What is a General Release?
How do you legally define it?
What are the important elements you should know!
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Table of Contents
What is a General Release
A general release (legal release or liability release) is a contractual agreement entered between two parties where one party gives up or “releases” the other party from any responsibility or responsibility.
In other words, a general release is a legally binding agreement where a party commits not to legally pursue, file a claim or take legal action against another in a specific context.
It’s like a general release of all claims agreement.
In business, a release is used in a variety of ways.
For a legal release to be valid, the general release contract must observe the elements required in contract law to be valid.
A general release can be signed at any time or in many situations, such as:
- Before embarking on a dangerous activity
- In business dealings between a company and its clients
- In the context of a contract for the sale of goods or services
- To settle any type of dispute (contract or tort)
- As part of a settlement agreement before and during legal proceedings
The possibilities are endless.
Why is it important
It’s important to fully understand the objective of a general release as the person granting it is doing so for “all possible claims” and not just a specific one.
A “general” release means a release from “all” claims.
In essence, a party is releasing another party (potentially the at-fault party) of all claims, liability, and recourse it may have.
Typically the release will be worded in such a way to include “past, present and future” possible claims.
Due to the significance of the release given, before signing release contracts or granting general releases, it’s important to consult with a legal advisor or attorney to understand the legal consequences of the release.
When signing a release, here are some elements you must consider:
- What rights are you giving up?
- What are you getting in exchange for giving up those rights?
- What is the scope of the release?
- Do you understand the terms used in the release of contracts?
- Do you have all the information you need to sign the release?
General Release definition
How do you define a general release?
A “general release” is a document where a party legally releases the other party from any possible claims, lawsuits or possibilities of legal action.
In most cases, it is not important if the releasor was aware of the possibilities of claims or knew of the claims at the time the release was signed.
In some jurisdictions, the law may impose specific requirements when the claims are unknown.
However, in most cases, a general release covers all possible claims up to and including the day the release was signed.
General release agreement
A general release agreement (also known as a release agreement, release contract or simply “release”) is a type of contract where the object is for one party to waive its rights to assert a claim against another in the future.
It’s a “general” release as the releasor is releasing the other party (releasee) for all possible claims and not just a specific one.
For this type of agreement to be valid in law and legally enforceable, it must be formed by observing the applicable contract law rules.
One important aspect is “consideration”.
For a release to be valid, there must be a consideration.
In other words, for a party to legally waive their rights to file a lawsuit or refrain from filing future claims, the releasor must receive a valid consideration in exchange for giving up such rights.
For example, imagine that Mary’s dog causes damage to John’s property.
If Mary wishes that John execute a release contract, John must receive consideration for committing not to legally pursue Mary in the future.
Generally, the consideration is paid in the form of monetary compensation.
Consideration is what the releasor gets in exchange for signing the release.
In most cases, it’s worth consulting a lawyer before signing a general release to ensure that you fully understand the scope and objective of the release from a legal perspective.
Mutual vs unilateral general release
A general release can be mutual or unilateral.
When the general release language is drafted in such a way where both parties benefit from the release commitments, then you have a mutual general release.
We say “mutual” as both parties waive their right to take legal action against one another.
Each party is a releasor and releasee at the same time where on the one hand they are relinquishing their right to assert a claim against the other party but at the same time benefiting from the same or similar commitment.
If the release benefits one party, we say that it’s a unilateral general release.
A unilateral general release is when one party acts as the releasor and the other party is the releasee.
The legal position of the releasee vs releasor are different.
The releasee is the person benefiting from the release agreed to be given by the other party.
The releasor is the person granting the release and waiving his or her rights to file a claim against the other.
General Release Form
A general release form is a general release document (or form) where a party will complete it by entering his or her information.
For example, if you sign up for parachuting or bungee jumping, the organizer or company offering such activities will provide interested candidates a release form to complete.
The document is presented as a form since there are fields in blank that the client must complete, such as:
- Name
- Address
- Date
- Signature
Typically, the person completing the form will acknowledge that the activity bears some risk and that he or she is aware of them and accepting them.
As a result, the client offers the company a general release should the person suffer any damages while going on the ride.
A general release form will generally be unilateral (as opposed to mutual).
In other words, one party is waiving rights to possible claims in favor of the other.
Examples
Let’s look at a few examples of how business owners and companies can leverage a general release of claims to resolve potential disputes or limit liability.
Example 1: General release to franchisees
When the release is given in the context of a franchisor and franchisee dispute, we say that it’s a release from contract liability.
In essence, the parties resolve or settle a contractual dispute and to conclude their settlement will sign a release committing not to pursue one another before the courts.
Generally, the general release will be granted in exchange for payment.
Example 2: General release from liability
In the context of tort claims or in cases where someone’s actions have caused damages to another, a general release can be used as a tool to resolve the conflict between the parties.
For example, imagine a person’s dog causes property damage to another.
In this example, the dog owner may reach an agreement with the person suffering damages.
For the dog owner to be sure that the other party will not take his or her money and still file a lawsuit, it’s prudent to have a general release signed to safely conclude the out-of-court settlement between them.
Example 3: Damages caused by a minor
Another example is when a minor causes damage to another.
Generally, the minor’s parents or guardians will be legally responsible for the damages caused by the minor.
In that case, if they settle a possible dispute due to damages caused by their child, the parents should ask for a release to ensure that the matter is definitively settled in law.
General release sample
There are many samples and templates you can find when dealing with releases.
Here is a sample language you may find when signing a general release:
Sample 1: Employment contract
You (on behalf of yourself and all of your heirs, assigns, legal representatives, successors-in-interest, or any person claiming through you) hereby release and discharge any claim, charge, complaint, demand, dispute, or liability of any kind that relates to or involves your employment (or termination) by the Company and/or your separation from the Company, except those claims that may arise from any breach of this Agreement by the Company.
Sample 2: Commercial contracts
In exchange for and in consideration of the benefits described in this Agreement, the First Party, on behalf of himself, his agents, representatives, administrators, receivers, trustees, estates, spouse, heirs, devisees, assignees, transferees, legal representatives and attorneys, past or present (as the case may be), hereby irrevocably and unconditionally releases, discharges, and acquits the Second Party from any and all claims, promises, demands, liabilities, contracts, debts, losses, damages, attorneys’ fees and causes of action of every kind and nature, known and unknown, which the First Party may have against them up to the Effective Date of this General Release.
Takeaways
So what is the legal definition of General Release?
What does a general release mean?
Let’s look at a summary of our findings.
General Release:
Related legal terms
Breach of contract
Business waiver
Confidentiality clause
Contract witness
Effective date
Employment agreement
Franchise agreement
Notary public
Promissory note
Release clause
Settlement agreement
Termination of employment
Tort claims
