Williams v. Spitzer Autoworld Canton, L.L.C. , 122 Ohio St. 3d 546 ( 2009 )

[Cite as Williams v. Spitzer Autoworld Canton, L.L.C., 122 Ohio St.3d 546, 2009-Ohio-3554.]
WILLIAMS, APPELLEE, v. SPITZER AUTOWORLD CANTON, L.L.C., APPELLANT.
[Cite as Williams v. Spitzer Autoworld Canton, L.L.C.,
122 Ohio St.3d 546, 2009-Ohio-3554.]
Contract — Parol evidence — Consumer Sales Practices Act — The parol
evidence rule applies to actions brought pursuant to the Consumer Sales
Practices Act — Ohio Adm.Code 109:4-3-16(B)(22) in this context
unconstitutionally usurps the legislative function — Judgment reversed.
(No. 2008-1337 — Submitted April 22, 2009 — Decided July 28, 2009.)
APPEAL from the Court of Appeals for Stark County,
No. 2007 CA 00187, 2008-Ohio-2535.
__________________
SYLLABUS OF THE COURT
1. To the extent that Ohio Adm.Code 109:4-3-16(B)(22) conflicts with the parol
evidence rule as codified by R.C. 1302.05 and allows parol evidence
contradicting the final written contract, Ohio Adm.Code 109:4-3-
16(B)(22) constitutes an unconstitutional usurpation of the General
Assembly’s legislative function and is therefore invalid.
2. The parol evidence rule applies to actions brought pursuant to the Consumer
Sales Practices Act, and absent proof of fraud, mistake, or other
invalidating cause, a consumer may not present extrinsic evidence
contradicting the parties’ final written contract to prove a violation of that
act.
__________________
O’DONNELL, J.
{¶ 1} This case presents the question of whether the purchaser of an
automobile may use parol evidence to contradict the terms of a final written
SUPREME COURT OF OHIO
purchase agreement in a Consumer Sales Practices Act action against an
automobile dealer who allegedly failed to integrate an oral representation into the
final written purchase agreement. Absent fraud, mistake, or other invalidating
cause, a final written agreement may not be contradicted by evidence of a prior or
contemporaneous oral agreement, and therefore a consumer may not use parol
evidence to contradict the final written agreement to prove a violation of the
Consumer Sales Practices Act. Accordingly, we reverse the judgment of the court
of appeals.
Facts and Procedural History
{¶ 2} In October 2004, appellee Reynold Williams Jr. purchased a 2004
GMC Yukon SLT from appellant Spitzer Autoworld Canton, L.L.C. The
purchase agreement specified that appellee would receive a trade-in allowance of
$15,500 for his 2003 Ford Explorer and also contained a merger clause, providing
that it comprised the entire agreement between the parties. Almost two years
later, Williams filed this action in the common pleas court alleging, among other
claims, that Spitzer violated the Consumer Sales Practices Act (“CSPA”), R.C.
Chapter 1345, by not integrating a prior oral agreement – that he would receive a
trade-in allowance of $16,500 for the Ford Explorer – into the purchase
agreement. Although he admitted at trial that on the final written purchase
agreement, the “trade allowance is about as bold of print there as anywhere on
that form,” Williams explained that he did not notice that the contract provided a
trade-in allowance of $15,500 rather than the promised $16,500 because he had
focused on whether he could afford the monthly payment. According to
Williams, he did not discover the discrepancy until weeks later, when the
dealership informed him that his financing had been declined and that he owed an
additional $2,000 to pay off the loan secured by the Explorer. However, even
though he believed that he had received too little for his Explorer, he brought the
dealership two separate checks for $1,000 each.
2
January Term, 2009
{¶ 3} At trial, Thomas Capozzi, the salesman who sold the Yukon to
Williams, testified that he had not promised Williams a $16,500 trade-in
allowance for the Explorer, and the finance manager who worked on the deal
explained that he had gone over the information on the final purchase agreement
with Williams, including the $15,500 trade-in allowance and the final purchase
price of the Yukon. In rebuttal, Williams testified that no one went through the
purchase agreement with him line by line and that he did not agree to a trade-in
allowance of $15,500.
{¶ 4} The jury found that Spitzer knowingly violated the CSPA by orally
promising Williams $1,000 more than it provided in the written purchase
agreement, and it awarded him $2,500 in compensatory damages. The trial court
entered a judgment in favor of Williams, imposed treble damages pursuant to
R.C. 1345.09(B), and awarded attorney fees.
{¶ 5} Spitzer appealed, contending that the parol evidence rule barred
introduction of evidence of a prior oral agreement relating to a trade-in allowance
that contradicted the written purchase agreement for the Yukon. The Fifth
District Court of Appeals rejected that argument and affirmed the judgment,
holding that the parol evidence rule does not apply to a claim brought pursuant to
the CSPA “ ‘ “because the claim is based not on the contract, but on oral or other
misrepresentations.” ’ ” Williams v. Spitzer Auto World Canton L.L.C., Stark
App. No. 2007 CA 00187, 2008-Ohio-2535, at ¶ 18, quoting Wall v. Planet Ford,
Inc., 159 Ohio App.3d 840, 2005-Ohio-1207, 825 N.E.2d 686, at ¶ 25, quoting
Doody v. Worthington (Apr. 10, 1991), Franklin M.C. No. M 9011 CVI-37581,
1991 WL 757571, * 3. The appellate court explained that the CSPA protects
consumers in a manner not available under the common law and that as a
remedial law, it is to be liberally construed. Id. at ¶ 18 – 19.
{¶ 6} We accepted Spitzer’s discretionary appeal to determine whether
the parol evidence rule applies to actions brought pursuant to the CSPA and
3
SUPREME COURT OF OHIO
precludes evidence of a prior oral agreement that contradicts a final written
agreement. Williams v. Spitzer Autoworld Canton, L.L.C., 119 Ohio St.3d 1485,
2008-Ohio-5273, 894 N.E.2d 1243.
Proposition of Law
{¶ 7} Spitzer contends that the parol evidence rule applies to CSPA
claims arising out of contractual relationships and that it prohibits testimony
regarding prior oral agreements that specifically contradict terms in the final
written contract. It asserts that applying the parol evidence rule to Williams’s
claim upholds the enforceability of written contracts and does not jeopardize the
legislature’s purpose in enacting the CSPA because the exceptions to the parol
evidence rule (to supply a missing term, to clarify an ambiguity, and to vitiate a
contract when fraud is involved) adequately protect consumers.
{¶ 8} Williams maintains that he did not offer parol evidence to
contradict or invalidate the contract; instead, he claims that he sought to prove
that Spitzer committed an unfair or deceptive act when it failed to integrate a prior
oral agreement regarding the trade-in allowance into the written purchase
agreement. He argues that common law contract defenses do not apply to
statutory causes of action such as the CSPA, and he emphasizes that regulations
promulgated by the attorney general expressly make it a deceptive and unfair act
for a dealer not to integrate all oral promises made to the consumer into the
written contract. Further, Williams cites authority from other jurisdictions in
support of the proposition that the parol evidence rule does not apply to claims
brought pursuant to consumer protection statutes when an oral representation is
the basis for the claim.
{¶ 9} We are therefore called upon to resolve the question whether the
parol evidence rule applies to claims brought pursuant to the CSPA and bars
testimony regarding prior oral representations that contradict a final written
4
January Term, 2009
contract when the alleged unfair or deceptive act is the failure to integrate the oral
representations into the signed writing.
Law and Analysis
{¶ 10} The CSPA prohibits unfair or deceptive acts and unconscionable
acts or practices by suppliers in consumer transactions whether they occur before,
during, or after the transaction. R.C. 1345.02(A) and 1345.03(A). The parties do
not dispute that the sale of the Yukon involved a consumer transaction by a
supplier regulated by the CSPA.
{¶ 11} The General Assembly has delegated authority to the attorney
general to “[a]dopt, amend, and repeal substantive rules defining with reasonable
specificity acts or practices that violate sections 1345.02 [and] 1345.03 * * * of
the Revised Code.” R.C. 1345.05(B)(2). Pursuant to this authority, the attorney
general has promulgated Ohio Adm.Code 109:4-3-16(B)(22), which makes it a
violation of the CSPA for a “dealer * * * in connection with the advertisement or
sale of a motor vehicle, to * * * [f]ail to integrate into any written sales contract,
all material statements, representations or promises, oral or written, made prior to
obtaining the consumer’s signature on the written contract with the dealer.”
{¶ 12} However, Williams relies on parol evidence to establish his claim
that Spitzer failed to integrate an oral agreement relating to the trade-in allowance
into the written purchase agreement. The parol evidence rule provides that “
‘absent fraud, mistake or other invalidating cause, the parties’ final written
integration of their agreement may not be varied, contradicted or supplemented by
evidence of prior or contemporaneous oral agreements, or prior written
agreements.’ ” Galmish v. Cicchini (2000), 90 Ohio St.3d 22, 27, 734 N.E.2d 782,
quoting 11 Williston on Contracts (4th Ed.1999) 569-570, Section 33:4. “The
principal purpose of the parol evidence rule is to protect the integrity of written
contracts.” Id. “By prohibiting evidence of parol agreements, the rule seeks to
5
SUPREME COURT OF OHIO
ensure the stability, predictability, and enforceability of finalized written
instruments.” Id.{¶ 13} This transaction also falls under the Uniform Commercial Code
(“UCC”), which regulates the sale of goods. The UCC’s parol evidence rule
provides, “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 * * *.” R.C. 1302.05. In addition, “[t]he Code
does not displace pre-Code law governing evidence in general, nor the
admissibility of parol evidence in particular.” (Footnotes omitted.) 1A Anderson
on the Uniform Commercial Code (3d Ed.1996) 765, Section 2-106:7; see also 11
Williston on Contracts at 581 (“Cases interpreting the Code’s parol evidence
provisions indicate that, except to the extent the admissibility of evidence of a
course of dealing, usage of trade and course of performance are concerned, they
liberalize the traditional parol evidence rule only slightly”). Pertinent here is the
fact that the common law and statutory parol evidence rules both bar the use of
parol evidence to contradict a written contract.
{¶ 14} As we have explained, “[t]he parol evidence rule is a rule of
substantive law that prohibits a party who has entered into a written contract from
contradicting the terms of the contract with evidence of alleged or actual
agreements. ‘When two parties have made a contract and have expressed it in a
writing to which they have both assented as the complete and accurate integration
of that contract, evidence, whether parol or otherwise, of antecedent
understandings and negotiations will not be admitted for the purpose of varying or
contradicting the writing.’ ” (Citation omitted.) Ed Schory & Sons, Inc. v. Soc.
Natl. Bank (1996), 75 Ohio St.3d 433, 440, 662 N.E.2d 1074, quoting 3 Corbin,
Corbin on Contracts (1960) 357, Section 573.
6
January Term, 2009
{¶ 15} Courts have taken the view that as the prohibitions of the parol
evidence rule are a matter “ ‘of substantive law and not a mere rule of evidence,
testimony introduced in violation of the rule, even in the absence of objection
thereto, can be given no legal effect.’ ” 11 Williston on Contracts at 581, quoting
Natl. Sur. Corp. v. Curators of Univ. of Missouri ex rel. Paul Mueller Co. (C.A.8,
1959), 268 F.2d 525; see also In re Estate of Holden (2000), 343 S.C. 267, 276,
539 S.E.2d 703 (“The parol evidence rule is a rule of substantive law, not a rule of
evidence. Accordingly, admission of evidence violating the parol evidence rule is
legally incompetent and should not be considered even if no objection is made at
trial”); Friedman-Deems Co. v. Zimmerman (Dec. 22, 1977), Franklin App. No.
77AP-388, 1977 WL 200678, * 2 (“the failure of appellant to object to the parol
evidence or to instructions of the trial court to the jury in this regard does not
constitute a waiver of the plain and ambiguous terms of the contract defining the
obligations of the parties in respect to the commission. Irrespective of who
introduces the testimony or under what circumstances, if introduced in violation
of the parol evidence rule, it has no legal effect”).
{¶ 16} Further, we have previously recognized that the parol evidence rule
has application to claims beyond those sounding in contract. In Ed Schory &
Sons, 75 Ohio St.3d at 440, 662 N.E.2d 1074, we applied the parol evidence rule
to a claim alleging the tort of negligent misrepresentation, and we emphasized
that “the parol evidence rule will not be overcome by merely alleging that a
statement or agreement made prior to an unambiguous written contract is different
from that which is contained in the contract.” See also J.A. Industries, Inc. v. All
Am. Plastics, Inc. (1999), 133 Ohio App.3d 76, 89, 726 N.E.2d 1066 (applying
the UCC parol evidence rule to a negligent-misrepresentation claim). Because the
parol evidence rule is substantive in nature and not limited in application to
contract claims, we conclude that it also applies to statutory causes of action such
as the CSPA.
7
SUPREME COURT OF OHIO
{¶ 17} The court of appeals, here, relying on a decision of the Second
District Court of Appeals, concluded that the parol evidence rule has no
application in the context of an action alleging a violation of the CSPA. Williams,
2008-Ohio-2535, ¶ 18. Although we recognize that the General Assembly has the
authority to abrogate the parol evidence rule, “ ‘the general assembly will not be
presumed to have intended to abrogate a settled rule of the common law unless
the language used in a statute clearly supports such intention.’ ” Mandelbaum v.
Mandelbaum, 121 Ohio St.3d 433, 2009-Ohio-1222, 905 N.E.2d 172, at ¶ 29,
quoting State ex rel. Hunt v. Fronizer (1907), 77 Ohio St. 7, 16, 82 N.E. 518. Our
cases have long established that the parol evidence rule bars extrinsic evidence of
prior oral representations that contradict the parties’ final written contract, and
R.C. 1302.05 has codified this rule of law rather than abrogating it. No plain and
express language in the CSPA manifests the General Assembly’s intent to limit
the application of the parol evidence rule in the causes of action that the CSPA
establishes.
{¶ 18} Nor has the General Assembly delegated authority to the attorney
general to abrogate the parol evidence rule. “ ‘Rules promulgated by
administrative agencies are valid and enforceable unless unreasonable or in
conflict with statutory enactments covering the same subject matter.’ ” Hoffman v.
State Med. Bd. of Ohio, 113 Ohio St.3d 376, 2007-Ohio-2201, 865 N.E.2d 1259,
at ¶ 17, quoting State ex rel. Curry v. Indus. Comm. (1979), 58 Ohio St.2d 268,
269, 12 O.O.3d 271, 389 N.E.2d 1126. A rule that is in conflict with law is
invalid and unconstitutional because it usurps the General Assembly’s legislative
function. Blue Cross of Northeast Ohio v. Ratchford (1980), 64 Ohio St.2d 256,
259, 18 O.O.3d 450, 416 N.E.2d 614 (“the General Assembly is precluded from
delegating its legislative function * * *”).
{¶ 19} Here, Ohio Adm.Code 109:4-3-16(B)(22) provides that an
automobile dealer violates the CSPA if it fails to integrate all oral representations
8
January Term, 2009
and promises made prior to obtaining the consumer’s signature on the written
contract into that contract. To the extent that Ohio Adm.Code 109:4-3-16(B)(22)
conflicts with the parol evidence rule as codified by R.C. 1302.05 and allows
parol evidence contradicting the final written contract, Ohio Adm.Code 109:4-3-
16(B)(22) constitutes an unconstitutional usurpation of the General Assembly’s
legislative function and is therefore invalid.
{¶ 20} The parol evidence rule applies to actions brought pursuant to the
CSPA, and absent proof of fraud, mistake, or other invalidating cause, a consumer
may not present extrinsic evidence contradicting the parties’ final written contract
to prove a violation of that act. Here, Williams testified that Spitzer orally agreed
to give him $16,500 as a trade-in allowance for his Explorer. This extrinsic
evidence contradicts the final written contract, which specifies a trade-in
allowance of $15,500 for that vehicle. Thus, the parol evidence rule requires
exclusion of Williams’s testimony absent proof of fraud, mistake, or other
invalidating cause.
Conclusion
{¶ 21} Like the common law parol evidence rule, the parol evidence rule
codified by R.C. 1302.05 serves to ensure the stability, predictability, and
enforceability of finalized written contracts. The rule promulgated by the attorney
general in Ohio Adm.Code 109:4-3-16(B)(22) seeks to protect consumers from
unscrupulous sales practices and to prevent sellers from making oral promises
secure in the knowledge that the parol evidence rule would render those promises
unenforceable. However, it is the role of the General Assembly, rather than the
attorney general or this court, to declare the policy of the state of Ohio. See State
ex rel. Curtis v. DeCorps (1938), 134 Ohio St. 295, 298, 12 O.O. 96, 16 N.E.2d
459 (an administrative rule-making authority “may enforce but may not declare
public policy”); State ex rel. Cincinnati Enquirer, Div. of Gannett Satellite Info.
Network, Inc. v. Dupuis, 98 Ohio St.3d 126, 2002-Ohio-7041, 781 N.E.2d 163, at
9
SUPREME COURT OF OHIO
¶ 21 (“the General Assembly is the ultimate arbiter of public policy”); Carroll v.
Dept. of Adm. Servs. (1983), 10 Ohio App.3d 108, 110, 10 OBR 132, 460 N.E.2d
704 (“In the absence of clear legislative authorization, declarations of policy, of
the nature involved in this rule, are denied administrative agencies and are
reserved to the General Assembly”).
{¶ 22} Thus, the administrative rule promulgated by the attorney general
is not enforceable because it is in conflict with a statute, and the parol evidence
rule applies to claims alleging violations of the CSPA. Accordingly, we reverse
the judgment of the court of appeals.
Judgment reversed.
MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, and CUPP, JJ.,
concur.
PFEIFER, J., concurs in judgment only.
LANZINGER, J., concurs in paragraph two of the syllabus and in judgment
only.
__________________
CUPP, J., concurring.
{¶ 23} I join the majority opinion in all respects. I write separately to
explain why I believe that the facts in this case distinguish it from some other
situations in which the parol evidence rule does not bar the admission of certain
evidence to support claims made under the Consumer Sales Practices Act
(“CSPA”). In addition, I write to address why in my view, this case is
distinguishable from the situation presented to the Second District Court of
Appeals in Wall v. Planet Ford, Inc., 159 Ohio App.3d 840, 2005-Ohio-1207, 825
N.E.2d 686, upon which the court of appeals here heavily relied.
{¶ 24} In essence, the court of appeals resolved the issue of this case by
holding, with minimal analysis, that the parol evidence rule is inapplicable to all
claims brought under the CSPA. Williams v. Spitzer Auto World Canton L.L.C.,
10
January Term, 2009
Stark App. No. 2007 CA 00187, 2008-Ohio-2535, ¶ 18-20. As the majority
opinion concisely explains, this holding was overbroad in light of the pertinent
statutes. The parol evidence rule applies in the circumstances of this case to
prevent the introduction of extrinsic evidence to contradict the express terms of
the parties’ written contract.
{¶ 25} As the majority notes, the parol evidence rule states that “ ‘absent
fraud, mistake or other invalidating cause, the parties’ final written integration of
their agreement may not be varied, contradicted or supplemented by evidence of
prior or contemporaneous oral agreements, or prior written agreements.’ ”
Galmish v. Cicchini (2000), 90 Ohio St.3d 22, 27, 734 N.E.2d 782, quoting 11
Williston on Contracts (4th Ed.1999) 569-570, Section 33:4.
{¶ 26} The parol evidence rule is a principle of substantive law providing
that “ ‘a writing intended by the parties to be a final embodiment of their
agreement cannot be modified by evidence of earlier or contemporaneous
agreements that might add to, vary, or contradict the writing.’ * * * The rule
‘operates to prevent a party from introducing extrinsic evidence of negotiations
that occurred before or while the agreement was being reduced to its final written
form,’ * * * and it ‘assumes that the formal writing reflects the parties’ minds at a
point of maximum resolution and, hence, that duties and restrictions that do not
appear in the written document * * * were not intended by the parties to survive.’
” Bellman v. Am. Internatl. Group, 113 Ohio St.3d 323, 2007-Ohio-2071, 865
N.E.2d 853, ¶ 7, quoting Black’s Law Dictionary (8th Ed.2004) 1149-1150.
{¶ 27} Galmish sets out the primary situations in which the parol evidence
rule does not apply. These include occurrences involving fraud or mistake and a
contract that is not truly a “ ‘final written integration of [the parties’] agreement.’
” Galmish, 90 Ohio St.3d at 27, 29, 734 N.E.2d 782, quoting Williston on
Contracts at 569-570. These specific situations are commonly referred to as
“exceptions” or “limitations” to the rule. See generally Russell v. Daniels-Head
11
SUPREME COURT OF OHIO
& Assocs., Inc. (June 30, 1987), 4th Dist. No. 1600, 1987 WL 13943, * 4,
discussing six exceptions to the parol evidence rule.
{¶ 28} An “integration” for these purposes is “[t]he full expression of the
parties’ agreement, so that all earlier agreements are superseded, the effect being
that neither party may later contradict or add to the contractual terms.” Black’s
Law Dictionary (9th Ed.2009) 880. If an integration is a “complete integration,”
then it fully expresses the intent of the parties, and parol evidence is inadmissible.
Id. On the other hand, if an integration is a “partial integration,” then it does not
fully express the parties’ intent, and “[p]arol (extrinsic) evidence is admissible to
clear up ambiguities with respect to the terms that are not integrated.” Id.{¶ 29} This case specifically involves a contract that the parties intended
to be a final and complete integration of their agreement, and Williams is
attempting to contradict an express term of that contract. His only support for his
position is his allegation that an oral agreement regarding the trade-in value of his
vehicle reached prior to the execution of the final contract is different from the
trade-in value term that appears in the final contract.1 However, his attempt to
prove the contradictory assertion “ ‘is exactly what the Parol Evidence Rule was
designed to prohibit.’ ” Galmish, 90 Ohio St.3d at 29, 734 N.E.2d 782, quoting
Shanker, Judicial Misuses of the Word Fraud to Defeat the Parol Evidence Rule
and the Statute of Frauds (With Some Cheers and Jeers for the Ohio Supreme
Court) (1989), 23 Akron L.Rev. 1, 7. Consequently, once it is accepted that the
parol evidence rule applies generally to CSPA cases, Williams’s extrinsic
evidence is not admissible under that rule.
1. As the majority’s statement of the facts details, the final written purchase agreement clearly
displayed a trade-in allowance of $15,500. In addition, Williams’s actions after he claims he
discovered the discrepancy regarding that allowance were inconsistent with his allegation that a
discrepancy exists, in that he later tendered two separate checks for $1,000 to provide the
additional money to pay off the loan secured by the trade-in vehicle without mentioning any
problem either time.
12
January Term, 2009
{¶ 30} In some cases, an exception to the parol evidence rule will apply
when it is asserted that the final contract is only a partial integration of the parties’
agreement and that a term that should have been included in the contract was not
included. In certain situations of this type, the plaintiff is permitted to offer
extrinsic evidence regarding the alleged missing term. See, e.g., Patrick v.
Ressler, 10th Dist. No. 04AP-149, 2005-Ohio-4971, ¶ 28 (the “collateral
agreement rule” is an exception to the parol evidence rule that allows parol
evidence to be used to show the existence of collateral agreements made prior to
or contemporaneously with a written agreement). This case does not implicate
any type of partial-integration exception because “ ‘any such collateral agreement
must not contradict the terms of the written agreement, and the agreement must be
one that would naturally be omitted from the written instrument.’ ” Id., quoting
Pingue v. Durante (May 9, 1996), Franklin App. No. 95APG09-1241, 1996 WL
239642.
{¶ 31} Other common exceptions, which include clarifying a mistaken or
ambiguous term and fraud as the inducement to enter into the contract, are not
pertinent to the situation here, either. Because this case does not involve an
exception, and because the parol evidence rule is relevant to CSPA cases, the
parol evidence rule applies here to bar Williams from asserting that the contract
price is different from what the contract expressly states. This case is
distinguishable from cases involving exceptions to the rule because Williams is
trying to directly “contradict” the express terms of the fully integrated contract.
{¶ 32} The situation in this case is fundamentally different from the
situation considered by the Second District Court of Appeals in Wall, 159 Ohio
App.3d 840, 2005-Ohio-1207, 825 N.E.2d 686, which the court of appeals here
cited in support of its holding that certain defenses, including the parol evidence
rule, do not apply in CSPA cases. In particular, the court of appeals in the case
sub judice focused upon paragraph 25 of Wall, in which the Second District
13
SUPREME COURT OF OHIO
stated: “ ‘Waiver, ratification, and other common law defenses do not apply to a
claim under a law such as the Ohio Consumer Sales Practices Act because the
claim is based not on the contract, but on oral or other misrepresentations. For the
same reason, the statute of frauds, the parol evidence rule, contractual limitations
on liability, and contractual limitations on remedies do not apply.’ Doody v.
Worthington [Apr. 10, 1991], Franklin Cty. M.C. No. M 9011CVI-37581, 1991
WL 757571, at * 3, citing National Consumer Law Center, Unfair and Deceptive
Acts and Practices (2d Ed.1988), Sections 4.2.15 and 5.2.4.” However, further
examination of Wall does not support the court of appeals’ reliance on that case
for its expansive holding.
{¶ 33} In Wall, the plaintiff claimed that the auto dealership from which
she had purchased her vehicle promised to pay off her home-equity line of credit
that she had taken out to finance the vehicle she was trading in to the dealership.
Id. at ¶ 20, 22. This alleged promise was not reduced to writing, and the purchase
agreement did not mention anything about such a payoff. Id. at ¶ 23-24.
{¶ 34} Wall states that “[u]nder her CSPA claims, Wall is not attempting
to enforce the oral representations made by Planet Ford as part of her contract, but
is claiming that Planet Ford’s representations amounted to an unfair, deceptive,
and unconscionable act in connection with a consumer transaction, in violation of
the CSPA. The parol evidence rule is irrelevant in this sense.” Id. at ¶ 26. Even
though it expressed some skepticism about Wall’s version of the facts, the
appellate court concluded that the trial court had improperly awarded Planet Ford
summary judgment because Wall’s CSPA claim raised a genuine issue of material
fact. Id. at ¶ 27.
{¶ 35} Regardless of whether Wall was correctly decided, Wall does not
support the sweeping proposition, asserted by the court of appeals herein, that the
parol evidence rule is never applicable to CSPA claims. A close reading of Wall
in its context reveals that the reason the parol evidence rule was “irrelevant” was
14
January Term, 2009
because the particular claims in that CSPA case were not based on the parties’
contract but on the representations themselves, which the plaintiff claimed were
deceptive. Moreover, those purported promises were not in the agreement at all,
so there could have been no issue of whether the alleged representations
underlying the plaintiff’s CSPA claims “contradicted” the terms of the agreement.
Equally important, even if the parol evidence rule had been held applicable in
Wall, one or more of the exceptions to the rule allowing evidence extrinsic to the
written agreement (such as fraudulent inducement, misrepresentation, or the
collateral-agreement exception in that the parties did not intend the contract to be
a final integration in light of its alleged missing term) likely would have applied,
given the facts. Thus, the ultimate result of making the rule “irrelevant in this
sense” would have been the same. Id., 159 Ohio App.3d 840, 2005-Ohio-1207,
825 N.E.2d 686, ¶ 26. In this case, in contrast, no exception to the rule is
applicable. Williams merely attempts to contradict a specific term of the parties’
express agreement.
{¶ 36} The first paragraph of the syllabus of the majority opinion
accurately states the holding that Ohio Adm.Code 109:4-3-16(B)(22) can have no
effect to the extent that it is susceptible of the interpretation that the
administrative rule authorizes an automobile purchaser to present parol evidence
expressly contradicting the parties’ final written contract. However, this holding
does not make the administrative rule ineffective in other contexts. The
administrative rule is designed to avert disagreements concerning a particular
term that had been discussed by the parties during negotiations but is missing
from the parties’ final written sales contract by specifying that “all material
statements, representations or promises” should be integrated into the final
contract. To the extent that Ohio Adm.Code 109:4-3-16(B)(22) clarifies that the
final sales contract should not omit “material” terms that induced the consumer to
15
SUPREME COURT OF OHIO
sign it, it serves a salutary purpose that is not affected by the holding of paragraph
one of the syllabus.
{¶ 37} Finally, today’s decision does not vitiate the principle that the
CSPA is a remedial act that must be liberally construed. See Einhorn v. Ford
Motor Co. (1990), 48 Ohio St.3d 27, 29, 548 N.E.2d 933. Rather, we are holding
that the parol evidence rule applies to contracts upon which CSPA claims are
based in the same way that the rule applies to other contracts because there is no
support in the relevant statutes for a contrary result. The rule of liberal
construction cannot overcome this overriding consideration. Although the court
of appeals was incorrect in holding that the parol evidence rule can never apply in
a CSPA case, the rule of liberal construction for CSPA claims can be relevant in
evaluating whether the recognized exceptions to the parol evidence rule apply in a
particular situation. The instant case, however, does not present such a situation.
MOYER, C.J., and LUNDBERG STRATTON and O’CONNOR, JJ., concur in the
foregoing opinion.
__________________
Crawford, Lowry & Associates, L.L.C., and G. Ian Crawford, for appellee.
Giardini, Cook & Nicol, L.L.C., and Anthony B. Giardini, for appellant.
Stockamp & Brown, L.L.C., David A. Brown, and Deanna L. Stockamp,
urging reversal for amicus curiae Automotive Dealers Association.
Bricker & Eckler, L.L.P., Kurtis A. Tunnell, Anne Marie Sferra, and Eric
S. Bravo, urging reversal for amici curiae National Federation of Independent
Business/Ohio and American Tort Reform Association.
Richard Cordray, Attorney General, Benjamin C. Mizer, Solicitor General,
Elisabeth A. Long, Deputy Solicitor, and Melissa G. Wright, Assistant Attorney
General, urging affirmance for amicus curiae state of Ohio.
Equal Justice Foundation and Rachel K. Robinson, urging affirmance for
amici curiae Ohio State Legal Services Association, Southeastern Ohio Legal
16
January Term, 2009
Services, Legal Aid of Western Ohio, Inc., Advocates for Basic Legal Equality,
Legal Aid Society of Columbus, Legal Aid Society of Cleveland, Housing
Advocates, Inc., and the Equal Justice Foundation.
Ronald L. Burdge and Elizabeth Ahern Wells, urging affirmance for amici
curiae National Association of Consumer Advocates, Ohio Association for
Justice, and Stark County Association for Justice.
______________________
17