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.
While the principal may enter into an oral modification of a written contract in spite of a covenant in such contract against oral modification,1 such covenant may operate as a restriction upon the power of an agent to modify the contract on behalf of his principal by oral modification or waiver.2 If an architect or engineer is authorized to modify the plans only by a written order, he has no authority to modify the plans by oral instructions.3 If an insurance agent is authorized to waive conditions only by written waiver, his oral waiver is inoperative.4
6 Copeland v. Hewett, 96 Me. 525, 63 Atl. 36.
7 Richie v. State, 39 Wash. 95, 81 Pac. 79.
8 Consaul v. Sheldon, 35 Neb. 247, 52 N. W. 1104; De Mattos v. Jordan, 15 Wash. 378, 46 Pac. 402.
9 Northern Light Lodge v. Kennedy, 7 N. D. 146, 73 N. W. 524. (Criticizing the opinions in the cases in the previous note as obiter.) to Alabama. Insurance Co. v. Williams, - Ala. - , 77 So. 159.
Kansas. Continental Ins. Co. v. Pearce, 39 Kan. 396, 7 Am. St. Rep. 537. 18 Pac. 291.
Michigan. Westchester, etc., Ins. Co. v. Earle, 33 Mich. 143.
New York. Pechner v. Ins. Co., 65 N. Y. 195.
Tennessee. American Central Ins
Co. v. McCrea, 76 Tenn. (8 Lea) 513, 41 Am. Rep. 647.
Provision against other insurance. Firemen's Fund Ins. Co. v. Norwood, 69 Fed. 71, 16 C. C. A. 136; Morrison v. Ins. Co., 69 Tex. 353, 5 Am. St. Rep. 63, 6 S. W. 606.
11 Carpenter v. Ins. Co., 41 U. S. (16 Pet.) 495, 10 L. ed. 1044.
12 Heard v. Dooly County, 101 Ga. 619, 28 S. E. 986; Wortman v. Klein-schmidt, 12 Mont. 316, 30 Pac. 280; Headley v. Cavileer, 82 N. J. L. 635, 48 L. R. A. (N.S.) 84, 82 Atl. 908; Coorsen v. Ziehl, 103 Wis. 381, 79 N. W. 562; Davis v. La Crosse Hospital Assn., 121 Wis. 579, 99 N. W. 351.
Such restrictions upon the powers of agents are usually construed rather strictly. A provision requiring modifications of the written contract to be itself in writing, has been held to impose no restriction upon the power of such agent to waive conditions.5
If the agent who modifies a provision of a contract by oral agreement has in fact authority to modify it, his oral agreement is binding on his principal, although the contract provides that modifications must be in writing and signed by certain other designated officers.6