Present: All the Justices 

JERRY J. COADY 

 OPINION BY 

v. Record No. 981857 CHIEF JUSTICE HARRY L. CARRICO 

 June 11, 1999 

STRATEGIC RESOURCES, INC. 

FROM THE CIRCUIT COURT OF FAIRFAX COUNTY 

Jane Marum Roush, Judge 

 This appeal involves a “Consulting Agreement” entered into 

on April 22, 1996, between Strategic Resources, Inc. (SRI) and 

Jerry J. Coady (Coady) whereby SRI retained Coady as a 

consultant to perform services at a rate of $50.00 per hour in 

connection with “SRI’s contract with the Food and Drug 

Administration (FDA) Center for Drug Evaluation and Research.” 

The focus of the controversy is this provision of the Consulting 

Agreement: 

CONSULTANT shall indemnify SRI . . . and hold [it] 

harmless from any and all claims, suits, proceedings, 

costs, losses, expenses, damages and liabilities, 

including but not limited to attorney’s fees and court 

costs, caused by or arising out of, or in connection 

with, CONSULTANT’S performance or non-performance 

under this Agreement. 

 The record shows that Coady submitted an invoice to SRI for 

his work during the month of September 1996 in the amount of 

$7,700.71. SRI refused to pay the amount billed and sent Coady 

a check in the amount of $3,350.95 accompanied by a letter dated 

January 13, 1997, stating as follows: “This check covers all 

approved hours and expenses for all projects per our 
discussions. This will now settle your account with SRI.” 

Coady wrote on the front of the check “Accepted as Partial 

Payment Balance due $3450.00.” On the back, he endorsed the 

check “For Deposit Only” and below his signature wrote “Accepted 

as partial payment of account.” 

 Coady requested payment of the $3,450.00, but SRI refused. 

On July 22, 1997, Coady filed a warrant in debt against SRI in 

the General District Court of Fairfax County alleging that SRI 

owed him $3,450.00 plus interest, costs, and attorney’s fees for 

services performed under their contract. SRI answered the 

warrant in debt and also filed a counterclaim alleging breach of 

contract and breach of warranty on Coady’s part and requesting 

damages in the amount of $30,000.00. 

 Prior to commencement of the trial in the district court, 

SRI moved to dismiss the warrant in debt on the ground of accord 

and satisfaction. The court dismissed both the warrant and the 

counterclaim “on the basis that an accord and satisfaction had 

been reached by the parties pursuant to Section 8.3A-311 of the 

Code of Virginia.”1

 1 In pertinent part, Code § 8.3A-311 provides that “[i]f a 

person against whom a claim is asserted proves that (i) that 

person in good faith tendered an instrument to the claimant as 

full satisfaction of the claim, (ii) the amount of the claim was 

unliquidated or subject to a bona fide dispute, and (iii) the 

claimant obtained payment of the instrument . . . the claim is 

discharged if the person against whom the claim is asserted 

proves that the instrument or an accompanying written 

2
 With leave of the district court, SRI subsequently filed a 

motion for attorney’s fees based upon the indemnification 

provision of the Consulting Agreement. The court allowed SRI 

$3,228.00 in attorney’s fees, and Coady appealed this award to 

the Circuit Court of Fairfax County. In its final order, the 

circuit court awarded SRI the same amount in attorney’s fees and 

an additional $305.00 for the fee of an expert witness SRI 

presented in the circuit court. We awarded Coady this appeal. 

 In an argument that ignores the indemnification clause of 

the Consulting Agreement, Coady cites three of our earlier 

decisions applying what is now Code § 17.1-604, which allows the 

recovery of costs in this Court by the “party substantially 

prevailing.”2 Those decisions recognize the principle that when 

a case becomes moot while an appeal is pending, the controversy 

ceases to exist and there is no prevailing party. Coady asserts 

that because the claims of both the parties in this case were 

dismissed in district court on the ground of accord and 

satisfaction, the “controversy ceased to exist” and there was no 

 

communication contained a conspicuous statement to the effect 

that the instrument was tendered as full satisfaction of the 

claim.”2 The cases cited by Coady are Ficklen v. City of Danville, 

146 Va. 426, 131 S.E. 689, reh’g denied, 146 Va. 436, 132 S.E. 

705 (1926), Wallerstein v. Brander, 136 Va. 543, 118 S.E. 224 

(1923), and Branscome v. Cunduff, 123 Va. 352, 96 S.E. 770 

(1918).

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prevailing party. Hence, Coady concludes, neither party should 

be liable for the other’s attorney’s fees and costs. 

 Further, quoting United States v. One Bally Golden Gate, 

225 F.Supp. 552 (W.D. Va. 1964), Coady argues that the “`general 

principle of Anglo-Saxon jurisprudence has always been that the 

loser of a lawsuit had to pay the taxable court costs but that 

other costs incurred by the winner (legal fees, expert witness 

fees, etc.) are not such costs as can be charged to the loser.’” 

Id. at 554. Finally, Coady argues that under Code § 14.1-178 

(now Code § 17.1-601), “the party for whom final judgment is 

given in an action or motion shall recover his costs against the 

opposite party.” Here, Coady says, “neither party obtained a 

judgment against the other in the underlying cases and, 

therefore, neither should be granted costs against the other.” 

 The difficulty with these arguments is that the outcome of 

this case is controlled not by the statutes Coady cites or 

Anglo-Saxon jurisprudence but by the indemnification clause of 

the Consulting Agreement. There is nothing in the language of 

the indemnification clause that hinges the allowance of 

attorney’s fees and costs upon a determination whether SRI was 

the prevailing party or not, was a winner or not, or was given a 

final judgment or not. The allowance depends upon whether the 

attorney’s fees and costs SRI claimed were “caused by or [arose] 

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out of, or in connection with, [Coady’s] performance or nonperformance under” the Consulting Agreement. 

 But, Coady argues, “[t]he indemnification clause in this 

contract does not mean that the party agreeing to indemnify the 

other is indemnifying it from a suit to enforce the provisions 

of the contract.” The answer to this argument is found in 

Chesapeake & Potomac Telephone Co. v. Sisson & Ryan, Inc., 234 

Va. 492, 362 S.E.2d 723 (1987). There, the telephone company (C 

& P) entered into an agreement with a contractor (S & R) for the 

site work incident to the construction of several buildings. 

When one of the buildings collapsed, C & P sued S & R for its 

damages and also made a claim for its attorney’s fees. The 

trial court denied the fee claim, and C & P appealed. The 

contract between the parties contained this provision: 

To the fullest extent permitted by law, the Contractor 

shall indemnify and hold harmless the Owner and the 

Architect from and against all claims, damages, losses 

and expenses, including but not limited to attorneys’ 

fees, arising out of or resulting from the performance 

of the Work. . . . 

Id. at 501, 362 S.E.2d at 728. S & R contended that the 

indemnification provision was “one of indemnity against 

liability for property damage sustained by third parties” and 

that “indemnification does not operate between parties to a 

contract in a dispute involving those parties.” Id. at 502, 362 

S.E.2d at 728. Dismissing this argument and holding that C & P 

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was entitled to recover its attorney’s fees, we said: “We are 

committed to the view that parties may contract as they choose 

so long as what they agree to is not forbidden by law or against 

public policy. S & R contracted . . . to pay C & P’s attorneys’ 

fees in certain situations, and we think the present situation 

falls fairly within the terms of that agreement.” Id. at 503, 

362 S.E.2d at 729. 

 The remaining question, therefore, is whether SRI’s 

attorney’s fees and costs were “caused by or [arose] out of, or 

in connection with, [Coady’s] performance or non-performance 

under” the Consulting Agreement. (Emphasis added.) Coady says 

that his original warrant in debt was not a proceeding in 

connection with his performance or non-performance but rather 

one in connection with SRI’s non-performance, i.e., not paying 

Coady for the services he rendered. Coady also says that 

although SRI’s counterclaim alleged his non-performance, the 

counterclaim was dismissed and decided in his favor and, 

accordingly, “the indemnity cannot be construed to apply to the 

Counterclaim either because it certainly cannot include claims 

by SRI against Coady in which SRI is not successful.” 

 For Coady to say that his original warrant in debt was not 

a proceeding in connection with his performance or nonperformance under the Agreement is pure sophistry. While the 

warrant did not mention Coady’s performance or non-performance 

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as such, he cannot deny that what he sought recovery for in the 

warrant was his performance under the Agreement during the month 

of September 1996, as shown by a bill of particulars he filed. 

If that did not make the warrant proceeding one in connection 

with Coady’s performance or non-performance, the answer and 

grounds of defense SRI filed to the warrant certainly did. SRI 

not only denied liability for Coady’s claim but also asserted as 

grounds of defense unclean hands, fraud, misrepresentation, 

breach of contract, and lack of authorization, all obviously 

related to Coady’s performance or non-performance under the 

Consulting Agreement. 

 The terms of the indemnification clause are broad and allencompassing. The clause permits of no conclusion other than 

that SRI’s attorney’s fees were incurred in connection with 

Coady’s performance or non-performance under the Agreement. 

 Coady contends, however, that “[a]ttorney’s fees of 

$3,228.00 are not reasonable and necessary in a case where the 

defendant is being sued for $3,450.00.” Coady says that, 

although the hourly rate of SRI’s attorney is reasonable, “the 

amount of hours spent to defend a claim of $3,450.00 is not 

reasonable.” Coady states that the case was heard in general 

district court on SRI’s motion to dismiss on the ground of 

accord and satisfaction in approximately fifteen minutes; had 

SRI filed the motion immediately after the warrant in debt was 

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served, all the necessary preparation for trial could have been 

avoided. Coady says that the fact “this motion was not filed 

makes the amount of attorney’s fees unreasonable and 

unnecessary.”3

 We disagree with Coady. An award of attorney’s fees rests 

within the sound discretion of the trial court. Ingram v. 

Ingram, 217 Va. 27, 29, 225 S.E.2d 362, 364 (1976). In Mullins 

v. Richlands National Bank, 241 Va. 447, 403 S.E.2d 334 (1991), 

we said: 

Where [a contract] provide[s] for attorney’s 

fees, but [does] not fix the amount thereof, a 

fact finder is required to determine from the 

evidence what are reasonable fees under the facts 

and circumstances of the particular case. . . . 

In determining a reasonable fee, the fact finder 

should consider such circumstances as the time 

consumed, the effort expended, the nature of the 

services rendered, and other attending 

circumstances. . . . Ordinarily, expert 

testimony will be required to assist the fact 

finder. 

Id. at 449, 403 S.E.2d at 335. 

 Here, the trial court heard the testimony of SRI’s 

president and an expert witness called by SRI. The expert 

testified that “the amount of the attorney’s fees was necessary 

 3 Coady asserts on brief that SRI’s “statement of attorney’s 

fees also included time to establish the right of indemnity” and 

that SRI should not have received an allowance of fees for such 

time. SRI has not included the statement of attorney’s fees in 

the appendix, but, assuming the statement did include time for 

establishing the right of indemnity, we find no objection by 

Coady to the allowance on that ground. Rule 5:25.

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and reasonable.” In addition, the court had available to it the 

time records submitted by SRI’s counsel. Coady submitted no 

countervailing evidence. Under the circumstances, we cannot say 

that the trial court abused its discretion in fixing the amount 

of attorney’s fees it awarded to SRI. 

 Finally, Coady objects to the trial court’s allowance of 

$305.00 as a fee for SRI’s expert witness. Coady says there was 

no prayer for expert witness fees in SRI’s counterclaim filed in 

general district court and, therefore, that it cannot be 

recovered. 

 SRI says it did not move for expert witness fees in the 

general district court because it did not employ an expert 

witness in that proceeding. SRI states, however, that it “moved 

for its expert witness fees at the outset of the trial in the 

Circuit Court and the issue was fully litigated between the 

parties.” SRI also says “that it is within the discretion of 

the trial court to allow amendments of pleadings, including a 

party’s ad damnum, at any time before a verdict is rendered.” 

 This suggests that SRI sought and was granted an amendment. 

However, there is nothing in this record resembling a motion for 

amendment or an order allowing an amendment. Furthermore, the 

record discloses no motion by SRI for expert witness fees at the 

outset of the trial in the circuit court or at any other time. 

Accordingly, we will disallow the award of $305.00 to SRI for 

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the fee of its expert witness. “In Virginia, a plaintiff cannot 

recover more than he sues for though he can recover less.” 

Powell v. Sears, Roebuck & Co., 231 Va. 464, 469, 344 S.E.2d 

916, 919 (1986). 

 Accordingly, we will reverse the award of $305.00 to SRI 

for the fee of its expert witness, affirm the award to SRI of 

attorney’s fees in the amount of $3,228.00, and enter final 

judgment in favor of SRI for the latter amount. 

 Affirmed in part, 

 reversed in part, 

and final judgment. 

JUSTICE KINSER, with whom JUSTICE KOONTZ joins, dissenting. 

 I am not persuaded that the indemnification clause of the 

“Consulting Agreement” between Jerry J. Coady and Strategic 

Resources, Inc. (SRI), is applicable in the factual context of 

this case. Moreover, even if the indemnification clause applies 

as the majority concludes, I would reverse the circuit court’s 

award of attorney’s fees to SRI because I believe that the 

circuit court abused its discretion in awarding a reasonable 

fee. 

 In Mullins v. Richlands Nat’l Bank, 241 Va. 447, 403 S.E.2d 

334 (1991), we said that, in determining a reasonable fee, a 

court should consider several factors, including “the effort 

expended, the nature of the services rendered, and other 

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attending circumstances.” Id. at 449, 403 S.E.2d at 335. In 

the present case, these factors do not support the award of 

attorney’s fees in an amount that almost equaled that of Coady’s 

claim for services rendered. The general district court 

dismissed both the warrant in debt and the counterclaim on the 

basis of accord and satisfaction. SRI waited until just prior 

to the commencement of the trial in that court to present its 

motion to dismiss. The grounds for the motion were not 

complicated, and the motion could have been presented with 

minimal effort before SRI filed its counterclaim. 

 For these reasons, I conclude that the circuit court abused 

its discretion with regard to the amount of attorney’s fees 

awarded to SRI and, therefore, respectfully dissent from that 

part of the majority opinion affirming the award of attorney’s 

fees to SRI. 

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