diff --git a/plugins/trace-codex/AGENTS.md b/plugins/trace-codex/AGENTS.md
index 1d07d3f..1b51542 100644
--- a/plugins/trace-codex/AGENTS.md
+++ b/plugins/trace-codex/AGENTS.md
@@ -179,8 +179,8 @@ Invariants to preserve when changing this:
   keep the server/processor/braintrust layers agent-agnostic.
 - **Config**: two layers. The agent-specific layer (`src/agents/codex/settings.ts`)
   reads the user's `config.json` from `PLUGIN_DATA`, maps its friendly camelCase
-  keys onto `BRAINTRUST_*` / `BRAINTRUST_EVENT_SERVER_*` env vars (env wins over
-  the file), and is run by the hook client before it boots the server — so the
+  keys onto `BRAINTRUST_*` / `BRAINTRUST_EVENT_SERVER_*` env vars (the file wins
+  over env), and is run by the hook client before it boots the server — so the
   spawned server inherits the resolved env. The generic layer (`src/config.ts`)
   then reads **only** those env vars and never touches `config.json`. Keep it
   that way: config-file parsing is deliberately agent-specific. User-facing
diff --git a/plugins/trace-codex/README.md b/plugins/trace-codex/README.md
index cafbfee..40a8de7 100644
--- a/plugins/trace-codex/README.md
+++ b/plugins/trace-codex/README.md
@@ -83,7 +83,7 @@ cp ~/.codex/plugins/cache/braintrust-codex-plugins/trace-codex/<plugin-version>/
 # now edit config.json with your desired settings
 ```
 
-Every setting can be provided as a `config.json` key or as an environment variable; **an environment variable always overrides config.json**
+Every setting can be provided as a `config.json` key or as an environment variable; **`config.json` always overrides the environment variable**. An environment variable only takes effect for settings that `config.json` leaves unset.
 
 | `config.json` key    | Environment variable                  | Default            | Meaning                                                                                                                                      |
 |----------------------|---------------------------------------|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------|
diff --git a/plugins/trace-codex/src/agents/codex/register.ts b/plugins/trace-codex/src/agents/codex/register.ts
index f4b194d..47920e8 100644
--- a/plugins/trace-codex/src/agents/codex/register.ts
+++ b/plugins/trace-codex/src/agents/codex/register.ts
@@ -28,7 +28,7 @@ export interface Agent {
   terminalEvents: string[];
   /**
    * Read this agent's user settings and apply them to the environment
-   * (environment wins). Returns the names of applied settings, for diagnostics
+   * (the config file wins). Returns the names of applied settings, for diagnostics
    * (never values). Run before booting the server so the client and server
    * agree on configuration.
    */
diff --git a/plugins/trace-codex/src/agents/codex/settings.test.ts b/plugins/trace-codex/src/agents/codex/settings.test.ts
index 1d371da..f18650d 100644
--- a/plugins/trace-codex/src/agents/codex/settings.test.ts
+++ b/plugins/trace-codex/src/agents/codex/settings.test.ts
@@ -115,10 +115,19 @@ describe("applySettingsToEnv", () => {
     expect(applied.sort()).toEqual(["apiKey", "port", "project"]);
   });
 
-  test("environment wins: does not overwrite an existing env var", () => {
+  test("file wins: overwrites an existing env var", () => {
     const env: NodeJS.ProcessEnv = { BRAINTRUST_PROJECT: "from-env" };
     const applied = applySettingsToEnv({ project: "from-file", apiKey: "sk" }, env);
 
+    expect(env.BRAINTRUST_PROJECT).toBe("from-file");
+    expect(env.BRAINTRUST_API_KEY).toBe("sk");
+    expect(applied.sort()).toEqual(["apiKey", "project"]);
+  });
+
+  test("env var survives for a setting the file omits", () => {
+    const env: NodeJS.ProcessEnv = { BRAINTRUST_PROJECT: "from-env" };
+    const applied = applySettingsToEnv({ apiKey: "sk" }, env);
+
     expect(env.BRAINTRUST_PROJECT).toBe("from-env");
     expect(env.BRAINTRUST_API_KEY).toBe("sk");
     expect(applied).toEqual(["apiKey"]);
diff --git a/plugins/trace-codex/src/agents/codex/settings.ts b/plugins/trace-codex/src/agents/codex/settings.ts
index b77f040..2c2622f 100644
--- a/plugins/trace-codex/src/agents/codex/settings.ts
+++ b/plugins/trace-codex/src/agents/codex/settings.ts
@@ -6,9 +6,10 @@
 // onto the BRAINTRUST_* / BRAINTRUST_EVENT_SERVER_* environment variables that
 // the rest of the code (and the Braintrust SDK) already understand.
 //
-// Precedence: environment variables always win over the file, so power users
-// and CI can override the file without editing it. The file is optional;
-// missing or malformed files are ignored (never throw).
+// Precedence: the file always wins over environment variables, so a setting
+// written to config.json takes effect even when an ambient env var is present.
+// Env vars only supply a value for settings the file leaves unset. The file is
+// optional; missing or malformed files are ignored (never throw).
 
 import { readFileSync } from "node:fs";
 import { join } from "node:path";
@@ -134,8 +135,9 @@ export function loadSettingsFile(path: string): Settings {
 }
 
 /**
- * Apply settings to the environment: for each setting, set its env var only if
- * that var is not already set (environment wins). Mutates `env`. Returns the
+ * Apply settings to the environment: for each setting present in the file,
+ * overwrite its env var so the file wins over any ambient value. Settings the
+ * file omits leave the existing env var untouched. Mutates `env`. Returns the
  * list of setting keys that were applied, for diagnostics (never includes
  * values, so secrets are not logged).
  */
@@ -148,7 +150,7 @@ export function applySettingsToEnv(
     const value = settings[key];
     if (value === undefined) continue;
     const envVar = SETTINGS_TO_ENV[key];
-    if (env[envVar]) continue; // environment wins
+    // The file wins: always overwrite, even when the env var is already set.
     // Objects (additionalMetadata) are serialized as JSON; everything else
     // stringifies directly (booleans -> "true"/"false", numbers, strings).
     env[envVar] = typeof value === "object" ? JSON.stringify(value) : String(value);
diff --git a/plugins/trace-codex/src/index.ts b/plugins/trace-codex/src/index.ts
index 81853fe..8e7a22a 100644
--- a/plugins/trace-codex/src/index.ts
+++ b/plugins/trace-codex/src/index.ts
@@ -57,7 +57,7 @@ async function main(): Promise<void> {
 
   // Default: hook client. The hook is the client-side entry point, so this is
   // where the agent reads its user settings and maps them onto the environment
-  // (environment wins). We do this BEFORE loadConfig so the client and the
+  // (the config file wins). We do this BEFORE loadConfig so the client and the
   // server it may spawn agree on port/etc. The spawned server inherits this
   // resolved env. Swallow everything; never break the agent's turn.
   const agent = codexAgent;