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the purchase agreement, but also to the other operative
documents, including the mortgage loan agreement and escrow
documents, as well as the instruments of conveyance, assignment,
and transfer used to accomplish the property transfers, and the
Pecaris and Coastal partnership agreements, to determine the
integrated, overall agreement between the parties that was
actually consummated. In re Steen, 509 F.2d 1398, 1403 (9th Cir.
1975); 3 Corbin on Contracts, secs. 581-582 (West 1960 & Supp.
1994).13 Furthermore, as the Court of Appeals for the Ninth
Circuit said in In re Steen, supra at 1403 n.5, parol and
extrinsic evidence are admissible to show that the true
consideration paid and received was different from that stated in
the agreement (quoting Haverty Realty & Inv. Co. v. Commissioner,
3 T.C. 161, 167 (1944)):
Turning now to the question of consideration: "* * *
the recitals of a written instrument as to the
consideration received are not conclusive, and it is
always competent to inquire into the consideration and
show by parol or other extrinsic evidence what the
real consideration was." Deutser v. Marlboro Shirt Co.
13The Danielson rule encompasses and mirrors the parol
evidence rule, Commissioner v. Danielson, 378 F.2d 771, 779 (3d
Cir. 1967), vacating. and remanding 44 T.C. 549 (1965); Schmitz
v. Commissioner, 51 T.C. 306, 317 (1968), affd. sub nom.
Throndson v. Commissioner, 457 F.2d 1022 (9th Cir. 1972).
Because the parol evidence rule does not exclude evidence where
there is a series of transactional documents that must be read
together before the agreement is treated as wholly integrated, 3
Corbin on Contracts, secs. 581-582 (West 1960 & Supp. 1994), the
Danielson rule applies only after all those documents have been
aggregated to form the overall agreement.
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