Opinion ID: 222537
Heading Depth: 2
Heading Rank: 2

Heading: Proof of Damage to Batzli

Text: Next, Minnesota Mutual maintains that there was insufficient evidence presented at trial to permit a reasonable 26 jury to conclude that the damage element of a breach of contract claim had been satisfied. Minnesota Mutual agrees with the trial court’s determination that actual damages were not proven to a reasonable degree of certainty. However, Minnesota Mutual challenges the district court’s determination that an award of “nominal damages” supported by the evidence at trial was sufficient to make out a prima facie case for breach of contract. We find no merit to Minnesota Mutual’s argument. It stands to reason that Minnesota Mutual’s refusal to defend the malpractice suit forced Batzli to retain legal counsel. Moreover, there was evidence that the cost of those legal services was billed to Batzli. In other words, there was sufficient evidence to support a determination that there was “injury or damage to the plaintiff caused by the breach of obligation.” Filak, 267 Va. at 619, 594 S.E.2d at 614. The district court awarded nominal damages for that breach. Significantly, the Virginia Supreme Court has explained that “[n]ominal damages are those recoverable where a legal right is to be vindicated against an invasion that has produced no actual present loss of any kind or where, from the nature of the case, some injury has been done the amount of which the proofs fail to show.” News Leader Co. v. Kocen, 173 Va. 95, 107-08, 3 S.E.2d 385, 390 (1939) (quotation omitted); see also 22 Am. Jur. 2d Damages § 8 (2003) (“The term ‘nominal damages’ describes two 27 types of awards: (1) those damages recoverable where a legal right is to be vindicated against an invasion that has produced no actual, present loss of any kind; and (2) the very different allowance made when actual loss or injury is shown, but the plaintiff fails to prove the amount of damages.”). The district court relied on the inferred nominal damages that result from the violation of the legal rights created by the contract. Minnesota Mutual correctly argues that such damages are insufficient to satisfy the third prong of a prima facie case for breach of contract. However, neither of the cases on which Minnesota Mutual relies stands for the proposition that nominal damages can never satisfy the third element in a Virginia breach of contract claim. In Orebaugh v. Antonious, 190 Va. 829, 58 S.E.2d 873 (1950), the court considered an action by a property owner alleging that a contractor hired to install a heating system breached his contract because the heating system failed to operate properly. Id. at 830, 58 S.E.2d at 873. However, the evidence also showed that the property owner had since sold the property with the heater still inoperable. There was no evidence of the sale price or evidence that the property owner took less for the property because of the faulty heating system. The court stated that the plaintiff did not “introduce any evidence from which it could be determined that she suffered any 28 loss or damage” other than the nominal damages inferred from the violation of her legal rights under the contract. Id. at 833. As such, the court held that judgment in favor of the plaintiff was in error. Id. at 834. In Bailey v. Potter, No. 1:05c936(JCC), 2006 WL 1582410 (E.D. Va. June 5, 2006), the court considered an action brought by an employee alleging that her employer breached a contractual duty to review the employee’s leave requests to ensure they were “properly coded.” 17 Plaintiff alleged that the employer breached the contract by improperly coding some of her leave time as “Leave Without Pay” instead of “Office of Worker Compensation Program Leave Without Pay.” Id. at . The court concluded that “there was no meaningful difference between” the two time codes and that, consequently, if the leave time was coded as the plaintiff desired, “Plaintiff would receive no benefit whatsoever.” Id. The court then rejected the plaintiff’s assertion that nominal damages inferred from the inconsequential violation of her legal rights would satisfy the third element of a breach of contract suit. Id. at  (“Essentially, Plaintiff seeks to eviscerate the “consequential injury or damage” element 17 Although we distinguish Bailey, we also note that, as an unpublished opinion, it bears no precedential weight that would necessarily alter our analysis. United States v. Ruhe, 191 F.3d 376, 392 (4th Cir. 1999) (“[U]npublished opinions are not binding precedent in this circuit.”); see also Local Rule 36(c). 29 of a claim for breach of contract, as nominal damages would always be inferred upon the allegation of a breach of a binding agreement.”). This case is distinguishable from Orebaugh and Bailey because here, “actual loss or injury is shown, but the plaintiff fails to prove the amount of damages.” See 22 Am. Jur. 2d Damages § 8 (2003). Batzli demonstrated that he had to pay attorney’s fees as a result of Minnesota Mutual’s breach, but failed to prove that the amount claimed was reasonable. 18 As such, nominal damages were appropriate. 19 Both Orebaugh and Bailey involved circumstances where there was no evidence that any damage (other than the abstract damage caused by violation of legal rights created by a contract) resulted from the breach of contract. In other words, both cases held that nominal damages of the first sort discussed in Kocen cannot support a 18 See infra, Section III. 19 We reject Minnesota Mutual’s contention that Batzli’s failure to specifically plead nominal damages barred the award thereof, particularly when the counterclaim asked the court to award, in addition to the costs and fees incurred in prosecuting the counterclaim and defending the Chasen malpractice suit, “such other and further relief as the Court deems just.” [J.A. 76] See Yniguez v. State, 975 F.2d 646, 647 n.1 (9th Cir. 1992)(per curiam)(“Although the plaintiff’s complaint does not expressly request nominal damages, it did request ‘all other relief that the Court deems just and proper under the circumstances.’ That is sufficient to permit the plaintiff to pursue nominal damages.”). 30 breach of contract action. However, those cases provide no support for the contention that nominal damages can never satisfy the damage element of a prima facie case for breach of contract under Virginia law. Indeed, in Crist v. Metropolitan Mortg. Fund, Inc., 231 Va. 190, 343 S.E.2d 308 (1986), the court reviewed a breach of contract action in which the trial court awarded nominal damages but denied compensatory damages. The court affirmed, stating “[b]ecause damages, if any, cannot be established with reasonable certainty, no actual damages can be recovered. Accordingly, we will affirm the judgment of the trial court denying compensatory damages but awarding nominal damages of $100.” Id. at 195, 343 S.E.2d at 311. Crist therefore contradicts Minnesota Mutual’s contention that a breach of contract cannot be established absent proof of actual damages, as well as the contention that nominal damages are insufficient to satisfy the damage prong of the prima facie case. In sum, we conclude that there was sufficient evidence presented to the jury to permit its conclusion that Minnesota Mutual owed a duty to its insured and that the breach of that duty caused the insured to suffer damage. Consequently, the jury had a legally sufficient evidentiary basis to find for the insured on the breach of contract counterclaim. See Filak, 267 Va. at 619, 594 S.E.2d at 614. Accordingly, we affirm the 31 denial of Minnesota Mutual’s renewed motion for judgment as a matter of law.