If your commercial contract eventually results in litigation, there are several things that are worth knowing, or at least being familiar with. One of these is the parol evidence rule. The parol evidence rule says that, when a legal dispute involves a contractual agreement, the court should resolve the case based solely upon the wording contained in the contract document itself. This rule can be very important in getting certain piece of evidence excluded. There are, however, some scenarios where the rule doesn’t apply and can’t be cited as the basis for keeping outside (or “parol”) evidence out of the record.
If the underlying agreement is unclear or ambiguous, then the rule is not applied and all evidence is admissible. The same is true if the contract document is shown not to be a “complete and accurate integration of the” agreement. Additionally, outside evidence is allowed if the party submitting it intends to use that proof to show the existence of fraud, accident or mistake. What you should take away from all of this is that there are many tools potentially available to strengthen your commercial contract litigation case, including the parol evidence rule, and the assistance of an experienced Florida business attorney can be invaluable in utilizing these tools to your maximum advantage.
As an example, consider this case that arose from work done on a major outlet shopping mall in the Tampa area. The electrical subcontractor on the job, which was responsible for light fixtures at the mall, obtained a price quote from a Miami-Dade supplier, which the subcontractor accepted. As the work proceeded, the subcontractor made nine change orders to the original purchase order, which made both qualitative and quantitative alterations to the initial terms.
In the end, the subcontractor refused to pay the supplier, so the supplier recorded a construction lien on the mall property and followed up by suing. Eventually, the focus of the case shifted to whether or not the supplier filed its lien in good faith. In the Court of Appeal, much of the focus revolved around evidence that was not admitted in the lower court, specifically, one particular affidavit. In this case, the supplier had wanted to admit an affidavit sworn by its contract manager. The trial court refused to admit the affidavit based on the parol evidence rule. According to the appeals court, though, the affidavit was admissible and should have been allowed in.
The important thing to know from this aspect of this ruling is that, while the parol evidence rule may keep you from introducing outside evidence that is offered to attempt to change the terms of your contractual agreement, the rule does not prohibit a party from submitting outside evidence to demonstrate whether or not a construction lien was filed in good faith. Because the supplier offered the affidavit to counter the subcontractor’s argument that the supplier’s lien was not recorded in good faith, it was not barred by the parol evidence rule.
There are many different legal concepts or rules of law, any one of which can be the key to success. To best guard your interests, arm yourself with skilled counsel who is prepared for whatever twists or turns your case takes. For advice and representation that you can rely upon in relation to your commercial contract issues, consult the experienced South Florida commercial litigation attorneys at Stok Kon + Braverman.
Contact us online or by calling (954) 237-1777 to schedule your consultation and find out how this firm can help you.
More blog posts:
A Rose is a Rose is a Rose, But When is a Sale Not a Sale in a Florida Commercial Contract?, Florida Business Lawyers Blog, Jan. 10, 2019
What it Takes to Secure (or Stop) the Issuance of an Injunction in Your Florida Commercial Litigation Matter, Florida Business Lawyers Blog, Nov. 30, 2018