Opinion ID: 2224408
Heading Depth: 1
Heading Rank: 3

Heading: Contractual Provisions Against Oral Modification.

Text: Both the district court and the court of appeals found that the representations made by Rowley's insurance representative to Humiston's insurance agent served to estop Rowley from recovering for the amount of loss on the trailer under the breach of contract claim. We agree. For the district court to reach the issue of estoppel it was necessary to overcome the contract provision against oral modification. The district court concluded that the integration clause prohibiting oral modification could be overcome because the representation made by the Rowley representative was not related to the subject matter of the contract and thus was not an oral modification of the contract. Although we find the agreement did address the general subject matter of insurance coverage, we conclude that proof of estoppel makes the clause against oral modification inoperative. Historically, provisions against oral modification can be overcome upon showings of certain facts. The rule followed by the courts generally, with some authority to the contrary, is that a written contract not required by law to be in writing may be modified by a subsequent oral agreement even though it provides it can be modified only by a written agreement. Such a stipulation in the original contract may become inoperative because of modification, recision, waiver or estoppel, or an independent contract. 17A Am.Jur.2d Contracts § 527 (1991) (emphasis added). We specifically recognized this principle in Berg v. Kucharo Construction, 237 Iowa 478, 488-89, 21 N.W.2d 561, 566-67 (1946), where we said: [I]t is equally well settled that [such provisions] may be avoided by the parties to the contract. The courts have adopted various theories of avoidance which may be classified as those of independent contract, modification or recision, waiver and estoppel.  (Citation omitted.) (Emphasis added.) Thus, in certain cases, such as may exist in claims of estoppel, contractual provisions prohibiting oral modification may be invalidated by the courts. This recognized exception allows a court to initially overlook the provision against oral modification to determine whether there are any facts establishing one of the invalidating circumstances. Although the district court did not specifically recognize this concept in its decision, the end result reached is the same. We have long held that a decision of the district court may be upheld on appeal if there is an alternative ground for supporting the decision. See Citizens First Nat'l Bank v. Hoyt, 297 N.W.2d 329, 332 (Iowa 1980); see also 5 Am.Jur.2d Appeal & Error § 785 (1962). Finally, we find there is substantial evidence in the record to support the trial court's finding that Humiston proved by sufficient clear, convincing and satisfactory evidence, the four elements of estoppel. See, e.g., Bricker v. Maytag Co., 450 N.W.2d 839 (Iowa 1990). Rowley's representative, with apparent authority to act for Rowley, falsely represented to Humiston's insurance agent that Rowley would provide physical damage coverage for the trailer with the knowledge and intent that Humiston would rely upon the representation.