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 a release which is not under seal has been given to one of two joint wrongdoers, the other wrongdoer is a stranger thereto, within the meaning of the parol evidence rule, though the effect of such release may be to discharge him.1 If the instrument does not show whether or not the sum received was in full satisfaction, extrinsic evidence is admissible to show what the fact was.2 If the release is under seal, a stranger can not contradict its legal effect.3 This result, however, does not depend on the parol evidence rule alone.4
5 Muir v. Morris, 80 Or. 378, 157 Pac. 785 [denying rehearing, Muir v. Morris, 80 Or. 378, 154 Pac. 117].
6 Kupferschmidt v. Agricultural Insurance Co., 80 N. J. L. 441, 34 L. R A (N.S.) 503, 78 Atl. 225.
7 Frith v. Thomson, 103 Kan. 305, 173 Pac. 915.
8 Foley v. Grand Rapids & Indiana Ry.. 168 Mich. 406, 134 N. W. 446.
9 Minneapolis, St. Paul & Sault Ste.
Marie Ry. v. -Home Ins. Co., 55 Minn. 236, 22 L. R. A. 390, 56 N. W. 815.
1 O'shea v. Ry. 105 Fed. 559, 44 C. C. A. 601; Ryan v. Becker, 136 Ia. 273, 14 L. R. A. (N.S.) 329, 111 N. W. 426; Fitzgerald v. Union Stock Yards Co., 89 Neb. 393, 33 L. R. A. (N.S.) 983. 131 N. W. 612; Hauth v. Sambo, 100 Neb. 160, 158 N. W. 1036 Randall v Gerrick, 93 Wash. 522, L. R. A. 1918D, 179, 161 Pac. 357.
If A and B have jointly committed a tort against X, A may show by extrinsic evidence that an instrument which was in form a covenant by X not to sue B was really intended as a release.5 A stranger to a consent judgment may contradict the stipulation under which it was taken and show the real agreement of the parties.6 If X takes judgment against A under a stipulation that such judgment is to be in full satisfaction of X's claim set forth in his petition which he has filed against A, X may contradict the provisions of such stipulation and of such petition in a subsequent action against B, by showing that A was not in fact liable and that the consideration for such stipulation consisted in A's saving the expenses of a journey to defend such action.7 It may be shown that it was assumed that no liability existed against the joint tort-feasor, who was released on payment of a nominal consideration to save the expense of a trial.1