The underlying facts are as follows.\u00a0 Defendant is a lender<\/a>.\u00a0 Plaintiff owed<\/a> money on an outstanding loan.\u00a0 \u201cOn March 26, 2007, plaintiffs and defendant entered into a written forbearance agreement . . . Plaintiffs failed to make the payments required by the March 26, 2007, agreement and defendant recorded a notice of default.\u201d<\/p>\n Plaintiffs \u201calleged that, two weeks prior to their execution of the written forbearance agreement, defendant’s senior vice president, David Ylarregui, met with them and represented defendant would agree to forbear from collection for two years if plaintiffs would pledge two orchards as additional security.\u201d<\/p>\n \u201cOn March 26, 2007, at the time of execution of the written agreement, Ylarregui told plaintiffs the agreement would be for two years and would include as security only the two orchards, and not plaintiffs’ residence or the truck yard.\u00a0 Plaintiffs alleged they did not read the written agreement, but relied on Ylarregui’s representations of its terms in executing the written agreement.\u201d<\/p>\n The court started its review by noting that, \u201cAn integrated contract is a complete and final embodiment of the terms of an agreement . . . Whether a writing is an integration is a question of law, which we review de novo.\u00a0 We agree that the forbearance agreemen<\/a>t is an integrated agreement, to which the parol evidence rule applies.\u201d<\/p>\n This finding did not protect the lender.\u00a0 The court said there are different kinds of fraud.\u00a0 In the case of \u201cpromissory fraud, \u201c being \u201ca false promise directly at variance with the terms of the written agreement,\u201d parol (extrinsic) evidence is generally not admissible.<\/strong><\/p>\n Thus, \u201cParol evidence of promissory fraud is only permissible in the case of a promise to do some additional act which was not covered by the terms of the contract.\u00a0 [When] the alleged false promise related to the identical matter covered by the written agreement and directly contradicted the plain language of the guarantee, evidence of the oral statements was properly stricken as incompetent.\u201d<\/p>\n However, court found a different specie of fraud<\/strong>, recognizing that \u201ca distinction between promissory fraud and misrepresentations of fact over the content of an agreement at the time of execution is a valid one.”\u00a0 Stated otherwise, \u201cWhere failure to read an instrument is induced by fraud of the other party, the fraud is a defense even in the absence of fiduciary or confidential relations.\u201d<\/p>\n Accordingly, \u201cparol evidence<\/a> of a prior promise made without any intention of performing it that directly contradicts the provisions of the written contract must be distinguished from parol evidence of a contemporaneous factual misrepresentation of the terms contained in a written agreement submitted for signing.\u201d\u00a0 This becomes \u201cfraud in the procurement,\u201d as distinguished from \u201cpromissory fraud.\u201d<\/strong><\/p>\n Added the court, \u201cRelief based on this type of fraud would not be available in every case.\u00a0 It would be available only when one party made a false statement about the terms contained in the contract after the written contract was prepared, and the other party reasonably relied on that statement and was thereby induced to sign the written contract without discovering that the actual provisions were not as represented.\u201d<\/p>\n To this end, the evidence does not contradict the terms of the written contract; it shows that \u201cthe written contract was not the actual, integrated agreement of the parties.\u201d<\/p>\n![\"South](\"http:\/\/fresnolawyerblog.com\/wp-content\/uploads\/2011\/01\/South-America.jpg\" "\\"Fresno")
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