Opinion ID: 1484921
Heading Depth: 1
Heading Rank: 4

Heading: The Rescission and Offer of Restitution Were Legally Sufficient and Timely.

Text: The conclusion that the validity of the release presented a question of fact calls for the determination of the final question involved in this appeal, i. e., whether there was adequate and timely rescission and offer of restitution. Except where fraud enters into the execution of a release, rescission must be timely and a tender of the consideration received for the release must be made. Restatement, Restitution, § 65; Restatement, Contracts, §§ 349, 480; 17 C.J.S., Contracts, § 439; Miles v. Lavender, 9 Cir., 1926, 10 F.2d 450, 454; Irish v. Central Vermont Ry., 2 Cir., 1947, 164 F.2d 837, 840; Cal.Civil Code, § 1691; King v. Mortimer, 1948, 83 Cal.App.2d 153, 159, 188 P.2d 502. It is argued that there was neither rescission nor offer of restitution. It is true that neither the notice of rescission nor the offer of restitution is before the court. They were enclosed in the letter of November, 25, 1945, the receipt of which was admitted in court by counsel for the defendant. The letter contains the following significant statement at the end of the second paragraph, which referred to the enclosed notice of rescission and offer to restore: Kindly advise us of your wishes in this respect. It is quite evident that this statement called for action on the part of the defendant, if they intended to question the legal sufficiency of the notice and offer. In the absence of any objection, the plaintiff is entitled to the presumption that the documents referred to were legally sufficient to achieve the purpose intended. By failing to object, the defendant has waived the right to question the adequacy of the instruments. 17 C.J.S., Contracts, § 439, p. 924; Cal.Code of Civil Procedure, §§ 2074, 2076. [4] The plaintiff testified that he had means of carrying into effect the offer  in other words, ability and willingness to perform. Cal.Civil Code, §§ 1493, 1495. We also have his statement that the offer was made in good faith. He added, under cross-examination: I believe I could have gotten it together at the time if it had been demanded of me. He stated that his lawyer would have helped, and that he had property worth more than the amount and could have borrowed. Grant that these statements may lack specificity, yet they were not contradicted. And we cannot brush them aside upon the assumption that they are of a character which the jury might not have believed. [5] We are, therefore, of the view that the trial court erred in holding that the evidence showed, as a matter of law, that there was no valid rescission and offer of restitution. We are also convinced that the question of the timeliness of the rescission should have been submitted to the jury. It is of the essence of rescission that it be timely. Lapse of time may destroy a person's ability to defend his position. He may have been induced by the belief in the validity of a release, to cease all endeavors to gather testimony to support his cause. And because equity takes these facts into consideration, it demands that he who rescinds a contract, be not guilty of laches in so doing. But, there is no hard and fast rule as to what lapse of time will amount to laches. Every case must be judged by the facts surrounding it. In re Meiselman, 2 Cir., 1939, 105 F.2d 995, 999; Johnson v. Umsted, 8 Cir., 1933, 64 F.2d 316, 323-324. See Furman v. Gulf Ins. Co., 8 Cir., 1946, 152 F.2d 891, 894-895; Austin v. Hallmark Oil Co., 1943, 21 Cal.2d 718, 134 P.2d 777, 786. On the whole, courts are very liberal in the matter. In Komer v. Shipley, 5 Cir., 1946, 154 F.2d 861, 866, cited by the defendant, we find this statement of the rule: Whether a ratification resulted from the retention of the amount paid on the execution of a release has been held to be a question for the jury. See cases cited 76 A.L.R. at page 349. With consideration of plaintiff's difficulty in employing legal counsel the court below did not err in holding that a retention of the amount paid for more than one year was not unreasonable, hence did not amount to a ratification. In that case more than a year elapsed before any attempt to rescind or restore the consideration was made. This Court, in Robert Hind, Ltd., v. Silva, supra, ruled that, in the absence of a showing of detriment, a delay of nearly two years presented a question of fact. Judge Wilbur wrote [75 F.2d 78]: Moreover, it is not shown that the delay in bringing the suit has worked any prejudice or disadvantage to appellant, and it is well settled that `mere delay in asserting a right does not ipso facto bar its enforcement in equity, by the great weight of authority, unless the case is barred by the statute of limitations.' There was no showing of change of position or injury resulting from the delay. And, mere delay without injury does not constitute laches which bars recovery. Robert Hind, Ltd., v. Silva, supra; Allen v. California Mutual Bldg. & Loan Ass'n, 1943, 22 Cal.2d 474, 488, 139 P.2d 321, 329. The plaintiff was entitled to have the facts relating to the timeliness of the rescission submitted to the jury. See Brown v. Pennsylvania Ry. Co., 2 Cir., 1947, 158 F.2d 795; Carr v. Sacramento Clay Products Co., 1917, 35 Cal.App. 439, 170 P. 446; O'Meara v. Haiden, supra. The trial court having erred in granting the motion for a directed verdict, the judgment on the verdict in favor of the defendant is reversed and a new trial is ordered.