The significance of a seal is losing its force in America. In some states a seal no longer has any significance, whatever, so that even when present in due form, it does not import a consideration, but such consideration must be proved the same as for a simple or parole contract. The plain intent of the parties is the controlling factor. The rules given above are the common law rules and still have more or less force in some states.

PAROLE CONTRACTS.

29. Oral and Written Contracts.

All contracts,

either oral or written, not executed under seal, are called simple or parole contracts.

An oral contract has all the force of a simple written contract, but it is subject to difficulties in the way of establishing or proving its terms, which a written contract is comparatively free from. A large proportion of the litigation arising from the nonfulfillment of contracts is caused by a failure to reduce the terms of the contract to writing.

An oral or written contract can be modified by subsequent agreements, and such subsequent agreements become a part of the original contract. A written contract, however, has this advantage over an oral contract: It is presumed in law to embody all understandings and agreements made at the time of, or previous to, the signing of the contract. No oral evidence can be admitted therefore as to agreements or understandings made at the time of the written agreement or antecedent thereto which would modify its terms. Evidence will be received, however, as to oral or written agreements made subsequent to the signing of the written contract which may modify its terms.

It is allowable, however, to admit testimony as to oral agreements or understandings made prior to, or contemporaneous with, the signing of the contract, for the purpose of proving fraud and deception.

Such evidence may also be introduced for the purpose of proving duress or mistake in the drafting of the contract. It can not be introduced for the purpose of modifying its terms, since it must be assumed that all the essential or material matters in the agreement were embodied in the written contract.

Subsequent oral or written agreement modifying the terms of the original contract requires a separate and distinct consideration to support it, unless the original contract contained special provision for such changes, in which case they must be made in accordance therewith, and may or may not require a new consideration.

ASSIGNMENTS OF CONTRACTS.

30. When Assignments Can Be Made. All contracts and agreements can in general be assigned by either party, and the contract enforced by the assignee, except such contracts or agreements as involve a personal trust or confidence in one or both of the parties. Evidently trust and confidence in the skill or professional ability of another can not be assigned, and when such trust is a material element in the contract there can be no assignment. Of such character are nearly all kinds of personal services, except, perhaps, the most common labor.

All building and engineering contracts are assignable, unless the writings themselves contain conditions denying such privilege. It is, however, common to insert such a clause in all engineering contracts by which they then become nonassignable.

31. Notice of Assignment Necessary. While an assignment is effectual as between the assignor and assignee, from the moment it is made, it does not bind the other party to the original contract until he has received notice of the assignment. Without such notice any performance on his part in favor of the original party or assignor releases him to that extent with the assignee. It is necessary, therefore, to give prompt notice of all assignments to all the parties concerned. After such notice has been given, all parties become bound to the assignee, the same as they had formerly been to the assignor.

An exception to the rule of the necessity of giving notice obtains in the case of what is called negotiable paper. The transfer of such contracts is not called assignment, the document itself carrying with it its own evidence of ownership. Such documents are bills of exchange, bank checks, promissory notes, bills of lading, certificates of deposit, certain kinds of bonds and coupons, warehouse receipts, and bank bills.

CONSTRUCTION OF THE CONTRACT.

32. The Original Contract. An original written contract is presumed to embody all the

agreements made at, or No oral evidence will be

previous to, the time of its signing. admitted to explain or supplement the terms expressed in the written contract, provided these are clear and plain. It is permissible, however, to modify the terms of any written contract by subsequent oral or written agreements. It is also permissible to submit evidence as to contemporaneous oral agreements which supplement or explain the terms imposed in the contract, provided these be not inconsistent with the terms of the written document.

Oral evidence is also admissible to explain the identity of the parties, or the existence of an agency, the identity of the

subject-matter, and the sense in which certain unusual or technical words have been used.

Oral evidence is also admissible to explain any latent ambiguity in the instrument, as where more than one meaning may be given to a word or phrase; but in the case of a patent ambiguity, that is to say, an ambiguity apparent on the face of the instrument itself, and which is meaningless without oral explanation, such an ambiguity will make the contract void.

33. The Explanation of Technical Terms in Contracts. In all cases where either common or uncommon words are used in a technical sense, or in a sense peculiar to a given trade or business, in which custom has given to such expressions particular and definite meanings, oral testimony can be received for the purpose of explaining the real meaning of such terms. Furthermore, the meaning which the law will enforce is that which such a term has in that neighborhood, or with the parties to the contract. In such cases the common usage or custom will fix the meaning of the technical words used.

In other cases oral evidence may be introduced to explain the real meaning of a contract, where custom or usage caused the meaning to be clear to the parties themselves when the contract was signed, but which would not be understood by strangers to such usages.

In order that a contract may be interpreted in the light of custom or usage, such custom or usage must be certain, definite, and uniform in that district, or between the parties to the contract. Unless it is a universal custom or usage as between the parties, it can not be received as positive evidence of meaning. Furthermore such custom and usage must have been continuous and uninterrupted up to and including the time of the transaction in question. Thus one or more acts do not

establish a custom as between the parties, and a few illustrative examples will not serve to establish a usage.

When the explanation rests upon usage in the neighborhood, such usage must be general and a knowledge of it must be common, so that it may have been presumed to have been known to the parties to the contract.

Such custom or usage must be reasonable, and must have been generally assented to, and complied with without protest, in order to become binding in explaining the terms of a contract.

Such custom or usage, also, must not be repugnant to any of the express terms of the contract itself, neither must it contravene a state statute, city ordinance, or conflict with the law of public policy.

34. Rules of Construction.

1. The first and principal rule to be followed in the construction of contracts is to ascertain the real intention of the parties at the time the contract was signed. In fact all rules are merged in this one, and have for their object the determination of the original real meaning of the document.

In arriving at this real meaning, the words used must be understood in their ordinary and popular meaning, when these do not have a technical significance, as indicated in the previous article. In all other cases, the language is supposed to mean what it would ordinarily be understood to mean under the given circumstances of time and place, and as between the given parties.

3. Furthermore the whole instrument must be looked to, and all the terms thereof made effective if possible. The whole instrument will be construed, also, in construing any latent ambiguity which may pertain to any given part. Where more than one document enters into a general agreement they shall all be taken into account in the construction of the entire