Case Title: O'Connell v. Bean

Citation: 

Docket Number: 002900

State: virginia

Court: Virginia Supreme Court

Date: 2002-01-11T00:00:00Z

Document:
Present:  Carrico, C.J., Lacy, Hassell, Keenan, Kinser, and 
Lemons, JJ., and Whiting, S.J. 
 
MARJORIE A. O'CONNELL 
         OPINION BY 
SENIOR JUSTICE HENRY H. WHITING 
v.  Record No. 002900 
     January 11, 2002 
 
DEBORAH L. BEAN 
 
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY 
Henry E. Hudson, Judge 
 
 
This appeal raises jurisdictional and punitive damage 
issues. 
 
Marjorie A. O'Connell, an attorney, represented Deborah L. 
Bean in a divorce suit filed in Virginia.  Bean discharged 
O'Connell as her attorney, obtained other counsel, and later 
filed this action against O'Connell. 
 
Bean's four-count motion for judgment alleged professional 
negligence, actual fraud, constructive fraud, and breach of 
fiduciary duty.  Process was served on the Secretary of the 
Commonwealth (the Secretary) as statutory agent of O'Connell, a 
non-resident of Virginia, under the provisions of Code § 8.01-
329 (the service provision of the Long-Arm Statute, Code § 8.01-
328.1). 
 
When O'Connell failed to file responsive pleadings within 
the required time, Bean obtained a default judgment against her 
on the issues of liability.  In a later jury trial limited to 
the damage issues at which O'Connell did not appear, Bean 
obtained an award of $400,000 in compensatory damages and 
$350,000 in punitive damages upon which a final judgment was 
entered. 
 
According to O'Connell, she discovered that the action had 
been filed and that the judgments had been entered when a 
newspaper reporter called her for comment.  In a special 
appearance four days after the entry of the final order, 
O'Connell filed a motion to vacate that order, to set aside the 
default judgment, and to quash service of process.  Seven days 
later, the court entered an order suspending the final judgment 
pending further proceedings. 
 
Although the court later denied O'Connell's motion to 
vacate the default judgment as to liability, it set aside the 
judgment as to damages and fixed that issue for a jury trial in 
which both parties participated.  The court entered final 
judgment on the jury's award of $71,535.68 in compensatory 
damages and $110,000 in punitive damages and we awarded 
O'Connell this appeal. 
I 
 
O'Connell contends that the circuit court lacked in 
personam jurisdiction to enter the default orders against her 
because of material defects in obtaining service of process upon 
the Secretary, including a failure to file an affidavit setting 
forth O’Connell’s last known address.  O'Connell also notes that 
Bean could have had her personally served with process in the 
 
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District of Columbia under the provisions of Code § 8.01-320 but 
chose to use a method of constructive service of process under 
the long-arm statute. 
 
Bean responds that her attorney's clerical error in failing 
to check a box in the Secretary's preprinted affidavit form, 
which would have incorporated into the affidavit O'Connell's 
last known address as shown in the caption of the form, did not 
rise to the level of a material deviation from the requirements 
of Code § 8.01-329.  Bean further argues that the address shown 
in the caption of the document was a sufficient statement under 
oath of O'Connell's last known address.  We disagree with Bean. 
 
We have held that "[w]here a defendant has received 
personal service of process, irregularity will not defeat the 
court's jurisdiction, but if a statute provides for constructive 
service, the terms of the statute authorizing it must be 
strictly followed or the service will be invalid and any default 
judgment based upon it will be void."  Khatchi v. Landmark Rest. 
Assoc., 237 Va. 139, 142, 375 S.E.2d 743, 745 (1989) (citations 
omitted).  The express language of Code § 8.01-329 clearly 
requires that the affidavit, essential for valid constructive 
service upon the Secretary, "shall set forth the last known 
address of the person to be served."  Code § 8.01-329(B).  The 
affidavit in this case merely states that O'Connell is a 
nonresident but does not set forth her last known address.  The 
 
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recitation of O'Connell's purported address shown in the caption 
of the document is not a sufficient statement under oath of 
O'Connell's last known address. 
 
Additionally, O'Connell testified that she never received 
notice of Bean's action.  Bean's evidence indicated, and the 
trial court found, that the Secretary's notice to O'Connell of 
the action was sent by registered mail, return receipt 
requested, and would normally have been delivered to O'Connell's 
office.  However, the records in the Secretary's office could 
not establish that notice of the action was delivered to 
O'Connell or her office because those records did not contain 
the post office's certified mail form which would have confirmed 
that delivery.  Further, the trial court did not find that 
O'Connell or her office actually received the suit papers. 
 
Because the omission of O'Connell's last known address in 
the affidavit of Bean's attorney was a material failure to 
comply with the terms of Code § 8.01-329, the court lacked in 
personam jurisdiction over O'Connell at the time it entered the 
default orders and judgments.  Hence, those orders and judgments 
are void, Khatchi, 237 Va. at 142, 375 S.E.2d at 745, and the 
court should have set them aside under the following pertinent 
provisions of Code § 8.01-428(A): 
Upon motion of the plaintiff or judgment debtor and after 
reasonable notice to the opposite party, his attorney of 
record or other agent, the court may set aside a judgment 
 
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by default or a decree pro confesso upon the following 
grounds: . . . (ii) a void judgment. 
 
Therefore, we will reverse and set aside the default judgments. 
II 
 
Because O'Connell raises an issue of Bean's entitlement to 
punitive damages that may arise upon the retrial, we will 
consider it here.  O'Connell argues that Bean cannot recover 
punitive damages either for a breach of O'Connell's fiduciary 
duty to Bean or for constructive fraud in misstating her ability 
to competently represent Bean in the divorce suit.*  According to 
O'Connell, those alleged breaches arose from the contract and 
were not independent, willful torts beyond the alleged breaches 
of the implied duties arising under the contract.  O'Connell 
relies primarily on Kamlar Corp. v. Haley, 224 Va. 699, 707, 299 
S.E.2d 514, 518 (1983), in which we held that punitive damages 
could not be recovered for breach of a contract in the absence 
of a willful independent tort. 
                     
*Since the jury awarded no compensatory damages for actual fraud 
in the second trial on the issue of damages, there could be no 
award of punitive damages based on the claim of actual fraud.  
Valley Acceptance Corp. v. Glasby, 230 Va. 422, 432, 337 S.E.2d 
291, 297 (1985).  See also Zedd v. Jenkins, 194 Va. 704, 706-
707, 74 S.E.2d 791, 793 (1953).  Neither party contests the 
jury's finding and under the law of the case doctrine, both are 
bound thereby.  Lockheed Info. Mgmt. Sys. Co., Inc. v. Maximus. 
Inc., 259 Va. 92, 108, 524 S.E.2d 420, 429 (2000); Searles v. 
Gordon, 156 Va. 289, 294-98, 157 S.E. 759, 761-62 (1931).  
Accordingly, the issue of actual fraud will not be relitigated 
in any subsequent trial.  Id. 
 
 
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Bean responds that "[s]he never [pled] that O'Connell also 
breached her contractual obligation to Bean," and that these 
counts of her action were claims of negligence and breach of 
fiduciary duty, neither of which is a contractual claim.  We 
disagree with Bean. 
 
But for the contract, O'Connell would have had no duties to 
Bean.  Whatever duties O'Connell owed Bean arose from their 
attorney-client relationship, which was created by their 
contract.  Lyle, Siegel, Croshaw & Beale v. Tidewater Capital 
Corp., 249 Va. 426, 432, 457 S.E.2d 28, 32 (1995).  Implicit in 
a professional's contract of employment is the professional's 
duty to "'exercise the care of those ordinarily skilled in the 
business,'" Nelson v. Commonwealth, 235 Va 228, 235, 368 S.E.2d 
239, 243 (1988) (quoting Surf Realty Corp. v. Standing, 195 Va. 
431, 442-43, 78 S.E.2d 901, 907 (1953)) (architects), and to 
"exercise a reasonable degree of care, skill, and dispatch in 
carrying out the business for which he is employed," Ortiz v. 
Barrett, 222 Va. 118, 126, 278 S.E.2d 833, 837 (1981) 
(attorneys). 
 
Even though the contractually implied duties of due care 
and fiduciary responsibility employ tort concepts, they, and 
principles relating thereto, may be applied to legal malpractice 
actions.  Lyle, Siegel, Croshaw & Beale, 249 Va. at 432, 457 
S.E.2d at 32 (contributory negligence).  Nevertheless, "an 
 
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action for the negligence of an attorney in the performance of 
professional services, while sounding in tort, is an action for 
breach of contract."  Oleyar v. Kerr, 217 Va. 88, 90, 225 S.E.2d 
398, 400 (1976) (contract statute of limitation applied to 
malpractice action arising from attorney's negligent title 
examination). 
 
Hence, we conclude that Bean's assertions of breaches of 
fiduciary duty and constructive fraud, while sounding in tort, 
are actions for breaches of the implied terms of O'Connell's 
contract.  For this reason, punitive damages may not be awarded 
for any such breaches in the absence of an independent, willful 
tort giving rise to such damages.  Kamlar Corp., 224 Va. at 707, 
299 S.E.2d at 518. 
 
For the foregoing reasons, we will reverse the judgment and 
remand the case for a new trial. 
Reversed and remanded. 
 
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