Apple Final Cut Pro 7 - Manual (Page 529)

The source clip is inserted into the sequence with the default transition.
Before an insert with transition edit
New clip is inserted
with transition.
After an insert with transition edit
Performing an Overwrite Edit
Since this is the most commonly used edit type, it occupies the biggest overlay area in
the Canvas. If you drag a clip into any part of the Canvas to the left of the Edit Overlay,
an overwrite edit is performed.
With this type of edit, the source clip overwrites any clip items starting at the sequence
In point for the duration of the source clip. No clip items are rippled forward, so the
duration of your sequence remains the same. You can perform an overwrite edit with
one or more source clips.
A B D
D
C
A C
Before edit
After edit
529 Chapter 36 Three-Point Editing