Opinion ID: 3167779
Heading Depth: 2
Heading Rank: 4

Heading: Dismissal of Recoupment Defense

Text: The third assignment of error concerns the circuit court’s dismissal of Virginia Fuel’s and Justice Companies’ defense of recoupment. 9 The trial court did not expressly dismiss that defense. Virginia Fuel and Justice Companies argue that the trial court “implicitly rejected [this defense] by granting Lambert summary judgment and dismissing the case.” Therefore, we apply the same de novo standard of review that we applied in deciding the issue of whether summary judgment was properly awarded to Lambert. See Deutsche Bank, 290 Va. at 114, 772 S.E.2d at 573. “Recoupment” has been defined as “the right of the defendant to cut down or diminish the claim of the plaintiff in consequence of [the plaintiff’s] failure to comply with some provision of the contract sought to be enforced, or because [the plaintiff] has violated some duty imposed upon him by law in the making or performance of that contract.” Burks Pleading and Practice § 247, at 438 (4th ed. 1952). See Odessky v. Monterey Wine Co., 188 Va. 184, 189, 49 S.E.2d 330, 332 (1948); Dexter-Portland Cement Co. v. Acme Supply Co., 147 Va. 758, 766-67, 133 S.E. 788, 790 (1926). 10 See also Black’s Law Dictionary 1466 (10th ed. 2014) (defining 9 In their answer and grounds of defense, Virginia Fuel and Justice Companies asserted the affirmative defense of “credit and/or offset.” The parties have referred to this defense variously as one of “credit,” “offset,” or “recoupment.” The Court will refer to the defense as “recoupment.” 10 A plea of recoupment may be made pursuant to Code § 8.01-422, and we have held that it is not a counterclaim, for example, for purposes of the nonsuit statute. See Bremer v. Doctor's Bldg. P’ship, 251 Va. 74, 80, 465 S.E.2d 787, 790 (1996); Code § 8.01-422 (statutory pleas such as recoupment are allowed in contract actions “against the obligation of the contract”). 19 recoupment as “[t]he right of a defendant to have the plaintiff’s claim reduced or eliminated because of the plaintiff’s breach of contract or duty in the same transaction”). As we have stated above, Lambert did not breach any provision of the Agreement, nor did Lambert breach any duty it had to Virginia Fuel or Justice Companies in the same transaction. Therefore, we hold that the circuit court did not err in implicitly dismissing the defense of recoupment when it granted summary judgment to Lambert.