Can a Release Be Rescinded Without Returning Payment? 

To rescind a release to do all of the following as required by California statutory and common law: 

Establish that the rescission is due to a misrepresentation of facts material to the decision or the concealment of material facts or other ground for rescission. 

Comply with Civil Code § 1691 that requires:

 

[t]o effect a rescission a party to the contract must, promptly upon discovering the facts which entitle him to rescind if he is free from duress, menace, undue influence or disability and is aware of his right to rescind:

 

(a) Give notice of rescission to the party as to whom he rescinds; and

 

(b) Restore to the other party everything of value which he has received from him under the contract or offer to restore the same upon condition that the other party do likewise, unless the latter is unable or positively refuses to do so.

 

When notice of rescission has not otherwise been given or an offer to restore the benefits received under the contract has not otherwise been made, the service of a pleading in an action or proceeding that seeks relief based on rescission shall be deemed to be such notice or offer or both.

An insured person seeking to rescind the terms of the contract, even when it alleges fraud against the other party, must still comply with the requirements of the statute and California law.