Berry v. Javitch, Block & Rathbone, L.L.P., 940 N.E.2d 1265

In 2001 the Berry plaintiffs and Javitch negotiated a settlement with a consent judgment for $195,000; Javitch paid $65,000 with a schedule for dismissal and releases.
The settlement required dismissal with prejudice of claims against individual attorneys and a broad release, to be held until funds or Legion insurance resolution occurred.
Legion Insurance denied coverage for the claim; Javitch attempted to persuade Legion to satisfy the full judgment, but was unsuccessful.
The consent judgment was filed in 2002 after Javitch attempted to obtain coverage and the parties pursued claims against Legion and Clarendon, which were denied.
In 2006 the Berrys filed a separate action alleging fraud in the inducement and concealment related to Javitch’s failure to disclose a Clarendon policy.
Javitch moved for summary judgment arguing Civ.R. 60(B)(3) bars relief, and that Berrys could not pursue separate fraud claims without rescinding the settlement.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether fraud in the inducement may be pursued separately without rescission	Berry argues they can maintain a separate fraud action without rescinding the agreement.	Javitch argues Civ.R. 60(B)(3) bars relief and election of remedies requires rescission before fraud claims.	No; election of remedies bars separate fraud claim when not rescinding.
Scope of Civ.R. 60(B) time limits for fraud arising after settlement	Berry contends no Civ.R. 60(B)(3) period applies to a separate fraud action.	Javitch contends Civ.R. 60(B)(3) applies within one year of learning of the fraud.	Civ.R. 60(B)(3) applies; claim must be timely under that rule.
Whether the settlement release was valid and thus barred the fraud action	Berry argues there was no complete release since full settlement funds were not paid.	Javitch argues the release was valid because the agreement was performed and claims were 'otherwise resolved'.	The settlement constituted a release of all claims.
Application of Picklesimer/Shallenberger/Haller lineage to this settlement	Berry relies on those cases to permit fraud claims without tendering consideration.	Javitch asserts those cases require tender to void the release.	Longstanding precedents require tendering consideration before attacking a release.

Picklesimer v. Baltimore & O.R. Co., 151 Ohio St. 1 (1949) (release obtained by fraud in inducement is voidable; tender required)
Shallenberger v. Motorists Mut. Ins. Co., 167 Ohio St. 494 (1958) ( releasor cannot recover more than agreed; must tender consideration)
Haller v. Borror Corp., 50 Ohio St.3d 10 (1990) (releasor may not attack release for fraud without tender)
Frederickson v. Nye, 110 Ohio St. 459 (1924) (election of remedies bars inconsistent claims unless tendered)
Manhattan Life Ins. Co. v. Burke, 69 Ohio St. 294 (1903) (suit on original contract requires tender; not an action to rescind)