In the aftermath of an accident, a victim who is traumatized can be easily manipulated, by kind words and money, into signing a general release that forestalls future benefits. Insurance companies know this, which is one of the reasons they cultivate the image of neighborliness and caring in their advertising. Indeed, friendly alacrity may be just what an accident victim needs after the trauma of an accident—but not when it involves compensation for personal injury.
A friendly insurance adjuster who shows up right away to estimate the damages to your car can be worth his or her weight in gold—saving you from the “wreck chasers” who might otherwise high jack you into substandard repair. There is great solace in knowing that you will have a car to drive, without delay, and that the insurance company is covering the cost. But when it comes to evaluating and receiving compensatory damage for personal injuries, a too-hasty settlement is risky.
During my thirty-three years as a practicing car accident attorney in Philadelphia, I have had many injured victims contact my office after signing a third party release, only to discover that they’d forfeited their rights to future compensation. One story that comes to mind is that of an elderly woman who was visited by an insurance company representative shortly after being involved in a car accident. A warm and effusive grandmother, she was touched by the fact someone had come to check on her. She invited the man into her home for lunch and, after a pleasant round of small talk, was presented with a check, and asked to sign a release. She did so without hesitation. However, when she began to experience severe back pain in the coming weeks—and learned that she had multiple herniated discs impinging on her nerves—she was not quite so charmed. She was injured, and didn’t know how she would pay her medical bills.
We were successful in arguing that no one—not a doctor, not my client, and certainly not an insurance company representative— could possibly have known the extent of my client’s injuries so soon after the accident. The release was invalidated on the basis of fraud, and my client was properly compensated for her medical expenses.
Pennsylvania permits the recision or reformation of a release, based upon fraud or a mutual mistake. The Pennsylvania Supreme Court holds that a release covers only those matters that were within the reasonable realm of the contemplation of the parties when it was executed. The Supreme Court of Pennsylvania, in the case of Ristefo v. McDonald, 230 A.2d at 1990 (Pa. 1967), recited the case of Cady v. Mitchell, 220 A.2d 373 Pa.Super 1966, in which the plaintiffs had given the defendant a general release for all claims arising out of a motor vehicle accident, including all unknown, unforeseen, unanticipated, and unsuspected injuries. The release was signed nine days after the accident, before the extent of Ms. Cady’s injuries was known. The Court considered the circumstances, and, based upon the inadequacy of consideration, voided the release.
So, if a friendly agent comes to your door with a smile and a settlement check, think twice before you accept it. And, please, don’t sign a release before consulting a lawyer.
Jeffrey Reiff is a car accident lawyer in Pennsylvania who has been recognized as one of the Top 100 Lawyers in Philadelphia and one of the Top Northeast Lawyers. He has regularly been named a Pennsylvania Super Lawyer, and has consistently been rated Superb by Avvo.com.