Before Justices Hardesty, Parraguirre, and Cherry. Opinion by Justice Cherry.
In this appeal from judgment after a bench trial, the Court considered several evidentiary issues dealing with contracts for the sale of real property. First, the Court addressed whether evidence of the terms of an agreement for the sale of property that was written but had been lost or destroyed could be considered without violating the statute of frauds. The Court held that evidence of the existence and terms of the agreement should have been admitted because the statute of frauds was satisfied by the original writing even if that writing was lost or destroyed before trial. Second, the Court addressed the argument that the parol evidence rule barred testimony regarding the fraud used to induce an agreement and testimony regarding the existence of the lost or destroyed agreement. The Court determined that the parol evidence rule does not bar consideration of evidence regarding fraud in the inducement of a contract, to establish subsequent alteration of a contract, or to prove the existence or terms of a written but lost or destroyed agreement. Finally, the Court determined that a liquidated damages provision requiring payment of “150% of actual damages” was an unenforceable penalty. Reversed and remanded. (Kerry S. Doyle, Associate in the Reno office of McDonald Carano Wilson.)
