Understanding Extrinsic Evidence and its Role in Business Contracts: Insights for Professionals
|Understanding Extrinsic Evidence in Evidence Law
The term evidence in law may seem like an underlying concept that is only occasionally used, but throughout the world, and encompassing almost every type of business transaction, global or otherwise, these very concepts will arise. As they are so fundamental, the rules surrounding comprehensive extrinsic evidence principles in evidence law could be a key factor in any business decision. Using the example of space rental arrangements for office use, we will now explore the topic of extrinsic evidence in evidence law.
What is extrinsic evidence in evidence law? Extrinsic evidence covers all communication surrounding a contract arrangement not included in the original (or present) contract. This communication can be from parties, or non-parties to the contract, and may have been written in the form of emails, memos, notes and drafts. Verbal communication may also be considered extrinsic evidence. The purpose of extrinsic evidence in evidence law is to highlight what may be missing from a written contact, in order to minimize the possibility of misunderstanding of a contract, and provide more insight into the intentions of parties involved.
Does extrinsic evidence influence professional business contracts? One would think that the use of technology in the workplace, or cutting-edge innovations are enough to eliminate the need for written contract arrangements. However, while extrinsic evidence in evidence law may not be relevant in every single situation, it may potentially impact the validity, interpretation and interpretation in a dispute involving a contract agreement. Particularly if there is a need to clarify borderline issues or make a decision about a contract that has not been explicitly included in that agreement.
Is extrinsic evidence of relevance in Indonesia? The concepts surrounding extrinsic evidence in evidence law have been applied in many jurisdictions, including Indonesia. In particular, Article 1346 of the Indonesian Civil Code (Kitab Undang-Undang Hukum Perdata, Book III) explains that an agreement must include the following elements:
- There must be reciprocity of consent between the relevant parties not involving force, fraud or deception
- There must be capable parties for entering into an agreement
- The subject matter being agreed upon must be lawful
- The subject matter being agreed upon must have a possible outcome
If all conditions outlined above are met, and an extrinsic evidence tactic is to be employed, the content of an agreement will prevail, as will the intention of parties (in the absence of a written contract, for example).
Possible uses of extrinsic evidence in a private business contract Because evidence law is meant to be transparent, the principles and implications of extrinsic evidence can be difficult to interpret without the assistance of legal counsel. As a part of requiring professional legal counsel in this area, the following are some possible scenarios where extrinsic evidence may be introduced:
- Parties wanting to admit extrinsic evidence must do so in the beginning stages of a case
- There must be an application of the relevant extrinsic evidence principles of the jurisdiction
- Once the validity of evidence and admissibility has been established, a court will assess the burden of proof for extrinsic evidence
- Extrinsic evidence may be excluded if there is valid reasoning as to why it may not be relevant to a case
- A declaration may occur if evidence is found to be relevant after a court has allowed for it to be introduced
With regard to office rentals and similar private contract arrangements, Indonesia follows the principles surrounding extrinsic evidence in evidence law, much like the scenario above. For example, if an office space rental agreement is in writing, under the Indonesian legal system, any contract with missing terms or conditions (that are required for legal validity) may be admissible in court to supplement or clarify the existing contract. However, much like with the use of any evidence, extrinsic evidence is only relevant for the interpretation of a contract in the absence of uncertainty, and where an agreement made by parties is reasonable.
While extrinsic evidence in evidence law could potentially save parties years of court proceedings and thousands in legal fees, the incorporation of this evidence into legal proceedings must be conducted carefully, and with the advice of a lawyer.