jan ion. 6 Or. 137: Kent v. Kent (Va.), 34 S. E. 32.