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undertaken by Pepsi at the end of each calendar year.6 Mr.
Goodson explained that only if Pepsi, after conducting the
investigation, considered the theater company to be in compliance
with the agreement would Pepsi then pay the flex and marketing
funds to the theater company. He also explained that Pepsi
believed that it could recover any flex or marketing funds
previously paid if Pepsi considered the theater company to have
breached the agreement. We now rule on respondent's objection.
Under Arizona's parol evidence rule, a judge “first
considers the offered evidence and, if he or she finds that the
contract language is ‘reasonably susceptible’ to the
interpretation asserted by its proponent, the evidence is
admissible to determine the meaning intended by the parties.”
Taylor v. State Farm Mut. Auto. Ins. Co., 854 P.2d 1134, 1140
(Ariz. 1993). The judge, however, must still exclude extrinsic
evidence which would vary or contradict the meaning of the
written agreement. See id.
We believe that certain parts of Mr. Goodson's testimony are
properly admissible for the purpose of interpreting the rights
and obligations of the parties under the agreement. We also
believe that other parts of Mr. Goodson's testimony are
inadmissible as they contradict or vary the parties' agreement as
6 Mr. Goodson testified that the investigation could take
up to 180 days.
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