Court allows oral testimony in interpreting real estate contracts

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The Washington Supreme Court reversed. It held that the parol evidence rule did not apply, and extrinsic evidence was admissible, because the written agreement was ambiguous as to when Brogan and Anensen could take possession of the property. The contract stated that the keys were to be delivered on the closing date or the possession date, whichever was first. It provided for three possibilities in defining “possession date” with boxes next to each so that the parties could check off their desired choice. But the parties failed to check any of the three boxes.

Therefore, the Brogan & Anensen Court found that the term “possession date” was undefined. Because the parol evidence rule allows for extrinsic evidence that would assist in defining an undefined contract term, the Supreme Court concluded that the testimony of the defendant's witnesses should have been admissible and raised material questions of fact that precluded summary judgment.

Brogan & Anensen v. Lamphiear arises from unusual facts, so that its application might be limited. But it is a rare real estate case that permits evidence outside the four corners of the signed agreement. This decision could afford future litigants an opportunity to avoid the terms of a written contract.