Kelley v. Salt Lake Transportation Co.

• Decision Date: 15 August 1941
• Docket Number: 6329
• Citation: 116 P.2d 383,100 Utah 436
• Court: Utah Supreme Court
• Parties: KELLEY v. SALT LAKE TRANSPORTATION CO., et al

116 P.2d 383

100 Utah 436

KELLEY v. SALT LAKE TRANSPORTATION CO., et al

No. 6329

Supreme Court of Utah

August 15, 1941

Appeal from District Court, Third Judicial District, Salt Lake County; P. C. Evans, Judge.

Action by Clarabell Kelley against the Salt Lake Transportation Company and others for personal injuries. From a judgment for plaintiff, the defendants appeal.

Reversed and remanded with directions.

Ingebretsen Ray, Rawlins & Christensen, of Salt Lake City, for appellant.

E LeRoy Shields, of Salt Lake City, for respondents.

LARSON Justice. MOFFAT, C. J., and WOLFE, McDONOUGH, and PRATT, JJ., concur.

OPINION

LARSON, Justice.

Plaintiff was a passenger in one of the defendants' cabs on February 10, 1940, seeking to be driven from the Medical Arts Building on East South Temple Street in Salt Lake City, to her home at 921 West Third North Street. Plaintiff and her minor child sat in the back seat. The driver proceeded west on South Temple Street. Plaintiff in her complaint claims the cab was being driven carelessly, at an excessive rate of speed, and that the driver failed to keep a proper lookout; that as the cab entered the intersection of South Temple and First West Streets in order to avoid a collision with another car going across the intersection, the defendant driver of the cab applied his brakes without warning and so suddenly that the plaintiff was thrown from the rear seat against the back of the front seat and into the bottom of the cab; that as a result she sustained injuries consisting of bruises and contusions of the arms and legs, a wrench of her back, severe pain and nervous shock; and that as a result she has suffered damages in the amount of $ 1,000 general damages, and $ 50 for doctors' and nursing fees.

The defendants' answer denied the negligence of the driver and alleged as an affirmative defense that shortly after February 10, 1940, plaintiff informed the defendants of the accident and of her injuries; that the defendants denied the claimed negligence of the driver but to discharge any possible claims that the plaintiff might have against the defendants, on February 21, 1940, they paid to the plaintiff the sum of $ 20 of which the plaintiff acknowledged receipt in writing, and in consideration thereof released and discharged the defendants from all claims, damages and right of action of every kind and character growing out of the incident of which complaint is made. In reply the plaintiff admits that she signed the release but alleges that her signature was procurred by misrepresentation and fraud, consisting of statements made by defendants' agents that the defendants were not liable to her in damages and that unless she signed the release they would not pay her doctor bills.

Later plaintiff returned the $ 20 to the defendants and stated in her letter to them that she would not be further bound by the provisions of any release she had signed. Plaintiff sued and the trial resulted in a verdict for plaintiff. Defendants appeal. The questions involved are the following:

1. Were the pleadings or evidence sufficient to avoid the effect of the release executed by plaintiff in favor of the defendants?

2. Is the evidence sufficient to justify or sustain a verdict in favor of the plaintiff and against the defendants on the question of negligence?

3. Did the trial court err in giving plaintiff's instruction No. 2, or in refusing to give defendants' requested instructions?

Were the pleadings or evidence sufficient to avoid the effect of the release executed by respondent in favor of the appellants? Respondent admits the execution and delivery of the release, but alleges that it was obtained by the misrepresentations of the appellants' agents, and denies that she is bound by its terms. The accident out of which this suit arose occurred on the 10th of February, 1940. On the 13th, respondent called appellant on the telephone and talked with Mr. Charles A. Boynton, appellants' agent, and he sent her to see Dr. Spencer Wright. On the 14th, Mr. Boynton had Dr. Wright call at the respondent's home. On the 15th or 16th respondent saw Dr. Byron Reese, a doctor of her own choosing; and on the 18th, Dr. Howard T. Anderson, likewise a doctor of respondent's choice. In response to a telephone call from respondent's home to the effect that she was still in bed, Mr. Boynton went to see her on the 14th or 15th. Respondent testified that he offered her $ 10 and payment of all doctors' bills in settlement, which she refused. Mr. Boynton testified that he merely discussed her injuries. In response to a telephone call made by Mr. George Utley, a mature man, respondent's brother, Mr. Boynton returned to the respondent's home accompanied by another agent of the appellants, on the 21st, which was eleven days after the accident. Mr. Utley stated over the telephone that they were ready to talk a settlement. Respondent was still in bed. Mr. Boynton offered $ 20 to cover respondent's expenses in having to employ household help while in bed and payment of all past doctors' bills and any further treatments by Dr. Wright. Mr. Utley suggested that she accept the terms of the offered settlement, and it was so agreed. Mr. Boynton left and a third agent of the appellant company brought back the release, which plaintiff signed, and he left the $ 20 in currency. Respondent testified that she had told Mr. Boynton on the 21st that they had called an attorney and that Mr. Boynton said there was no need for an attorney and told her that the defendants were not liable under any circumstances.

If the release is a full settlement and satisfaction of the respondent's claim the trial court erred in refusing to grant appellants' motion for a directed verdict.

A release may be avoided if the releasor is at the time of its execution mentally incompetent and this incompetence may be caused by various things such as disease or physical injury, nervous shock, extreme mental pain, etc., or if the release is obtained by fraud and misrepresentation. But to so make a release void it must be clearly shown that the releasor did not possess at the time of the execution of the release sufficient understanding to know the nature and effect of the agreement, or to be able to carefully consider his or her rights, or that he or she signed the release under a misapprehension of the facts, which was induced by the false and fraudulent representations of the party released, made for the purpose of deceiving the releasor and actually deceiving him or her as to the facts. It is the duty of a releasor, having the ability and understanding to familiarize himself or herself with the contents of the written release and to exercise prudence in signing it. As said in 53 C. J. 1219, § 36:

"A releasor, in order to avoid a release on the ground of fraud or misrepresentation, must show that he had a right to rely on the misrepresentation, and that he did in fact rely on it in executing the release. As otherwise stated, the rule is that the fraud must have induced or produced the execution of the release, or contributed to it as a cause * * * It has been held that the releasor has the right to rely upon the releasee's material statements of fact, but that he has no right to rely on the usual chaffering statements of the releasee on which a prudent man would not rely."

And as said by Justice Sharwood in Pennsylvania R. Co. V. Shay, 82 Pa. 198:

"It has been more than once held that it is error to submit a question of fraud to the jury upon slight parol evidence to overturn a written instrument. The evidence of fraud must be clear, precise and indubitable; otherwise it should be withdrawn from the jury."

In the absence of a confidential relationship, which does not exist in the present situation, a misrepresentation of law does not vitiate a release unless it is made recklessly or without belief of its truth. Where the releasor has consulted his attorney with respect to the matter, a misrepresentation of law, which is not a representation as to fact, will not make it possible to avoid the release.

The inadequacy of the consideration for the release may be so gross as to clearly indicate fraud, but here the consideration was not grossly inadequate, and is not indicative of any fraud or overreaching on the part of the appellant companies' agent. Respondent's medical expenses were to be paid and further treatments given if necessary in addition to the $ 20 in currency. Here the plaintiff had the opportunity of exercising her freedom of choice as between executing the release or relying on her legal rights and bringing suit. She chose to execute the release...