Two people wearing suits tearing a piece of paper in half

What Evidence Is Admissible
in a Contract Dispute?

Engel Professional Association Feb. 22, 2022

Running a business often involves forging legal agreements with other individuals or businesses to provide needed products or services. These agreements generally take on the form of a contract, whether express, oral, or implied.

If you or your business suddenly gets involved in a breach of contract lawsuit – either you’re being accused of violating the terms of the contract, or you’re accusing the other party of the violation – you may wonder what to expect when the issue goes to trial, if it gets that far without a settlement.

A lot will depend on the contract underlying the legal action. If the contract is express and written in an unambiguous way, the introduction of evidence will be more limited. If it’s an oral or implied contract open to interpretation, then the evidence that may be admitted can be more far-reaching.

If you are involved in a breach of contract dispute in or around Minneapolis, Minnesota, or in nearby St. Paul, contact Engel Professional Association. We have more than two decades’ experience in contract law and business litigation, and we can advise you of your best options and aggressively represent you in resolving the situation.

Types of Contract Disputes

A breach of contract can involve different situations: a partnership dispute, real estate transactions gone awry, failure to pay rent or lease obligations, sales transactions, promissory notes and collections, and more, so long as one party has agreed upon an obligation to another party and fails to honor it.

On the most basic level, a breach involves one party failing to live up to a promise it made in a contractual obligation.

For instance, Company A agrees to deliver 200 microchips to Company B every Wednesday for Company B to manufacture drones. If Company A fails to make the delivery, a breach can be said to have occurred. If Company A quickly makes up for the missed delivery, then the breach can be said to be minor, but if the delivery never takes place, it could be considered major and lead to a lawsuit.

Four Types of Evidence

If a breach of contract dispute goes to trial, evidence will have to be submitted on both sides. In general terms, evidence can be of four types: real, demonstrative, documentary, and testimonial.

REAL EVIDENCE: Real evidence is like the proverbial “smoking gun,” something the jury can touch and examine.

DEMONSTRATIVE EVIDENCE: Charts, maps, diagrams, and illustrations that back up a witness’s testimony constitute demonstrative evidence. In a breach trial, a chart might be used to show sales lost due to the non-delivery of microchips (to use our earlier example).

DOCUMENTARY EVIDENCE: This category comprises written documents. In a breach lawsuit, the contract itself — provided it was written out — would be documentary evidence.

TESTIMONIAL EVIDENCE: When a witness takes the stand to relate what he or she saw, heard, or experienced, that is considered testimonial evidence.

General Rule of the
Admissibility of Evidence

For any of the above four types of evidence to be admitted during trial, the evidence must be relevant, material, and competent. Evidence must first be shown to be relevant to the issue at hand to be admitted. Once it is admitted, the judge or jury will have to determine whether it is material to the ongoing case. Competency refers to how reliable the source of the evidence is judged to be.

Parol Evidence: When It’s
Admissible and Not Admissible

Parol evidence is anything that exists outside of the actual contract in question. When there is a written contract, the judge is required to look within the “four corners” of the contract to determine if a breach has occurred. To make this determination, the judge must find a clearly stated intent in the contract; for instance, Company A agreed to deliver 200 microchips each Wednesday of the year to Company B. There represents clear intent.

Parol evidence could be anything from prior or subsequent discussions about the contract to agreements reached or discussed before the contract was finalized. Parol evidence is also known as extrinsic evidence.

Minnesota Statute 336.2-202 states: “Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement …”

Parol evidence can come into play, however, when the intent of the contract is ambiguous. This likely might be the case with contracts that are oral or implied and never put into writing. It could also be the case if the terms of a written contract are not clear. If the contract for microchips we discussed earlier stated only that the chips should be delivered “weekly,” then there could be ambiguity over which day of the week met the criterion.

How an Experienced
Attorney Can Help You

In any breach of contract dispute, the first priority is to examine the contract. Is the intent clear? Is there a statement or clause in the contract affirming that the agreement is final?

What this means in practical terms is that, before you agree to any contract, you should have an attorney review it or draft it for you so that the obligations of all parties to the contract are crystal clear. An unambiguous contract can avoid endless court proceedings and arguments over who promised what or who failed to deliver.

If you’re facing a breach of contract lawsuit or are involved in a dispute that may lead to legal actions, contact Engel Professional Association. With over 20 years of experience in drafting and enforcing contracts, we can advise and help you regardless of which side of the breach you’re on.

We proudly serve clients in and around Minneapolis, St. Paul, Mankato, Maple Grove, Woodbury, and St. Cloud, Minnesota. Call today to set up a consultation.