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Scope of Release

A release is the relinquishment, concession, or giving up of a right, claim, or privilege, by the person in whom it exists or to whom it accrues, to the person against whom it might have been demanded or enforced[i].  In other words, a release is a discharge of a claim or obligation and a surrender of a claimant’s right to prosecute a cause of action.  Generally, a release is considered to be a final expression of settlement and terminates litigation or a dispute[ii].

It is to be noted that a general release covers all claims and demands due at the time of its execution which were within the contemplation of the parties.  However, a release may not cover matters which the parties had not desired or intended to dispose of[iii].

If a release is general and there is no incident of fraud, then such a release will bar any cause of action by the person executing such a release[iv].  Whereas, a specific reference to the release of a certain type of claim will limit the release to that claim and other types of claims outside the scope of the release are not released or waived.

It is to be noted that the scope of a release is a question for the court.  In construing releases, the courts must determine whether the language of a release is clear, explicit, and unambiguous, and whether a lay man can understand the same.  The courts also consider the intent of the parties[v].  The scope of a release and the intention of the parties are to be determined by the jury or other triers of fact.  However, if the facts are undisputed, then determination of the scope will be upon the court[vi].

Under some statutes, when construing a release, the intention of the parties is controlling. In determining whether a release is ambiguous, the court must consider the whole instrument and the natural and ordinary meaning of the language. If a release is unambiguous, the intention of the parties and the legal import of the language of a release contract cannot be varied by parol or extrinsic evidence. However, parol evidence is admissible to explain ambiguous language.  If the court determines that a release is ambiguous, resolution of the ambiguity is a question of fact for the jury[vii].

Moreover, when a release contains both general and specific language, the general language will be presumed to be used in subordination of the specific language and will be construed and limited accordingly.  If it is possible to harmonize the general and specific language, then the release and parol evidence must not be submitted to the jury.  However, if harmonization is not possible, then the resolution of the ambiguity remains a question of fact for the jury[viii].

It is to be noted that in some cases, the parties’ stipulation as to choice of law will be upheld.  However, in the absence of such a provision, the court must determine which state’s law must be applied.

According to some statutes, a release by an injured person of one joint tortfeasor will not discharge the other tortfeasor, unless the release so provides, but reduces the claim against the other tortfeasor by the amount of consideration paid for the release[ix].

[i] Macy v. United States, 557 F.2d 391 (3d Cir. Pa. 1977).

[ii] Cunningham v. Goettl Air Conditioning, Inc., 194 Ariz. 236 (Ariz. 1999).

[iii] Meyer v. Fanelli, 266 A.D.2d 361 (N.Y. App. Div. 2d Dep’t 1999).

[iv] Creamer v. Smith, 161 Ga. App. 312 (Ga. Ct. App. 1982).

[v] Arnold v. Shawano County Agricultural Soc., 111 Wis. 2d 203 (Wis. 1983).

[vi] Id.

[vii] Allison v. Flexway Trucking, 28 F.3d 64 (8th Cir. Mo. 1994).

[viii] Tuttle v. Muenks, 21 S.W.3d 6 (Mo. Ct. App. 2000).

[ix] 42 Pa.C.S. § 8326.

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