## Facts

- John Hand, an attorney, worked for Dayton-Hudson Corporation from 1967 until his termination in February 1982 during a company restructuring.
- Dayton-Hudson offered Hand $38,000 in exchange for a written release of any claims against the company; Hand initially refused, asserting he was already entitled to the amount under his employment contract.
- Dayton-Hudson prepared a release reflecting its offer and gave Hand until March 20, 1982 to accept or reject it.
- On March 19, 1982, Hand met with a Dayton-Hudson agent and presented a release for signature.
- Hand had prepared a different release that closely matched Dayton-Hudson’s document in formatting and appearance but added an exception stating he released all claims “except as to claims of age discrimination and breach of contract.”
- The agent signed Hand’s version, and Hand later sued for age discrimination and breach of contract based on the inserted exception.
- Dayton-Hudson asserted the release was procured by fraud and sought equitable reformation of the document to reflect its original terms.

## Issues

1. Whether the undisputed facts established that Hand’s preparation and presentation of the altered release constituted fraud under Michigan law.
2. Whether Michigan equity permits reformation of a written release based on fraud or inequitable conduct even without a mutual mistake of fact.
3. Whether, after reformation, the release barred Hand’s age-discrimination and breach-of-contract claims as a matter of law.

## Decision

- The Sixth Circuit affirmed the district court.
- The court held that the undisputed record established intentional fraud by Hand as a matter of law.
- The court held that Michigan law allows equitable reformation of a written instrument for fraud or inequitable conduct even absent mutual mistake.
- The court affirmed reformation of the release to a complete release of all claims in exchange for $38,000.
- With the release reformed, the court affirmed summary judgment for Dayton-Hudson, which barred Hand’s claims.

## Legal Principles

- Under Michigan law, intentional deception in presenting an altered written instrument as if it reflected the other party’s terms can constitute fraud when the alteration is material, intended to induce reliance, and does induce reliance.
- When historical facts are undisputed, fraud may be decided as a matter of law on summary judgment.
- Michigan equity permits reformation of a written instrument not only for mutual mistake but also for unilateral fraud or inequitable conduct, to restore the instrument to the terms actually agreed upon or proposed and accepted.
- A release, once reformed to reflect a complete discharge of claims, can bar subsequent contract and statutory claims within its scope.

## Conclusion

The court enforced Michigan’s equitable remedy of reformation where an employee procured a signed release by presenting a nearly identical but materially altered document, and it upheld summary judgment because the reformed release extinguished the employee’s age-discrimination and breach-of-contract claims.


Hand v. Dayton-Hudson Corp., 775 F.2d 757 (6th Cir. 1985)