Report No. 185

Section 99

This section deals with the question 'who may give evidence of agreement varying terms of document'. It reads as follows:

"99. Persons who are not parties to a document, or their representatives in interest, may give evidence of any facts tending to show a contemporaneous agreement varying the terms of the document".

There is an illustration below Section 99. It reads as follows:

"A and B make a contract in writing that B shall sell A certain cotton, to be paid for on delivery. At the same time, they make an oral agreement that three months' credit shall be given to A. This could not be shown as between A and B, but it might be shown by C, if it affected his interests."

In the 69th Report, three aspects are considered and three amendments suggested to Section 99. The first one is that the section enabling extrinsic evidence must apply where both parties in a case are strangers to a document or one party is a stranger. Secondly, the section permits evidence to 'vary'. The word, 'contradict, add to or subtract', which are used in other sections must also be added. Thirdly, so far as where third parties to the document are involved, there must be an exception, as in England. The Commission accepted the suggestion in Cross on Evidence, 1974, page 540, that 'contradiction by oral evidence should not be permitted, even between strangers', if the matter is required by law to be reduced to writing'.

We agree with the above proposals and revised draft from para 44.27 of the 69th Report with slight modification as follows:-

"99. Who may give evidence of agreement varying the terms of a document.- Evidence of any fact tending to show a contemporaneous agreement contradicting, varying, adding to, or subtracting from the terms of a document may be give.-

(a) as between persons who are not parties to the document or their representatives in interest; or

(b) as between a person who is a party to the document or his representative in interest and a person who is not such party or representative in interest:

Provided that no such evidence shall be given where the matter is required by law to be reduced to writing.

Illustration

A and B make a contract in writing that B shall sell certain cotton, to be paid for on delivery. At the same time they make an oral agreement that three months' credit shall be given to A. This could not be shown as between A and B, but it might be shown by C, if it affected his interests."