I was recently retained to represent a young college student who was involved a significant car accident.  My client was driving her car through an intersection when another driver ran a red light and crashed into the front of my client’s car.  She went to the emergency room where she was treated for a concussion and neck and back injuries.  The next day, a representative of the insurance company came to my client’s home to “check in” on her.  At this meeting, the representative had my client sign a release for a very small amount of money. Not long after the accident and the signing of the release, my client began to experience severe lower back pain.  She has now been diagnosed with a herniated disc in her lower back for which she received epidural injections and will be having surgery in the near future.  She wanted to know if she can still pursue an action even though she signed a release. 

I believe the release should be invalidated because of “mutual mistake.”  It cannot be said that these injuries were contemplated at the time the release was signed, nor did the amount offered to my client represent adequate compensation for her injuries.  Accordingly, the subject release was obtained based upon a mutual mistake of fact and cannot be given legal effect. I also believe the representative of the insurance company procured the subject release from my client through the use of overzealous practices which served to benefit no party other than the insurance company. 

The release was obtained on the day after the subject’s accident when no one, not my client, not doctors and certainly not the representative of the insurance company could have known the extent of my client’s injuries.  My client was examined at the emergency room the day before and was diagnosed with a concussion and whiplash.  As such, my client was persuaded to sign a release for a small amount of money when approached the following day. Due to my client’s young age, and the fact that she was still suffering from the effects of a concussion and under the influence of pain medication, my client was not in a position to fully appreciate and understand the release she was signing.

I was able to find several cases which strongly supported my position.  In Jenkins v. People’s Cab Company, 220 A.2d 669 (Pa. Super. 1966), the Court stated that the Supreme Court of Pennsylvania has recognized several factors that must be considered in determining whether a Plaintiff had an intelligent understanding of a release.  Among these factors are the physical and mental conditions of the Plaintiff, the circumstances under which the release was obtained, the amount paid on the release, and how soon after the accident the release was given. 

In Jenkins, the Plaintiff was involved in a motor vehicle accident at 1:30 p.m., and the Defendant’s representative arrived at her home at 10:00 a.m. the following morning and asked her to sign a release. The Plaintiff was in the process of leaving her home for a 10:15 a.m. doctor’s appointment and she was presented with a release in the amount of $20.00 and was told that the payment was to be used for cab fare.  She stated that she was not prevented from reading the release, but she opted not to read it because she felt sick.  The representative stated that he had reached the conclusion that there was no liability on the part of the Defendant driver.  After considering several factors, including the timing of the request for execution, and the insignificant amount paid for the release, the Court determined that there was sufficient evidence from which a jury might reasonably infer that Plaintiff did not understand that she was releasing Defendant from further liability. 

In Restifo v. McDonald, 230 A.2d 199 (Pa. 1967), the Supreme Court of Pennsylvania referred to a long line of Pennsylvania cases which have held that a release covers only those matters which may be fairly said to have been within the contemplation of the parties when the release was executed. The Restifo Court cited the case of Cady v. Mitchell, 220 A.2d 373 (Pa. Super. 1966), in which Plaintiffs had given the Defendant a general release for all claims arising out of a motor vehicle accident, including all unknown, unforeseen, unanticipated and unsuspected injuries.  The release was signed nine days after the accident, the consideration for it being the lowest estimate received by Plaintiffs for the repair to their vehicle.  At the time the release was executed, neither party suspected that Mrs. Cady had suffered any bodily injury.  Subsequently, Mrs. Cady developed symptoms which indicated that she had sustained bodily injuries in the accident.  After considering the circumstances, including the details as to when, where and how the release was secured and the inadequacy of the consideration, the Court voided the release.

In Groh v. Huckel, 36 Pa. D & C 2d 172 (C.C.P. Allegheny County 1964), the Court invalidated a release based upon mutual mistake where a Plaintiff signed a release for $90.00 thirty-four (34) days after the accident and subsequently developed severe back pain requiring two hospitalizations and fusion procedures.  The Court stated that under the circumstances, it was abundantly clear that the parties did not intend to trade lifelong crippling injuries for $90.00.  Since Pennsylvania law permits rescission or reformation based upon mutual mistake, the Court denied Defendant’s Motion for Judgment on the Pleadings which relied upon the release.   

If you are in an accident, you should never sign a release until you have been checked out by a doctor and you understand the extent of your injuries.  Many insurance companies will approach victims immediately after an accident for the express purpose of procuring a release.  This saves the insurance companies money by not fully compensating victims for their injuries.    

Joe Cullen is a Shareholder in Stark & Stark’s Yardley, PA office specializing in Accident & Personal Injury Law. For more information, please contact Mr. Cullen.