What does the parole evidence rule state?

The correct answer is that contracts must include all terms in writing. The parole evidence rule is a legal principle that governs the admissibility of oral or written statements made prior to or at the same time as a written contract. Essentially, it dictates that once a written contract is established, any prior oral or written agreements that contradict the written terms are not admissible in court to alter or contradict the written agreement.

This rule emphasizes the importance of having a comprehensive written document that captures all terms and agreements between the parties involved. It supports the integrity of written contracts by preventing parties from introducing extraneous evidence that is not included in the final document. Therefore, a well-drafted contract should encompass all the essential terms to ensure clarity and enforceability.

The other options suggest ideas that do not align with the principles of contract law as they relate to the parole evidence rule. Written contracts retain their enforceability, and the precedence of oral agreements over written terms is specifically disregarded by this rule. Addenda do not inherently overrule original contracts unless they are expressly executed in a way that modifies those terms, and thus contracts must indeed ensure all terms are clearly included in writing to avoid any ambiguity or disputes.