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Partial integration is a contracts law term that describes a written contract that does not contain all of the terms of agreement between the parties who entered into the agreement. According to the Parol Evidence Rule, unless otherwise stated, any written agreement encompasses the full agreement between the parties and prior words or writing that contradict those terms are inadmissible to show that the parties intended to include them. However, the document may incorporate supplemental terms that do not contradict any stated terms included in the final written agreement between the parties.
The Parol Evidence Rule states that any evidence of prior agreements is not admissible to contradict the terms of the final written agreement unless it falls within one of several stated exceptions. These exceptions include aiding in resolving ambiguous terms in the contract, correcting a mistake, or showing a fraud or duress in the contract’s execution. For example, if there is a contract to purchase a car that simply includes price terms, evidence of previous promises by the seller to have the oil changed in the event the car is sold may be introduced to show that having the oil changed prior to transfer of the car was part of the sale agreement. Evidence of different price terms may not be introduced, however, as that would violate the Parol Evidence Rule. Additionally, because the previous agreement to include an oil change is considered part of the agreement in this example, the final contract that included just the price terms is an example of a partial integration.
Partial integration can lead to confusion between the parties, as one may falsely believe that the other has previous discussions in mind when signing the final contract. Therefore, it is best to ensure that the final agreement is a full integration through an explicit reference to any documents that would indicate any and all points either party believes should be part of the agreement. Furthermore, by incorporating these points by reference into the agreement, the parties avoid all complications that may potentially be caused by the Parol Evidence Rule.
Another way to avoid the problems associated with partial integration is a merger clause, which is a paragraph in the contract explicitly stating that the written document is a full and complete integration and no prior discussions shall be included within the indicated agreement. Though this is a common measure taken by parties, it is not always entirely foolproof in preventing partial integration issues as the clause simply creates a presumption that the document is fully integrated, which can be rebutted. In other words, the party who asserts that the document is just a partial integration may still introduce evidence that other non-contradictory terms should be included within the agreement.