Opinion
C.A. No. 04C-10-021 (THG).
Submitted: April 15, 2005.
June 16, 2005.
Jeffrey A. Young, Young Young, 300 S. State Street, P.O. Box 1191, Dover, Delaware 19903.
Mary E. Sherlock, Esquire, Brown, Shiels, Beauregard Chasanov, 108 East Water Street, P.O. Drawer F Dover, Delaware 19903
Dear Counsel:
On October 30, 2002, Violet Stout pulled away from a stop sign into the path of a vehicle driven by Jermaine Conquest, resulting in a collision. A third vehicle, traveling behind Conquest on Route 113 and driven by Galit Waanders, collided with the rear of the Conquest vehicle, resulting in a second point of impact.
Plaintiff, Patricia Snead, was a passenger in the Waanders vehicle. Plaintiff contends that she suffered several injuries in the accident including a broken right femur, a damaged right knee cap and injured right heel. Plaintiff complains that her injuries resulted in two surgeries and may require further treatment because she has not yet fully recovered.
On April 27, 2004, Plaintiff, with the assistance of counsel, executed a Release document discharging by name Jasper Waanders, Galit Waanders and Galit Waanders from liability for her injuries arising out of the October 2002 accident. The release was given for the sole consideration of fifty thousand dollars ($50,000). In the release, Ms. Snead
discharges Jasper Waanders, Galit Waanders, Galit Waanders Their heirs, executors, administrators, agents and assigns, and all other persons, firms or corporations liable or, who might be claimed to be liable, none of whom admit any liability to the undersigned but all expressly deny any liability, from any and all claims, demands, actions, causes of action or suits of any kind or nature whatsoever, and particularly on account of all injuries, known and unknown, both to person and property, which have resulted or may in the future develop from an accident which occurred on or about October 30, 2002 at or near Rt. 113, Georgetown, DE.
On October 25, 2004, Patricia Snead instituted an action for damages against Violet West Stout. Ms. Stout has petitioned this Court to grant a Motion for Summary Judgment, contending that she is protected by Ms. Snead's execution of the April 27th release. This is the Court's decision on Defendant Violet West Snout's Motion for Summary Judgment. For the following reasons, the motion is DENIED.
In Chakov v. Outboard Marine Corp., the Delaware Supreme Court held that general releases can apply to third party strangers not contemplated by a release. In that case, the plaintiff signed a release discharging a named party "and all other persons, firms or corporations liable or who might be claimed to be liable . . . which have resulted or may in the future develop from an accident. . . ." The lower court held that the release was clear on its face, and therefore refused to admit extrinsic evidence. The Supreme Court affirmed the decision, but not for the same reason. The Supreme Court assumed the release was ambiguous, considered extrinsic evidence and found that no issue of material fact existed.
429 A.2d 984, 985 (Del. 1981).
Id.
The Court did concede, though, the "potential for confusion in general releases referring to "other persons, firms or corporations." Such releases might, in given circumstances, reasonably be read as referring only to third party entities related to the contracting party obtaining the release." The Court then considered extrinsic evidence to determine whether the settlement negotiations encompassed the discharge of third parties not enumerated in the release. Reviewing the literal language of the release and the course of negotiations, the Court determined that the release included the discharge of a third party defendant as well as the listed parties.
In Sellon v. General Motors Corporation, the U.S. District Court for Delaware determined that recent decisions in Delaware indicated an "unwillingness to rest on the plain meaning rule to the exclusion of conflicting evidence of intent when one not a party to the release seeks to benefit from its general language." In that case, the settling parties agreed to a release containing the same language as we find here. Specifically, both releases discharge all other persons, firms, or corporations from liability. Sellon established that an otherwise clear release of all parties might contain "an ambiguity which might otherwise appear slight, [but] is enough to necessitate admission of extrinsic evidence on the issue of the release's intended scope." Based on that, the Court held that it was unclear whether the release applied to only the parties enumerated in the release or all parties related to the claim. If "the language does reveal confusion about what entities were released, then extrinsic evidence bearing on the parties' intention will be admissible."
521 F. Supp. 978, 983 (D. Del. 1981).
Id. at 984.
Id.
Inferences should be drawn in favor of the nonmoving party on a motion for Summary Judgment. Both the Chakov and Sellon courts recognized the risk of confusion caused by general releases, and indicated that extrinsic evidence may be necessary to clarify the intent of the parties. Both courts found or assumed ambiguity and admitted extrinsic evidence to make a summary judgment determination. Finding the release in this case very similar to the releases at issue in those decisions, I find it necessary to consider the intent of the parties at the signing of the release.
First, the Plaintiff contends that only Jasper and Galit Waanders are specifically identified in the Release. Plaintiff claims that at all times during settlement negotiations, Defendant State Farm, the automobile liability carrier for Violet Stout, handled the claim against Ms. Stout as a separate claim with a separate claims adjuster, which is supported by the fact that State Farm issued two separate claim notices. The Plaintiff thought that State Farm considered the claim against Violet West as a separate incident from the claim against Jasper and Galit Waanders. Plaintiff and her former counsel, who assisted her in signing the release, submitted affidavits insisting that it was not their intent to discharge Violet West Stout in the April 27, 2004 release. Also, Plaintiff submits that she had filed a separate claim and made a formal demand of Violet West Stout, and that State Farm, Stout's insurer, was aware of that. Therefore, the Plaintiff insists that Violet West Stout was not an intended party to the release agreement.
Defendant Stout has not proffered any evidence that she expected to be included in the release agreement. Rather, it appears that the Defendant is merely contending that the broad language included in the release protected her as well. However, the fact that State Farm Insurance was the insurer for both parties creates a plausible inference that the parties may have expected the $50,000 settlement to cover both the Waanders and Stout claims.
I cannot grant a motion for summary judgment when conflicting factual inferences concerning the scope of the release agreement exist. The pleadings and motions offered by the parties do not provide enough information to determine the intended scope of the release as a matter of law. Since the intent of the parties is a material question of fact, summary judgment is precluded. For the foregoing reasons, the motion is DENIED.
Id. at 986.