A defendant gives sufficient notice of its intent to rescind a contract on which the plaintiff sues by alleging rescission as an affirmative defense in the answer.  The defendant need not give any separate notice of rescission since Civ. Code 1691 provides that service of a pleading seeking rescission is deemed notice of rescission and of an offer to restore benefits.  Also, the defendant need not file a cross-complaint seeking rescission.  An answer alleging rescission as an affirmative defense is all that is required.  An insurer was not entitled to summary judgment on its rescission defense based on false answers to its insurance application questions.  The questions were ambiguously worded and the answers were arguably accurate under one reasonable interpretation of the questions.  One question asked whether any damage remained unrepaired from prior claims and/or defects, claim disputes, property disputes or lawsuits.  Here, a claim remained unresolved, but not property damage remained unrepaired.  The decision holds that a reasonable interpretation of the ungrammatical question is that it asked only about unrepaired damage, not unresolved claims.  The other question asked whether any type of business was conducted on the premises.  This could reasonably be interpreted to mean a regularly conducted business and so the “no” answer wasn’t proven false by evidence of the tenant’s occasional sales of motorcycle parts from the basement.

California Court of Appeal, First District, Division 2 (Miller, J.); June 12, 2017 (modified & published June 29, 2017); 2017 WL 2834131