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Integration requires a mutual intent by both of the contracting parties that the written agreement contain all of the agreements of the parties and the further mutual intent that the written agreement is intended to be the sole agreement, barring reliance upon any other prior or contemporaneous representations or agreements.
Plaintiff buyer and defendant seller entered into written contracts for the purchase of recommended computer equipment and related software for the purpose of meeting the buyer's needs regarding his accounting for accounts receivable, accounts payable, and inventory. The buyer was not familiar with computer terminology and in signing the agreements he was relying upon the representations of the seller's personnel as to what computer equipment and software should be purchased and what it was expected to accomplish. Each agreement contained an integration clause stating that each agreement constituted the entire agreement and superseded all prior communications between the parties. Plaintiff brought the present action after the computers failed to accomplish the specific needed tasks in question. Defendant asserted that the contract’s integration clause protected it from responsibility or liability for the representations of its salespersons, so long as the representations were not included in the agreement.
Under the circumstances, were the contracts integrated, thereby relieving defendant seller from liability for the representations of its salespersons?
The court held that the contracts were not integrated. The court noted that integration required a mutual intent by both of the contracting parties that the written agreement contained all of the agreements of the parties and the further mutual intent that the written agreement was intended to be the sole agreement, barring reliance upon any other prior or contemporaneous representations or agreements. The court held that, in this case, the preponderance of the evidence revealed that there was no such mutual intent of the parties that the agreement be integrated. The court noted that the plaintiff buyer was not particularly versed in contract law or computer science, and although he scanned and in part read the agreements, he did not understand that the integration clause meant that the representations of defendant's salespersons as to what the computer could accomplish might be nullified. On the other hand, what the computer would accomplish was an essential part of the agreement of the parties. The equipment and software were useless to plaintiff unless they would accomplish the specific needed tasks in question. The court averred that provided the plaintiff buyer understood the possible legal effect of the integration clause in question, he would have insisted that the prior written and oral representations which had been made regarding the computer be included in the written agreement.