Parol Evidence Rule Not Permitted To Be Instrument of Fraud

“Parol evidence”‘ that is verbal evidence to show that the written contract was not the true contract,  admitted to prevent a fraud upon a trust.Parol Evidence

The BC Court of Appeal upheld the finding of a trust in the decision Bradshaw v Stenner 2012 CarswellOnt 1936

The plaintiff transferred her property to the defendant, allege deadly on terms of trust, that the defendant would re convey the property upon request

The defendant ultimately refused to do so, and the plaintiff successfully sued the defendant and both the trial and appeal courts held that there was a trust.

The defendant had paid no funds for the property and the plaintiff always remained in possession of it.

The trial judge found the plaintiffs version to be more credible.

At issue was the legal predicament that the attempted to prove the trust through the introduction of “Parol evidence”‘ that is verbal evidence to show that the written contract was not the true contract, and that a trust should be imposed over the entire transaction

The Parol evidence rule is a hard and fast concept in contract law that basically says Parol evidence cannot be introduced into evidence to refute the written terms of a contract.

Both courts here did allow the Parol evidence to be admitted on the basis that the Parol evidence rule did not apply to render in admissible evidence used to create a trust, as where a trust is alleged and proven, then the Parol evidence rule has no application.

To have not permitted the oral evidence to be admitted would have permitted the said rule to be used asan instrument of fraud. applauds this decision in estate law as the law of contracts re the Parol evidence rule can lead to misjustice if oral evidence is not admissible.

There are many cases where the courts have worked around the rule by finding such as two contracts rather than one.

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Trevor Todd

Trevor Todd is one of the province’s most esteemed estate litigation lawyers. He has spent more than 40 years helping the disinherited contest wills and transfers – and win. From his Kerrisdale office, which looks more like an eclectic art gallery than a lawyer’s office, Trevor empowers claimants and restores dignity to families across BC. He is a mentor to young entrepreneurs and an art buff who supports starving artists the world over. He has an eye for talent and a heart for giving back.

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