Opinion ID: 602079
Heading Depth: 2
Heading Rank: 1

Heading: Admission of Parol Evidence

Text: 7 The Special Master found that the Agreements were ambiguous and admitted parole evidence to explain their terms. Whether contract language is ambiguous is a question of law, subject to de novo review. See Petro-Ventures, Inc. v. Takessian, 967 F.2d 1337, 1339-40 (9th Cir.1992). Although New York retains a strict version of the parol evidence rule, this limitation applies only where the contract is unambiguous. See 67 Wall Street Co. v. Franklin Nat'l Bank, 333 N.E.2d 184, 186 (N.Y.1975). A provision is ambiguous when it is reasonably susceptible to more than one reading. United States Fire Ins. Co. v. General Reinsurance Corp., 949 F.2d 569, 572 (2d Cir.1991) (applying New York law). 8 This dispute focuses on p 10 of the Distribution Agreement 1 and p 13 of the Financing Agreement. 2 The Special Master admitted parol evidence because [t]here are portions of the agreements ... that are verbose, redundant, misleading and ambiguous. A de novo examination demonstrates that he was correct. 9 While each individual provision may appear to be unambiguous, any attempt to read the disputed provisions together raises serious questions. Do the distribution rights end after ten years, or do they continue until the Producer exercises the buy-or-sell option? Is there joint control after the distribution terms ends, or does UA have the sole and exclusive distribution and exploitation rights? Is there joint control over all rights in the Picture, or only over the original theatrical and television rights? Was UA granted rights to any new technology, or only to new developments in the theatrical and television areas? Since these questions are raised even by a cursory reading of the Agreements, we find that the Special Master did not err by admitting parole evidence. 3 10