Also known as: recision · rescission · cancellation · avoidance
Written by attorneys — see sources below.
An agreement under which each party discharges all remaining duties of performance owed by the other under an existing contract. The agreement also operates as a remedy permitting a party to avoid performance when title to land is unmarketable or when other grounds for avoidance exist.
Ravi Reddy contracts to buy land from Rebecca Ross. A recorded lien clouds title at closing. Reddy refuses to perform and demands rescission because the defect renders title unmarketable under the contract duty to convey clear title.
Rita Russell and Rajesh Rao enter a written land-sale contract. Later they orally agree to cancel all remaining duties. The oral rescission discharges the contract even though the original agreement fell under the Statute of Frauds.
Raphael Rivera executes a will leaving property to Regina Robinson. Rivera later burns the document with intent to revoke it. The burning constitutes a revocatory act that revokes the will under the probate statute.
Radiance Media and Rising Sun Electronics sign a supply contract. They later sign a written agreement stating each releases the other from all unperformed obligations. The rescission agreement discharges every remaining duty.
Rhapsody Entertainment and Radiant Technologies cancel their licensing deal by mutual agreement. One party has already paid an advance. The court must interpret whether the rescission also requires restitution of the payment already made.
Rebecca Ross holds a promissory note from Ravi Reddy. She cancels the note and returns it to him with the clear intent to forgive the debt. The surrender discharges Reddy's obligation without additional consideration.
Yes. An oral agreement of rescission discharges all unperformed duties under an enforceable contract notwithstanding the Statute of Frauds, although the statute may still apply to a contract that rescinds a transfer of property.
Supporting sources
A buyer may refuse to close and obtain rescission when title is unmarketable because of recorded encumbrances, gaps in the chain of title, or adverse claims, unless the contract provides otherwise or the defect is waived.
Supporting sources
The agreement discharges all remaining duties of performance. Whether it also requires restitution of benefits already conferred is a question of interpretation of the parties' intent.
Supporting sources
An obligee's cancellation or surrender of a writing customarily accepted as evidence of a right discharges the obligor's duty without consideration when done with manifested intent to discharge the obligation.
Supporting sources
…test therefore cannot be read without reference to the twin aims of the Erie rule: discouragement of forum-shopping and avoidance of inequitable administration of the laws. The difference between the conclusion that the Massachusetts rule is applicable, and the conclusion that it is not, is of course at this…