Present: All the Justices 

WESTMORELAND-LG&E PARTNERS 

 OPINION BY 

v. Record No. 961410 CHIEF JUSTICE HARRY L. CARRICO 

 June 6, 1997 

VIRGINIA ELECTRIC AND POWER COMPANY 

FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND 

Melvin R. Hughes, Jr., Judge 

 In an amended motion for judgment, Westmoreland-LG&E 

Partners (Westmoreland) sought to recover from Virginia Electric 

and Power Company (Virginia Power) damages resulting from 

Virginia Power's alleged breach of a "Power Purchase and 

Operating Agreement" (the Contract). Westmoreland appeals from 

the award of summary judgment in Virginia Power's favor and the 

dismissal of Westmoreland's action with prejudice. 

 Westmoreland makes three complaints on appeal. First, 

Westmoreland says the trial court erred in holding that evidence 

of trade custom and usage would not be permitted to explain the 

meaning of certain contractual terms. Second, Westmoreland 

contends the Contract is ambiguous and that the trial court erred 

in ruling that parol evidence would not be allowed to show the 

parties' intent and understanding with respect to certain of the 

Contract's payment provisions. Third, relative to an alternative 

basis for recovery, Westmoreland maintains the trial court erred 

in failing to recognize that certain contractual language might 

entitle Westmoreland to at least a partial recovery for Virginia 

Power's alleged breach of the Contract. 

 The facts are not in dispute. Westmoreland, a Virginia 

general partnership composed of Westmoreland Roanoke Valley, L.P. 
and LG&E Roanoke Valley, L.P., is an independent power producer. 

 Virginia Power is a public utility providing electrical service 

to its customers. 

 In the late 1970s, Virginia Power began purchasing 

electricity from independent power producers. In 1988, Virginia 

Power issued a request for proposals from a number of independent 

power producers, including Westmoreland, for the supply of 

electricity to Virginia Power. A model contract prepared by 

Virginia Power accompanied the request for proposals. 

 Westmoreland responded with a proposal, which Virginia Power 

accepted, and the two parties entered into the Contract on 

January 24, 1989.1 On or about the same date, Virginia Power 

entered into agreements with approximately twenty other 

independent power producers as a result of its request for 

proposals. 

 In order to fulfill its obligations under the Contract, 

Westmoreland constructed a $300 million power plant, known as 

"ROVA I" (the Facility), near Roanoke Rapids, North Carolina.2

 

The plant commenced commercial operations in May 1994 with the 

capacity to produce approximately 150 megawatts of electricity. 

Westmoreland is obligated under the Contract to supply this 

capacity to Virginia Power upon demand for a term of twenty-five 

 

 1The Contract was "amended and restated" in 1990 and 1991, 

but the provisions in issue here have remained unchanged since 

the 1989 version of the Contract was executed by the parties. 

 2Virginia Power operates in North Carolina under the name 

North Carolina Power. However, for convenience and clarity, we 

will continue throughout this opinion to refer to Virginia Power 

only. 
years. 

 In the Contract, Westmoreland agrees to sell and Virginia 

Power agrees to purchase "the Net Electrical Output of the 

Facility." Also, Westmoreland agrees to sell and Virginia Power 

agrees to purchase "Dependable Capacity from the Facility." "Net 

Electrical Output" is defined in the Contract as "[a]ll of the 

Facility's generating output made available for sale." 

"Dependable Capacity" is defined as "[t]he amount of capacity set 

by [Westmoreland based upon prescribed tests] and delivered from 

the Facility" to Virginia Power. 

 Under the Contract, Westmoreland must "control and operate 

the Facility consistent with [Virginia] Power's Dispatch of the 

Facility." "Dispatch" is defined in the Contract as "[t]he right 

of [Virginia] Power . . . to schedule and control . . . the 

generating level of the Facility in order to commence, increase, 

decrease, or cease the delivery of Net Electrical Output" to 

Virginia Power. When Virginia Power dispatches the Facility by 

providing notice to Westmoreland of the estimated needs for the 

following week, Westmoreland must comply with the notice. 

 Virginia Power is obligated by the Contract to make two 

types of payments to Westmoreland, one for net electrical output, 

termed "Energy Payments," and the other for dependable capacity, 

termed "Capacity Payments," based upon the different types of 

costs incurred by Westmoreland. Energy Payments are designed to 

compensate Westmoreland for the actual amount of electricity it 

generates and delivers to Virginia Power and to reimburse 

Westmoreland for its variable costs incurred to produce the 
electricity. 

 Energy Payments are not in dispute here, but Capacity 

Payments are. Capacity Payments are designed to compensate 

Westmoreland for the costs it incurred in constructing the 

Facility and for the fixed costs it incurs in operating and 

maintaining the Facility. 

 Under § 10.15(a) of the Contract, Virginia Power is required 

to make Capacity Payments in a fixed amount for a 25-year term, 

"so long as the plant is available as required by the Contract." 

 Although paid monthly, the Capacity Payment is calculated at the 

rate of approximately $200,000 per day. 

 The present controversy arose when Virginia Power withheld 

Capacity Payments for each day it deemed to be a "Forced Outage 

Day" within the meaning of the Contract. In its amended motion 

for judgment, Westmoreland sought recovery for the total amount 

withheld by Virginia Power. 

 Section 1.18 of the Contract defines a "Forced Outage" as 

"[a]n interruption . . . of the Facility's delivery of the Net 

Electrical Output [that] is not . . . the result of a Scheduled 

Outage."3

 Section 1.20 defines a "Forced Outage Day" as 

 [e]ach continuous twenty-four (24) hour period 

beginning with the start of a Forced Outage (regardless 

of the number of actual outages that may occur during 

such twenty-four (24) hour period(s)) 

 (a) designated by [Westmoreland] as a Forced 

Outage Day, 

 

 (b) a Forced Outage Day which is determined 

 

 3The Contract allows 30 days annually for scheduled outages. 

 Westmoreland says it is undisputed that Capacity Payments are 

"never reduced on account of Scheduled Outages." 
 pursuant to Section 10.15(d). 

 Section 10.15(d) forms the entire basis of Virginia Power's 

defense in this case. It is a unique section, found only in the 

contract involved here and not in the agreements Virginia Power 

executed with other independent power producers at or about the 

same time.4 Section 10.15(d) provides as follows: 

 For each instance where [Westmoreland] fails, after the 

second oral notification (such notification shall not 

be less than fifteen (15) minutes from the first 

notification) from [Virginia] Power, to maintain the 

operating level specified by [Virginia] Power pursuant 

to Section 7.6, to within + five (5%) percent of the 

Dispatched level then for each percent or portion of a 

percent deviation from the above allowed + five (5%) 

percent, then at [Virginia] Power's option, the payment 

for that Day's Dependable Capacity shall be reduced two 

(2%) percent. If such deviation reduces that Day's 

payment for Dependable Capacity to zero (0) then that 

Day shall be a Forced Outage Day. Example: If the 

Facility is Dispatched at 100MW but is only able to 

deliver 87MW then the payment for Dependable Capacity 

for that Day would be reduced by 16%. 

 Because, under § 10.15(d), the 2% reduced payment scale 

applies to each percent of deviation from the dispatched level, 

or portion thereof, the reduction in the capacity payment reaches 

100% and a Forced Outage Day occurs on any day when power 

generation falls below 46% of the dispatched level, giving credit 

for the + 5% allowance. This is the result derived from the 

 

 4The parties tell us on brief that the Model Agreement 

accompanying Virginia Power's request for proposals contained a 

provision that a Forced Outage Day would occur when the net 

electrical output deviated from the dispatched level by more than 

+ 5%. However, because Westmoreland planned to use a low grade 

fuel to generate electricity, with likely reductions in power 

output below 95% of the dispatched level, the parties agreed to 

the inclusion of § 10.15(d) in the Contract, which increased from 

5% to 55% the permitted deviation from the dispatched level 

before a Forced Outage Day occurred. 
formula, 100 - 5 = 95 - 45 = 50 x 2 = 100. 

 Sections 10.15(g) and 10.18 also relate to Forced Outage 

Days. Section 10.15(g) provides in pertinent part as follows: 

 [Westmoreland] shall be allowed thirty (30) Forced 

Outage Days per full Capacity Test Period (May 1 

through April 30). . . . Payments for Dependable 

Capacity will be reduced five hundred thousand 

($500,000) dollars as liquidated damages for each 

Forced Outage Day that occurred or was designated by 

[Westmoreland] during that period in excess of the 

above allowances. 

 And § 10.18 provides in pertinent part as follows: 

 The parties agree that [Virginia] Power will be 

substantially damaged in amounts that will be difficult 

or impossible to determine if the Facility: 

 . . . . 

 (d) Exceeds the allowed number of Forced Outage 

Days in Section 10.15(g). 

 Therefore, to the limited extent set forth in the 

Agreement, the Parties have agreed on sums which the 

Parties agree are reasonable as liquidated damages for 

such occurrences. It is further understood and agreed 

that the payment of the liquidated damages is in lieu 

of actual damages for such occurrences. 

 The relationship between § 10.15(d) and the terms "Forced 

Outage Days" and "Force Majeure Days" is also relevant to this 

dispute. Under § 14.1, a delay in performance occurring on a 

given day is excused if Westmoreland designates such day a "Force 

Majeure Day." A Force Majeure Day may be designated when a delay 

in performance is "due solely to circumstances beyond the 

reasonable control of the Party experiencing such delay, [for 

example,] acts of God; . . . war; riots; . . . or accidents." 

 A Force Majeure Day does not count against the thirty Forced 

Outage Days allowed before the $500,000 per day liquidated damage 
provision of § 10.15(g) may be invoked. However, under 

§ 10.15(b) of the Contract, if a forced outage is designated as 

an event of Force Majeure, "then [Virginia] Power's obligation to 

pay the payments for Dependable Capacity specified in Section 

10.15(a) above shall cease, prorated daily, until the condition 

of Force Majeure has been overcome." 

 In awarding summary judgment in Virginia Power's favor, the 

trial court found that the Contract was unambiguous and, 

therefore, that evidence of trade custom and usage as well as 

parol evidence concerning the parties' intent and understanding 

would be inadmissible. The court found further that Westmoreland 

had "failed to maintain power generation at greater than 45% of 

the specified level" on the days for which it sought recovery. 

Hence, the court held, § 10.15(d) of the Contract expressly 

permitted Virginia Power to withhold Capacity Payments for those 

days, including the days Westmoreland had designated as Forced 

Outage Days, and to charge Westmoreland with all such days "for 

the purpose of determining the liquidated damages provision of 

the parties' contract pursuant to § l0.15(g)." 

Admissibility of Evidence

Concerning Trade Custom and Usage

 Westmoreland argues that it should have been permitted to 

introduce evidence showing that "the terms 'Capacity Purchase 

Price' and 'Forced Outage Day' have special meaning in the trade 

custom and usage, under which the occurrence of such Days does 

not diminish the monthly payment unless the annual Forced Outage 

Day allowance is exceeded." Westmoreland submits that "[t]his 
trade custom and usage, reflected in all of the contracts 

resulting from the 1988 solicitation, 'form a part [of the 

Contract] ... unless the terms of the writing [clearly exclude] 

the usage or custom.'" (Quoting Walker v. Gateway Milling Co., 

121 Va. 217, 224, 92 S.E. 826, 828 (1917)). Westmoreland 

maintains there is no language in the Contract that clearly 

excludes consideration of custom and usage. 

 Noting that the trial court excluded the evidence of trade 

custom and usage because it found the Contract unambiguous, 

Westmoreland cites Doswell Ltd. Partnership v. Virginia Electric 

& Power Co., 251 Va. 215, 468 S.E.2d 84 (1996), for the 

proposition that such evidence is admissible to show that 

contract phrases or terms have acquired a peculiar meaning by 

trade custom or usage "even though the phrases or terms 

themselves are unambiguous." Id. at 225, 468 S.E.2d at 90. 

Hence, Westmoreland concludes, the trial court erred in excluding 

its evidence of trade custom or usage. 

 While we confirm what we said in Doswell, we disagree with 

Westmoreland. In our opinion, Westmoreland has not met the 

threshold requirement for admission of the disputed evidence. 

 In Walker, supra, we said that evidence of trade usage is 

proper "to permit the jury to consider the situation of the 

parties and the circumstances leading up to the making of the 

contract for the purpose of determining whether the usage in 

question operated upon the minds of the parties in using the 

language which was employed in the contract." 121 Va. at 226, 92 

S.E. at 829 (emphasis added). However, "knowledge of the 
existence of the custom must be brought home to the [contracting 

parties], unless the evidence shows that it is so uniform and 

notorious at the place where the parties to be affected by it 

reside, as to raise a prima facie presumption that they knew of 

it." Bowles v. Rice, 107 Va. 51, 55, 57 S.E. 575, 577 (1907). 

 Because the Contract and the other agreements resulting from 

the 1988 solicitation were made at or about the same time, what 

was done under the other contracts could not possibly have been 

brought home to, or have operated upon the minds of, the parties 

to the Westmoreland contract at the time of its execution. In 

other words, Westmoreland has failed to establish the existence, 

at the time the Contract was executed, of any trade custom or 

usage relevant to the meaning of the language that was employed 

in the Contract. The trial court did not err, therefore, in 

excluding evidence of trade custom and usage. 

Admissibility of Parol Evidence

 Westmoreland contends that § 10.15(d) of the Contract is 

ambiguous, even when viewed in isolation, because it does not 

"define the financial consequence of treating a day as a Forced 

Outage Day." And, Westmoreland says, when the Contract, 

including § 10.15(d), is read as a whole, it does not 

"unambiguously permit any reduction of the capacity purchase 

price on account of allowed Forced Outage Days." Hence, 

Westmoreland concludes, "there was no justification for the 

Circuit Court's foreclosure of parol evidence of the parties' 

intent and understanding." 

 Virginia Power contends on the other hand that § 10.15(d) is 
unambiguous. Virginia Power says that the "2-for-1 reduced 

payment scale established by § 10.15(d) applies to all shortfalls 

in Westmoreland's generating capacity after the initial five 

percent variance." Therefore, Virginia Power asserts, "[w]hen 

Westmoreland's generation is 45% or less of the Dispatched level, 

. . . Virginia Power has the right, in the words of § 10.15(d), 

to reduce 'that Day's payment for Dependable Capacity to zero 

(0).'" This shortfall occurred, Virginia Power says, "on each 

day for which [it] made no Dependable Capacity payment" and, 

hence, it was excused from making payment for each of those days. 

 But, Virginia Power insists, even when § 10.15(d) is read 

along with the other provisions of the Contract, no ambiguity 

appears. "Those other provisions," Virginia Power says, "have 

nothing to do with the situation addressed by § 10.15(d) and do 

not make that section ambiguous." Hence, Virginia Power 

concludes, the trial court did not err in excluding parol 

evidence of the parties' intent and understanding. 

 "The question whether a writing is ambiguous is one of law, 

not of fact." Tuomala v. Regent University, 252 Va. 368, 374, 

477 S.E.2d 501, 505 (1996). Thus, "we are not bound by the trial 

court's conclusions on this issue, and we are permitted the same 

opportunity as the trial court to consider the contract 

provisions." Id.

 In Doswell, supra, we reiterated the principle that 

"'[p]arol evidence of prior or contemporaneous oral negotiations 

are generally inadmissible to alter, contradict, or explain the 

terms of a written instrument provided the document is complete, 
unambiguous, and unconditional.'" 251 Va. at 222, 468 S.E.2d at 

88 (quoting Renner Plumbing, Heating & Air Conditioning, Inc. v. 

Renner, 225 Va. 508, 515, 303 S.E.2d 894, 898 (1983)). We also 

said in Doswell: 

 Contracts are not rendered ambiguous merely because the 

parties or their attorneys disagree upon the meaning of 

the language employed to express the agreement. Even 

though an agreement may have been drawn unartfully, the 

court must construe the language as written if its 

parts can be read together without conflict. 

 And, parol evidence may not be used to first 

create an ambiguity and then to remove it. Finally, an 

agreement is not rendered ambiguous merely because it 

deals with a technical subject that may be considered 

complex to the uninformed lay person who is not 

familiar with the topic. 

Id. at 222-23, 468 S.E.2d at 88-89 (citations omitted). 

 "A contract must be construed as a whole to determine the 

parties' intent with respect to specific provisions." Hooper v. 

Musolino, 234 Va. 558, 569, 364 S.E.2d 207, 212, cert. denied, 

488 U.S. 823 (1988). "No word or clause in the contract will be 

treated as meaningless if a reasonable meaning can be given to 

it, and there is a presumption that the parties have not used 

words needlessly." D.C. McClain, Inc. v. Arlington County, 249 

Va. 131, 135-36, 452 S.E.2d 659, 662 (1995). 

 "'An ambiguity exists when language admits of being 

understood in more than one way,'" Doswell, 251 Va. at 222, 468 

S.E.2d at 88 (quoting Renner, 225 Va. at 515, 303 S.E.2d at 898), 

or when "'language is of doubtful import,'" Galloway Corp. v. 

S.B. Ballard Constr. Co., 250 Va. 493, 502, 464 S.E.2d 349, 355 

(1995) (quoting Allen v. Green, 229 Va. 588, 592, 331 S.E.2d 472, 

475 (1985)). And an award of summary judgment is improper when 
"neither party has offered a construction of [contractual] 

provisions that could be deemed so clear that it unambiguously 

excludes the explanation offered by the opponent." Cascades 

North Venture Ltd. Partnership v. PRC Inc., 249 Va. 574, 582, 457 

S.E.2d 370, 374-75 (1995). 

 Guided by these principles, we reach the conclusion that the 

Contract is ambiguous. In the first place, the language of 

§ 10.15(d), even when read in isolation, admits of being 

understood in more than one way, Doswell, 251 Va. at 222, 468 

S.E.2d at 88, and, hence, is of doubtful import, Galloway, 250 

Va. at 502, 464 S.E.2d at 355. 

 The penultimate sentence of § 10.15(d) contains the crucial 

language. The sentence states that "[if the deviation from the 

dispatched level on a given day] reduces that Day's payment for 

Dependable Capacity to zero (0) then that Day shall be a Forced 

Outage Day." If emphasis is placed upon the words, "reduces that 

Day's payment for Dependable Capacity to zero," the language of 

(d) may be taken to mean that the result of such a deviation 

would be no capacity payment for that day. If, however, emphasis 

is placed upon the words, "then that Day shall be a Forced Outage 

Day," the language of (d) may just as well be taken to mean that 

the only result of such a deviation would be the counting of the 

day in question against the thirty Forced Outage Day allowance 

provided by § 10.15(g) before the $500,000 per day liquidated 

damage provision may be invoked. 

 Hence, this case presents a situation in which "neither 

party has offered a construction of these provisions that could 
be deemed so clear that it unambiguously excludes the explanation 

offered by the opponent." Cascades North Venture, 249 Va. at 

582, 457 S.E.2d at 374-75. This alone is sufficient to justify 

the admission of parol evidence concerning the parties' intent 

and understanding at the time they entered into the contract. 

 However, there is more. When § 10.15(d) is read in context 

with other provisions of the Contract, the ambiguity becomes even 

more apparent. First, a reading of § 10.15(b) demonstrates that 

when the parties wished to make clear under what circumstances 

Virginia Power would not be obligated to make Capacity Payments 

for a Forced Outage, they knew how to accomplish the task, using 

clear and precise language. Section 10.15(b) states that when 

Westmoreland "designates [a] Forced Outage as an event of Force 

Majeure, then [Virginia] Power's obligation to pay the payments 

for Dependable Capacity . . . shall cease."5

 As Westmoreland 

suggests, the absence of such an explicit provision in § 10.15(d) 

casts doubt upon the correctness of Virginia Power's assertion 

that § 10.15(d) unambiguously relieves it from the obligation to 

make Capacity Payments for all Forced Outage Days, however they 

occur. 

 Virginia Power argues that § 10.15(b) is consistent with 

§ 10.15(d) in that both "relieve[] Virginia Power of any 

obligation to pay Westmoreland for capacity Virginia Power does 

not receive." However, this assumes the correctness of Virginia 

 

 5Similarly, § 5.3 of the Contract provides that Virginia 

Power "shall not be obligated to make payments for Dependable 

Capacity" during periods allowed to cure defaults under the 

Contract. 
Power's position and begs the question to be decided, i.e., 

whether § 10.15(d) really does relieve Virginia Power of the 

obligation to make Capacity Payments for Forced Outage Days 

occurring under § 10.15(d). 

 Virginia Power also argues that § 10.15(d) applies only to 

those days on which Westmoreland's facility is dispatched to 

produce electrical power while § 10.15(b) applies even if 

Westmoreland is not so dispatched. But this argument misses the 

point, viz., if it was necessary to say explicitly in 

§ 10.15(b) that Capacity Payments cease for Force Majeure Days 

occurring under that section, was it not just as necessary to say 

explicitly in § 10.15(d) that payments cease for Forced Outage 

Days occurring under that section? In any event, we do not think 

it appears as a matter of law that the distinction drawn by 

Virginia Power would make a difference in its obligation with 

respect to Capacity Payments for Forced Outage Days, but perhaps 

parol evidence submitted by the parties on remand will reveal 

whether the distinction was intended to make a difference. 

Second, § 10.15(g) allows Westmoreland thirty Forced Outage 

Days annually before the provision for liquidated damages in the 

amount of $500,000 per day may be invoked. Section 10.18 

provides that "the payment of the liquidated damages is in lieu 

of actual damages" Virginia Power may suffer if Westmoreland 

"[e]xceeds the allowed number of Forced Outage Days in Section 

10.15(g)." As Westmoreland maintains, these provisions support 

the implication that liquidated damages may be the only penalty 

Westmoreland must suffer for Forced Outage Days, and such an 
implication is completely inconsistent with Virginia Power's 

position that § 10.15(d) permits it to withhold Capacity Payments 

for all Forced Outage Days in addition to collecting $500,000 per 

day in liquidated damages if the number of such days exceeds the 

thirty days allowed annually. 

 Virginia Power says, however, that § 10.15(g) "relates to a 

different subject matter than § 10.15(d)," that "[n]either 

section refers to the other," and that § 10.15(g) "has nothing 

whatsoever to do with Virginia Power's obligation to make 

Dependable Capacity payments." However, both sections mention 

and deal with the subjects of Forced Outage Days and payments for 

Dependable Capacity -- § 10.15(d) states that a Forced Outage Day 

occurs when the deviation on a particular day reduces that day's 

Dependable Capacity payment to zero and § 10.15(g) states that 

payments for Dependable Capacity will be reduced by $500,000 for 

each Forced Outage Day that exceeds the thirty-day allowance. 

 Moreover, § 10.15(d) is implicitly incorporated by reference 

into § 10.15(g) because, in its final sentence, the latter 

section states that "[p]ayments for Dependable Capacity will be 

reduced five hundred thousand ($500,000) dollars as liquidated 

damages for each Forced Outage Day that occurred or was 

designated by [Westmoreland] during [a capacity test] period in 

excess of the above allowances." (Emphasis added.) If a Forced 

Outage Day is not designated by Westmoreland, it can only occur

as a result of the reductions required by the sliding scale set 

forth in § 10.15(d). 

 Therefore, it is not correct to say categorically, as 
Virginia Power would have us say, that § 10.15(g) has "nothing 

whatsoever to do with Virginia Power's obligation to make 

Dependable Capacity payments." Rather, Westmoreland should have 

the opportunity to show by parol evidence on remand what the 

parties intended by the language they employed in the Contract. 

 We hold that it was error for the trial court to exclude 

parol evidence concerning the parties' intent and understanding 

with respect to Forced Outage Days and Capacity Payments at the 

time they executed the Contract. 

Alternative Basis of Recovery

 Westmoreland's amended motion for judgment contained an 

alternative claim of breach of contract for Virginia Power's 

withholding of Capacity Payments for days that Westmoreland 

designated as Forced Outage Days pursuant to § 1.20(a) of the 

Contract. The trial court's award of summary judgment in favor 

of Virginia Power encompassed this alternative claim. 

 Under § 1.20, a Forced Outage Day occurs when "(a) 

designated by [Westmoreland] as a Forced Outage Day," or "(b) 

determined pursuant to Section 10.15(d)." Westmoreland argues 

that "[e]ven if § 10.15(d) could be read as depriving [it] of 

[capacity] payments attributable to days that are classified as 

Forced Outage Days by [the section's] own operation, its impact 

[should] be limited to such days." Hence, Westmoreland 

concludes, it was "entitled, at a minimum, to a judgment for the 

amount attributable to the days covered by § 1.20(a)." Virginia 

Power says the trial court did not err in denying Westmoreland a 

partial recovery for designated days. 
 The trial court stated no reason for the inclusion of 

Westmoreland's alternative basis for relief in its award of 

summary judgment. As Westmoreland suggests in a footnote to its 

brief, the trial court's disposition of this phase of the case 

may have been inextricably entwined in the court's conclusion 

that § 10.15(d) unambiguously "permits Virginia Power not to make 

dependable capacity payments on days for which [Westmoreland] 

seeks payment," which necessarily included Forced Outage Days 

designated by Westmoreland pursuant to § 1.20(a). Since we hold 

supra that the Contract is ambiguous, we think the trial court on 

remand, if Westmoreland is unsuccessful on its principal claim 

for breach of contract, should have the opportunity to consider 

further the question whether Virginia Power is entitled to 

withhold Capacity Payments for Forced Outage Days designated by 

Westmoreland pursuant to § 1.20(a). 

Conclusion

 We will affirm the trial court's action in excluding 

evidence of trade custom and usage. For the error in excluding 

evidence concerning the parties' intent and understanding with 

respect to Forced Outage Days and Capacity Payments, we will 

reverse the judgment of the trial court and remand the case for 

further proceedings consistent with the views expressed in this 

opinion. 

Affirmed in part,

 reversed in part,

and remanded.