State the exception to the rule that no evidence of any oral agreement or statement shall be admitted for the purpose of contradicting, varying, adding to, subtracting from, the terms of a written instrument.

Question: State the exception to the rule that no evidence of any oral agreement or statement shall be admitted for the purpose of contradicting, varying, adding to, subtracting from, the terms of a written instrument.

Find the answer to the mains question only on Legal Bites. [State the exception to the rule that no evidence of any oral agreement or statement shall be admitted for the purpose of contradicting, varying, adding to, subtracting from, the terms of a written instrument.]

Answer

Section 92 of the Indian Evidence Act, forbids the admission of evidence of an oral agreement for the purpose of contradicting, varying, adding to, or subtracting from, the terms of a written document as between the parties to such document or their representatives in interest.

There are six provisos to section 92 which acts as an exception to this—

1. Any fact which would (i) invalidate any document, or (ii) entitle any person to any decree or order relating thereto may be proved, such as fraud, intimidation, illegality, failure of consideration, a mistake in fact or law.
2. Any separate oral agreement (i) as to any matter on which the document is silent, and (ii) which is not inconsistent with its terms, may be proved.
3. Any separate oral agreement, constituting a condition precedent to the attaching of any obligation under the document, may be proved.
4. Any subsequent oral agreement to rescind or modify any such contract, grant, or disposition of property, may be proved, except when such contract of grant (i) is required to be in writing, or (ii) has been registered.
5. Any usage or custom by which incidents not expressly mentioned in any contract are usually annexed to such contracts may be proved if they are not repugnant to, or inconsistent with, its express terms.
6. Any fact which shows in what manner the language of the document is related to existing facts may be proved.

Proviso (1) provides that any fact may be proved which would invalidate any document which would entitle any person to any decree or order relating thereto such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, want of consideration or mistake in fact or law.

Under the said proviso, the facts which may be proved must be such as to show either that legal requisites for a valid agreement did not exist at all or that one of the parties did not give his free consent to it or that document does not express what was really intended to be embodied therefore parol evidence may be given to show that by a mistake of parties not entered into a valid contract.

The evidence of contemporaneous oral agreement contracting document is admissible therefore, for example, the usufructuary mortgagee has the right to show that he has not mortgaged the property. In a mortgagors suit for redemption, oral evidence can be admitted to prove that the document was not intended to be acted upon and it was a sham document executed only as collateral security. Such evidence does not have the effect of varying or contradicting the terms of documents

Proviso (2) provides that existence of any separate oral agreement as to any matter on which a document is silent, and which is not inconsistent with its terms, may be proved, therefore, when a document in writing does not contain the entire agreement but, embodies only some of the conditions, oral evidence to prove some other terms agreed upon and not inconsistent with the written instrument is admissible.

The separate agreement should be on a distinct collateral matter, although it may form part of the same transaction; the test being that it should not vary or contradict the terms of a written contract. For example, when a promissory note was silent as to the interest, a subsequent verbal agreement to pay interest can be allowed to be proved.

Proviso (3) provides that, the existence of any separate oral agreement, constituting a condition precedent to be attaching of any obligation under such contract, grant or disposition of property, may be proved. As per this proviso, when there is a separate oral agreement, the terms of the written contract will not take effect or will be of no force until a condition precedent has been fulfilled or a certain event has happened, oral evidence is admissible to show that the conditions not having been performed the contract did not mature so there was no written agreement at all.

It is permissible to adduce evidence of contemporaneous agreement under which the parties agreed that until happening of a certain event, no-obligation whatever under the written contract should attach.

Proviso (4) deals with three situations:

1. Where a transaction has been reduced into writing not because the law requires but, by agreement for the convenience of the parties, the oral evidence of any distinct subsequent oral agreement modifying or rescinding it all together is admissible. Thus, oral evidence is admissible to show that a prior written contract has been waived or replaced by a new parol agreement.
2. Where a transaction has been reduced to writing because the law requires it to be in writing then, subsequent agreement rescinding or modifying should also be writing, and oral agreement is not admissible.
3. In a contract, grant etc. has been registered, parol evidence of any subsequent agreement modifying or rescinding the registered instrument is not admissible but, it can be modified only by another registered instrument.

Proviso (5) provides that Oral evidence is admissible to explain or supply terms in commercial transactions for example contracts, Bill of exchange, insurance policies etc. on the presumption that the contract is to be interpreted or regulated by established usages or customs provided that they are not inconsistent with the terms of the contract.

Proviso (6) provides that any fact may be proved which shows in what manner the language of the document is relating to existing facts. The object of the admissibility of the evidence of surrounding circumstances is to ascertain the real intentions of the parties, but those intentions must be gathered from the language of the document as explained by extrinsic evidence.

No evidence of any intention inconsistent with the plain meaning of the words used will be admitted, as the object is not to vary the language used, but merely to explain the sense in which the words are used by the parties. Thus, this proviso comes into play when there is a latent ambiguity in the document i.e. when there is a conflict between the plain meaning of the language used and the facts existing or when put together they lead to ambiguity.

Extrinsic evidence of every material fact which will enable the Court to ascertain the nature and qualities of the subject matter of the instrument, or in other words to identify the persons and things to which the instrument refers must of necessity be received.

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Important Mains Questions Series for Judiciary, APO & University Exams

1. Law of Evidence Mains Questions Series Part-I
2. Law of Evidence Mains Questions Series Part-II
3. Law of Evidence Mains Questions Series Part-III
4. Law of Evidence Mains Questions Series Part-IV
5. Law of Evidence Mains Questions Series Part-V
6. Law of Evidence Mains Questions Series Part-VI
7. Law of Evidence Mains Questions Series Part-VII
8. Law of Evidence Mains Questions Series Part-VIII
9. Law of Evidence Mains Questions Series Part-IX
10. Law of Evidence Mains Questions Series Part-X