Opinion ID: 1058030
Heading Depth: 1
Heading Rank: 4

Heading: Bennett's Repudiation

Text: In his June 7, 2008 email to Sage, Bennett communicated his dissatisfaction with his salary: [W]hile I would enjoy recommitting to Sage, the inequity between my current compensation and what I think my value is on the outside is substantial. With that in mind, I am suggesting that either my compensation be altered to something more in line with my value, albeit discounted, or we agree to my transition out of the company. Bennett asserts that his communication with Sage was simply an invitation to negotiate, and that it clearly indicates his preference to stay with the company. He argues that his language did not evince a clear and unequivocal repudiation of the Agreement covering the entire contract because he also agreed to stay on for a period of time while he transitioned out of the company. But, while transitioning out of the company, he expected the twelve-month time frame restricting his employment under the non-competition clause, which he referred to as the clock, to be running. In response, Sage argues that there was ample evidence by which the jury could find that Bennett had repudiated the contract. According to Sage, testimony at trial included statements attributed to Bennett during a June 5th conversation that July 1, 2008 was his drop dead date for his departure and that he had effectively given notice of his resignation. Also, Sage argued that Bennett never suggested that there was a third alternative to his receiving a higher salary or leaving Sage. Finally, Sage contends that Bennett never suggested that he would be willing to continue in his position at his current salary of $360,000 and that he suggested his own departure date. We have held that [i]t is firmly established that for a repudiation of a contract to constitute a breach, the repudiation must be clear, absolute, unequivocal, and must cover the entire performance of the contract. Vahabzadeh v. Mooney, 241 Va. 47, 50, 399 S.E.2d 803, 805 (1991) (citations omitted); see also Restatement (Second) of Contracts § 250 (repudiation entails a statement or voluntary affirmative act indicating that the promisor will commit a breach when performance becomes due). In this case, when Bennett told Sage, four months into his year-long contract, that he would leave the company unless his demand for increased compensation was met, the jury could have found that Bennett repudiated his obligation under the Agreement. Bennett's repudiation would have been anticipatory with respect to the remainder of the time he agreed to serve as Sage's president under the Agreement. If Sage could not rely upon Bennett's repudiation, it could not begin its search for his replacement until the day that Bennett simply failed to show up for work and notified Sage that he would no longer perform under the Agreement. Because the Agreement required continuous performance over a period of time, when Bennett declared he would leave his position as president unless his compensation was increased, Sage was entitled to rely on Bennett's repudiation and treat it as a breach. Therefore, we hold that the circuit court did not err in rejecting Bennett's argument that he did not repudiate the contract as a matter of law, because he continued to perform his duties as he was attempting to negotiate his exit from the company. Based on the evidence presented, the jury was entitled to conclude that Bennett's refusal to consider any alternative other than almost tripling his salary and his demand that his post-termination non-compete obligations begin running immediately constituted a repudiation by Bennett of his future obligations under the one-year contract.