Sep 24, 2015
Under Texas law, if I have a written contract with someone, they tell me what the terms are, and later I find out that what I was told differs from the written terms, are the written terms enforceable?
Generally, the written terms will be enforceable. In a recently decided case (National Prop. Holding, L.P. v. Westergren, 453 S.W.3d 419 (Tex. 2015), the Texas Supreme court stated that: “Texas courts have repeatedly held, a party to a written contract cannot justifiably rely on oral misrepresentations regarding the contract's unambiguous terms. See, e.g., Thigpen v. Locke, 363 S.W.2d 247, 251 (Tex. 1962) (‘In an arm's-length transaction the defrauded party must exercise ordinary care for the protection of his own interests . . . . [A] failure to exercise reasonable diligence is not excused by mere confidence in the honesty and integrity of the other party.’) (citation omitted). This is particularly true when the party had a reasonable opportunity to review the written agreement but failed to exercise ordinary care to do so. See Tex. & Pac. Ry. Co. v. Poe, 131 Tex. 337, 115 S.W.2d 591, 592 (1938) (holding that evidence was legally insufficient to support a finding of fraud where party who relied on oral statement that release was receipt had an opportunity to read the document which plainly identified itself as a release); see also Thigpen, 363 S.W.2d at 251. Instead of excusing a party's failure to read a contract when the party has an opportunity to do so, the law presumes that the party knows and accepts the contract terms. It is not the courts' role ‘to protect parties from their own agreements.’ El Paso Field Servs., L.P. v. MasTec N. Am., Inc., 389 S.W.3d 802, 810-11 (Tex. 2012). As the [United States] Supreme Court explained long ago: ‘It will not do for a man to enter into a contract, and, when called upon to respond to its obligations, to say that he did not read it when he signed it, or did not know what it contained. If this were permitted, contracts would not be worth the paper on which they are written. But such is not the law. A contractor must stand by the words of his contract; and, if he will not read what he signs, he alone is responsible for his omission.’ Upton v. Tribilcock, 91 U.S. 45, 50, 23 L. Ed. 203 (1875).”