CHANDLER v. Tuomrsou. 43 _
modifications for the purpose of showing that they are not applicable to
the case now before us. ·
Parol evidence of surrounding circumstances is admissible to show the
subject-matter of the contract, when ambiguous or indefinite; but the
express terms cannot be varied by proof of the negotiations and transac-
tions out of which it grew, and the circumstances which surrounded
its adoption. In construing the terms of a written contract, such evi-
dence is allowable for the purpose of ascertaining the real intention of
the parties, but no new obligation or duty can be imposed on a party _
which is not warranted by a fair and reasonable construction of the
words of the instrument. The general current of authorities shows that
parol evidence is only admissible in courts of law to aid in the cemstruc-
tion of written contracts, admitted or proved; to ascertain the subject-
matter; to show the real nature of the instrument; or to explain latent
ambiguities or indefinite terms; or to give effect to general customs, when
they do not contradictrexpress stipulations; or when the original contract
was verbal and entire, and a part only of it was reduced to writing. _
Parol evidence is permissible to show a subsequent agreement, on a new
consideration, varying the terms of a written contract.
The exceptions to the general rule as to the parol evidence that relate
to fraud, mistake, or accident in a written contract usually arise in
courts of equity, which have ample, elastic, and flexible forms and modes
of procedure in administering full and adequate relief to suitors. Courts
of equity will look beyond the terms of a written contract, and consider
the whole transaction, and will hear parol evidence in the investigation
of allegations as to matters of fraud which induced or affected the terms
of the contract, if the person seeking relief has acted promptly and de-
cidedly upon the discovery of fraud, and has not derived such benehts
from the transaction as to prevent the parties from being placed in mtu
quo. Proof of fraud, in actions at law, is restricted to narrower limits;
the alleged fraud must affect the execution of the instrument.
( T In George v. Tate, 102 U. S. 564, we rind the rule of evidence upon
this subject clearly stated and sustained by cited authorities:
"P1·oof of fraudulent representations by Myers and Green, beyond the re-
, cital in the bond, to induce its execution by the plaintiffs in error, was prop-
erly rejected. It is well settled that the only fraud permissible to be proved
at law in these cases is fraud touching the execution of the instrument,-
such as misreading, etc. The evidence was properly rejected for another
reason. Where a party reaps the benefit which the bond gives in such cases,
and is called upon to respond, he is not permitted to repudlate the 0bliga—
tion he has assumed."
The rules and principles of law thus announced are applicable to the
case now before us. The contract between the plaintiffs and defendants
about the saw-mill is evidenced by a written and sealed instrument, con-
taining mutual and dependent covenants, defining the rights, liabilities,
and duties of the respective parties, and providing a specic remedy for
any defects that might be discovered in the material, construction, and
proper working of the engine and other machinery.