Present: All the Justices 

CITY OF MANASSAS 

v. Record No. 941189 OPINION BY JUSTICE LEROY R. HASSELL 

 June 9, 1995 

BOARD OF COUNTY SUPERVISORS OF 

PRINCE WILLIAM COUNTY 

BOARD OF COUNTY SUPERVISORS 

OF PRINCE WILLIAM COUNTY 

v. Record No. 941206 

CITY OF MANASSAS 

 FROM THE CIRCUIT COURT OF PRINCE WILLIAM COUNTY 

Thomas S. Kenny, Judge Designate 

 In these appeals, we consider issues relating to a decree 

requiring the City of Manassas to make efforts to cede 

jurisdiction of a portion of the City to Prince William County. 

 I. 

 The Town of Manassas, formerly a part of Prince William 

County, became a city of the second class independent of the 

County in 1975. The newly created City and the County executed 

an Agreement, described as an inter-jurisdictional agreement, to 

facilitate the transition of the Town's status to a city. The 

Agreement sought to resolve numerous governmental issues relating 

to: public schools; water; library and police services; and 

jurisdiction. 

 The City filed this action at law, seeking a declaration 

that an area of land and improvements thereon, referred to as the 

Courthouse Complex, is within the City limits and subject to its 

jurisdiction. The County filed a counterclaim, asserting that 

jurisdiction had been "equitably converted" to it and, 

alternatively, sought an award of monetary damages based upon the 

City's failure to cede jurisdiction to the County pursuant to the 
terms of the Agreement. The City demurred to the counterclaim 

and filed a special plea in bar, contending that the County's 

counterclaim was barred by the applicable statute of limitations. 

 The trial court sustained the demurrer and plea, holding that 

the County's claim for damages was barred by the five-year 

statute of limitations for written contracts. The trial court 

also transferred the case to the equity side of the court. 

 Subsequently, the County filed an amended counterclaim, 

seeking a declaration that the Courthouse Complex was under the 

County's jurisdiction because such jurisdiction had been 

"equitably converted" to the County or, in the alternative, 

seeking specific performance of the Agreement. The City filed a 

demurrer and special plea asserting, inter alia, that the 

County's claims are barred by the statute of limitations and 

laches. 

 At a trial on the merits, the chancellor held, inter alia, 

that: the City retained jurisdiction over the Courthouse 

Complex; the County's counterclaim is not barred by the statute 

of limitations or laches; and the City is required to institute 

proceedings to cede jurisdiction of the Courthouse Complex to the 

County as required by the Agreement. Both the County and the 

City appeal. 

 II. 

 The chancellor made numerous findings of fact, relevant to 

these appeals, that are not challenged by the litigants. The 

Courthouse Complex, situated upon 38.4 acres of land, is owned by 

the County, and the City has a 20% ownership interest in the 

Courthouse Complex. For many years before the incorporation of 
the City in 1975, the County's courts, jail facilities, police 

facilities, and other administrative offices were located in the 

Courthouse Complex. Presently, many of these facilities, 

including the County courts, remain located in the Courthouse 

Complex. 

 During the negotiations relating to the Town's transition to 

city status, the City wanted the County to retain its courthouse 

within the Courthouse Complex because the courthouse provides 

substantial economic and symbolic benefits to the City. The City 

made certain inquiries and learned that Fairfax City had created 

a geographical configuration described as a "doughnut hole" 

within its boundaries, in which Fairfax County had jurisdiction. 

 Fairfax City instituted certain proceedings in 1967 by adopting 

an ordinance pursuant to Code § 15.1-1059, which was subsequently 

approved by the Fairfax Circuit Court and the General Assembly. 

When it executed the Agreement, the City of Manassas anticipated 

that it would institute legal proceedings to cede jurisdiction 

over the Courthouse Complex to Prince William County in a manner 

similarly utilized by Fairfax City and Fairfax County. 

 The Agreement includes the following paragraph, which is 

germane to these appeals: 

 D. COURTHOUSE COMPLEX 

 City agrees to institute proceedings necessary to 

exclude from its corporate boundaries and from the 

jurisdiction of the City the contiguous property 

constituting the courthouse complex as per the attached 

map, provided that such property shall again become 

incorporated within the City corporate limits in the 

event that the Prince William County Courthouse is 

relocated, and Council and Supervisors agree that any 

court order or legislation entered in furtherance 

hereof shall contain a reversionary clause to such 

effect. 
 In 1976, an assistant city attorney sent a letter to the 

acting county attorney, requesting that the County provide a 

legal description of the Courthouse Complex. The assistant city 

attorney also raised concerns about the constitutional validity 

of certain statutes that authorized the Fairfax jurisdictional 

arrangement. The County failed to respond to this letter. 

 The City admitted, and the chancellor found, that the City 

did not repeat its request for information, nor did it seek 

legislation or institute court proceedings to transfer 

jurisdiction of the Courthouse Complex to the County. However, 

the County did not complain about these matters until a dispute 

arose in 1990, when the County sought to expand its jail and 

Judicial Center, located in the Courthouse Complex. 

III. THE CITY'S APPEAL 

 A. 

 The chancellor held that the County's counterclaim is exempt 

from the statute of limitations and laches. The City asserts 

that the County is merely seeking to vindicate a private 

contractual right and, thus, the County, like any private 

litigant, is bound by laches and the statute of limitations. The 

County, relying upon City of Portsmouth v. City of Chesapeake, 

232 Va. 158, 349 S.E.2d 351 (1986), argues the chancellor 

correctly held that laches and the statute of limitations are not 

defenses that may be asserted against a municipality acting in a 

governmental capacity. We agree with the County. 

 In City of Portsmouth v. City of Chesapeake, we considered 

whether the City of Portsmouth's petition to ascertain and 

establish the boundary line between Portsmouth and the City of 
Chesapeake was barred by the doctrine of laches. Portsmouth had 

filed an action against Chesapeake in 1982, seeking to establish 

and ascertain certain boundary lines that were created in 

annexation proceedings brought by Portsmouth against the County 

of Norfolk, now Chesapeake, in the 1950s. According to 

Chesapeake, the suit papers in the annexation proceedings had 

disappeared, and Chesapeake did not have the benefit of a plat 

depicting the boundaries of the area awarded. 

 Portsmouth had filed identical petitions to establish 

boundaries in the Circuit Courts of Portsmouth and Chesapeake, 

and the Circuit Court of Chesapeake granted Chesapeake's motion 

to dismiss on the ground that Portsmouth's petition was barred by 

the doctrine of laches. Reversing that judgment, we held: 

 [L]aches or estoppel is not available as a defense 

against a municipality acting in its governmental 

capacity. See Segaloff v. City of Newport News, 209 

Va. 259, 261, 163 S.E.2d 135, 137 (1968); Supervisors

v. N. & W.R. Co., 119 Va. 763, 790, 91 S.E. 124, 133 

(1916); Norfolk & W.R. Co. v. Supervisors, 110 Va. 95, 

103, 65 S.E. 531, 534 (1909). Protecting municipal 

boundary lines is governmental activity. 

Id. at 164-65, 349 S.E.2d at 354. 

 Recently, we restated our longstanding rule, albeit a 

minority view, that certain equitable defenses, such as laches, 

do not apply to state or local governments when acting in a 

governmental capacity. Dick Kelly Enterprises v. City of 

Norfolk, 243 Va. 373, 381, 416 S.E.2d 680, 685 (1992); accord

Board of Supervisors v. Booher, 232 Va. 478, 481, 352 S.E.2d 319, 

321 (1987) (laches does not apply "to a local government in the 

discharge of its governmental functions."). Likewise, we have 

held that neither laches nor the statute of limitations may be 

asserted as a defense in an equitable proceeding to bar the state 
from asserting a claim on behalf of the public. Supervisors v. 

N. & W.R. Co., 119 Va. 763, 790, 91 S.E. 124, 133 (1916); Norfolk 

& W.R. Co. v. Supervisors, 110 Va. 95, 103, 65 S.E. 531, 534 

(1909). 

 Applying this established precedent, we hold that the 

chancellor correctly ruled that the County's counterclaim was not 

barred by either the statute of limitations or laches. Here, as 

in City of Portsmouth v. City of Chesapeake, the County's claim 

is asserted in furtherance of a governmental activity. The 

County is seeking to acquire jurisdiction, including the right to 

exercise its police and zoning powers, over the Courthouse 

Complex. We also observe that the County's reasons for pursuing 

this litigation, expansion of its jail and Judicial Center, are 

also in furtherance of governmental activities. 

 B. 

 The City argues that the chancellor erred by awarding 

specific performance of the Agreement. First, the City argues 

that the County has an adequate remedy at law, and, thus, 

specific performance is not appropriate. The County asserts, and 

we agree, that it has no adequate remedy at law. 

 It is true, as the City asserts, that we have recognized 

that a litigant who seeks specific performance must demonstrate 

the lack of an adequate remedy at law. See Chattin v. Chattin, 

245 Va. 302, 307-08, 427 S.E.2d 347, 350 (1993). And, we do not 

depart from this elementary principle. 

 Contrary to the City's contention, however, the County lacks 

an adequate remedy at law to enforce the provisions of Paragraph 

(D) of the Agreement. As the chancellor found, the County 
desires jurisdiction over the Courthouse Complex so that it can 

expand the jail and Judicial Center and exercise zoning and other 

police powers over the Courthouse Complex. Even though the 

County initially sought monetary damages when it filed its 

counterclaim, which was dismissed by the chancellor, a judgment 

at law is not an adequate legal remedy for the right that the 

County seeks to vindicate. 

 C. 

 Next, the City argues that the chancellor erred by ordering 

specific performance because the City says that Paragraph (D) of 

the Agreement "lack[ed] certainty and definiteness." 

Specifically, the City says that there "is no provision in 

Paragraph D, apart from the ambiguous reference to institute 

proceedings, as to what the parties intended to be done." We 

disagree with the City. 

 We have held that: 

 The granting of specific performance is addressed 

to the sound discretion of the trial court. Although 

it is not a matter of absolute right, "where the 

contract sought to be enforced is proved and is in its 

nature and circumstances unobjectionable, it is as much 

a matter of course for courts of equity to decree 

specific performance as it is for a court of law to 

give damages for a breach of it." 

Haythe v. May, 223 Va. 359, 361, 288 S.E.2d 487, 488 (1982) 

(quoting Pavlock v. Gallop, 207 Va. 989, 995, 154 S.E.2d 153, 157 

(1967)). We have also stated: 

 When the contract sought to be enforced . . . has been 

proven by competent and satisfactory evidence, and 

there is nothing to indicate that its enforcement would 

be inequitable to a defendant, but will work injury and 

damage to the other party if it should be refused, in 

the absence of fraud, misapprehension, or mistake, 

relief will be granted by specific enforcement. 

First Nat. Bank v. Roanoke Oil Co., 169 Va. 99, 117, 192 S.E. 
764, 771 (1937). 

 Additionally, the terms of the contract sought to be 

specifically enforced must be definite. Hoster's Comm. v. 

Zollman, 122 Va. 41, 45, 94 S.E. 164, 165 (1917); Van Dyke v. 

Norfolk & S.R. Co., 112 Va. 835, 849, 72 S.E. 659, 664 (1911). 

Finally, we also observe an equally important pertinent 

principle: 

 The law does not favor declaring contracts void 

for indefiniteness and uncertainty, and leans against a 

construction which has that tendency. While courts 

cannot make contracts for the parties, neither will 

they permit parties to be released from the obligations 

which they have assumed if this can be ascertained with 

reasonable certainty from language used, in the light 

of all the surrounding circumstances. This is 

especially true where there has been partial 

performance. 

High Knob, Inc. v. Allen, 205 Va. 503, 507, 138 S.E.2d 49, 53 

(1964). 

 Applying these principles, we hold that Paragraph (D) of the 

Agreement is sufficiently definite to permit specific 

performance. According to the plain language in that paragraph, 

the City agreed to institute necessary proceedings or seek 

appropriate legislation that would authorize the City to cede 

jurisdiction of the Courthouse Complex to the County. 

 We also observe that the chancellor permitted the litigants 

to introduce evidence at trial regarding the City's intent when 

it agreed to the 1976 Agreement. Many witnesses, including Harry 

J. Parrish, who was the City's mayor when the Agreement was 

executed, acknowledged that the City intended to convey 

jurisdiction of the Courthouse Complex to the County. Numerous 

other witnesses testified that the City and County intended to 

utilize the same method that Fairfax City and Fairfax County had 
used to create a similar geographical configuration. 

 Several members of the County's Board of Supervisors 

testified that the City agreed to take whatever steps were 

necessary to convey jurisdiction of the Courthouse Complex to the 

County. Finally, the chancellor found that the County had 

performed all its obligations under the Agreement, but that the 

City, which has reaped economic and symbolic benefits 

attributable to the location of the Courthouse Complex, has not 

performed its obligation to initiate proceedings to transfer 

jurisdiction to the County. 

 D. 

 The City argues that the chancellor's decree is inconclusive 

in nature and indefinite. To buttress its argument, the City 

says that the decree directed it to "make a good faith effort to 

return the Complex to County control, whether it uses the Fairfax 

model or something else" and "[t]hus, the decree seemingly 

permits the City to elect the type of proceedings it must 

institute but at the same time puts the City at risk of making 

the wrong election because it must use a 'means (involving one or 

more steps) reasonably calculated to offer the best chance of 

success.'" The County asserts, and we agree, that the 

chancellor did not err by decreeing that the City make a good 

faith effort to cede jurisdiction of the Courthouse Complex to 

the County. We have said that 

 [e]quity will decree that as done which by agreement is 

agreed to be done and is proper to fully effectuate the 

intentions of the parties concerned. 

Pleasants v. Pleasants, 221 Va. 1017, 1021, 277 S.E.2d 170, 172 

(1981). 
 The chancellor, in the proper exercise of his equitable 

jurisdiction, directed the City to comply with its agreement by 

making a good faith effort to cede jurisdiction over the 

Courthouse Complex to the County. Simply stated, the chancellor 

has merely required the City to perform the very task that the 

City agreed to perform. Contrary to the City's argument, the 

chancellor's decree is not indefinite, but a reasonable and 

practical solution that will prevent the City, which has received 

economic benefits from the County's full performance, from 

avoiding its contractual obligation. 

 E. 

 The City argues that it cannot lawfully cede the Courthouse 

Complex to the County, nor may the County lawfully accept 

jurisdiction over the Courthouse Complex. The City says that 

"[n]o statute in 1976 or now empowers the City to institute court 

proceedings to effectuate the transfer of jurisdiction and the 

reversion called for in Paragraph D of the 1976 Agreement. 

Hence, Paragraph D is void and unenforceable as a matter of law 

because of the absence of statutory authority for the City to 

carry it out." 

 We disagree with the City's contentions. The City fails to 

recognize its obligation under Paragraph (D). There, the City 

agreed to institute the appropriate legal proceedings and, if 

necessary, seek appropriate legislation so that the City could 

cede jurisdiction of the Courthouse Complex to the County. We 

simply fail to understand how the City can characterize as 

unlawful its contractual obligation to make good faith efforts to 

transfer jurisdiction to the County. 
 F. 

 The City argues that the chancellor "erred in failing to 

consider the hardship which would result to the City if the 

contract is specifically enforced." The City contends that it 

should have been permitted to introduce evidence to demonstrate 

its purported hardship and inequity. 

 The County filed a motion in limine to prohibit the City 

from adducing evidence on the issue of laches. The chancellor 

advised the City that it may present evidence, which would 

otherwise be inadmissible, to prove laches if that evidence was 

admissible under some other theory or if the evidence related to 

some other issue in the case. 

 The City sought to admit evidence of hardship, but the 

County's objection was sustained. Subsequently, the City 

proffered the testimony of its mayor, Robert L. Browne, that 

related solely to the issue of laches. Counsel for the City 

described the parameters of the City's proffered testimony as 

follows: 

 The testimony of Mr. Robert Browne is being proffered 

for the record in accordance with the Rules of Court 

because the trial judge has ruled that the City is not 

entitled to present evidence of laches on the part of 

the County and, therefore, the City would not be 

entitled to submit evidence as to the prejudice to the 

City by virtue of the County's failure to insist on the 

City performing under Paragraph D of the 1976 Agreement 

or failure to bring an action to enforce Paragraph D. 

 The City failed to proffer any evidence of any hardship or 

inequity that might harm the City if the chancellor granted 

specific performance. And, as we have said, "this Court will not 

consider an error assigned to the rejection of testimony unless 

such testimony has been . . . made a part of the record in the 
manner prescribed by the Rules of Court." Brown v. Commonwealth, 

246 Va. 460, 465, 437 S.E.2d 563, 565 (1993) (quoting Whittaker

v. Commonwealth, 217 Va. 966, 969, 234 S.E.2d 79, 81 (1977)); 

accord Blue Cross v. Commonwealth, 221 Va. 349, 357, 269 S.E.2d 

827, 832 (1980). 

 G. 

 As previously mentioned, Paragraph (D) provides, in part, 

"in the event that the Prince William County Courthouse is 

relocated, . . . Council and Supervisors agree that any court 

order or legislation entered in furtherance hereof shall contain 

a reversionary clause to such effect." The chancellor found that 

"many of the more significant executive and legislative functions 

have been moved off the Complex" since the date the Agreement was 

signed. The City argued at trial, and assigns as error, that 

"even if the County was entitled to jurisdiction of the Complex 

that this massive relocation of County buildings and functions 

triggered the reverter because the term 'Courthouse,' as used 

therein, was intended to refer to the entire Courthouse Complex." 

 We disagree with the City. 

 The chancellor considered evidence and held that a reversion 

did not occur because the word "courthouse" as used in the 

Agreement means the location where the judges sit, and the Prince 

William County Courthouse has not been relocated. Numerous 

witnesses testified, without dispute, that the courthouse remains 

in the Courthouse Complex. Accordingly, we hold that the 

chancellor's findings are supported by credible evidence, and 

such findings may not be disturbed on appeal. 

 H. 
 The City argues that "Paragraph D was entered into under 

mistake and misapprehension" and "a contract entered into under 

mistake and misapprehension will not be enforced." The City, 

relying upon Haythe v. May, 223 Va. at 361, 288 S.E.2d at 488, 

argues that a court of equity will not award specific performance 

where there is evidence of fraud, misapprehension, or mistake. 

 We disagree. The chancellor did not find, and the record is 

devoid of any evidence of fraud, misapprehension, or mistake. 

Thus, we hold that the City's argument lacks merit. 

IV. THE COUNTY'S APPEAL 

 As we previously have stated, the chancellor held that the 

City has jurisdiction over the Courthouse Complex. The County 

argues that "[p]rinciples of equity dictate that jurisdiction 

over the Courthouse Complex vested in the Board of County 

Supervisors after the County performed all of its obligations 

pursuant to the 1976 compact between the City and the County, 

which provided for transfer of jurisdiction of the Complex to the 

County, and when it became apparent that the City would not 

follow through with its obligation to convey such jurisdiction 

voluntarily." The City argues that "[t]here are no equitable 

principles recognized in Virginia which authorize the court to 

divest jurisdiction of the Complex from the City and invest that 

jurisdiction in the County." We agree with the City. 

 We discussed the doctrine of equitable conversion in Clay v. 

Landreth, 187 Va. 169, 172-73, 45 S.E.2d 875, 877 (1948): 

 That the doctrine of equitable conversion exists 

in Virginia cannot be doubted. In the early case of 

Dunsmore v. Lyle (1891), 87 Va. 391, at p. 392, 12 S.E. 

610, the doctrine was stated thus: "The principles 

upon which courts of equity decree specific performance 

of contracts for the sale of real estate are well 

understood and familiar to the profession, yet it will 
be convenient, in the view we have taken of this case, 

to briefly recur to first principles; and we will 

remark that it is one of the principles of equity that 

it looks upon things agreed to be done as actually 

performed; and, consequently, as soon as a valid 

contract is made for the sale of an estate, equity 

considers the buyer as the owner of the land, and the 

seller as a trustee for him; and, on the other hand, it 

considers the seller as the owner of the money, and the 

buyer as a trustee for him." 

Contrary to the County's assertions, the principles of equitable 

conversion simply have no application here. We also reject the 

County's contention that the chancellor, under the exercise of 

his general equitable power, may grant jurisdiction of the 

Courthouse Complex to the County. Accordingly, we hold that the 

chancellor did not err by refusing to apply the doctrine of 

equitable conversion here. V. 

 In view of our holdings, we do not consider the remaining 

arguments of the City and County. Accordingly, we will affirm 

the chancellor's decree, and we will remand these proceedings so 

that the chancellor may retain continuing jurisdiction. 

Record No. 941189 -- Affirmed and remanded. 

Record No. 941206 -- Affirmed and remanded.