Opinion ID: 1306499
Heading Depth: 1
Heading Rank: 4

Heading: Retention of Check

Text: (10) Occidental next contends that, even if no misrepresentation occurred, nevetheless the contract was mutually rescinded because plaintiff retained the check sent to her on September 4, 1964, by Occidental as refund of the first premium on the $100,000 policy. Plaintiff neither cashed nor endorsed the check but gave it to her attorney who, on September 25, notified Occidental of plaintiff's claim under the policy. The attorney retained the check and subsequently offered it into evidence at trial. The United States Court of Appeals, Ninth Circuit, succinctly answered a similar contention in Metropolitan Life Insurance Company v. Grant, supra, 268 F.2d 307, 308, footnote 1, stating that ... there was or was not insurance coverage in effect at the time of Grant's death. The subsequent act of returning the premium is irrelevant. No contention has been made that the premium was accepted as a satisfaction of the liability under the contract. When appellant [insurer] returned the check and unequivocally disclaimed liability, no further tender was necessary as it would have been futile. The question was primarily one of fact for the trial court to decide. (See Conderback, Inc. v. Standard Oil Co., 239 Cal. App.2d 664, 680-681 [48 Cal. Rptr. 901].) Under the circumstances in the instant case, we believe the trial court properly found that plaintiff's retention of the check did not constitute a mutual rescission or accord and satisfaction. Certainly plaintiff, who was actively pursuing her lawsuit against Occidental, did not intend any such result.