International Fidelity Insurance Company v. Western Virginia Water Authority, No. 7:2011cv00441 - Document 63 (W.D. Va. 2012)

Court Description: MEMORANDUM OPINION. Signed by District Judge Glen E. Conrad on 9/28/2012. (lab)

Download PDF

I TH E UN I N TED STA TES D I STRI C OURT CT FOR THE W ESTEM DI STRI OF VI NI CT RGI A ROA N OK E D I I ON V SI CL BOFFI u. . ST COURT ERK' GE S D# . ATR- Oc , < FI LED sEP 2 3 2 1 02 J I . ULA D R 0 D CL K R@ I TERN A TI A L FI ELI I SU M N CE N ON D TY N C OM PAN Y , Pl ntf ai if Ci lAc i No.7: 1 c 00 vi ton 1 - v- 441 W ESTERN VI NI W ATER AUTHORI RGI A TY, De e n / r pa t Pl i if f nda tThid- ry antf M EM ORANDUM OPI ON NI V. FI RST STA TE BAN K a nd By: H on.Gl n E. lad e Corr Chi fUnie S a e DititJ e t d t t s src udge CA RN ELL CON STRU CTI CORPOM TI , ON ON Thid- ry D e e n s r pa t f nda t . Thi c s c n ensmulpl c nr c d s ue se n fo ac n tu to p o e ta t s ae o c r t e o ta t ip ts tmmig rm o sr cin rj c the i Falng Cr e Dn i Be or Cot y.Thi i t s co tmet c t shad r as t is li e k m n df d mt s s he e nd i he our ha e on o s ue adec son i t ca e. Thi opi onconc m st orgi lc ii n he s s ni e he i na ompl i fld by I e ai na ant ie ntm to l Fi lt I ur nceCompa agans W ese n Vigi aW a e Aut iy.Thepa te fld cr s de iy ns a ny i t tr r ni t r hort ri s ie os moin f rs mmayj dg n pls n t Fe ea Rueo Cii Pr e u e5 a dt ec u t to s o u r u me t t ua to d r l l f v l oc d r 6, n h o r r he r a gume on t m at r a r s e i t pa te 'bre s ad r nt he te s dd e s d n he ri s i f .Fort r a onst tf l t he e s ha olow,he c u t lg a ti p r a dd n i p r t epanifsmoi nfrs mmayj d me t a dg a t o r wil rn n a t n e y n a th litf to o u r u g n , n rn i par a de i patt dee ntsmotonf s n t nd ny n r he fnda ' i or ummayj r udgme . nt 1 . Fac uala Pr duralBac r t nd oce u ound OnS ptmb r1 , 01 ,n en to a Fiei I s rn eCo a y(t 1 ' tepanif e e e 4 2 1 Itr ai n l d lt n u a c mp n tF C',h litf y 1 ) i t sa ton,fl ac anta i tW esen Vigi aW ae Aut rt (t ho iy' t n hi ci ied ompli gans tr r ni tr ho iy tAut rt ), he def nda a t r pary pl ntf . The c pl nts e m one a y a de a a o y r i ,a e nt nd hi d- t ai i f om ai e ks t r nd cl r t r elef nd alg scamso b e c o c nr c, q ia l s b o ai n a du j s e rc me t ( c t . le e li f ra h f o ta te u tb e u r g to , n nu t n ih n . Do ke No 1a 1) t. Ac o dn t t ec mplitt eAu h rt e trdit ac nrc (Ã§ n rc ' wih c r ig o h o an ,h t o i n ee n o o ta t s ta f) t y co CanelConsnztonCompa (< r e1')onM a 4,2009,frconsnzto a grdi wo k r l t ci ny $Ca n 1' y o t cin nd a ng r o teFal Cr e Da Re o ain($ oe t'.( za 2) Th ttl rc frCa l' wok n h li e k m n v to Ã§ j c' J .t . e oa p ie o mels r ng Pr ) # o tep o e t s$18 7 1 30 , n t eCo ta tp o ie f rmo t yp y nst Ca n l i n h rj c wa ,2 ,2 .0 a d h nr c r vd d o nhl a me t o r eln at a a oun e i ni t fvepe c ntoft c ot l m t qualng ney-i re he onka tprc wih fveper e oft mont y c ie t i c nt he hl Pay e st ber t ne i a e c'w ac ount m nt o eai d n n s l o c .TheConta to i t d t Aut rt t pay r c blga e he ho iy o Can l a yrmanngc nrc b ln eu o c mplto o teP oe t Ap i 6 2 0 , F C, r el n e ii o ta t aa c p n o ein f h rj c.On rl , 0 9 I I a s rt ,su dalb ra dmaeil a me t o d($ n ' o b h l o Can l t stsy a y s u ey is e a o n tra p y n b n t d' n e af f r elo aif n Bo ) t ads b o ta tr wokigo t eP o e t Do k t 13) P irt is igt eBo d I C mp i u c nr co s r n n h rj c.( c e No. - . ro o s un h n , FI r q ie Canel oe e uea Ag e me t fl d mni (d d mni Age me f).( c e No. e urd r lt x c t n re n o n e t dn e t r e n Do k t y l y 1 4. Thel mniyAgre ntesa ihe t rg sofI C i t e ntI C wa f c t -) nde t e me tbls d he iht FI n he ve FI s ored o m a apa e t rt Bo Thel mniy Agr me as c a ne aclus as i ng ke ym nt mde he nd. nde t ee nt lo onti d a e sgni alofCa nelsrgh s i l nga u i c r tba a ea r t i geamot s t I C i l r l' i t , ncudi ny npad ontac l nc nd ea na mt, o FI n t e tI C i ureda l son t Bond. he ven FI nc r os he TheAut iy, nelandFis Stt Ba (d rtStt' as e ee i oa esr hort Car l, rt ae nk s s ae' lo ntrd nt n cow Fi ) ag e mentCt c o Agre nf' wihrs tt t Conrc.( ke No.4- , B. I C re Esr w e me ) t epec o he ta t Doc t 1 Ex. ) FI sgne t Es r Ag e me ass eyf Canel (d) TheEs r Agreme pr d t t i d he cow r e nt urt or r l. 1= cow e nt ovied ha t A ut r t w oul pa i o t e c o a ou t f vepe c ntr t na a t tFi s St t he ho iy d y nt he s r w cc nt he i r e e ai ge, nd ha r t a e, 2 a t es ow age , ul pa t t Aut rt orCn ela a s he cr nt wo d y o he ho iy rn l ny mount asi tuce by t s nsr td he Au h rt (d; c t . 1 Ex B. TheAu h rt alg sta ip i afvepec n t o i I .Do ke No 4- , . ) y. t o i le e h t t ad i re t y rti e a nage a o i t e c ow ac ot tea h tm e Ca ne ls it d a pa e r ues ,r s tng m unt n he s r c m c i r l ubm te ym nt eq t e uli i at albaanc i t es r w a o mtof$85,23. Ho ve , hec c Fis St t r eved n ot l e n he c o cc t 8 33. we r t he ks r t ae ec i di notce l i c t t y we ebei pad t Fis Stt a e c o age .Asar s t whe d lary ndia e he r ng i o r t a e s s r w nt e ul, n Fis Stt r c vedt s c ksfom t Aut rt Fis Sut de ie t m i ot s pa a e rt a e e ei he e hec r he ho iy, rt e post d he nt he e r t busnes s vi ac ountofCa l whih hadbe n al tmeba ng c t rofFis S a e i s a ngs c nwl, c e ong-i nki usome rt t t . ( k t 2 - a 3) Doc e No. 5 1 t . OnJ n 1 , 01 , r l c mpee t ePrjc.( c e No 1a 3. Ac o dngt t e u e 4 2 1 Canel o ltd h oe t Do k t . t ) c r i o h c ompli t l C- i isr easszey f Ca e l r c ve a pa d apa e tbond c am fom a n , F1 n t ol lr t or m l- e ei d nd i ym n li r o eo Cn l' s bc nr co s F r us nEnep ie (Teg s n',ntea u to n f mels u o ta t r, e g o tr rs s Ã§ r u o ) i h mo n f $ 8 ,714 .(d) Bae o ti iv l ayasg me t I I a g e i isc mplit h tii 2 65 .4 l .. s d n h s n ot r sin n , F C r u s n t o an t a t s mt t pr rpat t r evet o sa ngbaanc of$85, 33unde t Contac.( ke he ope ry o ec i he uttndi l e 823. r he r t Doc t No 1) Ac o dn l, FI c n a tdt eAuh rt t rq e th tt yter mann c nr c . . c r igy I C o tce h to iy o e u s ta ipa h e i ig o ta t b ln ed eo t ePrj c dr cl t I C.( c t . a 4)I aJ ne1 , 1lte,h aa c u n h oe t ie ty o FI Do ke No 1 t . n u 4 201 etr te Aut rt a s d Ca ne lt t a ar s tofI C' s oga i c am ,i i e d t payt ho iy dvi e r l ha , s e ul FI S ubr ton l i t nt nde o he r mann c n rc b lnc t I C (n ldigt e$ 58 33 s p o e l b i hedi eco . e iig o ta t aa e o FI icu n h 8 ,2 .3 u p s dy eng l n sr w) (d) Cn n l idc td i a re n wi t i p o o a b sg iga drt r igt teAu h rt I . r el n iae t g e me t t hs r p s l y inn n eu nn o h t oiy s h ac oft J 1 lte .(d. opy he une 4 etr I ) TheAut iy t n die d Fis St t t r l s t I C t f hort he r de rt ae o eea e o FI he undsi be ivedwe ebeng t le r i hel i t e cow a coun.( ke No. a 4;Do tNo. 1, C. Howe r Fis Stt d n he s r c t Doc t 21 t cke 4- Ex. ) ve , rt ae c ul notco pl w ih t sdie ton,ha ng de ie a 1o t c ksdie ty i o Car l' o d m y t hi r c i vi post d 1 f he hec r c l nt ne l s spaaea co .( ke No.21a 4. TheAut iyis dac kt I C i t n e rt c unt Doc t t ) hort sue hec o FI n he mountof $ 38 59 ,e vn t rmanngb ln ed eo t eP o e t t 8 ,2 .3 tea u th ti 3 ,6 .8 la ig he e ii aa c u n h rj c a $ 58 33 ,h mo n ta t ha atmptdt payi ot esr ac ot .( . d te e o nt he cow c mt J ) #= I C fld isco pl nton Se e be l 2 1 s e ngt r ove fom t Aut iy FI ie t m ai ptm r 4, 01 , e ki o ec r r he hort te$ 58 33 baa c o tePrj c.( c t .1) OnOco e 2 , 01 ,h Auhoiyfld h 8 ,2 .3 ln e n h oe t Do ke No . t b r 6 2 1 te t rt ie at r pa t c hid- ry ompli a tmptng t hol bot Fis Stt a Ca ne lla east r pa t ant te i o d h r t a e nd r l i bl hid- ry d fn a t frt eu p i baa c o t ePrjc.( c e Nos 6a d21) Th c u t e r ee d n s o h n ad ln e n h oe t Do k t . n . e o r h a d a pl nton t Aut iy' t r pa t co pli a is d a o ni de ng i pa t r me he hort s hid- ry m ant nd s ue n pi on nyi n r and g a tn i pa t rtSaesmoi nt ds s a dmoinf rs mmayj d me t a d r ni g n r Fis tt ' to o imis n to o u r u g n, n uli t l g a i a to ldic r i ot is ofwheherFis Stt ha a t tma ey r ntng ddii na s ove y nt he sue t r t a e d cual knowl dget t c c i r c ve fom t Aut iys d ha be n pl c d i t es r e hat he he ks t e ei d r he hort houl ve e a e n he c ow a co . See l ' Fi l . v. . igi a W a e A u h.N o.7: 1 c 00441 201 W L c unt ntl d. ns Co. W V r ni tr t , 1 - v, 2 23 7 6 , t* ( . Va J ne2 , 01 ) 5 3 8 a 8 W D. . u 0 2 2 . I C a dt Au h rt t nfldc o smoin frsz r j d me t a dt c u t FI n he t o i he ie r s to s o l y mmay u g n , n he o r h ado a ag me to Se tmbe 2 , 1 I ismoinf rsl r u g n, FI s e s e r rl r u n n pe r 0 20 2. n t to o l mmayj d me tI C e k t a dsofm onea y r lef fr t i cli da gesi t a wo war tr ei : is, t a ms ma n he mountof$85,23. t ts ul 8 33 ha ho d havebe rti dt rt Esr Agre nt(s rc Reanage); s c i seks en eane mde he cow e me sconta t ti ' and e ond,t e r i s m e oft $286, . i pa dt Fe g on o behafoft BondAgr e e embm e nt he 57144 t i o r us n l he e m nt (pa me tBo Cli '. E y n nd am' t ) I . D i c s on I s us i A. LegalSt andard l c i rngamoto frs n onsdei in o ummayj me unde Fe r Rul ofCi lPr e e5 r udg nt r deal e vi oc dur 6, Chec ti r r d t viw t f t a d a r a o ei e e esi a lghtm os f vor bl i our s equie o e he acs nd r w e s nabl nf r nc n i t ta a e t t non ngpa t ' Sha v.Stoud,1 F.d791, (t Ci.1 .Viwi t fds o he movi ry. w ' r 3 3 798 4h r 994) e ng he a 4 i t i lg t s mmayj g n i p o e o l i t r i nog n n is eo maeil a ta d n hs ih , u r ud me t s r p r ny f hee s e uie su f tra fc n j g n i a p o raea amatro lw.Ceoe Co . Cart, 7 U. 31 3 2 4 ud me t s p r p it s te f a ltx p v. tet 4 7 S. 7, 2 -2 ( 9 6 ; v ev F ec tie, 1 8 ) Ho l . r ihln r LLC, 0F.d 3 , 31( t Ci. 01 ) A g n ieis eo 65 3 21 3 4h r 2 1 . e un su f mae il a t xsswh nt ee ie ei S u hta ara o a l u yc udr tr av r it o tra f c e it e h v d nc s Ã§ c h t e s n bej r o l eu n ed c f r s t en n vngp ry. An es nv. b ry Lo b l c, 7 U. 2 2 2 8( 9 6 . h o mo i a t ' d ro Lie t b yen .4 7 S. 4 , 4 1 8 ) ' B. A nal s ysi i . C ontractR et nage ai Ta ngt Co r c Re ana cli frt I C a gu t tbe a e i i undiput t t ki he nta t t i ge am is, FI r es ha c us t s s ed ha I C wa entte t t t d baa eoft co r c i t e ntofade aul by Ca nel,i FI s ild o he mpai lnc he nta t n he ve f t r lt s d r e vet por i oft co r c t tw a t be r t i d unde t Es r A g e e . houl ec i he ton he nt a t ha s o e a ne r he c ow r em nt I C p it o t h t h Auh rt iiil a r e t p yI I teCo ta tRean g .( c e FI on s u t a t e t o i ntal g e d o a F C h nrc tia e Do k t y y 4 1 Ex. (Ã§ ten u t e i igt b p i u d rt eCo ta t $ 58 33 i b igh l - , A) t h mo n r mann o e ad n e h nrc, 8 ,2 .3 s en ed Of unde a Es r A g ee e ... m d rw hi h t W a e Aut rt ha t pow e t die tt r n c ow r m nt t e c he t r ho iy s he r o r c he f .TheW aerAut iypr est payt sn mtt yourbondi c unds t hort opos o hi mot o ng ompa ' Onl ny. ). y a t rt Aut r t w a m ade a a e t tt f f e he ho iy s w r ha he unds ha ne rbe n pl c d i a es r a o d ve e a e n n c ow cc unt di i diput isoblgai n t pa I C t t t lr mai ngbaa ont Conta t I C a gues d t s e t i to o y FI he o a e ni lnce he r c . FI r t tt lnguageoft I ha he a he ndemniy Agr e e te il i t af l a sg e ofCa nel' rght t e m n nttes t o u l s i nm nt r ls i s t t Conta tRe ana asamaterofl w, by vit oft docrneofe t bl o he r c t i ge t a or rue he ti quia e s oga i n. ubr to Unde Vigi alw,Sg he aprncpa dea t o ac r tguaa e bya r r ni a Ã©wj n i i l fuls n ontac rnted pe f m a e orpa e bo a t s e y pe f m s on t bond, i i e ofs e y 1 w a r or nc ym nt nd nd he ur t r or he pr nc pl s ur t a nd t docti o e t bl s oga i i pos c r a n rght a dute r l i be w e n t he rne f quia e ubr ton m e e t i i s nd i s u m ng t e he sze y,prnci l and o i or a a l t s le y t e or s h r gh s a dute . XL lr t i pa , blg , nd low he t t o nf ce uc i t nd i s ' r ' S e ilyl s Co. Co n at 26 Va 3 2 3 9(00 )(iigDik ns nv. als 1 3 p cat n . v. mmo we 1 9 . 6 , 6 2 5 ctn c e o Ch re , 7 h, Va 3 3, 0 ( 9 9 ) l oh rwo d ,h d crneo e utb es b o ainalwsf ras rt t . 9 4 0 1 3 ). n te r s t e o ti f q i l u r g to l a o o u ey o es e i l G tp i o t s s ntaly Ã§ e nt he hoesof' prncpa a e or eisrg s I Howe r a s e y d s a i i l nd nf c t iht . d. ve , ur t oes m or t n m e e y ise i o t s e ha r l tt p nt he hoesof' he pr nc pa ,a $ pe f ng sze y m a r cove 't i i l s Ã§ r onni lr t a y e r r ana hel byt owne e nt ht c r t c dnotr ove s hrti .'J eti ge d he r ve houg he ontacor oul ec r uc eanage' ;s ( iigItmain l d l yl s Co. As ln Ll e Co 2 0Va 5 7 51 (9 5 ) W he a ctn n e to a Fiei n . v. h a d l r . 5 . 0 , 1 1 9 ). n t mb s ey pe f mson apa e bond,t s ey hasta equia erght't i m nii ai n o of ur t ror ym nt he ur t tn t bl i ' o nde fc to ut ar t i d f t tt con r c o nol nge pos e s . Se Pe rm a v.Re inc I tr nceCo. e ane und ha he ta t r o r s s es e a l n la e nsta , 3 U. 1 2 1 7( 9 2 .Thi i b c u es c fnd aeo tnetb ih da mu hf rte 71 S. 3 , 3 1 6 ) s s e a s u h u s r fe sa ls e s c o h be t oft s ey a t toft o r a s r easc lt r lt ti e i z t c r t nek he ur t s ha he wne , nd e v ola e a ha nc ntvies he ontacor t fnih iswor ontm ea f lilisoblgai t s on r c or .l- I Ame i a Sl ev ois t k i nd ufl t i tons o ubc ta t s d. n z rc n z t r Co. Plnk & W his t t Supr m eCou tofVig ni madet sc e r v. a tet he e r ri a hi l a : The f nd c ea ed by t sr t i d per e a w a r quie notonl asa pr e ton u r t hi e a ne c nt ge s e r d y ot c i t t ow ne s t be us i t e nt t tt c r c or def uled i a of hi o he r, o ed n he ve ha he ont a t a t n ny s oblga i ,buta a f o of whi h t s e y m i htbe pa d,i t e n t t i tons s und ut c he ur t g i n he ve t ha i elc e t c t e t d o ompl t t buidi a t t de aul oft c r cor a outof ee he l ng fer he f t he onta t , nd w hi h t y ha a rght t be r m bur e f r t pa en s t y m i t be c he d i o ei s d o he ym t he gh co pe ld t m a l bo e sa m aeram e m le o ke a r r nd t il n. 1 9Va 1 1 ( 9 2 . 5 ., 3 13 ) I mpora l t s ey' rghtt t t i c r tba a er a e ba k t t daet tnty, he ur t s i o he mpad ontac l nc elt s c o he t he s e y i s d t bonds o t unde l ng con r c . Se l r J ur t s ue he n he ryi t a t e n e onesCons r to & Re t uc i n nova i ton. I c 3 7B. 5 9 5 3( n r E. Va 2 0 )(g j i rg t(ortie f n )rlt sb c t n . 3 R. 7 , 8 Bn k . D. . 0 6 Ã§- hs ih t ean d u ds eae a k o tf ted t o t es rt sis a c o b n sfrt ec nrc.)( u tn Pe rma , 71U. a 1 7 h ae f h u ey' s u n e f o d o h o ta t' q oi g a l n 3 ' S. t 3 ) (iai o te .I J ne ,heba krptyco thedt tt sleyhads rorrght ove cttons mitd) n o s t n u c ur l ha he trt upei i s r t ba pty esaet r t i d f ndsbe a et s e y' i e e t r lt d bac t t d ei he nknz c t t o e ane u c us he ur t s nt r ss ea e k o he at t is d t bond.J=;s a s W eser Cas t a Surt Co. Br , 2 F. 486, s ue he # . Ã§e lo t n ualy nd ey v. ooks 36 2d 489 90 ( t Ci.1 6 )(g lnc ti iq ia l rg ' ftes rt t t f n rltsb c t ted t o 4h r 9 6 i s i e h s e u tb e iht o h u ey o he u d eae a k o h ae f l t s e y bond,i e ilst s ey t prort i pa e tove a 1s e n le de sa he ur t t ntte he ur t o i iy n ym n r l ubs que t inhol r nd g n r l rdtr . e e a c e io s' ). The Aut rt doe notdiput t tI C wa e ild t t $33, 98 r mai ng on t ho iy s s e ha FI s ntte o he 865. e ni he Co ta t ttet o tePrj c' c mpein I fc,h Auhoiyddno e e o ii al nr c a h i f h oe ts o lto . n a tte t rt i t v n rgn ly me diput I C' rg t t $85,23. pr vi d i ha be n pr ry r t i d i a es r s e FI S i ht o he 8 33, o de t d e ope l e a ne n n c ow a c t .( c e No 4- , . ) Th Auh rt ag e , o v r t t e a s Can li n c omt Do k t . 1 Ex A. e to iy ru s h we e ,ha b c u e r el s o l rl aly en ild t a y oft r t i d f nds I C c l m a acli f t mone onge eg l tte o n he e ane u , FI amot ke a m or he y et r TheAut iywrtsi isbreft tÃ»att tmeI C padFe gu on' cli Canel ihe . hort ie n t i ha ' l he i FI i r s s am, r l g onl had arg t t $35, 98t i ba a eon t c r c .TheAut iy pr de t s y i ht o he 865. mpad l nc he onta t hort ovi d hi t adb lnc t I C o Aug s 4, 01 . ( c e No 5 a 8) Th s t eAuh rt a es i mp i aa e o FI n u t 2 1' Do k t . 3 t . u ,h t o i v r,t ' y f fle isoblgai t Ca ne l a I C,i Ca nel' se d,c nnotma acai t tCa nel ulil d t i ton o r l, nd FI n r ls t a a ke l m ha r l c dno .Ho ver t sa s ri ove l oul t we , hi s e ton rookst sa e ntbyt Su e Cour ofVigni i he tt me he pr me t ri a n XL Spec at t ta sley doe m o et n m e ey se i ot s soft prncpa .XL i ly ha tr t s r ha r l tp nt he hoe he i i l Sp cat 2 9Va a 3 9(t j ac nr co d f ut o ab n e c n tu to c nr c, e il 6 . t 6 tlf o ta tr ea l n o d d o sr cin o ta t a y, l s pe f m i ste y ma r ove r t i ror ng tr t y ec r e anagehel by t o re n t ug t c r c o c ul not d he wne ve ho h he onta t r o d rcove s hrti . A s eyhasrg st t rti df ndst ta editnc fom, nd e r uc eanage' ). urt iht o he eane u ha r si t r a gr t rt n,t e oft c r c or I ;s e a s Fi lt & Cas Co.v.Cone ve Cont a tnc ea e ha hos he onta t . d. e l o de iv . nha r r ci Co.1 9Va 1 6 1 9 4 ( 9 2 (( h szeyi e t ldt b s b o ae t t rg t whc , 5 . 2 , 3 - 0 1 3 ) t T) e l t s n ie o e u r g td o he ih s ih ( r t t o i ha t orco d a s ta i t s h f he blgee d o, ul s er ga ns, uc undsupon t prncpa c r t ' de a tt he i i l ontacor s f ul o t e e ne sayt r i reis ff t outa ma t c eet c r t' . he xtnt ce sr o embu s tel or he ly de o omplt he ontac.) ' M or ove ,l C' r g st t e ie ba a e oft co r c w e e e t bls d on t da e e r Fl s i ht o he ntr l nc he nt a t r s a ihe he t i i s t bond. Se W es e n Ca ua t & Sur t 36 F. a 489- The f tt tCa nel t s ued he e t r s lv e v, 2 2d t 90. ac ha r l 7 i o ry r ceve t Contac Re ana a mpr pe l e i d he r t t i ge mounta trt Bond wasi s d snotdi nih fe he s ued oe mi s I C' pr e si rg st t s f . FI S e- xitng iht o ho e unds Suc ar ul i s h es t s uppore b t polc r a o unde l i t prncpl ofe t e td y he i y e s ns ry ng he i i e quiabl s ogai a wel. Sur te ,lkebond oblg s r quiepori nsofc r t lpa ubr ton s l e is i i ee , e r to ontac ua yment t be so rti e i o d rt ic n iieac nrco t fns wo ko ap oe t Hee I C wa a ean d n r e o n e tv z o ta tr o i ih r n rj c. r ,FI s sgna or t t Es r Agr e e r ii t tfvepe c ntoft co r c prc ber t ne i i t y o he c ow e m nt equ rng ha i re he nta t ie eai d n aspaaea c t u tl fe tePrj c ' c mpein Th I d mni Ag e me t p cfc ly e rt c omt n ia tr h oe ts o lto . e n e t r e n s e iial y m e i ne t tI C woul ha rgh st t r ui d f nto d ha FI d ve i t o he e ne undsi e hangef isa ee ntt n xc or t gr me o bond Car l. Sur te lke I C r l on t c l tr lt obt i fom e c ow a e nt i nel e is i FI e y he olae a hey an r s r gr eme s n dec d ng whe he t bond con r c o s a t y ar e il t t r t i d f ii t ro t a t r , nd he e ntted o he e a ne undsi t prnci l f he i pa def uls a t. The Aut iy ar ue t tI C ha no cl i t t Cont a tRe a na unl si c n s hort g s ha FI s a m o he r c t i ge es t a how t tt Aut iy Ã§ t ral at r 'I C' c r c wih Cn ne lt s h a e e t tI C ha he hort i e i ly le ed' FI S onta t t r l o uc n xt nt ha FI ma wa dic r d fo isoblgai unde t Bo s s ha ge r m t i tons r he nd.I C de e t scai by a g ngt tt FI f nds hi l m r ui ha he A ut iy' f iur t es a i h t es r a co n ount d t a m a e i a t r ton oft hort s a l e o t bls he c ow c unt m e o t ral le a i he co r c . ' H ow ever,t si s m or pr ry bel nt a t hi s ue e ope l ongsi t a l i ofI C' dem a f t n he na ys s FI S nd or he 'l s n uppor oft sa gumentI C p rplae teRettmett id o St tsi a dGu rn vj 7 t hi r , FI aa l ss h r sae n Thrl f tevhp n aa t 3 : r ( )I teo l e (ee WVW A)at t ice s tesc nd r o lg rs(ee I C)rs o ls 1 f h bi e h r , g cs o n rae h e o ay bio' h r, FI ik f os b ...d cesn i p tnila ii t c u etepicp lo l o (ee Can l t b a te y e raig t oe ta bly o a s h rn ia bi r h r, rel o e r h s t g j c sso p roma c ,h sc n m' o l o (FQ i dsh re .. a dtesc n ay o io ot f efr n e te e o d y bi r II s ic ag d . n h e o d r bl r g g (FI h sacam a an th o lg e( VWA). . I C) a li g is te bie W . ( )l teo ie ( 4 f h bl e WVW A)i iste sc n ayo lg rs(Fl s s rt sau (n ti c s g mpar h eo d r bio ' I C') uey tts i hs ae tru h p e tr p y n o tertia et tdsiae I C' c laeaj...b)beoete ho g rmaue a me t f h ean g ha isp td FI S oltrl ( fr h s c n m' o l o (FI p ro ms a p ri n o t e s c nd r o l to E t i c s p y n e o d y b i r I C! e f r g o t f h e o ay b i in i h s a e a me t o ga n t F r u o ,fh s c n ayo l o (FQ te p roms . . o eg sn)ite e o d r bi r I I h n efr : . g (i frtebe ei o a itn e b n fcay (ee F r uo )wh c n e fre tesc n ay i o h n ft f n ne d d e eiir h r , eg sn o a n oc h e o d r ) o iainnowi sa dn sc i ar n : . tesc ndr o l o (FI h sacam a ant bl to t t tn ig u h mp ime t . .h e o ay bi r I C) a li g is g h g te o ie ( h bl e WVWA)wih rs c t s c p roma c t te e tn t ts c i ar n g t epet o u h efr n e o h xe t ha u h mp ime t wo dh v dsh r e tesc n ayo io (FI wi rs e tota pef r n e ul a e ic ag d h e o d r bl r I C) t ep c t h t roma c . g h ( c e No 5la 1 ) Do k t . t 2. $28 5 44 unde t Pa ntBo Cl i ,Dee mi ng whe he t Aut iy m ae i ly 6,71. r he yme nd am tr ni t r he hort t ral c s r n t i hi Fl s i s n he nt a t t na a t r d t co r c 2i unne es a y i esabls ng l C ' rght i t Co r c Re ai ge, w hi h le e he nt a t s c a e s part fom isc r c rght a whih ve td t dae i is d t Bo t Ca ne l r e ae r t onta mal i s nd c se he t t s ue he nd o r l. SeeXL Specaly, Va. t369(t t l Subog i i s r tont aiesbyopeai i t 269 a d abe r aton s ubogai hat rs Equi rton oflw .l i notba ed o c r c orprviy ofpa tes b i pu ey e t bl i naur , a ts s n onta t it ri , ut s r l quia e n t e d p n e to tefcsa dcrl tn e o e c p riua c s .)( u tto mak a d e e d n n h a t n icl a c s f a h a t lr a e' q oain r s n ms c ' ctto so te ) seas Me hs& L. R. Do 1 U. 28 3 - 2( 8 7 (Ã§ erg t iain mi d ; e lo mp i t R. v. w, 20 S. 7, 010 1 8 ) s ih Th ofs oga i i notf mdedon c r c . I i a c e t e ofe t i e or e s e y f t ubr ton s ot onta t t s r aur quiy; s nf c d oll or he pupo eo a c mpls igtee d o s b tnilusie a i i d pe d n o a yc nr cu l r s f c o ihn h n s f u sa ta j tc ; nd s n e n e t f n o ta ta r ltonsbewee t pa tes' Thec ur c l est tI C wase ildt t $85, 33 eai t n he ri . l. o t oncud ha FI ntte o he 823. Con r c Re nag a s asCn n l de a t d,a t wilgr ntI C' moto f s ta t ui e s oon r e l f ule nd hus l a FI S in or umm a y r j d me to ta cam. u g n n h t li l. l Paym entBond C l m ai Tt i now t t i s ofm a e i la t r to I C a s s e r i b s m e f t l ng m o he s ue t ra le a i n, FI l o e ks e m ur e nt or he $286, .4 pa nti m a t Fe gus n, g ngt tt Aut rt sf iu et pr ry r t i 5714 yme t de o r o ar ui ha he ho iy' al r o ope l e a n c r tpa e sdic r ed I C' o i tonsasa sle y.I C a s t t ti i e ild t ontac ym nt s ha g FI S blga i tr t FI s ers ha t s ntte o r i btr e e bec us ,ha i known t tt co r c r t i ge w a no be ng w ihhel by t e m z s m nt a e d t ha he nt a t e a na s t i t d he A ut iy,I C w oul have r f e t pa Fe gus sbo cl m . hort FI d e us d o y r on' nd ai The e i pr e ntunde Vigi al w and es whe ef t pr ii t ta oblgee' r s ec de r r ni a le r or he oposton ha n i s a tonsi vi ai n ofa c r c bewe n a owne a aco r c o wil i c rai c i n olto onta t t e n r nd nta t r l,n e t n crumsnnc , s r aszeyfom iso i tonst pa t c r corsde .Ã§gl t ic f es dichage trt r t blgai o y he onta t ' bt Ã§lf he ow nerand cont act engage i pr i t cons iut a m at i change i t cons ructon r or n actces hat tt e er al n he t i cont actpr sons and t contac ors r ovi i , he r t ubsequenty def t on t cont act,t s et i l auls he r he ur y s 2Thi is i dic s d i s s ue s s us e nga a I.B.i t l i. e il t adic r ofisoblgai t payt c r c orsdeb . XL Spe i lv,269Va. t ntted o s ha ge t i tons o he onta t ' t' ' c at a 3 0(iigSo t wo dBui e s l c v. e re sI s Co.2 5Va 1 4, 6871( 98 )) e as 7 ctn uh o l r ,n . P els n . , 3 . 6 1 - 1 8 ) s e lo d Lu eme sM uu lCa u lyCo v. S.6 4F. d 1 5 1 4( e . r 2 1 (g e mb r n ta s at . U. , 5 3 30 , 31 F d Ci. 01 ) Ã§on ) Ã§ g o n f rd sh r e. .sta t eo lg eh sprj dc dtes rt b i o ryma ige ry r u d o ic a g . i h t h bie a eu ie h uey y mprpel kn a l c r c pa e s o ov pa e st t prnc paloblg i a m n ri ons s e wih ont a t ym nt r er ym nt o he i i i or n nne nc it nt t s e ii p y n she ue , o dto s o rtia ep o so i t eb n e c nr c. p cfc a me t c d ls c n iin , r ean g r viins n h o d d o ta t). ' W hehe t oblge sa tonsc tt eama e i ale a i i ba e a l a ti pa ton t g t r he i e' c i onsiut t ral t r ton s s d t e s n r he ood f i o tep ry.S eP a k& W htet I c, 5 Va a 1 (d qe tesley i r q rdt at f h at e ln h ist n .1 9 . t 7 EW h n h t t s e uie o l r m a r i bur e nt f a l soc sone by t de a toft prncpa ,i hasarg t ke em s me s or os ca i d he f ul he i i l t iht o r quiet owne st s how a i wha m n rt ha pe f me t i pa toft e r he r o how nd n t nne hey ve ror d her r he c r c .... oblge i t bond i no onl r quiedt e r ie go f ih wiht sley onta t The i e n he s t y e r o xe c s od at t he tr t a t tmet oblgai nsa ea s e butt sgood f ih m us beke i olt i a l t he i he i to r s um d, hi at t pt nvi a e n 1 s e ntta a tonsa f c i t i rg sa oblgai nsc eae by t c r ta t ubs que r ns c i fe tng her i ht nd i to r t d he ontac nd he bond.) ' ' Ca e i whc as rt ' o iai n h v be nds h r e g n r lyiv leaprj c ss n ih u ey s bl to s a e e ic ag d e e al n ov o e t g owne pr payi orove pa ng o a c ta tt s h a e e t ti m ae ily at r d t r e ng r yi n on r c o uc n xtnt ha t tra l le e he szey' rg t a de p cai n b rd cn t ec nr co ' ic n iet c mpeeisp o e ti a l t s ih s n x e tto s y e u ig h o ta trs n e tv o o lt t rj c n r tm ey a s tsacor m n r Se Contnen a I Co. Ciy ofVa.Be c 908F.Supp. i l nd ai f t y nne . e i t l ns. v. t a h, 341 ( D. . 9 5 (id n t a p e y n o o e hafteo ii l o ta ta t c n tttda E. Va 1 9 ) fn i g h t rpa me t f v r l h rgna c nr c momt o si e u C t ilvarai ' t c r c t dic r edt s eyfo isoblgains;Sout Ã§ era iton'of he onta that sha g he urt rm t i to ) ma hwood Buides 235Va.a 1 71(i ngt to pa l r, t 70- fndi ha ve ymen of$31, 0ona o i na conrc of t 00 n rgi l ta t $79, mno e t amaei atrto t tdic r edt s ey' o i tons.Subsani 500 untd o tral leain ha sha g he ur t s blgai ) t tal pr pa e di i s a ke pi ce oft c l t a a s e y co i er w he i de i st e e e ym nt m nihes y e he ola er l ur t ns d s n t c de o nt r 10 i t abond ag ee ntwih aco r cor M a pa ntbo ,i udi t o a is i t s no r me t nta t . ny yme nds ncl ng he ne t s ue n hi ca e i or r t t unde l ng c t c i co r c i t t bond a ee e ,t r by of e i s , nc po a e he ryi ons nz ton nt a t n o he gr m nt he e f rng s c t t t s r t t tt c r c orwilnotdeful on isoblgai t s onta t s. e miy o he u ey ha he onta t l a t t i tons o ubc r cor ( c e No. - a 1) Do k t 1 3 t . I t sca e t m a e i la t r ton a l ed i t t e ym e ' oft pori oft n hi s , he t r a le a i leg s he d pa nt' he ton he pr c r c t ts dhavebe r t i d i es r On at t lco r c prc ofo r$1. m ilon, onta t ha houl en ea ne n c ow. o a nta t ie ve 8 li $85, 23. - r h1 fvepe c nt wa pr ma ur l dibt s t Ca n l. Thecour fndst s 8 33 0ug y i r e - s e t ey s l ed o r e l r t i hi s a lrs i s t nta l dipr tonaet t muc l r rn o si vol d i t e c s s m le um s ubsa ily s opori t o he h a ge m unt n ve n hos a e i whih t s ey' oblg i wer de m e t ha bee dic r d.I bot Sout n c he ur t s i atons e e d o ve n s ha ge n h hwood a nd Contne a ,t c r notd t sg fca sz o t pa m e si r ai t t o i na i ntl he ou t e he inii nt ie f he y nt n elton o he rgi l c r c i deenui ngt tt c r csha be n m ae i ly atr bypr pa e .The onta t n t ni ha he onta t d e t ral le ed e ym nt r ltve i i fc nc oft $85823, i c ea i nsgnii a e he , 33 n ompa ion t t t a c r c prc i t sc e rs o he ot l onta t ie n hi as m iia esag ns fndi a m a e i la t r ton. lt t ai t i ng t ra le a i Addii nal t r i no s to ly, he e s howi ofba f ih onbe l oft Aut rt i f ii t ng d at haf he ho iy n alng o r t i t s s TheSupr meCour ofVigi aha i i d t tba f ih die t d a t s ey e an he um . e t r ni s mple ha d at r c e t he ur t i no ne s a y t a s w i ofm a e i la t r ton. Se Sou hwood Buide s 235 Va. t 1 s t ce s r o ho ng t r a le a i e t l r, a 70 (A spaaes o ngo p eu iet t es rt i ume e s r b c u eamaeil e ito i Ã§ e rt h wi f rj dc o h u ey s r c say e a s t tra d v ain,n isl, sa ls ss fiin p eu ie' .Ho v r i e au tn maeil leaincams i i tef e tb ihe u fce t rj dc .) we e ,n v laig tra atrto li ,t s ' c ea t ts m e c t ha c i r d w he he t oblge a t ly t ok i o ac ountwha ef e t l r ha o our s ve ons de e t r he i e c ua l o nt c t fc pr pa ntwo d ha ont rght oft s ey.l Con i nt l t Cour not d t tt e yme ul ve he i s he ur t n tne a ,he t e ha he oblge wasunc i e once ne a tpa ng t co r c orea l orf de ec i w or be us d he r d bou yi he nt a t ry or f tve k ca e k t s t wo l awa sb a alb et c mpeet ej ba do p yf rt rp is' 9 8F. p . t mey ud l y e v ia l o o lt h o n /r a o he e ar. 0 Su p a ' 348. The Cour f t ound t oblge sc pl e l c ofc e n f w he herpr pa e t t he i e' om et a k onc r or t e ym nt o he c nr co wo l d so r g i fo c mpeigtej b as t b ssf rds h r i gt esley' o ta tr ud ic u a e t r m o ltn h o omd a i o ic ag n h t t s r oblgai .l ;seas Plnk& W his t,15 Va a 1 (e rngoblgee t e r s I i tons d. e lo n tet 9 . t 7 rquii i s o xecie t good fih'wihr pec t t szey' rght t at ' t es t o he lrt s i s koughou t pe i c rdbyt bo . t he rod ovee he nd) I C m a no a lga i he e, doe i a FI kes le ton r nor s t ppea fo t f cst ti c ul t tt r r m he a t ha t o d, ha he Aut rt aced i ba f ih i f ii t e lr t tt e c ow a oun ha be n esa ihe ho iy t n d a t n alng o nsze ha he s r cc t d e tbls d. W hi hpa t i uli e yt bl f t tm itkei t is oft t r pary c c ry s tmatl o ame or ha sa s he s ue he hid- t ompl i ,bu i ant t t a ar t tunde no cic s a esw a t Aut rt a hi m o e t n ne i e i is ppe s ha r r um t nc s he ho iy nyt ng r ha glg nt n t a tonsc e ni t es r w a ot . Thus t que ton oft Aut rt sg f t i ci onc r ng he c o cc mt , he si he ho iy' ood aih n ha i t unde l ng c r c alowe g a i tfndi ama e i lat r ton. ndlng he ryi onta t s i hs ga ns i ng t ra le a i La ty,I C i ac sl FI s ompe ae s ey, nd s d bee t t s f rs ers whe i ns td ur t a houl xpeced o ufe om iks n t a e t apa ntbond c r ct Se C. Luc & Sonsv. t i ht 1 Va. 0, 95 gr es o yme onta . e S. k Boawrc , 57 49 494- ( 9 2 (tt eisf rhr aen t r sof h c u tobes ile fo h e lsn s o f ly 1 3 ) C l te o ie r o wad t e o r t h ed d r m e de s e s r o l. sr The mus a deby t rc r c sa pa e r hi whi hby f i i e y t bi hei onta t nd y ve yt ng c ar nt ndmen c n bec r d ta ha ge a ans t e '.I C c n a tdteAuh rt b f r ma i isp y n t F r us na g i t h m.) FI o tce h t o i e oe kng t a me t o e g o nd ' y ds o ee t thermann b ln eo t c nr c ttld$1 96 931(h $8 ,2 3 ta ic v r d ha t e iig aa c n he o ta t o ae 1 ,8 . te 58 3.3 h t s dhavebe nrti dpl t $ 8 98t twa e nmalypadt I C) Thus a t houl e eane us he 33,65. ha s ve l i o FI . , t he tm e i pai Fer us I C c d notha e c e t ta hi m or t n t s a ot tw oul i t d g on, FI oul ve xpe t d ha nyt ng e ha hi m m d be a ia e s di lt rs k t c risl s so t pa ntbo Thea r oft val bl houl t ae ee o ove t os e n he yme nd. wa d he $85, 23. on t Co r c Rea na c am plc I C i e c l t poston i e c e t be 8 33 he nta t ti ge l i a es FI n xa ty he ii t xpe t d o i be o e m a ng t pa e t Fe g on. n fr ki he ym nt o r us Aft consderng t s al si oft pr er i i he m l ze he epaym entnm ount asw el as t i entonsand , l he nt i e xpec a i oft pa test o houtt dipu e t co tfndst tt Aut iy' f iur t t tons he r i hr ug he s t , he ur i ha he hort s a l e o 12 r t i apori oft Conta tprc di nota e an ton he r c ie d moun t a ma ei latr to ofI C' c r t to tra le ai n FI S ontac wih Ca nel.Thus I C' cli f rt $286, . wilbede ed. t r l , FI S am o he 57144 l ni ii i. Pr j eudgme I er s nt nt e t I C as se sp eu g n itr s u d rVA. EANN. 8013 2o a ycam f r FI lo e k rj d me t nee t n e COD j . - 8 n n li o wh c i i s c e su.Un e Vigni lw, d cso t a r p eu me titr s i wi nte ih t s u c sf l d r r i a a a e iin o wad rj dg n n ee t s t h hi s md dicrton oft c t Hn ot s ei he our. nnon Ar tong& Co. Sumio o Tr s & Ba nc Co. 973 msr v. tm ut nki , F.d 3 9 3 9( t Ci.1 9 )(i n M ak v S n o 2 Va 35 ( 9 6 Dititc u t 2 5 , 6 4h r 9 2 ct g r s . a z , 31 . 0 1 8 $. src o rs i s o l t ihtee ute i ap riu a c s t d tr newh t e a a r of rj d me t h u d t g h q iis n a t lr a e o ee mi eh r n wad p eu g n we c i ees i a o it ' M oor Br .Co. Br & Ro l .207F.d71 727( hCi. ntr t s pprprae. ' e os v. own ok nc, 3 7, 4t r 2 0 ) Th c u ti d i ti c s t a a a r of rj g n itr s i n twarn e Th 0 0 . e o r fn s n h s a e h t n wad p eud me t n ee t s o ra td. e bassf t c tsde son i t tt diput be wee t pa tesi ve age nel al i or he our' cii s ha he s e t n he ri nvol d nui eg quesi t tt pari swe e e tte t ltgae, nd t net rpa t a a st ha a t d i ton ha he te r n ild o ii t a hat ihe ry ppe r o ve c e n b dfi S eHe tv. te, 3 F. u p. 9 8 0( . Va 1 7 ; n ie tl n . . a at e wit Hu tr 4 2 S p 7 5 0 W D. . 97 ) Co tn n a l s Co, h. 90 F. u p. t 4 Thec u tt eeo e wi d n l C' r q e tfra a r o p eud me t 8 S p a 3 9. o r,h rf r, l e y Fl s e u s o n wad f rj g n l i e es. ntr t 11 1. Conc us on l i Fort f e ng r as ,t c t l gr nti pa ta de i pa tI C' moton f he or goi e ons he our wil a n r nd ny n r FI S i or s mmayj d me t a wela g a ti p r a dd n i p r t eAuh rt ' moinf rs mma. u r u g n , s l s rn n at n e y n a th to iy s to o u l y j g n .Thec u t lod ne I C' rq e t o p eud me tn ee t ud me t o r as e is FI S e u s f r rj g n itrs. The Clr i die td t s nd c rii d c esoft sor rt alcouns ofr c d. e k s r ce o e e tfe opi hi de o 1 el e or ENTER:Ths ,9Ã l d yo Spe e i 7 - a f etmbr , , 2012. .- t. . I ,zw Chi U nied St esD i rctJudge ef t at sti 13

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.