Title: Travelers Property Casualty Co. v. Ely
Citation: N/A
Docket Number: 071421
State: Virginia
Issuer: Virginia Supreme Court
Date: September 12, 2008

Present:  Hassell, C.J., Keenan, Koontz, Lemons, Agee,* and 
Goodwyn, JJ., and Russell, S.J. 
 
TRAVELERS PROPERTY CASUALTY 
COMPANY OF AMERICA 
OPINION BY CHIEF JUSTICE LEROY R. HASSELL, SR. 
v.  Record No. 071421  
 September 12, 2008 
 
LESLIE C. ELY, ET AL. 
 
FROM THE COURT OF APPEALS OF VIRGINIA 
 
I. 
 
In these consolidated appeals from the Court of Appeals, 
we consider whether certain policies of workers' compensation 
and employers' liability insurance were "nonrenewed by the 
insurer" within the intendment of Code § 65.2-804(B), thereby 
requiring the insurer to provide notice to the Virginia 
Workers' Compensation Commission before the policies could be 
terminated. 
II. 
A. 
 
Travelers Property Casualty Company of America 
(Travelers) issued a workers' compensation and employers' 
liability insurance policy to Graycon, Inc.  The policy was 
effective July 30, 2003 through July 30, 2004.  In May 2004, 
Travelers informed Graycon by letter that the policy would 
expire on July 30, 2004 unless Graycon paid the renewal 
                     
* Justice Agee participated in the hearing and decision of 
this case prior to his retirement from the Court on June 30, 
premium and renewed the policy.  Travelers also informed 
Graycon in the letter that "[i]n order to avoid a lapse in 
coverage, your renewal payment must be received by the due 
date shown on your bill" and that if the premium was not 
received by the due date, the "policy will expire."  Graycon 
did not submit the premium before the due date. 
 
On September 17, 2004, Leslie C. Ely was injured while 
performing work on a house that was being constructed.  J.F. 
Schoch Building Corporation, the general contractor, retained 
Bruce Gray Construction as a subcontractor.  Bruce Gray 
Construction, in turn, retained Graycon, Inc., as a 
subcontractor, and Ely "was working for Graycon at the time of 
his injury."  Ely submitted a workers' compensation claim, and 
Travelers denied coverage of the claim because Graycon failed 
to pay the premium before the due date.  
 
Ely filed a claim for benefits with the Virginia Workers' 
Compensation Commission (the Commission), and a deputy 
commissioner concluded that the workers' compensation 
insurance policy issued by Travelers was not in effect at the 
time of Ely's accident, even though Travelers did not notify 
the Commission that the policy had expired.  The Building 
Insurance Association, Inc., a statutory employer's insurer, 
appeared before the Commission and argued that the policy of 
                                                                
2008. 
 
2
insurance remained in effect because of Travelers' failure to 
provide notice to the Commission.  The Commission rejected the 
deputy commissioner's opinion and held that Travelers' 
workers' compensation and employers' liability insurance 
policy issued to Graycon remained in effect at the time of 
Ely's accident because Travelers failed to notify the 
Commission that the policy had not been renewed.  The 
Commission held that the policy remained in effect and that 
Travelers is "responsible for [the] benefits associated with 
[Ely's] compensable injury by accident."  Travelers appealed 
to the Court of Appeals. 
B. 
 
Travelers issued a workers' compensation and employers' 
liability insurance policy to Willie M. Thomas Home 
Improvements (Thomas Home Improvements).  The policy was 
effective October 25, 2003 through October 25, 2004.  In 
August 2004, Travelers sent Thomas Home Improvements a letter 
offering to renew the policy.  Travelers also submitted a 
renewal premium notice and a bill for the new premium, but 
Thomas Home Improvements failed to pay the premium. 
 
On December 16, 2004, Matthew L. Bailey, an employee of 
Thomas Home Improvements, was injured while working within the 
scope and course of his employment.  He submitted a workers' 
compensation claim.  Travelers denied coverage of the claim 
 
3
because it considered the Thomas Home Improvements policy to 
have expired since the renewal premium had not been paid. 
 
Bailey filed a claim for benefits with the Commission.  A 
deputy commissioner held that Travelers was required to pay 
benefits because it failed to notify the Commission of "the 
non-renewal of the employer's policy" that Travelers had 
issued.  The Uninsured Employers' Fund of Virginia appeared 
before the Commission and supported the deputy commissioner's 
decision.  The Commission agreed with the deputy commissioner 
and entered an order holding that Travelers is "responsible 
for [the] benefits associated with [Bailey's] compensable 
injury by accident."  Travelers appealed to the Court of 
Appeals. 
C. 
 
The Court of Appeals consolidated the aforementioned 
cases, and a panel of the Court of Appeals affirmed the 
Commission's orders.  Travelers Prop. Cas. Co. of Am. v. Ely, 
49 Va. App. 271, 640 S.E.2d 520 (2007).  Upon a rehearing en 
banc, an evenly divided Court of Appeals approved the 
Commission's orders, and the court did not issue an opinion.  
Travelers Prop. Cas. Co. of Am. v. Ely, 49 Va. App. 807, 645 
S.E.2d 342 (2007).  Travelers appeals. 
III. 
 
Code § 65.2-804(B) states: 
 
4
 
"B.  No policy of insurance hereafter issued 
under the provisions of this title, nor any 
membership agreement in a group self-insurance 
association, shall be cancelled or nonrenewed by the 
insurer issuing such policy or by the group self-
insurance association cancelling or nonrenewing such 
membership, except on thirty days' notice to the 
employer and the Workers' Compensation Commission, 
unless the employer has obtained other insurance and 
the Workers' Compensation Commission is notified of 
that fact by the insurer assuming the risk, or 
unless, in the event of cancellation, said 
cancellation is for nonpayment of premiums; then ten 
days' notice shall be given the employer and the 
Workers' Compensation Commission." 
 
(Emphasis added). 
Travelers argues that the workers' compensation and 
employers' liability insurance policies that it issued to 
Graycon and Thomas Home Improvements expired when they failed 
to pay the premiums and renew the policies.  Continuing, 
Travelers asserts that Code § 65.2-804(B) is unambiguous, and 
pursuant to the plain language of this statute, Travelers had 
no statutory obligation to notify the Commission that the 
policy had expired because the insurance policies were not 
"cancelled or nonrenewed by the insurer issuing such policy" 
within the meaning of Code § 65.2-804(B). 
Responding, Thomas Home Improvements, Graycon, J.F. 
Schoch Building Corporation, Uninsured Employers' Fund, and 
Building Insurance Association, Inc. (hereinafter collectively 
referred to as Employers), argue that Code § 65.2-804(B) is 
ambiguous and that the notice requirements contained in this 
 
5
statute apply to all "nonrenewals, irrespective . . . whether 
it was the insurer or the employer who initiated the 
nonrenewal."  Continuing, the Employers assert that the 
Commission correctly determined that the insurance policies 
remained in effect when Ely and Bailey were injured because 
Travelers failed to give the statutorily prescribed notices.  
We disagree with the Employers' contentions. 
The construction of a statute presents a question of law 
that this Court reviews de novo on appeal.  Jackson v. 
Commonwealth, 274 Va. 630, 633, 652 S.E.2d 111, 113, (2007); 
accord Robinson v. Commonwealth, 274 Va. 45, 51, 645 S.E.2d 
470, 473 (2007).  This Court, when interpreting a statute, 
must "ascertain and give effect to the intention of the 
legislature."  Chase v. DaimlerChrysler Corp., 266 Va. 544, 
547, 587 S.E.2d 521, 522 (2003); accord Boynton v. Kilgore, 
271 Va. 220, 227, 623 S.E.2d 922, 925 (2006). 
We have stated the following principles that we must 
apply when determining whether a statute is ambiguous: 
 
"Language is ambiguous if it admits of being 
understood in more than one way or refers to two or 
more things simultaneously.  Lincoln National Life 
Ins. Co. v. Commonwealth Corrugated Container Corp., 
229 Va. 132, 136-37, 327 S.E.2d 98, 101 (1985).  An 
ambiguity exists when the language is difficult to 
comprehend, is of doubtful import, or lacks 
clearness and definiteness.  Ayres v. Harleysville 
Mut. Casualty Co., 172 Va. 383, 393, 2 S.E.2d 303, 
307 (1939).  If language is clear and unambiguous, 
there is no need for construction by the court; the 
 
6
plain meaning and intent of the enactment will be 
given it.  School Board of Chesterfield County v. 
School Board of the City of Richmond, 219 Va. 244, 
250, 247 S.E.2d 380, 384 (1978)." 
 
Brown v. Lukhard, 229 Va. 316, 321, 330 S.E.2d 84, 87 (1985); 
accord Gillespie v. Commonwealth, 272 Va. 753, 758, 636 S.E.2d 
430, 432 (2006); Lynch v. Commonwealth Transp. Comm'r, 255 Va. 
227, 231, 495 S.E.2d 247, 249 (1998). 
 
Applying the aforementioned principles, we hold that Code 
§ 65.2-804(B) is not ambiguous.  The language in Code § 65.2-
804(B) is clear, is not difficult to comprehend, and does not 
admit of being understood in more than one way.  Therefore, in 
deciding the meaning of Code § 65.2-804(B), we will consider 
the plain language contained therein.  VYVX of Va., Inc. v. 
Cassell, 258 Va. 276, 292, 519 S.E.2d 124, 132 (1999); Haislip 
v. Southern Heritage Ins. Co., 254 Va. 265, 268, 492 S.E.2d 
135, 137 (1997); Abbott v. Willey, 253 Va. 88, 91, 479 S.E.2d 
528, 530 (1997). 
 
Applying the plain language in Code § 65.2-804(B), we 
hold that Travelers was not required to comply with the 
notification provisions of that statute.  An insurer must 
comply with the statutorily prescribed notification mandates 
if its policy of insurance is "cancelled or nonrenewed by the 
insurer issuing such policy."  Code § 65.2-804(B).  Travelers 
offered to renew the policies but Graycon and Thomas Home 
 
7
Improvements did not pay the workers' compensation and 
employers' liability insurance premiums that were required in 
order to renew the policies.  Graycon and Thomas Home 
Improvements voluntarily chose to allow their insurance 
policies to expire as contemplated by the specific terms of 
those policies.  Thus, Graycon and Thomas Home Improvements, 
not Travelers, caused the policies of workers' compensation 
and employers' liability insurance at issue to expire.  Any 
contrary construction or application of Code § 65.2-804(B) 
would render the phrase "nonrenewed by the insurer issuing 
such policy" mere surplusage, which is contrary to the settled 
rule in this Commonwealth that every provision in or part of a 
statute shall be given effect if possible.  Level 3 Commcn's 
of Va., Inc. v. State Corp. Comm'n, 268 Va. 471, 477-78, 604 
S.E.2d 71, 74 (2004); Cook v. Commonwealth, 268 Va. 111, 114, 
597 S.E.2d 84, 86 (2004); Tilton v. Commonwealth, 196 Va. 774, 
784, 85 S.E.2d 368, 374 (1955). 
IV. 
 
We hold that Travelers was not required to comply with 
the notice provisions contained in Code § 65.2-804(B) because 
the insurance policies that are the subject of this appeal 
were not "nonrenewed by the insurer issuing such polic[ies]."  
Thus, these insurance policies were not in effect when Ely and 
Bailey were injured.  In view of our holdings, we need not 
 
8
 
9
consider the litigants' remaining arguments.  We will reverse 
the judgments of the Court of Appeals, and we will enter final 
judgments here in favor of Travelers. 
Reversed and final judgment.