In
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tr ...
law
Law is a set of rules that are created and are enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. It has been vario ...
, an integration clause, merger clause, (sometimes, particularly in the
United Kingdom
The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the European mainland, continental mainland. It comprises England, Scotlan ...
, referred to as an entire agreement clause) is a clause in a written contract which declares that contract to be the complete and final agreement between the parties. It is often placed at or towards the end of the contract. Any pre-contractual material which the parties wish to be incorporated into the contract need to be assembled with it or explicitly referred to in the contractual documentation.
Effect
A contract that has such a clause may be deemed an integrated contract, and any previous negotiations in which the parties to the contract had considered different terms will be deemed superseded by the final writing. However, many modern cases have found merger clauses to be only a
rebuttable presumption
In common law and civil law, a rebuttable presumption (in Latin, ''praesumptio iuris tantum'') is an assumption made by a court that is taken to be true unless someone proves otherwise. For example, a defendant in a criminal case is presumed inn ...
.
In the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
, the existence of such a term is normally not conclusive proof that no varied or additional conditions exist with respect to the performance of the contract beyond those that are in the writing but instead is simply evidence of that fact.
In ''Personnel Hygiene Services Ltd v Mitchell'', an
England and Wales Court of Appeal
The Court of Appeal (formally "His Majesty's Court of Appeal in England", commonly cited as "CA", "EWCA" or "CoA") is the highest court within the Senior Courts of England and Wales, and second in the legal system of England and Wales only to ...
case where there were two distinct contractual relationships between the parties, a service agreement superseded by a compromise agreement, and a separate share purchase agreement, it was held that the entire agreement provisions in the compromise agreement annulled the service agreement but the share purchase agreement remained intact.
[England and Wales Court of Appeal (Civil Division)]
Personnel Hygiene Services Ltd v Mitchell
EWCA Civ 1047, published 14 July 2009, accessed 18 March 2021
Sample clause
The following language is an example of an integration clause:
Collateral contracts
Parties in
dispute may wish to argue that a previous understanding or implied agreement, made before a contract with an entire agreement was signed, should also be separately enforced as a
collateral contract
A collateral contract is usually a single term contract, made in consideration of the party for whose benefit the contract operates agreeing to enter into the principal or main contract, which sets out additional terms relating to the same subj ...
.
Christopher Nugee QC, now a
Lord Justice of Appeal, has ruled that the existence of an entire agreement clause within the main contract creates an "obvious difficulty" for a party who wishes to rely on such a separate agreement.
See also
*
Parol evidence rule
The parol evidence rule is a rule in the Anglo-American common law that governs what kinds of evidence parties to a contract dispute can introduce when trying to determine the specific terms of a contract. The rule also prevents parties who hav ...
References
{{DEFAULTSORT:Integration Clause
Contract law
Contract clauses