When a contract includes a 'complete agreement' clause, what is the effect?

When a contract includes a 'complete agreement' clause, what is the effect?

• A. The contractor and owner are bound by the exact words of the contract
• B. Oral agreements can modify terms
• C. The contract is void without signatures
• D. Changes can be made without writing

Answer: (A)

A complete agreement clause declares that the written contract is the full and final understanding between the parties. Because of that, the contract binds the parties to its exact words, and any prior discussions or side promises aren’t enforceable unless they’re included in the written document. This clause also means changes or additions generally must be made in writing and signed by both sides, since oral modifications aren’t considered part of the agreement. This setup protects both parties by preventing later claims based on outside conversations and ensures that the contract’s terms stay precisely as written. That’s why the correct choice is that the contractor and owner are bound by the exact words of the contract.