“An evidentiary rule that excludes the use of extrinsic evidence by a court in determining the meaning or legal effect of word used in a written contract. There are a number of exceptions to the rule so that extrinsic evidence is admitted for specific purposes, including to resolve ambiguity on the face of the instrument, to determine whether a term should be implied, to show that the instrument was affected by some vitiating factor, to rectify the instrument and to admit evidence of the res qestae (surrounding circumstances) in order to ascertain the factual matrix.”
The Parol Evidence RuleWe will consider a number of elements covered within the definitions stated exceptions:
Implied terms and contract rectification
The admittance of evidence concerning the “factual matrix”
Where contracts are potentially affected by vitiating factors Note this definition makes no direct reference to the court's ascertaining of contractual intent, though our review of the I. C. S Ltd case will illustrate that the exception extends to this purpose.
Extrinsic evidence with respect to a contract, is evidential material that lies outside the contract and includes direct statements of intention made by the parties; evidence of the parties' pre -contractual negotiations, actions, correspondence, or words; evidence of the surrounding circumstances in which the contract was formed or executed; and the subsequent conduct of the parties.
Vitiating factors are those which affect a person's assent to a contract or intention to confer a benefit on another and include misrepresentation, mistake, duress, undue influence and unconscionable conduct — a range of these issues will be considered in seminars 8 and 9 dealing with the bases upon which a contract may be avoided.
From the cases we have recently reviewed, provide some example of what might amount to extrinsic evidence.
Source://www1.ecom.unimelb.edu.au/accwww/subjects_acc/686/Week3_seminars_5&6.