prior understandings
Definition
Prior understandings are any agreements, promises, conversations, or deals that two parties made before signing a formal written contract. Most written contracts include language that wipes out these earlier understandings, meaning the signed document becomes the only agreement that matters legally. This protects both sides from disputes about what was said or promised during negotiations.
Example
If a vendor verbally promised you free delivery during sales negotiations but the written contract says nothing about it, that prior understanding likely has no legal weight once you both sign the contract.
Watch Out
Always make sure every promise or condition from your negotiations makes it into the final written contract before you sign, because oral promises made beforehand are very difficult to enforce later.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.