Lawsuit Proceeds Despite Plaintiff’s Release of Defendant

Although this took place in a setting of a personal injury action, the court’s decision with these facts is broad enough to include other settings. In this case, the plaintiff was injured in a car accident and accepted a settlement from the driver’s insurance company for a nominal sum. In connection with that payment, she executed a release of all claims against the driver. Three days later, she underwent further x-rays and learned that she had a fractured fibula. The plaintiff thereafter sued the driver prompting the insurance company to seek dismissal based on her release. The plaintiff opposed arguing that her release was the product of a mistake, and was unfair and fraudulently obtained. The lower court granted the insurance company’s motion and dismissed the case. Upon appeal, however, the Third Department reversed. After recognizing the well-settled rules governing a release, including that it may be set aside if it was the product of fraud or mutual…

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