Fraud in the Inducement - Parol Evidence - Merger Clause: McCullough v. Allstate


McCullough v. Allstate, [Ms. 2160497, Oct. 27, 2017] __ So. 3d __ (Ala. Civ. App. 2017). This unanimous decision by Judge Moore (Thompson, P. J., and Pittman, Thomas, and Donaldson, JJ., concur) reverses summary judgment of dismissal in favor of Allstate on the insured’s claims of fraudulent inducement. Plaintiff alleged that he had been fraudulently induced to enter into a release agreement with Allstate.

The court concluded that Allstate’s reliance on the merger clause to bar the plaintiff’s parol evidence of the alleged fraudulent inducement was erroneous. The court held that “a merger clause does not prevent proof of fraudulent representations by a party to the contract ....” Ms. *14, quoting Environmental Sys., Inc. v. Rexam Corp., 624 So. 2d 1379, 1383 (Ala. 1993), (internal quote marks and other citations omitted). Ms. *14.

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