(a) where a written contract contains a clause stating that the document contains all contractual clauses (“merger clause,” “full contractual clause”), previous statements, commitments or agreements not included in the document are not part of the contract. 3 The parties` statements or statements prior to the conclusion of the contract are not negligible, however, even if a merger clause is included in the contract. They can be used to interpret the contract taking into account these previous statements or statements that may lead to a change in the written text of the contract or the adoption of a tacit clause. 4. Previous agreements and agreement by agreement – Finally, when entering into a contract, the parties should consider whether the agreements reached before the treaty are concluded and which should be included in such a contract. In this case, this should be done by explicit reference to this agreement and its inclusion in the new treaty. If this has been done correctly, a whole contractual clause will not work to exclude it. If, for whatever reason, the previous agreement is not expressly included, this earlier agreement may, in certain circumstances, give rise to a legally binding obligation, even if the contract contains a full contractual clause. This is due to the Estoppel doctrine by convention, which was recently discussed under the comprehensive contractual clauses contained in Mears Ltd/Shoreline Housing Partnership Ltd3. However, in some cases, previous agreements may prevail, even if, because of the Estoppel doctrine by convention, this agreement contains a full contractual clause.21The doctrine of the Estoppel by convention means that a party is discouraged from arguing that a contract is not altered by the conduct of the parties, although the contract includes a “comprehensive agreement” clause.
In summary, the parties should ensure that they are informed in advance of what was included prior to its execution and that it has been excluded from the contract. As we have seen, it is often necessary to include additional clauses in the contract in order to exclude unspoken clauses or pre-contract assurances or to include certain pre-contract agreements. Otherwise, a simple misunderstanding could lead to costly litigation. The whole agreement clause indicates that the agreement records all the rights and obligations of the parties in toto. If other conditions have been agreed between the parties prior to the conclusion of this contract, the parties are free to mention them in this agreement.19 Therefore, the entire clause of the contract generally replaces all previous agreements that were not expressly included in that agreement. In the case of Neelkanth Mansions and Infrastructucts Private Limited and Ors. v. Urban Infrastructure Ventures Capital Limited and Ors.20 did not allow Bombay High Court to provide oral evidence and to find that the entire purpose agreed between the parties was only included in the shareholders` agreement, since the shareholder contract does not relate to any conditions of the endorsement agreement.
“This contract contains final and comprehensive agreement and agreement between the parties and is the full and exclusive declaration of its terms. This contract replaces all previous written or written agreements in this context. The final contract contained a full contractual clause. Shoreline argued that this clause had prevented Mears from availing itself of the pre-contract agreement. However, Akenhead J noted that “the full agreement clause” does not exclude or limit confidence in an established and effective Estoppel, either explicitly or by interpretation. It was found that prior to the start of the contract, the parties shared an assumption and based on this assumption over a long period of time, so it would be unfair to allow Shoreline to apply the terms of the contract in order to avoid the performance of their obligations under the pre-contract agreement.