LEVIN, J. (dissenting).

The majority, persuaded by employer advocate rhetoric extolling the important role played by settlements in the orderly, expeditious, and smooth administration of justice, and the importance of protecting the inviolability of releases reflecting settlements, and by Judith Stefanac's asserted familiarity with releases, holds that she is precluded from obtaining judicial determinations on the merits (i) of her assertion that a release she signed of all claims against Cranbrook was obtained by fraud or duress, and (ii) of her assertion that she was not required, before commencing this action, to tender to Cranbrook the consideration recited in the release, two weeks' pay ($1,042.31), because Cranbrook owed her that amount as vacation pay, and (iii) of her underlying claims of wrongful discharge.

The majority so holds because Stefanac failed, before commencing this action, to tender to Cranbrook $1,042.31, recited as consideration in the release, although

— it was not until more than a year after this action was commenced that Cranbrook raised the issue of Stefanac's failure to tender;

— Stefanac tendered the $1,042.31 shortly after Cranbrook moved to dismiss because of failure to tender;

— Cranbrook would assuredly have refused to accept the $1,042.31 had it been tendered at anytime earlier.

A

In deciding whether tender is required before suit, the circuit court and the Court of Appeals were, and this Court is, obliged to accept as true the allegations in Stefanac's complaint and in her response to the motion for summary disposition. This Court is thus obliged to proceed on the assumptions, absent judicial determination at the trial level to the contrary, both that the release was in fact obtained by fraud or duress and that Cranbrook did indeed owe Stefanac two weeks' vacation pay not paid to her when the release was signed.

It appears, however, from the majority and concurring opinions, that the disposition by the Court of this appeal is in part based on inferences that the majority has taken upon itself to draw without any issue in that regard having been raised in the motion for summary disposition or otherwise at the trial level.

B

The majority's disposition barring Stefanac from obtaining judicial determinations on the merits is hypertechnical. It exalts form over substance to require tender before commencement of an action to set aside a release when it is apparent that the defendant would not have accepted the tender if it had been made promptly.

Courts generally excuse tender of consideration where tender would be futile. Surely it would not be seriously contended that Cranbrook would have accepted $1,042.31 from Stefanac, and thereby agreed to set aside the release, had that amount been tendered before this action was commenced.

Nor was Cranbrook prejudiced by the delay in tender.

C

The majority's reading of Leahan v Stroh Brewery Co, 420 Mich. 108; 359 N.W.2d 524 (1984), is incorrect, and contradicts a well-established tenet of the law of contracts. Parol evidence is always admissible to show that a statement in a document is not true.

Although the release recites the payment of two weeks' pay as consideration (severance pay), Stefanac is not precluded from contending that nothing was actually paid as severance pay because Cranbrook owed her as vacation pay the amount, $1,042.31, purported to have been paid as consideration. And, thus, no separate consideration was actually paid for the release of her underlying claims. And, therefore, because $1,042.31 is owing to her as vacation pay, she need not return the $1,042.31 if the release were to be set aside for fraud or duress. And, accordingly, there was no need to tender the $1,042.31 to protect against unjust enrichment of Stefanac should she prevail on her claim that the release should be so set aside.

The question whether a release without consideration is valid and the question whether recited consideration must in all events be tendered are different questions. The question presented is not whether the release is valid or there must be consideration, but whether whatever is recited as consideration must, whatever the facts and circumstances, be tendered before suit.

I will concede, arguendo, that a release may in some circumstances be valid although no monetary consideration was paid. It does not follow that whatever is recited as consideration must be tendered before suit. The recital of payment may be false. The payee may be entitled to retain the amount paid if the release is set aside because the amount paid belongs in all events to the payee and was not paid as separate consideration for the release of the payee's underlying claims.

There is ample, well-established authority that tender before suit is not required where the creditor (Stefanac) claims both that the release is invalid or otherwise does not bar the action and that the amount recited as consideration is, in all events, owing to the creditor (Stefanac) by the debtor (Cranbrook). This exception is based on the reason for requiring tender, avoidance of the unjust enrichment of the plaintiff that would result if he were permitted to retain, after a release is set aside, consideration paid therefor.

Where the plaintiff claims, and the court finds, that he would be entitled to retain the recited consideration after the release is set aside because the amount recited as consideration for the release represents in fact money that accrued and was owing to the plaintiff separate and apart from the claims that were settled by the release and that no consideration was in fact paid to settle those claims, tender is not required.

D

What motivates Cranbrook's legal argument is not so much a desire to prevent prejudice to Cranbrook resulting from delay in tender or to prevent unjust enrichment of Stefanac resulting from retention of the $1,042.31, as it is a desire to convert the law of tender into a jurisdictional requirement — a new statute of limitation of sorts, in addition to the one that protects against stale claims — that bars the costly litigation of potentially embarrassing claims.

Cranbrook contends that rigid enforcement of the tender rule will reduce the proliferation of unjustifiable wrongful discharge litigation. The majority apparently agrees, stating that releases, because they are contracts to discourage litigation, should not themselves become the breeding ground for further litigation. The tender rule is, to the majority, a means of discouraging litigation of the validity of a release.

The purpose of the tender rule is not, however, to provide a "fair and necessary check against the instability of contracts," but rather to provide a check against the unjust enrichment of the rescinding party that would result if the rescinding party were allowed to retain the benefits of the contract he attacks.

E

The majority, in stating that tender is a precondition to suit "whenever a legal claim is raised in contravention of settlement agreement, even if joined with an equitable claim," ignores not only the unjust enrichment rationale for the tender rule, but also a critical difference between an action in equity to set aside a release and an action on a "law" count in disaffirmance of the release.

The factual dispute in an action to set aside a release does not involve the merits of plaintiff's underlying claim against the defendant that were resolved by the release if it is valid. It is only if and when the release is set aside that the plaintiff should be able to put the defendant to the expense of defending against the underlying claim.

I agree with the majority that the "very essence" of a release and settlement is to avoid litigation — litigation concerning the settlement of the underlying claims, not litigation of the validity of the release itself.

The rule in equity permitting a plaintiff to maintain an action to set aside a release without tender of consideration paid for the release does not put the defendant to the "annoyance and expense of litigation" of claims discharged by the release.

The consideration paid by a defendant to a plaintiff at the time a release is signed protects only against litigation of the underlying claims, and is not paid to secure, and cannot provide protection against, litigation of a claim that the release was procured by fraud or duress. The consideration does not protect, in the words of the majority, the "very instrument that is intended to ensure forbearance of litigation."

Since the consideration paid for the release does not protect against litigation of a claim that the release is invalid, the consideration need not be returned as a precondition to an attack on the validity of the release itself as distinguished from litigation of the underlying claims. To be sure, if the release is found to be invalid, the consideration paid to protect against litigation of the underlying claims must most certainly then be returned before the plaintiff may be permitted to proceed with litigation of underlying claims.

I

Stefanac was employed for more than two years as personnel director of Cranbrook, a private school located in a northwest Detroit suburb. Stefanac, on deposition, testified that on the morning of November 16, 1983, she was advised by her supervisor, Robert Kipp, that her employment was terminated. Later that day, William Powell, a Cranbrook administrator, entered her office and presented a release form. According to Stefanac, Powell waved several checks in front of her, but did not allow her to examine them. Stefanac believed the checks to be payroll and expense reimbursement checks. Stefanac testified that she asked Powell if he was implying that she would not receive the checks unless she signed the release and that Powell responded, "you've never been a dumb person." Explaining that she needed the checks to support her children, Stefanac said that she was signing the release under duress.

Cranbrook's account of the events on the day Stefanac's employment was terminated is significantly different.

Stefanac commenced this action alleging that she had performed her job dutifully and faithfully and that her discharge violated Cranbrook's policy or practice of terminating employees only for major failures in professional conduct. She further alleged that she had been discriminated against on the basis of her sex and that terminating her employment violated public policy.

Three checks were delivered to Stefanac after she signed the release. Two were for amounts owed her for travel reimbursement and retirement contribution. The third was designated as four weeks' vacation pay and two weeks' severance pay.

The third check is in issue. Cranbrook contends that at the time it terminated Stefanac's employment, it owed her four weeks' vacation pay, and that the two weeks' pay, designated on the voucher accompanying the check as severance pay, was the two weeks' pay ($1,042.31) recited as consideration in the release.

Stefanac asserts that, at the time her employment was terminated, Cranbrook owed her at least six weeks' vacation pay. Thus, when Cranbrook paid her six weeks' pay, it paid her only the vacation pay it owed her and did not pay her the two weeks' pay recited as consideration in the release.

II

I share the majority's concern with protecting the integrity of settlements. It is, however, surely at least debatable whether the law should characterize as a settlement what occurred at Cranbrook on the day Stefanac was discharged.

A

Stefanac claims that a few hours after her discharge — before she had asserted a claim of any kind against Cranbrook — a Cranbrook official confronted her with a release form and led her to believe that the only way she could take home checks for amounts admittedly owed her was to sign the release.

A release is valid only if it is fairly and knowingly made, and is invalid if entered into as a result of duress or fraud. Parol evidence is admissible to show duress or fraud.

The question whether Stefanac, in fact and law, suffered duress or was induced by fraud to enter into the release has not been briefed or argued. This Court, before adopting the view that the writing signed by Stefanac bars her claims, should, nevertheless, scrutinize both the writing and the context in which Stefanac signed.

B

The writing, prepared by Cranbrook, begins with an untrue recital. The opening line states, "For and in consideration of Cranbrook Educational Community's (Cranbrook) acceptance of the voluntary resignation of Judith Stefanac. . . ." Stefanac did not voluntarily resign from Cranbrook. Her employment was involuntarily terminated.

It would seem that a writing, prepared by Cranbrook, that begins with a knowingly false recital of fact warrants close scrutiny rather than the reverence with which the majority vests this writing. Cranbrook's reliance on a writing prepared by it containing statements of fact known to have been false when made is a further reason to allow Stefanac the opportunity to show that other statements of the writing, including the recital of consideration and the disclaimer of duress, were also untrue.

It was not Stefanac who, armed with claims against her employer, negotiated with Cranbrook and ultimately accepted two weeks' pay in full settlement. It was, rather, Cranbrook that sought out Stefanac only a few hours after the termination of her employment. Cranbrook confronted Stefanac with the writing before she had time to overcome the stress she claimed she experienced as a result of her discharge from employment, or time to consider possible courses or causes of action or to consult with a lawyer to frame a strategy for bartering for her claims.

[T]he very fact of "haste," when coupled with nominal payment, is a potent factor courts take into account when cases like this arrive before them. [ Hall v Strom Construction Co, 368 Mich. 253, 261; 118 N.W.2d 281 (1962).]

Cranbrook's conduct might be found by the trier of fact, were this Court to allow the factual issues to be decided on the merits, to be comparable to a preemptive strike by an insurer who obtains a "rush release" from an injured person shortly after an accident.

C

Cranbrook acted on the advice of counsel. Stefanac did not.

It has become common for employers to use the exit interview as a means of obtaining a "rush release" by offering a discharged employee separation or severance pay on a take-it-or-leave-it basis. The employee is told if he does not sign before he leaves the room, the offer will be withdrawn.

A system of justice that expects lawyers to move from take-it-or-leave-it positions to settle civil and criminal cases should ponder whether to bestow the imprimatur of legitimacy on a release signed by an unrepresented, discharged employee, lacking in economic resources, and responding under emotional stress to an on-the-spot, take-it-or-leave-it offer by a well-advised and economically advantaged employer.

There was a time when a lawyer would not prepare documents for a client to be signed by another party, known not to be represented by counsel, unless the lawyer or the client, in submitting the document to the other party, strongly recommended that the unrepresented party obtain counsel before signing the document and allowed time to do so.

In Wahsner v American Motors Sales Corp, 597 F. Supp. 991 (ED Pa, 1984), the plaintiffs, co-investors/operators of an automobile dealership, filed an action against an automobile manufacturer and its zone manager for bad-faith termination in violation of the Automobile Dealers' Day in Court Act. The defendants interposed as a defense releases signed by the plaintiffs on the day their employment was terminated.

The court noted that the plaintiffs were not given advance warning that their employment would be terminated, that they were not provided with an opportunity to consult counsel or given more than twenty minutes to decide whether to sign the release — a decision that could affect the rest of their economic lives.

Plaintiffs' negotiation of more benefits than were originally offered did not, according to the court, substitute for the assistance of counsel. The court said that the plaintiffs were presented with an all-or-nothing choice; they were told that if they did not resign during the meeting they would leave the meeting with absolutely nothing. Holding that under Pennsylvania law, the conditions under which the men signed the releases might constitute duress, the court denied the defendants' motion for summary judgment.

D

The law does indeed favor compromise and settlement. It also recognizes, I agree, that persons often face difficult choices, and that they should be held to their agreements. But it is the courts' role to enforce compromises, not to create them. This Court invades the province of the trier of fact in finding that what occurred at Cranbrook on the day Stefanac's employment was terminated constituted a "settlement" or a "compromise."

Stefanac testified that she was offered a choice of either signing away her claims against Cranbrook in exchange for two weeks' pay or forgoing receipt at that time of amounts that Cranbrook conceded it owed her for vacation pay, expense reimbursement, retirement contribution and wages. If those were in fact the circumstances, the release no more represented an accord or settlement and has no more validity than if she had signed under threat of physical harm. The law does not permit an employer to withhold the payment of wages and other amounts due an employee to coerce the employee into releasing claims against the employer.

If there was no accord or settlement, if the release has no validity, cashing the check that included the two weeks' pay was not a satisfaction.

E

Had Cranbrook paid Stefanac the amounts it admittedly owed her and, after checks therefor had been delivered, offered Stefanac two weeks' pay in exchange for a release of any and all possible claims, and had Stefanac signed the release and then accepted the check, a different question would be presented. Stefanac would then have been free to accept or reject the offer of two weeks' pay in exchange for the release of all claims without forgoing the receipt of money admittedly owing. The release might then properly be seen as evidencing an accord and settlement.

F

Stefanac's supervisors testified on deposition, in effect, that they did not withhold payment of amounts to Stefanac and that they had been instructed to deliver the expense reimbursement and retirement contribution checks to her without regard to whether she signed the release. The check for the two weeks' severance pay was, however, included in the same check that had been written for the four weeks' vacation pay Cranbrook conceded it owed her. That tends to support, somewhat, Stefanac's assertion that she could not obtain the four weeks' vacation pay unless she signed the release.

Be that as it may, this Court should provide Stefanac an opportunity to prove her claim that she could not obtain amounts admittedly due her without signing the release, and that the two weeks' pay, recited as consideration in the release, was, as she asserts, owed as an additional two weeks' vacation pay.

III

The general rule is, indeed, that a person who claims that he has rescinded a contract cannot retain consideration received under the contract, and must tender recited consideration before commencing an action in disaffirmance of the contract. The rule is an expression of the principle that "you can't have your cake and eat it too."

A

The reason for requiring tender is to prevent unjust enrichment:

"The requirement that the other party to the transaction should be placed in his original position exists to prevent enrichment by the rescinding party at the expense of the other." [ Carey v Levy, 329 Mich. 458, 465; 45 N.W.2d 352 (1951), quoting Restatement Restitution, ch 2, § 65e.]

The commentary provides, however: "[T]he reason for the [tender] rule limits it." The commentary elaborates that tender is not required where the rescinding party was entitled "to retain what the other gave" as consideration.

That statement in the commentary is based on the reason for requiring tender, to prevent unjust enrichment. If, as Stefanac contends, Cranbrook was indebted to her for the amount of the "consideration," requiring her to return the disputed "consideration" would disturb, rather than re-establish, the status quo. Cranbrook would be unjustly enriched at Stefanac's expense.

There is considerable authority that tender before suit is not required where the alleged consideration either was, or arguably was, payment for an already existing debt between the defendant debtor and the plaintiff creditor:

[A] party who attempts to rescind a transaction on the ground of fraud, mistake, or otherwise, is not bound to restore that which he has received by virtue thereof, when, in any event, he is entitled to retain it as indisputably his own whatever may be the fate of his effort to rescind the transaction. [12 Williston, Contracts (3d ed), § 1530, pp 646-648.]

There is not universal agreement concerning when recited consideration must be tendered. It has been said that there are many exceptions to the general rule requiring tender, including "that restoration is not necessary where the money received by the party was due him in any event and if returned could be recovered back." Baker v All States Life Ins Co, 46 Ohio 308, 312; 96 N.E.2d 787 (1950).

The factual scenarios underlying this Court's decisions in Fritz v Marantette, 404 Mich. 329, 335; 273 N.W.2d 425 (1978), and Urben v Public Bank, 365 Mich. 279; 112 N.W.2d 444 (1961), are instructive. In Fritz, the plaintiff-seller of corn, brought an action to recover the unpaid balance on a contract from Marantette, the defendant-purchaser. The defendant said that the corn was inferior, that the plaintiff had agreed to a deduction from the contract price, and that the plaintiff's acceptance of the check endorsed "corn contract paid in full" for the reduced price constituted an accord and satisfaction. The plaintiff crossed out the endorsement before depositing the check. The plaintiff did not return the proceeds of the check before commencing an action for the unpaid balance. This Court, observing that "whether a particular set of facts amounts to an accord and satisfaction is generally a question of fact for the fact-finder," held that the trial court did not err in allowing the case to go to the jury.

In Urben, an employee sued his former employer. This Court held that the question whether there was an accord and satisfaction is a question of fact. It does not appear that the final paycheck, claimed by the defendant to have been paid in full consideration of all claims, was tendered before suit. In Sall v Luxenberg, 302 So.2d 167 (Fla, 1974), the court said that the principle requiring tender would not be applied on the record in that case because "the consideration for the release which would determine the amount of tender is presently in dispute." Fritz and Urben recognize that, notwithstanding that a check contains words of release, where there is a dispute whether the money received by the plaintiff constituted payment of a liquidated debt owed by the defendant, the question what debts were settled by the payment cannot be determined as a matter of law. Sall indicates that where there is a dispute, tender is not a prerequisite to commencement of an action.

The legal issue, obfuscated by the polarized employer versus employee posture in which the issue arrives for decision, might be clearer if the plaintiff were a businessman and not an employee claiming wrongful discharge. And the businessman asserted in his complaint, with apparent plausibility, that he had sold merchandise for $25,000 to a defendant who turned out to be a deadbeat, and that defendant deadbeat had strong-armed plaintiff businessman into accepting $10,000 and signing a release of the remaining $15,000.

I doubt that this Court would require the businessman to run the risk of returning the $10,000 to defendant deadbeat as a precondition to commencing an action for the $15,000, even though defendant deadbeat responded to plaintiff's complaint by denying that he owed the $15,000 or the $10,000, denying that he was a deadbeat or that he had strong-armed the plaintiff, and by imploring this Court to underscore the importance of encouraging and protecting settlements and the sanctity of written documents by requiring the return of the $10,000 as a precondition to suit for the $15,000, trusting deadbeat to be found and to pay a judgment should the Court ultimately find for the plaintiff.

IV

The majority extends Leahan beyond the scope of the decision in that case and, in so doing, ignores a well-recognized exception to the parol evidence rule.

A

The Court of Appeals and now the majority in this Court, reading Leahan out of context, interpret it as setting forth some sort of parol evidence rule. They erroneously read Leahan as precluding Stefanac from proving by extrinsic evidence, before being required to tender, that, if the release were set aside, she would be entitled nevertheless to retain the consideration recited in the release because Cranbrook owes her that amount as vacation pay and, thus, there is no need to tender that amount before suit to guard against unjust enrichment.

Leahan argued that the language of the letter he signed supported his claim that the consideration recited in the letter was paid solely in exchange for future performance by Leahan of "specific tasks and obligations" and that no consideration was paid for the release of the claims he sought to assert in the lawsuit. The Court looked at the language of the letter and ruled, as a matter of construction of the language, that the recited consideration was paid in exchange for release of the claims there described as well as for the "specific tasks and obligations" undertaken by Leahan.

The Court in Leahan thus merely resolved a dispute concerning how the language of the letter should be construed. The Court held only that Leahan had not established that the consideration was paid solely in exchange for the "specific tasks and obligations" and not for the release of the claims in suit.

B

If Leahan were read as barring evidence that recitation of payment of consideration was untrue, and thus no consideration was received, then Leahan would contradict a universal tenet of the law of contracts that the parol evidence rule does not prevent a showing that there has been nonpayment/failure of consideration:

The vast majority of cases have held that it may be shown that the consideration has not been paid and that no other consideration has been given. This result does not contravene the parol evidence rule since this rule does not prohibit the contradiction of a recital of fact. [Calamari Perillo, Contracts (3d ed), § 4-6, p 198. Emphasis added.]

[I]t may be shown by parol evidence . . . that the validity of the agreement was impaired by . . . lack of or failure of consideration rendering the agreement voidable or void. [4 Williston, Contracts (3d ed), § 634, pp 1017-1018.]

[T]he acknowledgment of receipt is . . . no more than evidence of certain action by one party in paying and by the other party in receiving payment. The courts have uniformly decided that this evidence is not conclusive, and that any kind of relevant testimony is admissible to rebut it. [3 Corbin, Contracts, § 586, pp 489-490.]

Decisions of this Court are fully in accord with the principle that parol evidence is admissible to show that no consideration was received. "Parol evidence is always admissible to show that a contract, although, apparently valid, has nothing to support it," that no consideration was paid, and thus there was a "failure of consideration."

Application of the principle that the parol evidence rule does not bar showing nonpayment/failure of consideration is not precluded in the instant case because the "plaintiff is not claiming that she did not receive any money . . . ." Stefanac sought to introduce evidence that the money she received was already owed her by Cranbrook. Such evidence would tend to show that there was no consideration paid to her and, in that sense, a failure of consideration. Since evidence of nonpayment/failure of consideration is always admissible, reading Leahan as barring such evidence is incorrect.

V

Tender of consideration, although a precondition to an "action at law," is not a precondition to commencement of an action seeking equitable relief. The reason for this distinction is historical, resting on the different theories of rescission at law and in equity and the respective powers of the chancellor and the courts of common law.

The chancellor had the power to cancel or rescind a contract. A person could, therefore, bring an action seeking cancellation of a contract or release, as distinguished from an action claiming that the contract or release had been rescinded. This Court said:

It is said that plaintiff neither restored nor offered to restore to defendant the property received before seeking rescission. Neither was necessary. A bill in equity praying rescission proceeds on the theory that there has been no rescission, not on the theory that rescission has already been accomplished. [ Witte v Hobolth, 224 Mich. 286, 290; 195 N.W. 82 (1923). Emphasis added.]

The chancellor could guard against unjust enrichment of the rescinding party by conditioning a decree of rescission on the rescinding party's return of consideration received:

A tender of restitution is not a condition precedent to a suit for rescission in equity, since the decree can be conditioned on the making of restitution. [ De Blouw v Ramm Co, 284 Mich. 589, 595-596; 279 N.W. 919 (1938).]

An action at law, by contrast, proceeded on the theory that the rescinding party had, himself, rescinded the contract. Courts of law were thought to lack the power to render conditional judgments. Consequently, tender was considered a precondition to the institution of an action at law — a formality perfecting the rescinding party's rescission.

A

In Style v Greenslade, 364 Mich. 679; 112 N.W.2d 92 (1961), this Court, on its own initiative, required a plaintiff who had begun an action at law in disaffirmance of a release to amend her complaint to seek cancellation of the release in equity. The plaintiff had commenced a negligence action for personal injury sustained in an automobile accident. The defendant, as here, moved to dismiss claiming settlement and release. The plaintiff, as here, responded that the release was procured through fraudulent inducements and misrepresentations. The plaintiff demanded a jury trial of the factual issues respecting the release.

This Court, a few months before the abolition of the distinction between law and equity, held that the plaintiff, seeking to avoid a release, should have proceeded in a chancery action, and remanded the case to the circuit court, enjoining further proceedings, "until plaintiff may bring and have determined an appropriate chancery action in accord herewith":

If the release is upheld in the chancery proceeding, that should end the matter. If the release is held invalid, plaintiff may then proceed with her law action involving questions of negligence and damages. [ Id.]

From the records and briefs, it is clear that remand to the circuit court with leave to amend was a disposition raised by this Court on its own initiative.

In Style, this Court thus held that the "law" action should be held in abeyance while plaintiff amended her complaint to add an equitable claim for cancellation of the release. The only differences between Style and the instant case are that Style was a personal injury action, not an action claiming wrongful discharge, and that this Court in that case was willing to permit an amendment of the complaint.

B

The same generosity of spirit that inspires the Court to permit Cranbrook to plead nontender more than a year after Stefanac had commenced this action should move it to allow Stefanac to amend her complaint to seek cancellation of the release on the ground of fraud or duress.

Stefanac did not, indeed, seek cancellation of the release in a separate action before commencing this action, or as a separate count in this action. Nor has she contended that this Court should apply in the instant case the rule developed in courts of equity that tender is not required where an action for cancellation of a release is commenced in equity.

I could nevertheless join in such a disposition of this case. Such a disposition is precedentially supported by this Court's decision in Style where the Court acted on its own initiative. Alternatively, this Court could appropriately require further briefing of whether the Style disposition — remanding to add a count seeking cancellation and trial by the court — should be ordered in this case.

VI

The Court is so smitten with the importance of tender, that, without briefing, argument, or citation of authority, it appears to substitute a new gatekeeping rationale — protection of "settlements" — for the well- and long-established avoidance-of-unjust-enrichment rationale of the tender requirement:

[T]he tender rule set forth here requires that whenever a legal claim is raised in contravention of a settlement agreement, even if joined with an equitable claim, tender is a precondition. Anything less would nullify the purpose of the tender rule. [ Ante, p 170. Emphasis added.]

The foregoing formulation expresses the Court's concern that the rule requiring tender before commencement of an action in disaffirmance of a release might be undermined by commencing an action seeking, in one count, rescission of the release (tender not being required), and, in another, a determination on the merits of an underlying claim for wrongful discharge.

The statement in the Court's formulation, "[a]nything less would nullify the purpose of the tender rule," is not followed with any discussion of the purpose of the tender rule. The only purpose heretofore recognized by this or any other court is avoidance of the unjust enrichment that would result if the plaintiff could keep separate consideration paid for a release after it is set aside.

Many leading authorities agree that, after the abolition of the procedural distinction between law and equity so that a trial court can, whatever the form of action or relief sought, indisputably enter a conditional judgment, there is no need to require tender as a precondition to commencing an action brought in disaffirmance of a release to guard against the unjust enrichment of the plaintiff.

No authority was found resurrecting tender, on a gatekeeping rationale, as an absolute precondition to suit. It appears that Michigan, if it persists in the obiter dictum announced by the majority today without briefing, argument, or citation of authority, will be alone in requiring tender on a gatekeeping rationale.

Modern procedural reforms, in conjunction with the consolidation in one court of jurisdiction of both equitable and law claims, eliminate the necessity of tender as a prerequisite to commencement of an action seeking to obtain rescission. Under unified proceedings, a court may enter a judgment conditioning rescission on the return of consideration received by the plaintiff, thus effectuating the purpose of the tender rule, the avoidance of unjust enrichment of the rescinding party:

In equity, his [the rescinding party's] failure to make such an offer [to return what he has received] before commencing a suit for rescission did not preclude relief. The decree could be made conditional on an offer. At law, however, an offer was traditionally regarded as a condition of the right to commence an action based on rescission. The merger of law and equity and modern procedural reforms have made this distinction undesirable, and the rule stated in this Section reflects the increasing criticism of the rule at law. If the court has the power to assure the required return in connection with the relief that it grants, it is not necessary that there have been a prior return or offer to return. [3 Restatement Contracts, 2d, § 384, comment b, p 245. Emphasis added.]

Textwriters have said, and courts in other jurisdictions have held, that the requirement of tender before commencement of an action no longer has validity:

No reason is apparent for this [tender] requirement, since courts under the codes have the same power as the chancellor possessed to render a judgment which can be made conditional upon a return of the consideration, and some courts which have acquired the power to render a conditional judgment either by statute or otherwise, apply the equitable procedure in legal actions. [McClintock, Equity (2d ed), ch 6, § 86, pp 231-232. Emphasis added.]

The rule of the law courts has retained an undeserved vitality. Today a court should hold that the equity practice applies to all actions, without regard to their historical origins in law or equity. Certainly this is fully justified where the procedural distinctions between law and equity have been abolished. In a court of general jurisdiction, having both law and equity powers, if the court can work out the problem of mutual restitution in one action it can do so in another, and it should make no difference that in an earlier period one was a suit in equity while the other was an action at law. [1 Palmer, Restitution, § 3.11, p 297. Emphasis added.]

It is gross error to refuse such a remedy [restitution] today, if it is within the powers of the court and accords with existing procedure, merely because some earlier court with more limited powers and less flexible procedure refused to grant it. [5 Corbin, Contracts, ch 61, § 1116, p 626. Emphasis added.]

Law and equity have long been merged in Washington; they now are merged in the Federal courts. The court can pass upon the validity of the release and upon the validity of the cause of action, and, if it finds for plaintiff, offset the consideration against the judgment, all in one action. [ Ted Price Construction Co v Cascade Natural Gas Corp, 307 F.2d 741, 743 (CA 9, 1962).]

I suggest that the obiter dictum requiring tender where a count seeking equitable relief, cancellation of a release, is joined with a "law" count should be reconsidered in light of the foregoing statements of textwriters and courts.

VII

I agree with the majority that the result for which the majority writes is "seemingly harsh" — I suggest "unnecessarily harsh." The purpose of the tender rule is not, again, to protect a release obtained by fraud or duress, but rather to prevent the plaintiff, if the release is set aside, from retaining money paid to the plaintiff to resolve the underlying claims.

I further agree with the majority that "[t]he plaintiff is not entitled to retain the benefit of an agreement and at the same time bring suit in contravention of the agreement." A plaintiff should not be permitted to proceed with an action in contravention of a release unless he can first convince the court to set aside the release. If he does, he should then be required to return all consideration that the court finds was paid for the release of the underlying claims.

It would not, therefore, "undermine the very rule announced by this Court in Carey" if a plaintiff is permitted to defer tendering consideration until after it is decided whether the release will be set aside. Carey was not an action in equity to set aside a release, but rather an action at law in disaffirmance of the release. We all agree that a plaintiff should not be permitted to proceed in an action in disaffirmance of a release unless and until he tenders consideration paid for the release of the underlying claims.

Recognizing, now that the procedural distinction between law and equity has been abolished, that tender before suit is no longer a precondition to commencement of an action would not mean that a plaintiff may put the defendant to the expense of defending against the plaintiff's claims on the merits of the underlying controversy before returning consideration in fact paid to avoid incurring that very expense.

A person who has signed a release who wishes to commence an action in disaffirmance of the release should be required to include in his complaint a separate count seeking to set aside the release. The trial court should not permit the plaintiff to proceed on counts seeking damages or other relief on plaintiff's underlying claims unless the plaintiff prevails in his effort to set aside the release.

Disputed issues of fact and law concerning the validity of a release should ordinarily be resolved before the plaintiff is permitted, over the objection of the defendant, to depose witnesses or otherwise obtain discovery respecting the underlying claims asserted by the plaintiff in the "law" counts of the complaint. If the release is found to be valid, the plaintiff's action would be dismissed and the defendant would have prevailed before any discovery on the meritorious questions in the underlying controversy. If, on the other hand, the release is found to be invalid, the plaintiff should be required to pay to the defendant an amount equal to all consideration the court finds was in fact paid to the plaintiff to avoid litigating on the merits the underlying claims. The defendant, thus, would not be put to the expense of defending against plaintiff's underlying claims unless the release is set aside, and consideration paid therefor has been returned.

VIII

Stefanac's claims of wrongful discharge, fraud and duress in obtaining her signature on a release and for two weeks' additional vacation pay may be wholly without merit. She may not have been strong-armed into signing the release. Cranbrook may have acted with the utmost rectitude and justification. If so, a court would presumably so adjudicate were there a hearing on the merits.

To be sure, there is considerable unjustified, costly litigation brought by disgruntled employees who should have been discharged by forbearing and indulgent employers long before they were in fact discharged. Unjustified litigation is a pall, manipulated by far too many plaintiffs and defendants and their advocates, that both hampers the administration of justice and undermines public confidence in the courts. It is a pall that preceded the burgeoning wrongful discharge litigation industry. The court rules provide remedies therefor that some courts are implementing by assessing costs where warranted.

The particularly vocal complaints of employers and their advocates do not justify a new gatekeeping rationale for the tender requirement, now that its historical justification, a law court's inability to enter a conditional judgment, no longer has any validity.

The question is important not only in wrongful discharge cases, but also in personal injury cases and in cases involving contracts other than a release claimed to have been obtained by fraud, duress, or other overreaching entitling a plaintiff to rescind. This Court has the duty to think beyond the case at hand, and to the rule of law that it is expounding not only for employer/employee cases but for all civil litigation.

IX

Contracts to relinquish the enforcement of legal rights warrant at least as much judicial surveillance as other contracts. This Court said in Denton v Utley, 350 Mich. 332, 333, 339; 86 N.W.2d 537 (1957):

We are not saying that all releases are vulnerable. What we are saying is that releases have no particular immunity of their own to attack on the ground of mistake or fraud. There is no form of words, there is no formula, no instrument, no transaction, that rises above the chancellor's scrutiny or resists his intervention. "Fiat justitia ruat coelum."

* * *

"If fraud or mutual mistake has induced the making of an unconscionable contract, courts ought to be more concerned about granting relief, than desirous of clinching future wrongs by making such contracts incontestable." [Emphasis added.]

The constitution confides to this Court both the power and the conscience of the chancellor. This Court cannot justify, on the basis that a ceremonial tender was not made, its failure to inquire into the bona fides of the release relied on by Cranbrook.

X

The real issue, avoided by the majority's disposition in this case, is whether the release was obtained by Cranbrook by fraud or duress.

If it were to be judicially determined, a determination which the majority's disposition precludes, that Stefanac was strong-armed into signing the release, the release should be set aside and she should be required to return the $1,042.31 before obtaining a determination on the merits of her claims of wrongful discharge unless, it were also so judicially determined, Cranbrook owes her that amount as additional vacation pay.

ARCHER, J. (concurring in the dissent).

I agree with the basic rationale and result in Justice LEVIN'S dissent. I write separately, however, to lend a slightly different perspective.

Unlike the dissent, I believe this Court's opinion in Leahan v Stroh Brewery Co, 420 Mich. 108; 359 N.W.2d 524 (1984), offered a sound and consistent method through which persons perceiving themselves to be aggrieved by signed release agreements could repudiate. I further believe the rule is applicable to the case at bar. However, in my view, the Leahan rule in its present state is neither complete nor fair.

In instances where there is a bona fide, good-faith dispute regarding whether consideration recited in the "expressed language of the release agreement" actually amounted to that which is defined "consideration," the rule in Leahan is unworkable. Accordingly, I agree that "`Where, aside from the transaction, the person seeking restitution would be entitled to retain what the other gave as the result of the agreement, the transaction does not enrich him even though he retains such things, nor does it diminish the net assets of the other. . . .'" See ante, p 198, n 48, citing Restatement Restitution, ch 2, § 65e; see also Carey v Levy, 329 Mich. 458, 465; 45 N.W.2d 352 (1951). The practical purpose of the "tender first" rule is to ensure that the party challenging the validity of the release form receives no unjust enrichment in receiving monies exchanged. Id.

Clearly, a plaintiff who contests the sufficiency of the consideration supporting a release agreement should be allowed to withhold tender of such alleged consideration until there is a judicial determination that consideration was in fact paid. If it is found that the consideration was paid, then the plaintiff should be required to tender that amount. However, if the court determines that the amount paid to the plaintiff for the release was already owed to the plaintiff, then the plaintiff should be allowed to retain that amount and proceed with any legal action. See, generally, ante, pp 196-202, part III.

The nature and depth of the rights sacrificed at the signing of a release or settlement agreement are of such stature that a mere, hollow "recitation of consideration" should not be considered as a sufficient basis for the exchange. Indeed, the sufficiency of consideration, in this context, should be foremost in the construction, execution, and review of the activities surrounding release and settlement agreements. Any endeavor to balance the equities involved in the relinquishment of clearly defined rights demands, above all, fairness.

In my view, the majority fails in its attempt to justify the harshness and inflexibility of the Leahan "tender back" rule with its assertion that parties contesting the fact and existence of consideration in this context should, prior to instituting an action on the propriety of their own dismissal, bring an action for rescission of the release agreement in equity. For then, the majority states, the issue whether valid consideration supported the agreement can be decided preceding the institution of a wrongful discharge suit.

In my view, however, even in the case that the validity of the release agreement is not challenged preceding the filing of legal claims, there is no justice in maintaining a rule that blindly demands "tender back," even when tender, absolutely, should not be required. See Williston, Contracts (3d ed), § 1530, p 646; 76 CJS, Release, § 37, p 666. It is the iron-clad feature of the rule that sits at the center of this dispute. The "tender back" rule simply cannot in fairness be properly applied, in every case, unless there is, in addition to equitable rescission, some internal method by which the sufficiency of that which must be tendered back, i.e., the consideration itself, can be "checked" as well. Hence, Justice LEVIN'S proposed rule, which merely reflects the standardization of Restatement Restitution, ch 2, § 65, comment e, provides the fairest solution of all.

In the present case, the plaintiff was unquestionably owed her earned wages, as well as four weeks of accrued vacation pay. Thus, she was not unjustly enriched in the receipt of these. However, because there is a factual dispute regarding whether additional vacation pay was owed, I believe, any amount over that which was concededly owed to the plaintiff should, indeed, be tendered to the defendant within a reasonable time following the resolution of this question of fact by the trial court. Accordingly, I would urge that the plaintiff be allowed to amend her complaint to request rescission of the release agreement. See Style v Greenslade, 364 Mich. 679; 112 N.W.2d 92 (1961); McDonald v Zinn Drywall, 134 Mich. App. 270, 277; 350 N.W.2d 864 (1984); Carey, supra at 466.

Lastly, I disagree with the dissent on one point. I do not believe the plaintiff was coerced into signing the release. The plaintiff's failure to question the circumstances surrounding the defendant's offer of alleged consideration reflects negligence, not on the part of the defendant, but on the part of the plaintiff. The dissent presumes that the immediacy of the defendant's request that plaintiff sign a release agreement necessarily intimated that the defendant prohibited the plaintiff from retaining an attorney. I disagree.

The implicit alleged threat, "sign now or forego your money," still carried with it the notion that the plaintiff should have been, with or without an attorney, concerned or at least hesitant about signing away her right to sue at any price, especially if she felt she had been wronged in her dismissal. Therefore, in my view, there was no actionable coercion in this case.