In response, Avemco claimed that NCAC had made a misrepresentation in its signed application for insurance and rescinded the policy, refunding all premiums paid. Avemco sent NCAC the check and then brought this action, seeking a determination that no coverage existed, and that the policy was rescinded and void ab initio because of the alleged misrepresentation. NCAC counterclaimed, and it also cashed the refund check sent by Avemco. The trial court held that by cashing the refund check and keeping the proceeds, NCAC had agreed to rescind the policy, and entered summary judgment for Avemco. The Court of Appeals reversed, holding that the mere cashing of a check for return of premiums does not always effect a mutual rescission as a matter of law.
Mutual rescission requires a meeting of the minds.
The question of intent to rescind is one of fact, proper for the jury's determination. The judgment was reversed and the case was remanded. Stuart v. D'Ascenz. Defendant appealed the judgment granting plaintiff Stuart the right to purchase real property. Defendant then refused to sell the property when plaintiff offered to purchase it for that price.