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.
The parol evidence rule has but a limited application to contracts and memoranda which show upon their face that they are incomplete and which are not required by law to be in writing or to be proved by writing. In contracts of this class, extrinsic evidence is admissible to show the terms of the contract which are not set forth in writing, as far as they are consistent with terms which are in writing.1 As far as a contract is incomplete on its face, it is not within the meaning of the parol evidence rule.2 On the other hand, if the law required the contract to be in writing or if it requires it to be proved by writing, a contract or memorandum which is incomplete upon its face can not be supplemented by extrinsic evidence unless this extrinsic evidence itself is in writing and complies with the rule of law which requires such written contract or such written evidence. In cases of this sort, the extrinsic evidence is not excluded by the parol evidence rule. On the contrary, this rule permits such evidence to be considered in order to show the actual terms of the contract. Such evidence is, however, inadmissible by reason of other rules of law which in this case exclude evidence which the parol evidence rule itself would admit.3
Arkansas. Schneider v. Fairmon, 128 Ark. 425, 194 S. W. 251; Breckenridge v. Hearne Lumber Co., - Ark. - , 204 S. W. 981.
Florida. Chamberlain v. Lesley, 39 Fla. 452, 22 So. 736.
Georgia. Forsyth Mfg. Co. v. Cast-len, 112 Ga. 199, 81 Am. St. Rep. 28, 37 S. E. 485; Bond v. Perrin, 145 Ga. 200, 88 S. E. 954.
Indiana. Louisville, etc., Ry. v. Reynolds, 118 Ind. 170, 20 N. E. 711.
Iowa. Dietrich v. Stebbins, 100 Ia. 426, 69 N. W. 564.
Kansas. Clark v. Townsend, 96 Kan. 650, 153 Pac. 555 [rehearing denied.
Clark v. Townsend, 97 Kan. 161, 154 Pac. 1009].
Kentucky. Peneix v. Rodgers (Ky.), 49 S. W. 447.
Maine. Gould v. Excelsior Co., 91 Me. 214, 64 Am. St. Rep. 221, 39 Atl. 554; American Mercantile Exchange v Blunt, 102 Me. 128, 120 Am. St. Rep. 463, 10 L. R. A. (N.S.) 414, 66 Atl 212.
Maryland. Courtney v. Mfg. Co., 97 Md. 499, 55 Atl. 614.
Massachusetts. Leavitt v. The Fiber-loid Co., 196 Mass. 440, 15 L. R. A. (N.S.) 855, 82 N. E. 682.
Michigan. Stahelin v. Sowle, 87 Mich. 124, 49 N. W. 529; Hayes v. Wabash R. Co., 163 Mich. 174, 31 L. R. A. (N.S.) 229, 128 X. W. 217.
Minnesota. Beyerstedt v. Mill Co., 49 Minn. 1, 51 N. W. 619; Nelson v. McElroy, 140 Minn. 429, 168 N. W. 179.
Missouri. State v. Cunningham, 154 Mo. 161, 55 S. W. 282.
Montana. Brockway v. Blair, 53 Mont. 531, 165 Pac. 455.
Nebraska. Bell v. Wiltson (Neb.), 98 N. W. 1049.
New Mexico. Strickland v. Johnson. 21 N. M. 599, 157 Pac. 142.
New York. Jamestown Business Association v. Allen, 172 N. Y. 291, 92 Am. St. Rep. 740, 64 N. E. 952
North Carolina. Sumner v. Graham County Lumber Co., 175 N. Car. 654, 96 S. E. 97.
North Dakota. Northern Trust Co. v. Bruegger, 35 N. D. 150, 159 N. W. 859; Gilbert Manufacturing Co. v. Bryan, - N. D. - , 166 N. W. 805.
Oklahoma. Smith v. Bond, 56 Okla. 112, 155 Pac. 1116; O. K. Transfer & Storage Co. v. Neill, - Okla. - , L. R. A. 1917A, 58, 159 Pac. 272; Rawlings v. Ufer, - Okla. - , 161 Pac. 183.
South Carolina. Virginia-Carolina Chemical Co. v. Moore, 61 S. Car. 166, 39 S. E. 346.
Tennessee. Waterbury v. Russell, 67 Tenn. (8 Baxt.) 159.
Texas. Magnolia Warehouse & Storage Co. v. Davis, 108 Tex. 422, 195 S. W. 184; Howell v. Denton (Tex. Civ. App.), 68 S. W. 1002.
Utah. Steed v. Harvey, 18 Utah 367, 72 Am. St. Rep. 789, 54 Pac. 1011.
Virginia. Lawson v. Hobbs, 120 Va. 690, 91 S. E. 750.
Washington. Knowles v. Rogers, 27 Wash. 211. 07 Pac. 572.
Wisconsin. Naumann v. Ullman, 102 Wis. 92, 78 N. W. 159; Seeger v. Boiler Co., 120 Wis. 11, 97 N. W. 485; Smith v. Pfluger, 126 Wis. 253, 2 L. R. A. (N.S.) 783, 105 N. W. 476.
"If the written instrument itself shows it to be either ambiguous or incomplete, parol evidence is admissible to show what the real contract was to the extent necessary to remove the ambiguity and to make the contract complete in its terms which show it to be incomplete." Magnolia Warehouse & Storage Co. v. Davis, 108 Tex. 422, 195 S. W. 184.
If the memorandum is not complete and is not signed by the buyer, extrinsic evidence is said to be admissible to show that the buyer reserved the power to cancel the order, although the memorandum which was prepared by the seller's agent provides that it is not subject to cancelation. Becker v. Calmenson, 102 Minn. 406, 113 N. W. 1014.
An oral contract to furnish cars is not merged in a subsequent written contract for limiting liability in case of transportation. Clark v. Ulster Ry., 189 N. Y. 93, 121 Am. St. Rep. 848, 13 L. R. A. (N.S.) 164, 12 Am. & Eng. Ann. Cas. 883, 81 N. E. 766.
2 United States. Dittmar v. Frederick Starr Contracting Co., 249 Fed. 437
Georgia. Bond v. Perrin, 145 Ga. 200, 88 S. E. 954.
Maine. American Mercantile Exchange v. Blunt, 102 Me. 128, 120 Am. St. Rep. 463, 10 L. R. A. (N.S.) 414, 66 Atl. 212.
Massachusetts. Glackin v. Bennett, 226 Mass. 316, 115 N. E. 490.
Michigan. Stretch v. Stretch, 191 Mich. 416, 158 N. W. 185.
New Mexico. Strickland v. Johnson, 21 N. M. 599, 157 Pac. 142.
As far as the parol evidence rule itself is concerned, extrinsic evidence of the actual agreement of the parties may be considered, as far as it does not contradict the incomplete written contract or memorandum.4
If the ordinary rules of construction, when applied to the contract, show that apparent gaps and omissions can be filled, the contract can not be said to be incomplete.5 In determining whether a contract is complete or not the surrounding circumstances may be considered,6 as they may be considered for the general purpose of aiding in the construction of a written contract.7