Is parol evidence admissible to establish that a party made misrepresentations in a settlement agreement?

Ontario, Canada


The following excerpt is from Thornton v. Toronto Police Services Board, 2012 HRTO 2412 (CanLII):

While misrepresentation and fraud are exceptions to the parol evidence rule, such an argument is usually raised to vitiate an agreement rather than uphold it. The kinds of statements the applicant is alleging were made in this case are not really misrepresentations (i.e. statements clearly wrong on their face) but rather are representations about the extent and scope of the duties to be assigned. The contract law principles related to representations that apply here are the principles relating to collateral contracts and warranties. As a general rule, parol evidence is admissible to establish a representation that induced someone to enter into a contract (i.e. to establish there was a distinct collateral agreement), but such evidence is only admissible to establish such a distinct collateral agreement where the oral evidence is not contradictory or inconsistent with the written contract (i.e. where the written agreement is silent). In this case the written contract is not silent on this point but rather has a provision that expressly addresses the duties to be assigned to the applicant. In order for a collateral agreement to be binding upon the parties, there must be a clear intention to create a binding agreement: see Hawrish v. Bank of Montreal, 1969 CanLII 2 (SCC), [1969] S.C.R. 515. In my view, there is no proper basis upon which to make such a finding where the parties expressly addressed the duties to be assigned to the applicant in the settlement agreement with a provision that did not include the representations upon which the applicant seeks to rely.

Other Questions


What is the effect of minutes of settlement or a settlement agreement containing an express prohibition against a child changing their name? (Ontario, Canada)
If a successful party accepts an offer to settle, can the successful party be ordered to pay all or part of the unsuccessful party’s costs? (Ontario, Canada)
Does the minutes of settlement constitute the underlying agreement or the agreement giving rise to the consent judgment? (Ontario, Canada)
Is an entire agreement clause binding a party to whom the agreement was signed? (Ontario, Canada)
How have the parties’ affidavit evidence before the Arbitrator been conflict about the circumstances surrounding both the July 20th and the 2014 Amending Agreement? (Ontario, Canada)
Does a party have to establish a permanent residence to establish habitual residence? (Ontario, Canada)
What is the effect of the parties’ agreement on the division of net family property pursuant to the terms of the agreement? (Ontario, Canada)
Does the requirement of uberrima fides apply when the parties have entered into a separation agreement requiring the parties to pay support for the children of the marriage? (Ontario, Canada)
Is a litigation guardian required to approve a partial settlement that includes payment of 15% plus party and party costs to solicitors? (Ontario, Canada)
What is the test for establishing that the responding party (the responding party) will not be prejudiced by the severance? (Ontario, Canada)
X



Alexi white


"The most advanced legal research software ever built."

Trusted by top litigators from across North America.