4-9 Release

• Jurisdiction: United States

4-9 Release

Release is an affirmative defense that must be pled in the answer.²⁷³ It cannot be raised in a motion to dismiss because doing so requires the court to go beyond the four corners of the complaint.²⁷⁴

In K.M.A. Associates, Inc. v. Meros,²⁷⁵ lawyers entered into a real estate investment with their client. When the deal soured, a withdrawal agreement between the client and the lawyers was executed that contained a release from any obligations under the partnership agreement or "otherwise."²⁷⁶

The client later sued the lawyers for legal malpractice and to impose a constructive trust, and the lawyers raised release and estoppel defenses. The trial court granted summary judgment on both grounds. In reversing, the appellate court, after first noting that business dealings between lawyers and clients are subject to heightened scrutiny, set aside the release because it was inconsistent with the lawyers' duty to the client.²⁷⁷

In Peebles v. Sheridan Healthcare, Inc.,²⁷⁸ a lawyer was held to be insulated from a claim of malpractice by a "broad release" contained in a stock purchase agreement.²⁷⁹ But in Hold v. Manzini,²⁸⁰the release was held not to include a legal malpractice action that had not accrued as of the date of the release.²⁸¹ Accordingly, summary judgment in favor of the lawyer was reversed.²...