Casey v. Proctor

• Decision Date: 14 February 1963
• Parties: , 378 P.2d 579 William CASEY, Plaintiff and Appellant, v. Robert Charles PROCTOR, Defendant and Respondent. L. A. 26961.
• Court: California Supreme Court

Page 307

28 Cal.Rptr. 307

59 Cal.2d 97, 378 P.2d 579

William CASEY, Plaintiff and Appellant, v. Robert Charles PROCTOR, Defendant and Respondent.

L. A. 26961.

Supreme Court of California, In Bank.

Feb. 14, 1963.

As Modified on Denial of Rehearing March 13, 1963.

Harney, Drummond & Fitzwater and David M. Harney, Los Angeles, for plaintiff and appellant.

Murchison, Cumming, Baker & Velpmen, John Baker and Henry F. Walker, Los Angeles, for defendant and respondent.

PETERS, Justice.

In this action for personal injuries, defendant alleged as a special affirmative defense that plaintiff had signed a release discharging him from all liability, and that the action was barred. Pursuant to Code of Civil Procedure, section 597, this issue was tried before the case on its merits. After the introduction of evidence, the trial court, on defendant's motion, directed the jury to find, as a matter of law, that the release 'is valid and binding and bars plaintiff from any recovery in this action.' Plaintiff appeals from the judgment entered upon this directed verdict.

The rules applicable to motions for directed verdict are well settled. (See Estate of Lances, 216 Cal. 397, 400, 14 P.2d 768; Herrera v. Southern Pacific Co., 155 Cal.App.2d 781, 783, 318 P.2d 784; 2 Witkin, Cal. Procedure (1954) Trial, § 125, pp. 1857-1858.) The question presented is whether the record discloses substantial evidence that would support a holding that the release does not conclusively bar the action. (Raber v. Tumin, 36 Cal.2d 654, 656, 226 P.2d 574.) If so, then the judgment must be reversed and the issue presented to the jury. (See Mairo v. Yellow Cab Co., 208 Cal. 350, 281 P. 66.)

On April 18, 1959, plaintiff was driving in Los Angeles when traffic in front of him stopped. After plaintiff also stopped, the car owned and driven by defendant ran into the rear of plaintiff's car, pushing it forward into another car. Plaintiff did not see defendant's car prior to the accident and could not have avoided the collision. Defendant's negligence is conceded.

Four days after the accident, Mr. Carrigan, a representative of plaintiff's collision insurer, Motors Insurance Corporation, with whom plaintiff carried a $100 deductible collision policy, met with plaintiff to discuss a claim for the damage to plaintiff's car for which an estimate of $490.90 had been obtained. Carrigan also helped plaintiff fill out a 'Report of Accident' which had been sent to plaintiff by defendant's liability insurer, Hardware Mutual Casualty Company. One question on this form was whether plaintiff had been injured in the accident, and 'no' was written in answer. Carrigan testified that during the hour long interview plaintiff showed no signs of distress and appeared to be uninjured. No discussion of injuries was had. At the conclusion of the interview, plaintiff assigned to Motors any claim he might have against defendant or Hardware for damage to property insured by Motors, and promised to execute any document necessary to assist Motors in collecting on that claim. In return, Motors was to reimburse plaintiff for the deductible amount of the policy if it were able to collect it from defendant or Hardware.

Six days after the accident the completed 'Report of Accident' was received by Hardware. Apart from the notation in this report stating that he had not been injured, plaintiff did not discuss with either defendant or Hardware the question or possibility of personal injuries. Thereafter, plaintiff's car was repaired, Motors paying all but $100 of the cost; plaintiff paying the remainder. Motors then sent a notice of subrogation to Hardware seeking reimbursement for the $490.90 repair bill. Hardware, whose representative testified that he believed his company was liable for all damages suffered by plaintiff in the accident, in turn, sent a release form to Motors for plaintiff's signature. Motors forwarded the release to plaintiff by mail, but plaintiff does not recollect receiving it or returning it. Nor does he remember whether or not he read it. However, he remembers signing it and acknowledges that the signature on it is his. Plaintiff does not remember how long he had the release in his possession although it appears that he retained it for a period of nine days before returning it. The release provides:

'RELEASE OF ALL CLAIMS

'FOR AND IN CONSIDERATION of the payment to me * * * of * * * $490.90 * * * I * * * hereby release, acquit and forever discharge * * * (defendant) of and from any and all actions, causes of action, claims, demands, damages, costs, loss of services, expenses and compensation, on account of, or in any way growing out of, any and all known and unknown bodily injuries and property damage resulting or to result from an accident that occurred on or about the 18th of APRIL 1959, at or near 9065 ROSCRANS.' Above plaintiff's signature appears the warning: 'CAUTION! READ BEFORE SIGNING.' The release is dated the 11th of May, 1959, 23 days after the accident.

On receipt of the executed release, Hardware sent a draft for $490.90 to Motors, who forwarded it to plaintiff for his endorsement. Plaintiff endorsed and returned the draft to Motors who later reimbursed him for the $100 he had paid the repair shop.

Plaintiff testified that for '* * * quite a few days after the accident I was completely shook up * * *. My nerves were completely shattered * * *.' He was forced to reduce his work load and could neither read easily nor concentrate. As a result of the accident he was sore and his muscles 'hurt,' but he thought these complaints would quickly disappear. He did not think that he had been injured. At the time he signed the release, he had not sought medical care. Plaintiff testified categorically that in executing the release he did not intend to release anyone from a claim for personal injuries.

On July 2, 1959, almost two months after he had signed the release, plaintiff, for the first time, sought medical attention. His doctor testified, without contradiction, that as a result of the accident plaintiff suffered a compression fracture of the sixth cervical vertebra resulting in nerve root compression and a ruptured disc between the third and fourth cervical vertebrae. As a result of these injuries, a laminectomy and vertebrae fusion are required. The estimated special damages are $3,000. In addition, plaintiff will have almost continuous pain until the injured portion of the neck can be immobilized.

Thus, there is substantial evidence that plaintiff was seriously injured as a proximate result of defendant's negligence; that the injuries for which compensation is now sought were unknown and unsuspected by the parties at the time the release was executed; that there were no negotiations leading to any settlement; that there were no discussions concerning personal injuries or the possibility of their existence; that plaintiff received no compensation for any personal injuries; and that plaintiff did not intend to execute a release for personal injuries. It should be emphasized that when the release was signed, neither party to it had any reason to believe that personal injuries had been suffered. Four days after the accident plaintiff had reported that he had suffered no injuries, which report was received by Hardware six days after the accident. Later, based on that report or its own investigation, and upon the demand of Motors for property damage only, the release was prepared and sent. The release, however, by its express terms, included a discharge of liability for unknown as well as known injuries.

Plaintiff's initial contention is that he mistakenly believed that the release related only to property damage claims and that its scope should therefore be limited to a discharge of liability for the damage to his car. Alternatively, it is contended that this mistaken belief affords grounds for rescission of the release. ¹ Secondly, plaintiff contends that the release is a 'general release' within the meaning of Civil Code, section 1542, and therefore does not extend to claims for injuries unknown at the time it was executed. Finally, plaintiff contends that he should be allowed to rescind the entire release on the ground of mistake as to existence of any injuries at the time the release was executed.

It has often been held that if the releaser was under a misapprehension, not due to his own neglect, ² as to the nature or scope of the release, and if this misapprehension was induced by the misconduct of the releasee, then the release, regardless of how comprehensively worded, is binding only to the extent actually intended by the releaser. (Raynale v. Yellow Cab Co., supra, 115 Cal.App. 90, 300 P. 991 (fraud); Meyer v. Haas, supra, 126 Cal. 560, 58 P. 1042 (misrepresentation as to the contends of the release); Mairo v. Yellow Cab Co., supra, 208 Cal. 350, 281 P. 66 (same); M. G. Chamberlain & Co. v. Simpson, 173 Cal.App.2d 263, 276, 343 P.2d 438 (deception); Jordan v. Guerra, supra, 23 Cal.2d 469, 144 P.2d 349 ('overreaching'); Smith v. Occidental etc. Steamship Co., supra, 99 Cal. 462, 34 P. 84 (same); Muir v. Cheney Bros., 64 Cal.App.2d 55, 60-61, 148 P.2d 138 (same); Wetzstein v. Thomasson supra, 34 Cal.App.2d 554, 93 P.2d 1028 (same); Tyner v. Axt, supra, 113 Cal.App. 408, 298 P. 537 (same).) Under such circumstances it is unnecessary to effect a rescission of the release, and no question of notice to rescind or of restoration of consideration received arises. (E. g., Garcia v. California Truck Co., 183 Cal. 767, 770, 192 P. 708; Wetzstein v. Thomasson, supra, 34 Cal.App.2d at p. 560, 93 P.2d at p. 1031.)

This rule does not here apply. There is no evidence of any fraud, misrepresentation, deception, overreaching, or other unfair conduct on the part of either the defendant or Hardware in obtaining the release. The release was sent through the mail and plaintiff had no personal dealings with either of them.

It is true that...