COA Opinion: Court enforces release agreement finding no fraud in its inducement
In Vertex Development LLC v Fifth Third Bank, the Michigan Court of Appeals enforced the plaintiff’s release of all claims against the Bank after determining that the Bank had not fraudulently induced the release. The plaintiff claimed the Bank’s failure to loan it additional funds and fraudulent actions by the Bank’s former loan officer had set the plaintiff up for failure. However, the plaintiff had previously signed a release of all such claims against the Bank in a negotiated settlement. After the settlement, the former loan officer pleaded guilty to federal bank fraud charges. The court granted the Bank’s motion for summary disposition based on the plaintiff’s prior release of all claims against the Bank, which the court noted was predicated the fraudulent behavior of the Bank’s former employee. The court reasoned that the subsequent criminal case against the former loan officer was “immaterial” and did not indicate fraudulent inducement of the plaintiff’s release.
Disclaimer: Warner Norcross & Judd, LLP represented Fifth Third Bank in this litigation.
