*3 helped Santa Maria complete Morta form, claim received from Morta his medi reports, cal examined the damaged Mazda and, acknowledging the liability of his in sured, offered Morta $900. Morta testified Klemm, Blair, Sterling, Thomas C. Ster- Johnson, Guam, ling ant-appellant. Agana, & for defend- that the settlement offer had several com ponents: “Three Hundred my Dollars for car; from that; $250 loss of compensation of Priore, Peter F. Perez Del and Daniel R. work, like and Two Hundred some Guam, Agana, plaintiffs-appellees. for sufferings for and injury suffered, that I you So, they me, know. told included also the medical bill from SDA and towing expenses, that 70-71; item.” 1 RT at id. at 44.1 * KOZINSKI, Before WIGGINS and Cir Morta was not satisfied with that GRAY,** Judge. Judges, cuit District amount, claiming that the car alone had a blue-book value of $2300.2 Santa Maria told him that $900 was all he pay. could KOZINSKI, Judge: Circuit Morta did jump offer; he whether, We consider law, under Guam a thought it over and went to see a lawyer. signed part release claims as of a settlement of He lawyer showed the the medical and arising from an automobile accident police reports. lawyer evaluated Mor- bars recovery for injuries. after-discovered ta’s claim and advised him that he would be * replace Circuit Wiggins Judge drawn to Maria testified that the settlement broke down into Kennedy. $500 for Judge Anthony Morta’s car M. and $400 for personal injuries. ** Gray, District Senior William P. Honorable admitted, however, 2. He also that the 1976 Maz- California, sitting by Judge, District of Central wagon da station was not in mint condition: designation. body got rusty "the spots some which are in the hood.” 1 RT at 77-78. claim, superior court bars Morta’s more than much recover unlikely directed a in KIC’s attempt should have verdict and that offered had KIC $900 to re- favor. delay payment. would do so accepted office Maria’s to Santa turned the release on two Morta attacks check settlement Because $900. First, argues the release is grounds. he as as well car damages for covered it was ob- subject to rescission because short, of Morta’s all injuries personal fraud, influence, mistake tained undue —in release. standard claims—Morta Second, that, argues he even if or deceit. settlement, Mor- in- binding, may a week after not be About dizzy. He was ill and feel began recovery unknown voked bar ta soon doctor but by his unanticipated of execution. medication at the time given unconscious, awak- collapsed argues he sufficient evi- that there was thereafter undergoing hospital after in his ing jury in a Honolulu to return a verdict dence for the favor on one or more of these clot for a blood surgery theories and emergency ap- amounted bills The medical correct in superior court was therefore brain. for Morta’s *4 $11,000, paid all refusing request for a directed ver- proximately KIC’s FHP, insurer, Inc. dict. re- damages to recover suit Discussion filed Morta disavowing the injury, sulting from this granted be A directed verdict will Maria that Santa ground on the release fraudulently if, light in examining the the only evidence its contents. misrepresented nonmoving party and to the most favorable for KIC from recover to intervened FHP in its fa drawing all reasonable inferences treating in incurred expenses medical all Morta’s ties vor, to no evidence is substantial “there par- injuries. The accident-related Fabrica support party.” verdict for that a the trial separate on a stipulated to F.2d 892 Corp., Inc. v. El Dorado 697 the evidence After release. validity of the Cir.1983); (9th Kennedy, see Peterson unsuccessfully moved KIC presented, was Cir.1985), (9th 1256 cert. 771 F.2d denied, a returned jury The verdict. a directed for 90 U.S. 106 S.Ct. 475 invalid, release holding the verdict general (directed (1986) proper 187 verdict L.Ed.2d to judgment entered superior court the only one rea permits evidence where “the stipulated, then The effect. verdict”). as to We the sonable conclusion apply entry of appeal, to to right subject to KIC’s court the trial same standard as the which, $14,600, for KIC against judgment v. KFC reviewing its decision. Walker in settlement, consti- the together $900 with Cir.1984); (9th F.2d Corp., 728 policy. insurance limits the of tuted Fabrica, F.2d at 892. of the District Appellate Division The I affirmed of Guam for the District Court us un- appealed to KIC instructed judgment properly jury was The 1985). 1424-3(c) (Supp. Ill if in aside 48 U.S.C. set der could be § the release influence, mistake fraud, undue duced Parties of the Contentions examine therefore We or record to deceit.3 re- argues that KIC any substan there see whether con- for valuable eyes open and lease with any of on support to rescission tial evidence terms, release covers By its sideration. these theories.4 accident, out of arising claims all original com KIC’s Fraud. Morta’s A. unknown. known or whether view, all. He attack the release conclusively plaint did therefore the release Although complaint plead superior gave 3. amend his separate court to mistake. Fur a thermore, deceit, 1691(2) instruction on under Guam Code § was all but to Civ. identical Moreover, obligated the instruction was to tender on actual fraud. return of separate provision signing $900 there is no consideration he for concerning deceit received prerequisite the Guam Civil Code. as a rescission on We therefore to consider ground merely species deceit as than fraud. of other See Graham v. Atchi fraud. son, Ry., T. S.F.& plead complaint, Morta did not mistake in his 1949). The record is about whether unclear though par even must be averred mistake with procedural requirements those were satisfied or ticularity. 9(b) ("[i]n See resources, Guam R.Civ.P. all judicial waived. To conserve ever, how mistake, averments of fraud or circumstanc they proceed we assume were satisfied constituting es or fraud mistake shall stated be to address these issues on the merits. particularity”). attempt with Nor did he complaint to add two jury later amended The was also instructed on con disavowing alleging fraud, the release and counts structive “any which consists of “falsely fraudulently and which, KIC duty breach without an actually of intent, intent to deceive and defraud the the gains advantage with plaintiff represented fraudulent the plaintiff that person fault, anyone claiming him, of All Claims form was not a com- by misleading Release under another to his damages plaintiff plete requesting prejudice, settlement of prejudice anyone to the claiming in an auto sustained under him.” Guam Civ. Code 4; Excerpt 1573(1)(1970) added). (emphasis accident.” of Record see As the § (1970) (defining language Code suggests, finding Guam Civ. of the statute § fraud). proof at trial does not requires actual fraud constructive a confiden allegation. relationship. bear out this tial or trust Guthrie v. Co., 879, 889, Times-Mirror 124 presented jury con- The evidence (1975).5 Cal.Rptr. KIC had no largely testimony from Morta and sisted Santa Morta, duty to however: As Morta was Maria, giving each his account aware, insurer, well KIC was not his but negotiations between them. Those ac- that of an adverse party, the driver who Signifi- counts do not differ all that much. caused the accident. Santa Maria and Mor- testify that cantly, Morta did not openly length. ta dealt was no and at arm’s There misrepresented the content or effect Maria finding basis of constructive any way, only that Santa the release Co., fraud. Sanger See 477, v. Yellow Cab anything Maria never said about it at all. (Mo.1972)(“[t]he S.W.2d does not releasee Morta, According to Santa Maria handed in a fiduciary stand relation to the release, stating, your him the claim.” 1 RT at 38. This “This is for releasor”). statement, stand- *5 alone, ing certainly does not amount B. Undue Under influence. anything fraud or close to it. law, Guam undue influence be estab however, argues, that Morta Santa any following lished under stances: confidence is such confidence of the circum he Maria committed fraud when told Morta (1) use, by “the one in whom a only was “the amount the insur $900 reposed another, ... of of give ance could 1 RT at 70. Morta [him].” purpose ... for the asked, he I testified that when “Is that all obtaining advantage him”; an unfair over “Well, get?,” responded, can Santa Maria (2) “taking advantage or an unfair of an They I’m not the one who decide this. [sic] mind”; (3) “taking other’s weakness of or a just working decide it in there. I’m grossly oppressive advantage and unfair them, so, nothing.” I can’t do at 71. Id. necessities or another’s distress.” Guam Morta, According “led this be [him] (1970). Civ. Code We find no evi § only lieve that was the amount $900.00 dence that Morta the release as a compensate Appellees’ available to him.” any result of of these circumstances. Brief at 12. This is not a reasonable con statement, points Morta struction of to nothing Santa Maria’s in the record suggesting conclusively reposed the Morta did not that he any evidence establishes confidence in Santa interpret it in this fashion. Maria. To the contrary, all the offer, reviewing After a available evidence suggests Morta consulted that Morta and lawyer possibility recovering negotiated Santa Maria about the length. arm’s Morta did lawyer rely more. The could in fact him that he not advised on Santa Maria to take get care of book more—perhaps him: carefully He $1500— checked the blue- car, but cautioned that it ta Maria’s no more—the made time. value of his would take San obtained treatment physicians from and Santa representation pay that he could two of his choosing own type frequently lawyer. of statement consulted a He complained to by parties during negotiations—sim Maria about the amount of the of- ply fered does not amount to fraud. Neither settlement and get tried to him to pay anything presented more. does else at trial. We On the basis lawyer’s advice, support therefore any finally are unable to find Morta decided to take the money jury’s theory for the on offered verdict of actual to him and be done with the business. fraud. Codes, Section like most of provisions See, the Guam e.g., identical of Guam law. Codes, was borrowed from the Lujan, California Smith v. we consider 1979). California construing decisions in overreaching. Sanger, Sparrow, See DuBois S.W.2d below, Cal.Rptr. cited is not (upholding at 478 as to unknown There, agent the insurance point. plaintiff quickly settled, on where be- dealing length”; not at arms plaintiff “were ing get “anxious to his car fixed because plaintiff agent represented first going weeks”). he was on vacation in two then, her, telling switched to without but event, nothing Santa Maria did “ ‘furnished position, which an adversarial pressure accepting Morta into the settle- ” overreaching.’ opportunity for Id. at part. ment in in full or Santa did Maria omitted). (citation Cal.Rptr. at 723 not intimate that the settlement would be always maintained Morta and Santa Maria accepted spot, withdrawn not on the relationship. purely adversarial Morta that settlement on the car would be held testify did not otherwise. hostage personal injury to a release of the any evidence that Morta Nor is there claim; delay making nor did Maria Santa from mental weakness of which suffered wall, push an offer in order to Morta to the advantage. have taken Maria could request pay- or refuse a advance injury; his incapacitated was not car; ment or a rental nor was the offer drugged, hospitalized, he was neither shockingly light of what the low prevented from pain nor otherwise serious jury knew at the time. No reasonable fair- bargaining effectively.6 Morta testified ly applying the law reach a could verdict of begin to suffer from head that he did invalidity on the basis of undue influence. days until several after aches and dizziness Indeed, jury C. Mistake. The was instructed settlement check. he received the unknown, unknowable, nature of that it could set aside the release if it found symptoms Morta’s latent forms the basis of consent was vitiated mis- Morta’s p. argument. law, “[mjistake 1458 in alternative See take. Under Guam of fact mistake, is a neglect not caused fra. legal duty part person on the mak- nothing suggests Finally, the record mistake, consisting in ing the ... [a]n suspected that Santa Maria knew or *6 ignorance forgetfulness unconscious any continuing vulnerability, had or that past present, material to the a fact con- anything to take advan- Santa Maria did 1577(1) (1970) tract.” Civ. Code Guam § tage of the situation. There was no reason added). (emphasis Maria to Morta was Santa believe straits; hospitalized, Morta he dire was not not read alleges he did Morta working any par- did and not disclose its the release and was mistaken about ticularly pressing need for the settlement inadequate to contents. That mistake is money. anyone Like else involved an release, however, rescinding justify be accident, get Morta was anxious to neglect of a by cause it was “caused him, unpleasant advising business behind making legal duty part person on getting Maria that ‘“I’m tired of ” spoke English; he the mistake.” Morta borrowing my daughter’s car.’ 1 RT at identify and read the release on was able to 41; hardly amounts to see id. at 77. That he bothered to the witness stand. Had type pressing pro- would need that it, signing he would a claim of undue influence read the release before vide a basis for 380, 384, condition, Sessions, suffering pain, importuned 17 Cal.2d 110 much ... Backus v. 51, Cf. (1941) (plaintiff hospitalized agent"); Raynale still importuned P.2d drugged, 53 v. Yel and state); 90, 92, 991, v. Co., semiconscious Cal.App. Wetzstein P. 991 low Cab 115 300 554, 558-59, Thomasson, Cal.App.2d 34 93 P.2d (defendants (1931) property discussed minor 1028, 1030-31 (1939) (adjuster repeatedly visited damage plaintiff she was still dazed with while despite plaintiff at her bedside for hours her agony did “in such that she could not and and settlement); Weger v. stated wish not to discuss then, signed," paper she "with not read the 109, 114-15, 417, Rocha, Cal.App. P.2d 138 32 effect, plac[ed] explaining out its before her (1934) (plaintiff 420 was "confined in a cast flat discussed”). covering not release matters back, highly hysterical on her in a nervous and 1458 meaning dealing
no doubt have understood its to believe that he understands law, the act done. purpose.7 Under established Morta rely not on his failure to read the (emphasis added). 66 Am.Jur.2d at 691 it, disavowing “par release as a basis for short, nothing on supports this record ticularly given opportunity where he is agreement rescission of the settlement explained to have it read and to him presented release under the theories to the competent person,” some and reliable such jury.8 66 Am.Jur.2d Release attorney. as an II (1973); see, e.g., Casey 15, v. Proc at 690
§ tor, 97, 105, 579, 583, 59 378 P.2d Cal.2d 28 Alternatively, argues Izzy (1963); Mesquite v. Cal.Rptr. 311 binding the release is not as to Club, Country Cal.App.3d 186 unknown and unforeseen at the time of its (1986); accord Do Cal.Rptr. execution. He cites Guam Civ. Code provides which Story, gen bler v. § “[a] eral release does not extend to claims 1959) law); Sanger, (applying California which the creditor does not know or sus (upholding at 481 S.W.2d release even pect to exist in his favor at the time of though plaintiff “thought signing he was release, executing which if known receipt”). him materially must have affected his set who, person without coercion or un- [A] tlement with the debtor.” The release persuasion, due executes a solemn re- signed, however, general lease cannot subsequently impeach it on meaning release within the of this section. ground carelessness, of his own if at provides Section 1542 only that a document the time of its might execution he have generally releasing claims, all but not re fully advised himself as to the nature ferring claims, to unknown does not dis legal effect of the act done. He charge such claims. A expressly complain cannot then imposi- that an compromising growing unknown claims out him, tion practiced upon has been particular of a accident is valid and en he knows or inquiry might know Berry according forceable its terms. done, the exact nature the act cannot Struble, Cal.App.2d 299, 302-03, 66 P.2d subsequently invoke his own heedless- (1937) (construing Cal.Civ.Code impeach ness to by calling his release 1542, which is identical to the Guam stat § such heedlessness someone else’s Swain, ute); Kostick fraud. right He has no to act as one who under- 187, 194, (1953) (“[i]t 253 P.2d stands what doing, he is unless in- he appears to be the rule par that where the tends to lead those with expressly whom he is ties ... and intentionally settle *7 nothing ambiguous, 7. tricky suggests There is might unclear or 8. The dissent six factors that lead page long. about the release. It is less than a jury a reasonable to conclude that Santa Maria’s tall, top, At quarter-inch the in characters a is "objectionable enough conduct was to excuse "RELEASE"; beneath, the immediately word in plaintiff the from his failure to read and under- letters, slightly smaller are the words "OF ALL the stand release that he and waiver the follow, CLAIMS.” A few concise sentences that it contained." Dissent at 1461. With all clearly unequivocally stating and that Morta re- respect, "objectionable enough” due is not a "growing any leases KIC from all claims out of legal standard. Morta cannot avoid the release unknown, and all known and foreseen and un- general jury might on the basis of unease the bodily personal injuries foreseen prop- arid settlement; feel about the fairness of the there erty damage” arising ques- out of the accident in justifying must be substantial evidence re- acknowledges inju- tion. Morta also that "the grounds specific provided scission on one of the may permanent ries sustained are or be by analyze Guam law. The dissent does not the progressive recovery and that therefrom is un- any particular legal six factors in terms of theo- indefinite_” capital certain and In letters them, ry, good and with reason: None of alone near the signer bottom is a certification that the combination, fraud, or in amounts to undue has read and understands the terms of the re- influence or mistake. lease; line, immediately signature above the capitals, also in instructing is a "caution" signer signing to read the release before it.
1459
whether,
Roberto,
given by
It is unclear
under
the release
for unknown
controlling
in
incontestible”);
Berry
merely
decision
is
Ding
see
is
the claimant
512, persuasive. Roberto seemed to consider
Co., Cal.App.2d
3
French
man v. J.E.
adoption
of the Codes in 1933 as the
(1935);
826,
514-15,
827
Suckow
39 P.2d
date,
pivotal
although its rationale seems
Consol.,
v. Borax Con
Inc.
Mines
Borax
apply equally
to the enactment of the
196,
sol., Ltd.,
F.2d
206-07
185
legislature
Codes
the Guam territorial
law),
1950)
cert. de
(applying California
1937,
Berry
1953.
was decided in
less than
506,
943,
95 L.Ed.
nied,
71 S.Ct.
340 U.S.
original
years
adoption
four
after the
of
(1951);
Greyhound Lines v.
680
Pacific
Codes,
appears
the Guam
to follow
731,
(9th Cir.1947)
Zane, 160 F.2d
prior
construing
case law
section 1542.
Kapneck, 290
(same);
Bernstein v.
accord
514-15,
at
Dingman,
See
602,
(1981);
461,
452,
430 A.2d
Md.
clearly represented
at 827. It
the law
P.2d
614,
Tesseneer, 519 S.W.2d
Trevathan
legislature
of California when the Guam
(holding terms of release
(Ky.1975)
615-16
Kostick,
enacted the Civil Code.
See
circum
injuries in similar
unknown
194,
(1953).
Cal.App.2d at
showing COMPANY, of a conscious S.A., FAI WONG WING suffered which had were Appellant, Plaintiff/ themselves, they too yet not manifested discharged by the release.” would be America, UNITED STATES of (Emphasis supplied.) Defendant/Appellee. case, present there is no evidence whatever, “apart from the words of the No. 86-2515. release”, that would indicate that Morta Appeals, United States Court of knowingly give up right intended Ninth Circuit. Thus, claims. under recover for unknown Casey, the rule in his failure to have insist Argued Aug. 1987. Submitted reading the release and under upon ed Decided Feb. standing implications ipso its did not facto recovery. majority As prevent such out, spe opinion points Casey decision Struble,
cifically Berry overruled Cal. (1st Dist.1937)
App.2d
the line of cases that followed had which that, in
ruled the absence of fraud or du
ress, specifically waiving a release
right pursue unknown claims is valid
and enforceable.
My colleagues panel on this do not like by Casey, major-
the rule laid down and the
ity opinion length sets forth reasons “by relying
for their belief that on the
agreement rather than ex- evidence, Berry provides
trinsic the far bet- However,
ter rule Casey of law.” is the California, accordingly persuasive
law
Guam,
Aguon,
Roberto v.
(9th Cir.1975), and was cited in this case
the United States District Court for the opinion affirming
District of Guam in the
the decision of the trial court. It therefore philosophical
seems to me that our views
concerning the wisdom or lack of wisdom
in the doctrine that announced are importance. Certainly,
little the decision upon theory
below based a tenable “[is] manifestly erroneous.” See [is] Gems-By-Gor-
Chase Manhattan Bank v.
don, Inc., (9th Cir.1981).
Accordingly, I would affirm the decision
of the United District for the States Court
District of Guam.