ContractsIntermediateCalifornia Exam

Under California's parol evidence rule, when may extrinsic (outside) evidence be introduced to change the terms of a written contract?

AAny time one party claims the written contract does not reflect the full agreement, under standard California purchase contract terms

BGenerally it may not; the written contract is the complete expression of the agreement, with limited exceptions such as fraud or mistakeCorrect

CWhenever the contract was signed more than 90 days ago, as typically drafted in a residential purchase agreement

DOnly when both parties agree in writing to allow it, consistent with common contract law principles

Why Generally it may not; the written contract is the complete expression of the agreement, with limited exceptions such as fraud or mistake Is Correct

Answer B: Generally it may not; the written contract is the complete expression of the agreement, with limited exceptions such as fraud or mistake

The parol evidence rule prevents introduction of prior or contemporaneous oral/written agreements to vary the terms of a final integrated written contract. Exceptions include evidence of fraud, mistake, illegality, or to clarify ambiguous terms.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

Key Contracts Terms in This Question

Purchase Agreement

A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.

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Key Terms to Know

Purchase Agreement

A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.

Option Contract

A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.

Listing Agreement

A contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.

Earnest Money

A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.

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