Humber/Ontario Real Estate Course 1 Exam Practice

In the event of a dispute over a written home sale agreement allegedly altered by a verbal agreement, which rule is likely to apply?

1. The contract is altered by subsequent verbal agreements.

2. The written agreement is voidable due to lack of mutual consent.

3. The rule of privity will dominate the case's outcome.

4. The parol evidence rule will likely be used in court.

5. The rule of equitable estoppel applies to oral assurances.

6. The buyer's testimony is valued over written proof.

The correct answer is: The parol evidence rule will likely be used in court.

The parol evidence rule is pertinent in situations involving written contracts and claims of modification or contradiction by oral agreements. This rule asserts that once parties have entered into a written contract that is intended to be a complete and final expression of their agreement, any prior or contemporaneous oral or written statements that contradict or modify the written terms are generally inadmissible in court. This maintains the integrity of the written agreement and ensures that all parties are held to what they explicitly signed. In cases of disputes over the terms of a home sale agreement, if one party asserts that there was an additional verbal agreement that alters the written contract, the court will likely rely on the parol evidence rule to uphold the terms of the original written document. The rule promotes consistency and reliability in contractual dealings, thereby reinforcing the significance of maintaining a precise written record. Other options might suggest different legal principles that could apply in various circumstances, but in the context of conflicting written and verbal agreements, the parol evidence rule is the key principle that usually governs.