Setzer v. OLD REPUBLIC LIFE INSURANCE COMPANY

The appeal presents this question: Does the complaint allege a cause of action for reformation on the grounds of fraud? Mutual mistake is eliminated by Paragraph X of the complaint which is as follows: “X. That the defendant knew the policy to be issued pursuant to the plaintiff’s application on or about January 20, 1960 would not provide indemnity coverage for loss of either hand.”

The mistake of only one party to an instrument, if it is not induced by the fraud of the other, affords no ground for relief by reformation. Smith v. Smith, 249 N.C. 669, 107 S.E. 2d 530. “A mere misunderstanding…