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.
It is perfectly possible for parties to make contracts which are not controlled by given usages. This may be done by expressly providing against them; but it is done more frequently by making express provisions, covering the same ground as the usage, but inconsistent therewith. Accordingly the usage invoked must furthermore be consistent with the contract in question in order to be regarded as part of it. If inconsistent with the expresss provisions of the contract, it can not be used to contradict them and to show an intent different from that expressed.1 A custom to use a freight elevaton for general purposes can not control an express provision of a lease to the effect that such elevator shall not be used except for freight.2 A custom to accept payment in checks can not control an express provision in a contract for payment in money.3 The specific provisions of a contract to ship goods can not be contradicted by a local custom.4 A contract by which the seller agrees to deliver "f. o. b." is so plain in view of the meaning which attaches to it in business that such meaning can not be varied by custom.5 A contract to saw logs as fast as the operator could can and also of the nature of the subject-matter of the contract,3 the relation of the parties to the contract,4 and the objects not be contradicted by a custom to saw logs of different owners in the order in which they were delivered.6 A contract which provides who shall pay the duty can not be contradicted by a custom as to who receives the benefit of subsequent reductions.7 A contract by which A sells to X property which A has acquired from B, imposes upon X the duty of making payments to A and it can not be varied by evidence of a custom that under such circumstances X should pay B.8 A written oil lease can not be contradicted by evidence of a custom that the prospector should burn oil produced on a claim.9 A contract requiring a specific number of wells to be bored can not be contradicted by a custom to bore a certain number in a given time.10 If a contract requires "walls to be washed or sized with good, strong glue," preliminary to papering, evidence of a custom as to the method of papering is no part of the contract.11 Under a contract to print a catalogue cover in accordance with approved proof, it can not be shown to be the custom for the printers to add their name to the bottom of the last page of the catalogue, proof having been approved without such addition.12 An express provision as to time can not be controlled by custom.13 A contract containing an express provision as to the time of settlement can not be varied by evidence of a general custom.14 An express provision as to time of delivery can not be controlled by evidence of a custom as to delivery.15 An express provision as to the time of employment can not be contradicted by a custom to employ for the season.16 If a contract provides for performance during a certain time, it can not be varied by evidence of a custom to terminate such contracts at will.17 A custom that a certain kind of employment should last for a certain sought to be accomplished by the contract.5 The surrounding circumstances have been considered in order to determine whether letters which were exchanged between the parties amounted to a contract.6 It will be presumed that the parties were acquainted with facts which were probably notorious at the time that the contract was made, and that they made their contract with reference to such facts.7 The preliminary negotiations of the parties have been considered in the construction of ambiguous contracts in order to enable the court to place itself in the position in which the parties were when the contract was made.8 Such preliminary negotiations may be considered if the contract is ambiguous and if one of the parties understands the sense which the adversary party placed upon the terms of the contract.9 If, however, the contract is unambiguous and is in writing, evidence of preliminary negotiations is inadmissible to affect the construction of the contract if the validity of the contract is established or conceded. The parol evidence rule is intended to prevent the admission of such evidence.10 The surrounding circumstances are to be considered as they exist at the time of the execution of the contract.11 Thus in contracts of guaranty,12 contracts between promoters of a corporation,13 and contracts of bailment,14 the surrounding facts, the relations of the parties and the object of the contract may all be looked to. Even though the contract is in writing extrinsic evidence of the surrounding facts and circumstances is admissible to aid the court to determine the intention of the parties.15 Thus extrinsic evidence of the surrounding facts is admissible to show want of consideration,16 the existence of consideration,17 whether a contract is severable or not,18 or the mode of performance.19 Where one tenant in common agreed to sell realty to another, it was permitted to show that they were partners and that the balance due one of them from the firm was to be applied on the price of the land.20 Thus in a contract to release dower in consideration of one-fourth of the proceeds of the property extrinsic evidence is admissible to show that the proceeds are the rents, and that an expensive building was erected upon the property after this contract was made.21 So where a note was given for $240, payable in case certain taxes were not rebated, "or such part of the above sum as may not be rebated," extrinsic evidence was admissible to show that the taxes amounted to $842, and that the note was not to be paid if $240 or more of such taxes were rebated.22 So where a village made a contract to take the water it might "need or desire for any and all purposes," extrinsic evidence is admissible to show that when the contract was made the village had a partial supply of water.23
21 England. Produce Brokers Co. v. Olympia Oil & Coke Co. , 2 K. B. 296.
United States. Insurance Companies v. Wright, 68 U. S. (1 Wall.) 456, 17 L. ed. 605.