Present: All the Justices 

T.L. GARDEN & ASSOCIATES, T/A 

LIFE SAFETY SYSTEMS 

v. Record No. 001849 OPINION BY JUSTICE ELIZABETH B. LACY 

 June 8, 2001 

FIRST SAVINGS BANK OF VIRGINIA 

FROM THE CIRCUIT COURT OF PRINCE WILLIAM COUNTY 

Richard J. Jamborsky, Judge Designate 

 In this appeal arising from a bank's agreement to reserve 

funds for payment of a subcontractor's equipment costs, we 

must determine whether the trial court properly set aside a 

verdict in favor of the subcontractor. 

 Although the trial court set aside the jury verdict, we 

recite the facts and all reasonable inferences in the light 

most favorable to T.L. Garden & Associates, Inc. (T.L. 

Garden), the recipient of the jury verdict. Kim v. Douval 

Corp., 259 Va. 752, 756, 529 S.E.2d 92, 95 (2000). On April 

9, 1998, T.L. Garden entered into a contract with BIP 

Electrical, Inc. (BIP) to install a fire alarm system. The 

total cost of the subcontract was $314,000. The fire alarm 

system was part of a $1.4 million contract between BIP and the 

federal government for the construction of the Naval Annex to 

the Pentagon. 

Shortly after executing the contract, T.L. Garden learned 

that BIP had a negative credit history and informed BIP that 

it required additional safeguards to assure payment. T.L. 
Garden also had the equipment for the project delivered to its 

warehouse, rather than the construction site, to assure 

payment before delivery. On April 23, 1998, T.L. Garden sent 

Invoice Number 25701 to BIP for $289,000, the entire cost of 

the equipment. 

First Savings Bank of Virginia (FSB) conducted the 

project accounting for BIP's contract, which included 

processing payments of T.L. Garden's invoices. Unknown to 

T.L. Garden, BIP had previously assigned to FSB payments due 

from the federal government on the Naval Annex project as 

security for amounts BIP owed FSB on two promissory notes, a 

line of credit, and a variable interest commercial note. At 

BIP's suggestion, Thomas Garden, president of T.L. Garden, 

called Jeffery Constantz, president of FSB, to explore options 

for guaranteeing payment to T.L. Garden. Constantz declined 

T.L. Garden's request that FSB execute a guaranty in the form 

of a letter of credit. Instead, Constantz agreed to reserve 

sufficient funds received under BIP's contract with the 

federal government to pay T.L. Garden's equipment costs. 

On April 29, 1998, Constantz sent a letter to T.L. 

Garden, stating in pertinent part: 

I am writing this letter on behalf of BIP, Inc[.] 

to confirm that, upon payment from the government, 

FSB will reserve an amount from contract number 

MDA9469763003 sufficient to pay your invoice for 

equipment supplied for this contract.

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The letter also contained discount provisions for early 

payments and asked that T.L. Garden acknowledge the terms set 

out in the letter. T.L. Garden signed the letter on May 5 and 

that same day sent a letter to FSB regarding its Invoice No. 

25701. That letter stated that Invoice No. 25701 had been 

"[r]evised due to Partial Shipment 5/5/98" and $197,328 was 

due June 5. On May 21, FSB received BIP's initial $431,781.82 

payment from the federal government. From this payment, FSB 

distributed $27,565.29 to BIP, approximately $5,900 to two BIP 

creditors, $66,113.95 to T.L. Garden, and retained 

approximately $332,000 in full satisfaction of BIP's 

indebtedness to FSB on its line of credit. 

 On June 4, FSB received BIP's second payment from the 

federal government. From those funds, FSB paid T.L. Garden 

the $131,214.05 balance due on the May 5 invoice. FSB paid 

the remainder of the second payment to BIP for its operating 

expenses. On June 9, T.L. Garden submitted Invoice No. 25878 

requesting payment of $110,000 by July 9, which it 

subsequently revised, increasing the amount to $116,672. 

On July 16, BIP filed a petition for Chapter 11 

Reorganization in the United States Bankruptcy Court for the 

Eastern District of Virginia. On July 25, FSB received BIP's 

third payment from the federal government in the amount of 

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$189,061.17. Because BIP had filed for bankruptcy, FSB was 

required to deposit the entire third payment in the bankruptcy 

court for the benefit of BIP's creditors. As part of the 

bankruptcy proceeding, T.L. Garden received $60,000, leaving 

an unpaid balance of approximately $30,000 for the equipment 

costs. 

In its motion for judgment, T.L. Garden sought recovery 

of the unpaid $30,000 balance on the theory that FSB's April 

29 letter fraudulently induced T.L. Garden to perform its 

subcontract with BIP. In support of its position, T.L. Garden 

produced evidence at trial showing that Constantz did not 

inform T.L. Garden that BIP was indebted to FSB and had 

assigned the construction contract to FSB, that Constantz told 

Thomas Garden that FSB would reserve sufficient funds to cover 

the cost of the equipment supplied by T.L. Garden, and that 

Constantz told Thomas Garden that BIP would not receive any 

money from the contract until T.L. Garden had been paid in 

full. On appeal, T.L. Garden contends that this evidence was 

sufficient to support the jury's verdict in its favor and the 

trial court erred in setting aside that verdict. 

In reaching a verdict, a jury is required to follow the 

instructions given by the court. In this case, the jury was 

instructed by the court as follows: 

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If you find that the letter dated April 29, 

1998, which is Joint Exhibit 1, required the 

Defendant to reserve from the first payment it 

received by assignment of the Government Contract, 

the full amount of Plaintiff's subcontract with BIP, 

and if you further believe by clear and convincing 

evidence that at the time the Defendant signed the 

April 29, 1998 letter it intentionally and knowingly 

made a false representation of a material fact to 

the Plaintiff with the intention to mislead 

Plaintiff into taking action based upon the 

representation, and that Plaintiff took action in 

reliance on the representation and that Plaintiff's 

reliance on the representation caused Plaintiff 

damage, then you shall return your verdict in favor 

of Plaintiff. (emphasis added)

This instruction was an agreed instruction and became the law 

of the case. Owens-Illinois, Inc. v. Thomas Baker Real Estate, 

Ltd., 237 Va. 649, 652, 379 S.E.2d 344, 346 (1989). In order 

for T.L. Garden to prevail under this instruction, the jury had 

to find that the April 29 letter required FSB to pay T.L. 

Garden the full amount of its subcontract with BIP "from the 

first payment" FSB received from the federal government. 

 However, the April 29 letter states that FSB "will reserve 

an amount from contract number MDA9469763003 sufficient to pay 

[T.L. Garden's] invoice for equipment supplied for this 

contract." (emphasis added) This language is not ambiguous. 

Nothing in the letter identifies any specific payment from the 

federal government as the source of payment to T.L. Garden. 

Because the letter cannot be construed to require that T.L. 

Garden be paid from the first payment made by the federal 

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government, as required by the jury instruction, the evidence 

was insufficient, as a matter of law, to support a jury verdict 

in favor of T.L. Garden. The trial court, therefore, correctly 

set aside that verdict. 

 Accordingly, for the reasons stated, we will affirm the 

judgment of the trial court setting aside the jury verdict and 

entering judgment in favor of FSB. 

Affirmed.

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