Court Opinion

ID: 9626727
Source: CourtListenerOpinion
Date Created: 2023-08-22 08:22:26.68219+00
Date Added: 2024-06-11T15:12:22.720855
License: Public Domain

Herd, J.,
dissenting: I respectfully dissent from the majority opinion reversing the district court judgment. The majority invokes the parol evidence rule finding the marketing agreement between Reinhard Simon and NFO complete, unambiguous, and free from uncertainty and, thus, requiring the exclusion of extrinsic evidence of an oral agreement between Simon and NFO’s agent, Norb Connor.
I have no quarrel with the parol evidence rule. It is essential to the resolution of disputes over written contracts. However, it is not an absolute. Theré are numerous valid exceptions. This case falls within some of those exceptions.
One exception is the doctrine of partial integration, which is invoked when a written instrument is shown to be an incomplete contract. Parol evidence is admissible to prove the entire contract. Such evidence is supplemental and not contradictory of the writing. Under this exception, the court must resolve, as a question of law, the preliminary question of completeness of the written contract. See 30 Am. Jur. 2d, Evidence § 1043.
The next relevant exception to the parol evidence rule is the collateral contráct doctrine. Under this doctrine, a prior or contemporaneous collateral oral contract, not inconsistent with the written contract, may be proved by parol evidence. It must relate to the same general subject matter as the written contract and be supplémental thereto. It must have separate consideration from the written contract. 30 Am. Jur. 2d, Evidence §§ 1049-1050.
In many jurisdictions, parol evidence is admissible to show matters of inducement to enter the contract where the written contract would not- have been éxecuted but for the oral representations. 30 Am. Jür. 2d, Evidence § 1051.
Also, it is generally held that in the absence of a recital of consideration, which the partiés intend to be contractual, parol evidence is admissible to show the consideration for the contract *686if different from that expressed in the written instrument. 30 Am. Jur. 2d, Evidence § 1056; 3 Jones on Evidence § 16:37 (6th ed. 1972).
A careful examination of the Simon/NFO contract discloses nothing is stated in the written agreement about the purchase price or the quality of the milk to be sold. According to the written contract NFO can negotiate and sell for any price it chooses and base the price on any quality it chooses. Simon is in the dairy business to sell milk. The price he receives for his products for sale is the essence of his business; however, it is omitted from the written contract. It does not require NFO to sell for fair market price based on Grade A or blend price. The parol evidence of the inducement of 20 cents over the blend price offered by Connor to obtain Simon’s signature and the recitation that Simon should receive the blend price does not contradict, alter, or vary the terms of the written agreement. It is merely supplemental to the contract. I believe omission of the price and quality of the milk qualify as a partial integration and as inducement to enter into the agreement. Because there was no separate consideration, the collateral contract doctrine does not apply.
The trial court relied upon Souder v. Tri-County Refrigeration Co., 190 Kan. 207, 212, 373 P.2d 155 (1962), which states in pertinent part:
“There is a wide distinction between an attempt to contradict the terms of a written instrument and to explain the circumstances and conditions under which it was executed and delivered. It has regularly been held that where a contract is incomplete or silent in any particular, parol evidence is admissible to show the actual agreement between the parties, and this is not limited to cases where there is ambiguity. Parties to a contract know best what was meant by its terms and are the least liable to be mistaken as to its intention, and, where the contract is silent or ambiguous concerning a vital point incident thereto, parol evidence will be received to aid in its construction. [Citations omitted.]
“The rule against admission of parol evidence to contradict, alter or vary the terms of written instruments is not violated when such evidence does not contradict but explains or supplements indefinite or incomplete matters contained in the instruments, or when it tends to show the relation of the parties and the circumstances under which the instruments were executed. [Citations omitted.] In cases where a written contract does not definitely embrace the entire agreement of the parties, and thus their interests are not completely expressed, parol proof may be received to supplement and *687explain that which is written. [Citation omitted.] Evidence of an omitted term has been received as to the time of payment of amounts due or to become due under a contract. [Citation omitted.] An oral agreement as to the manner in which a contract is to be performed is competent where the writing is not contradicted thereby, such as a delay in paying the purchase price.”
The rule discussed in Souder has been incorporated into Article 2 of the U.C.C.;
“Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement toith respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented
“(a) by course of dealing or usage of trade (section 84-1-205) or by course of performance (section 84-2-208); and
“(b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.” K.S.A. 84-2-202. (Emphasis added.)
I believe the trial court properly permitted introduction of Simon and Connor s oral agreement as to price and inducement.
I now turn to the issue of .whether the district court erred in overruling NFO’s motion for a directed verdict on the breach of contract claim arising from the provision in the written contract prohibiting an NFO representative from “altering or adding to the terms of the agreement’’ without written approval by the NFO Board.
As discussed earlier, the extrinsic evidence allowed does not alter or add to the terms and, therefore, this ban was not violated. The parol evidence provides missing elements in the contract. Hence, I believe the trial court properly overruled NFO’s motion for a directed verdict.
I would follow our rule that a trial court judgment should be affirmed if possible and affirm the trial court herein.
Lockett, J., joins the foregoing dissenting opinion.