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Lopez v. Reynoso - 129 Wash. App. 165, 118 P.3d 398 (2005)

Rule:

Under the parol evidence rule, prior or contemporaneous negotiations and agreements are said to merge into the final, written contract, and evidence is not admissible to add to, modify, or contradict the terms of the integrated agreement. But the parol evidence rule is only applied to writings intended as the final expression of the terms of the agreement. Extrinsic evidence may be used to ascertain the intent of the parties, to properly construe the writing, and to determine whether the writing is actually intended to be the final expression of the agreement.

Facts:

Stephany Lopez bought a used car from Ramon Reynoso pursuant to an installment sales contract. When Lopez did not make all the payments listed in her amortization schedule, Reynoso repossessed the car. Lopez sued for replevin and additional recovery. She moved to exclude parol evidence offered by Reynoso to show that a $2,000 payment by Lopez on the day of the sale or one day later was deducted from the sale price listed on the contract. She contends the $2,000 was actually an additional payment that reduced her obligation under the contract. The trial court allowed the parol evidence and entered judgment for Reynoso. On appeal, Lopez contends the trial court erred in admitting parol evidence that contradicted terms in the integrated contract. She also argues the trial court applied the incorrect standard of evidence.

Issue:

Was the trial court correct in admitting parol evidence to prove that the payment on the day of the sale was deducted to the price listed in the contract?

Answer:

Yes.

Conclusion:

The Court held that the trial court's examination of extrinsic evidence to determine whether the parties intended the written contract to be the final expression of their terms was proper. When Reynoso responded that the writing was an incomplete expression of the entire negotiations and agreements of the parties, the trial court was obligated to consider any extrinsic evidence to determine whether the agreement was fully integrated, and if not, what other terms consistent with the written agreement were operative. Furthermore, the Court ruled that the conclusion of the trial court that Reynoso's explanation of the negotiations was more credible was supported by a preponderance of the evidence and by the trial court's inherent authority to determine the credibility of the witnesses. Sufficient evidence supported the trial court's findings of fact, which in turn supported its conclusion that the $2,000 down payment reduced the sale price to $6,000, and that Reynoso lawfully repossessed the vehicle after the purchaser defaulted on the monthly payments due in January, February, and March 2002. Because Reynoso's repossession was lawful, he did not violate Wash. Rev. Code ch. 46.70 or 19.86. Dismissal of Lopez's complaint and judgment for the dealer were therefore justified. As Lopez did not prevail on appeal, she was not entitled to attorney fees under the sales contract, or the Consumer Protection Act. The Court affirmed the judgment of the trial court.

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