Court Opinion

ID: 8206586
Source: CourtListenerOpinion
Date Created: 2022-09-15 13:12:02.776655+00
Date Added: 2024-06-11T16:41:17.250348
License: Public Domain

PRESENT: Goodwyn, C.J., Powell, Kelsey, McCullough, and Chafin, JJ., and Russell and
Millette, S.JJ.

AV AUTOMOTIVE, LLC, ET AL.,
                                                            OPINION BY
v. Record No. 210320                              JUSTICE STEPHEN R. McCULLOUGH
                                                          September 15, 2022
BETELEHEM GEBREYESSUS

                   FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
                               Dontaè L. Bugg, Judge

       Appellants AV Automotive, LLC, AV Imports, LLC (collectively, “AV Automotive”),

and Geneva Enterprises, Inc. (“Geneva”) appeal the circuit court’s decision to impose sanctions

against them under Code § 8.01-271.1, awarding all attorney’s fees claimed by Betelehem

Gebreyessus.

                                      I. BACKGROUND

       Gebreyessus was employed by AV Automotive as a vehicle salesperson. AV

Automotive owns an Audi dealership in Arlington (“Audi Arlington”), which is a private

dealership in the Rosenthal Automotive Group (“Rosenthal Group”). Geneva manages the

Rosenthal Group dealerships, including Audi Arlington.

       AV Automotive and Geneva (collectively, the “Appellants”) maintained agreements with

Audi of America, Inc. (“Audi USA”) relating to the sale of Audi vehicles. Under one such

agreement, Audi USA provided bonus payments to dealers who met certain benchmarks with

respect to the sale of vehicles and positive customer survey ratings. From April 1, 2016, to

September 30, 2017, Audi USA paid AV Automotive approximately $700,000 in bonuses.

       In early 2018, the Appellants discovered a fraudulent scheme to manipulate customer

reviews for the incentive program. As a result of this scheme, Gebreyessus was terminated. In a

February 2019 Complaint, the Appellants alleged that the scheme was perpetrated by Donna
Bavely, Brandon Preske, and Gebreyessus. 1 The Appellants stated that Bavely and Gebreyessus

gained unauthorized access to the Audi customer survey system, submitted falsified positive

customer reviews, and arranged for customers who had a negative experience to not receive the

email invitation to submit a review. The Appellants asserted that the falsified positive reviews

resulted in Audi Arlington employees receiving additional compensation.

       The Appellants alleged that Gebreyessus failed to meet the requirements for a bonus

payment associated with customer surveys in March 2016, and that in April 2016, Gebreyessus

and Bavely began fabricating customer surveys. The Appellants maintained that Gebreyessus

instructed Bavely to either send real customer surveys or surveys to false email addresses, based

on Gebreyessus’ experiences with individual customers. The Appellants alleged that Bavely

used the false email addresses to complete false positive survey results. The Appellants

maintained that Gebreyessus and Bavely continued this scheme together from April 2016 until

Bavely was terminated in September 2017.

       The Appellants further asserted that Gebreyessus and Bavely submitted false internal

employee surveys as a part of a plan to get Sean Egnew, the General Sales Manager, fired from

Audi Arlington and replace him with Gebreyessus. The Appellants further allege that Bavely

created and emailed an anonymous survey for Audi Arlington sales employees. Gebreyessus

convinced the other sales employees to include false and negative information about Egnew in

their responses. As a result, Egnew was demoted and later left the Rosenthal Group.

       1
         Only Gebreyessus and Preske were named as defendants in the February 2019
Complaint. Bavely, the daughter of a former AV Automotive president, was identified as an
“un-named co-conspirator” in AV Automotive’s initial and subsequent complaints. At all times
relevant to this case, Preske was Bavely’s boyfriend. He was never employed by AV
Automotive or Geneva. All claims against Preske were dismissed with prejudice on demurrer.

                                                2
       In their February 2019 Complaint, the Appellants alleged fraud, breach of fiduciary duty,

tortious interference with a contractual relationship or business expectancy, and business

conspiracy against Gebreyessus. Each count alleged that AV Automotive had been penalized by

Audi USA and would have to repay approximately $700,000 in bonuses (the “Audi Penalty”).

However, in a letter dated April 5, 2019, Audi USA advised AV Automotive’s counsel that Audi

USA “has not financially penalized, and does not intend to financially penalize, [AV

Automotive] in connection with the alleged submission to [Audi USA] of manipulated customer

surveys.” On April 9, 2019, the Appellants communicated by letter to Gebreyessus’ counsel that

they would withdraw the allegations regarding the Audi Penalty and the claim of damages in the

amount of $700,000. On August 16, 2019, four months after sending the letter to counsel, the

Appellants filed a praecipe with the circuit court withdrawing the allegations relating to the Audi

Penalty.

       AV Automotive designated Domenico Conti, an in-house accountant serving as the

Rosenthal Group’s Corporate Controller, as an expert witness to testify about Gebreyessus’

compensation, bonuses, and benefits; bonuses paid and terms for bonuses to AV Automotive;

and past lost profits relating to Egnew’s departure. Conti testified that he was made aware of his

expert designation three to four weeks prior to his deposition. In his deposition, Conti indicated

he had no opinion on damages suffered by the Appellants, but he confirmed the accuracy of a

document summarizing Gebreyessus’ commissions.

       After the Appellants’ withdrawal of the Audi Penalty claim and the taking of Conti’s

deposition, on September 13, 2019, Gebreyessus filed a motion for sanctions against the

Appellants and their counsel pursuant to Code § 8.01-271.1 for the “bad faith filing and

prosecution” of the lawsuit against her. Gebreyessus sought sanctions “in an amount sufficient

                                                 3
to cover the considerable amount of reasonable attorney’s fees needlessly incurred” in defending

the suit. She asserted that the Appellants lacked factual support for asserting the Audi Penalty

claims against her, as AV Automotive had never been penalized by Audi USA. Gebreyessus

additionally alleged that the Appellants attempted to conceal their bad faith by refusing to

produce corporate designees and expert witnesses for depositions. Gebreyessus specifically used

Conti’s expert designation to support an award of sanctions, arguing that Conti had no

knowledge of his designation until just a few weeks prior to his deposition and that he ultimately

gave no substantive opinions on damages. The Appellants opposed the motion.

       The Appellants filed motions to nonsuit as to all parties. 2 The circuit court granted the

motions to nonsuit, but it retained jurisdiction to address Gebreyessus’ sanctions motion.

       Following a hearing, the circuit court granted Gebreyessus’ motion for sanctions by final

order on December 30, 2020. Though the circuit court could not find most of the claims to be

frivolous or sanctionable, the court awarded sanctions of $213,196.95—Gebreyessus’ total

attorney’s fees—against the Appellants, but not against counsel. The award was based on the

Appellants’ “(1) repeated misrepresentations of actual penalties from Audi USA in the amount of

approximately $700,000.00; (2) the designation of Mr. Conti as an expert without his knowledge;

and (3) actions related to court ordered deposition dates.” The circuit court found that the

Appellants “failed to establish factual grounds to form a reasonable belief it had a claim for

damages under its contract claim with Audi USA.” The circuit court further found that Conti

was designated as an expert witness without his knowledge, and that the “lack of consultation

       2
         Geneva moved for a nonsuit on September 5, 2019. While Gebreyessus’ motion for
sanctions was pending before the circuit court, AV Automotive also moved for a nonsuit.

                                                 4
with a designated expert witness is even more egregious when said expert is an employee of the

Plaintiff.”

        Notably, the circuit court rejected the Appellants’ argument that attorney’s fees could not

be awarded to Gebreyessus because Gebreyessus was not paying her own attorney’s fees. 3 The

circuit court further rejected the contention that “[attorney’s] fees must be properly separated out

before [the circuit court could] make an award under Oxenham v. Johnson, 241 Va. 281 (1991),”

concluding that “it would be impossible to separate time spent solely defending against the

frivolous Audi Penalty claim because [AV Automotive] mixed in that frivolous claim with its

request for damages within nearly every count.”

        This appeal followed.

                                          II. ANALYSIS

        On appeal, the Appellants contend that the circuit court abused its discretion by imposing

sanctions against them under Code § 8.01-271.1. “Under settled principles, we apply an abuse of

discretion standard when reviewing a sanctions award pursuant to Code § 8.01-271.1.” Robert &

Bertha Robinson Fam., LLC v. Allen, 295 Va. 130, 139 (2018). This Court has identified three

primary ways a circuit court can abuse its discretion:

               when a relevant factor that should have been given significant
               weight is not considered; when an irrelevant or improper factor is
               considered and given significant weight; and when all proper
               factors, and no improper ones are considered, but the court, in
               weighing those factors, commits a clear error of judgment.

Galiotos v. Galiotos, 300 Va. 1, 11 (2021) (quoting Landrum v. Chippenham and Johnston-

Willis Hosps., Inc., 282 Va. 346, 352 (2011)). We have stated that a “court’s imposition of a

        3
         Gebreyessus, Preske, and Bavely had a joint defense agreement, whereby Bavely agreed
to pay for Preske’s and Gebreyessus’ attorney’s fees.

                                                 5
sanction will not be reversed on appeal unless the court abused its discretion in 1) its decision to

sanction the litigant, or 2) in the court’s choice of the particular sanction employed.” Switzer v.

Switzer, 273 Va. 326, 331 (2007).

       Code § 8.01-271.1(B)(ii) “provides that an attorney’s signature to a pleading has a two-

pronged effect: the attorney certifies that the pleading is well-grounded in fact, to the best of his

knowledge, and also that it is warranted by law, or a good faith argument for a change in the

law.” Ford Motor Co. v. Benitez, 273 Va. 242, 250 (2007). Code § 8.01-271.1 further states that

               [i]f a pleading . . . is signed or made in violation of this section, the
               court, upon motion or upon its own initiative, shall impose upon
               the person who signed the [pleading] . . . , a represented party, or
               both, an appropriate sanction, which may include an order to pay
               to the other party or parties the amount of the reasonable expenses
               incurred because of the filing of the pleading, . . . including
               reasonable attorney fees.

Code § 8.01-271.1(D).

                                      A. The Audi Penalty Claim

       The Appellants contend that their claims for damages associated with the Audi Penalty

were “well-grounded in fact at the time they were made,” and therefore, the circuit court abused

its discretion in imposing sanctions. When this Court reviews the imposition of sanctions

pursuant to Code § 8.01-271.1,

               we use an objective standard of reasonableness in determining
               whether a litigant and his attorney, after reasonable inquiry, could
               have formed a reasonable belief that the pleading was well
               grounded in fact, warranted by existing law or a good faith
               argument for the extension, modification, or reversal of existing
               law, and not interposed for an improper purpose.

Flippo v. CSC Assocs. III, L.L.C., 262 Va. 48, 65-66 (2001). Any doubts should be resolved in

favor of the counsel and party filing the pleading. Tullidge v. Board of Supervisors, 239 Va. 611,

614 (1990).

                                                  6
       In their February 19 Complaint and in subsequent pleadings, the Appellants claimed that

they were affirmatively damaged because of the falsified customer reviews. Specifically, they

claimed with certainty that

               “AV [Automotive] has been penalized by Audi USA. AV
               [Automotive] must repay bonus monies back to Audi USA for the
               entire time when the false customer surveys were in play. AV
               [Automotive] has been damaged in the amount of approximately
               $700,000.00.”

(Emphases added). It later became apparent that at the time of the filings, Audi USA had not

financially penalized AV Automotive. Audi USA unquestionably advised AV Automotive’s

counsel that Audi USA had not, and did not intend to, financially penalize AV Automotive in

reference to the submission of the falsified customer surveys. Thus, when the Appellants filed

their pleadings, neither party could have had an objectively reasonable belief that the Audi

Penalty damage claims were grounded in fact, as required by Code § 8.01-271.1. Therefore, the

circuit court did not abuse its discretion in sanctioning the Appellants for their “repeated

misrepresentations of actual penalties from Audi USA.”

                                   B. Issues Pertaining to Discovery

  i.   Sanctions Awarded Against Appellants and Not Counsel

       The Appellants contend on appeal that the circuit court erred in awarding sanctions

against them and not their attorneys for issues related to discovery. Code § 8.01-271.1 “provides

that if this rule is violated, the court ‘shall impose’ an appropriate sanction upon the attorney, a

represented party, ‘or both,’ and that such sanctions may include reasonable attorney’s fees.”

Northern Va. Real Est., Inc. v. Martins, 283 Va. 86, 105 (2012) (emphasis added). When

“sanctioned parties desire to seek allocation of fault or the apportionment of such sanctions

[between attorney and client], they carry the burden of providing the trial court with evidence

                                                  7
sufficient to do so.” Id. at 115. The record is devoid of any indication that the Appellants met

their burden of providing the circuit court with evidence sufficient to allow the apportionment of

sanctions. To the contrary, the circuit court stated in a footnote that it had “exercised discretion

in not sanctioning plaintiff’s counsel in addition to the plaintiff” and gave counsel “the benefit of

the doubt given that counsel’s actions were based on information received from [the

Appellants.]” Consequently, we cannot say that the circuit court abused its discretion in

awarding sanctions against only the Appellants.

 ii.   Expert Witness Designation

       In awarding sanctions, the court took issue with the Appellants’ lack of consultation with

their expert prior to designation, finding it particularly “egregious” where that expert was their

own employee.

       On appeal, the Appellants argue that “nothing egregious or sanctionable has occurred

when an employee or in-house expert testifies to information learned or acquired during [their]

employment and testifies consistent[ly] with [their] expert disclosure.” The expert witness

designation stated that Conti, an employee of the Rosenthal Group, was expected to testify

concerning the damages incurred by the Appellants because of Gebreyessus’ conduct. The

designation states that Conti was designated as an expert in the field of accounting only to the

extent his testimony was considered “expert in nature.” Conti was not a hired expert, and he

testified in his deposition that he was not compensated for his expert testimony. Although Conti

testified that he learned of his designation as an expert witness only three to four weeks prior to

his deposition, he had prepared documents detailing Gebreyessus’ compensation that he

referenced during his deposition six months prior. In his deposition testimony, Conti provided

only information to which he had access by virtue of his employment. Because Conti was an

                                                  8
employee of the Appellants, and thus not a true “expert witness,” we agree with the Appellants

that Conti’s delayed notification of his expert designation is not sanctionable conduct under

Code § 8.01-271.1.

 iii.   Deposition-Related Issues

        The circuit court based its sanctions award, in part, on “actions related to court ordered

deposition dates.” Because the circuit court did not explain its reasoning as to this basis, we can

only presume it was referencing Gebreyessus’ argument that the Appellants went “to

extraordinary lengths to delay their own party depositions as well as their two designated

experts” by extensively rescheduling and eventually forcing Gebreyessus to obtain an order

compelling the depositions. Code § 8.01-271.1 is triggered by a “pleading, motion or other

paper.” See EE Mart F.C., LLC v. Delyon, 289 Va. 282, 286 (2015); Environment Specialist,

Inc. v. Wells Fargo Bank Nw., 291 Va. 111, 117 (2016). While we agree with the circuit court

that the actions of the Appellants in delaying depositions may have been sanctionable, the circuit

court failed to cite to any offending pleadings, motions, or papers surrounding these delays that

support the award of sanctions under Code § 8.01-271.1. However, because the court could have

awarded sanctions “for actions related to court ordered deposition dates” by relying on Rule

4:12(b) and (d), it appears the court nonetheless reached the right result for a different reason.4

        4
        The sanctions a trial court may impose if a party fails to comply with an order
compelling discovery are detailed in Rule 4:12(b)(2), which provides, in relevant part:

               If a party . . . fails to obey an order to provide or permit discovery
               . . . the court in which the action is pending may make such orders
               in regard to the failure as are just, . . . [and] the court must require
               the party failing to obey the order or the attorney advising him or
               both to pay the reasonable expenses, including attorney’s fees,
               caused by the failure, unless the court finds that the failure was
               substantially justified or that other circumstances make an award
               of expenses unjust.

                                                  9
                                   C. Attorney’s Fees as a Sanction

  i.   The Meaning of Attorney’s Fees Incurred under Code § 8.01-271.1
       The Appellants contend on appeal that the circuit court abused its discretion in awarding

attorney’s fees as a sanction under Code § 8.01-271.1 because Gebreyessus did not “incur” any

attorney’s fees in this case. Because Bavely paid Gebreyessus’ fees, there were no fees for

Gebreyessus to recover. This Court has not addressed whether a represented party who is not

personally paying his or her own attorney’s fees has incurred reasonable expenses that may

subsequently be awarded as sanctions pursuant to Code § 8.01-271.1.

       Textually, the statute provides that a court “shall impose . . . an appropriate sanction,

which may include an order to pay to the other party . . . the amount of the reasonable

expenses incurred because of the filing of the pleading, . . . including reasonable attorney

fees.” Code § 8.01-271.1(D). It does not provide that the court “shall impose . . . an appropriate

sanction, which may include an order to pay to the other party . . . the amount of the reasonable

expenses incurred directly by the other party because of the filing of the pleading, . . . including

reasonable attorney fees.” Code § 8.01-271.1(D). 5 The General Assembly allows sanctions for

fees that have been “incurred.” Here, the lawyers were not working for free. Their fees were

       5
          The language of Code § 8.01-271.1(D) contrasts with the language of Code § 38.2-
2201. In Code § 38.2-2201(A)(3)(a), the General Assembly equated “incurred” with an expense
that the “insured is directly responsible for payment of . . . .” That language – “directly
responsible for payment of” – is absent from Code § 8.01-271.1. “[W]hen the General Assembly
has used specific language in one instance, but omits that language or uses different language
when addressing a similar subject elsewhere in the Code, we must presume that the difference in
the choice of language was intentional.” Zinone v. Lee’s Crossing Homeowners Ass’n, 282 Va.
330, 337 (2011); see also Halifax Corp. v. Wachovia Bank, 268 Va. 641, 654 (2004) (“[W]hen
the General Assembly includes specific language in one . . . statute, but omits that language from
another . . . statute, [courts] must presume that the exclusion of the language was intentional”
because under these circumstances, it is evident that the General Assembly “knows how” to
include such language in a statute to achieve an intended objective; thus the “omission of [such]
language [in another statute] represents an unambiguous manifestation of a contrary intention.”

                                                 10
incurred. Even if their fees are ultimately paid for by Bavely rather than by Gebreyessus, that

does not make them any less “incurred.” It is not unusual for counsel fees to be covered by a

non-party, such as a corporation, an insurance company, a parent, legal aid, or a civil rights

group.

         Furthermore, the purpose of imposing sanctions is “punishment and deterrence” – not

compensation. Cardinal Holding Co. v. Deal, 258 Va. 623, 632 (1999). Therefore, even if an

opposing party who is not paying the attorneys’ fees obtains a “windfall,” that does not preclude

the imposition of a sanction to cover the cost of the attorneys’ fees.

         Code § 8.01-271.1 dictates that when the statute has been violated, the court “shall

impose . . . an appropriate sanction, which may include an order to pay to the other party . . . the

amount of the reasonable expenses incurred because of the filing of the pleading, . . . including

reasonable attorney fees.” Code § 8.01-271.1(D) (emphases added). We conclude that

regardless of whether the attorney’s fees were incurred personally by Gebreyessus, the fees were

incurred on her behalf because of the filing of the sanctionable pleadings. The circuit court was

within its discretion to hold that an award of those fees as a sanction was sufficient to “deter the

conduct at issue in this matter.” However, for the reasons that follow, we find that the circuit

court erred in awarding the total amount of the attorney’s fees claimed.

 ii.     Amount of Attorney’s Fees Awarded as Sanctions

         On appeal, the Appellants contend that the circuit court erroneously awarded a sanction

of the total amount of attorney’s fees claimed by Gebreyessus. Specifically, they argue that the

circuit court erred in refusing to segregate the attorney’s fees incurred due to sanctionable

conduct from the fees incurred for non-sanctionable conduct.

                                                 11
       In its final order, the circuit court rejected the Appellants’ contention that “[attorney’s]

fees must be properly separated out before [the circuit court could] make an award under

Oxenham v. Johnson, 241 Va. 281 (1991).” The circuit court concluded that the facts of this

case distinguish it from Oxenham, where this Court’s decision was based on the “failed attempt

of the parties to separate its fees based on defending against the purely compensatory damages

versus the punitive damages.” The circuit court stated that “it would be impossible to separate

time spent solely defending against the frivolous Audi Penalty claim because [the Appellants]

mixed in that frivolous claim with [their] request for damages within nearly every count.”

                      Code § 8.01-271.1 expressly limits the amount that may be
               awarded to an appropriate sanction, which may include those
               attorney’s fees and expenses “incurred because of the filing of the
               pleading, motion, or other paper or making of the motion.”
               (Emphasis added.)

EE Mart F.C., L.L.C., 289 Va. at 286. The “incurred because of” language in Code § 8.01-271.1

requires that when a trial court awards attorney’s fees as a sanction, those fees must have been

sustained as a direct result of the sanctionable conduct. Id. Consequently, an appropriate

sanctions award of attorney’s fees pursuant to Code § 8.01-271.1 is restricted to fees incurred

acting in response to the sanctionable pleading. Id. (citing Oxenham, 241 Va. at 289-90).

       We find that Oxenham is indistinguishable in any way that is pertinent to the case before

us. The trial court in Oxenham awarded sanctions against a plaintiff’s attorney for violations of

Code § 8.01-271.1, which stemmed from a malicious prosecution claim brought against a

Department of Social Services licensing inspector. Oxenham, 241 Va. at 284-85. In the course

of litigation, it became clear that the subject charging decision was made by the licensing

administrator and not the licensing inspector. Id. However, the plaintiff persisted with the

malicious prosecution claim and made a damages claim against the licensing inspector. Id. The

                                                 12
jury ultimately found for the defense, and the licensing inspector filed a motion for sanctions

against the plaintiff. Id. The trial court awarded sanctions, finding that the plaintiff failed to

conduct a reasonable investigation and the purpose for filing the action was “to harass the

defendant.” Id. at 286.

       On appeal, this Court held that the trial court erroneously based the sanction award, at

least in part, on the plaintiff’s continued claim for compensatory damages after discovery

revealed that the licensing inspector was likely not the person who made the charging decision.

This Court further found that although the plaintiff’s frivolous claim for punitive damages should

not have been presented at trial, elements of the compensatory damages claim were “subsumed

in [plaintiff’s] claim for punitive damages.” Id. at 290. Since the “sanction requested and

imposed was an award of attorneys’ fees,” the

               [licensing inspector’s] attorneys’ time spent in defending the
               punitive damage claim should have been segregated and the
               sanction based only on the time taken in defending that claim.
               Although the trial court did not award the full amount of the
               attorneys’ fees claimed, it based its award upon a projection of the
               time [licensing inspector’s] attorneys spent in defending the entire
               case. In doing so, it based its conclusion upon an erroneous
               application of the law and thereby abused its discretion.

Id. This Court, however, refused to remand the case to the trial court, finding that further

proceedings in an attempt to apportion the fees “would impose additional and unnecessary

burdens upon [the licensing inspector] and the trial court.” Id.

       Here, the circuit court failed to make any attempt to segregate the amounts incurred

because of the Appellants’ sanctionable conduct, namely, the costs incurred defending the Audi

Penalty claim. See Oxenham, 241 Va. at 290; Code § 8.01-271.1. Therefore, the award of

sanctions in the full amount of Gebreyessus’ requested attorney’s fees was improper and an

abuse of discretion. We do not find that it “would impose additional and unnecessary burdens”

                                                  13
on the circuit court to segregate fees related to the Audi Penalty claim, as Gebreyessus’ attorneys

provided detailed billing statements and invoices. See Oxenham, 241 Va. at 290. “[E]ven if the

trial court found the task of apportioning attorney’s fees between frivolous and non-frivolous

claims to be unworkable, a public censure or other ‘appropriate sanction’ could be imposed to

‘give effect to the [statute’s] central goal of deterrence.’” Id. at 299 n.4 (Poff, J., dissenting)

(quoting Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 393 (1990)).

                                         III. CONCLUSION

        For the reasons stated, we conclude that the circuit court was within its discretion to

award sanctions against the Appellants. However, we find that the circuit court abused its

discretion in awarding sanctions for Appellants’ failure to notify Conti of his expert witness

designation. We also find that the circuit court abused its discretion in failing to segregate the

sanctionable Audi Penalty claim from the attorney’s fees requested. Accordingly, we reverse the

sanctions award and remand the matter to the circuit court for a recalculation of the attorney’s

fees commensurate with this opinion.

                                                   Affirmed in part; reversed and remanded in part.

JUSTICE CHAFIN, with whom JUSTICE KELSEY joins, concurring in part and dissenting in
part.
        The majority holds that although Gebreyessus’ attorney’s fees were not personally

incurred by Gebreyessus, they were incurred on her behalf in response to the Appellants’

sanctionable pleadings. For this reason, the majority holds that the circuit court could award

those fees as a sanction pursuant to Code § 8.01-271.1. Because the plain language of the statute

contradicts the majority’s holding on this issue, I respectfully dissent.

                                                  14
       “Alleged errors involving statutory interpretation or application present questions of law

that we review de novo on appeal.” Lucas v. Riverhill Poultry, Inc., 300 Va. 78, 87 (2021). This

Court is bound by the “plain language of a statute unless the terms are ambiguous or applying the

plain language would lead to an absurd result.” Id. (quoting Boynton v. Kilgore, 271 Va. 220,

227 (2006)). “We must also assume that the legislature chose, with care, the words it used when

it enacted the relevant statute.” Barr v. Town & Country Props., Inc., 240 Va. 292, 295 (1990).

“Where the General Assembly has expressed its intent in clear and unequivocal terms, it is not

the province of the judiciary to add words to the statute or alter its plain meaning.” Couplin v.

Payne, 270 Va. 129, 137 (2005) (quoting Jackson v. Fidelity & Deposit Co., 269 Va. 303, 313

(2005)). In addition, “[i]n th[e] Commonwealth, courts . . . are not free . . . to ignore language[ ]

contained in statutes.” SIGNAL Corp. v. Keane Fed. Sys., Inc., 265 Va. 38, 46 (2003); Andrews

v. Richmond Redevelopment & Hous. Auth., 292 Va. 79, 86 (2016). “That is to say, ‘[w]hen the

legislature has used words of a plain and definite import the courts cannot put upon them a

construction which amounts to holding the legislature did not mean what it has actually

expressed.’” Andrews, 292 Va. at 87 (quoting Kiser v. A.W. Chesterton Co., 285 Va. 12, 25

(2013) and Barr, 240 Va. at 295).

       Code § 8.01-271.1 states that the court “shall impose . . . an appropriate sanction, which

may include an order to pay to the other party . . . the amount of the reasonable expenses

incurred because of the filing of the pleading, . . . including reasonable attorney fees.”

Code § 8.01-271.1(D) (emphases added). To “incur” is “[t]o suffer or bring on oneself (a

liability or expense).” Black’s Law Dictionary 917 (11th ed. 2019); see also Webster’s Third

New International Dictionary 1146 (2002) (defining “incur” as “becom[ing] liable or subject to”

or “bring[ing] down upon oneself”). In effect, the majority’s interpretation of Code § 8.01-271.1

                                                 15
adds words to the statute. The majority opinion directs that if a pleading violates the statute, the

trial court “shall impose . . . an appropriate sanction, which may include an order to pay to the

other party or parties the amount of the reasonable expenses personally incurred, or incurred on

behalf of the party, because of the filing of the pleading, . . . including reasonable attorney fees.”

See Couplin, 270 Va. at 137 (reiterating that courts cannot add language to statutes).

       The majority overlooks that the plain meaning of the term “incur” is to personally take on

an expense or liability. Instead, the majority relies heavily on the fact that the attorney’s fees

were ultimately paid, even if they were paid by Bavely, a non-party, and not Gebreyessus. This

reasoning is incomplete. The majority correctly states that “[i]t is not unusual for counsel fees to

be covered by a non-party.” However, in such scenarios (e.g., insurance companies, legal aid

clinics, civil rights groups, etc.), fees would be awarded to the party because the party was

legally liable (either by contract or implied indemnity principles) to reimburse the non-party

payor. A party can only “incur” a legal expense when the party agrees to pay the fees directly or

to pay them indirectly by incurring a liability to reimburse the actual payor. However, this logic

does not apply to the case at hand. Gebreyessus never asserted that she was obligated to repay

any attorney’s fees to Bavely under their joint defense agreement. If Gebreyessus had been

obligated to reimburse Bavely, then Gebreyessus would have indirectly “incurred” the expense.

That is not what Gebreyessus asserts and, as the party seeking relief, she has the burden of proof.

       The majority further contends that Code § 8.01-271.1 is punitive and not compensatory,

thus allowing a court to award a punitive fee to Gebreyessus, who did not directly or indirectly

incur any attorney’s fees, so long as someone else paid the attorney’s fees. This argument,

though novel, is unprecedented and not supported by Virginia law. Under this construct, the

majority misdescribes the punitive sanction as a fee award. While it is an award, it is not one of

                                                  16
fees. Rather, it is a judicially imposed fine calculated at the court’s discretion. Neither the plain

language of the statute nor its policy context supports this view by the majority.

       To the extent that the majority opinion endorses a reading of Code § 8.01-271.1 that

construes the statute as authorizing payment of the reasonable expenses arising from the filing of

the offending pleading, including reasonable attorney fees, it impermissibly ignores the

restrictive scope of “incurred.” SIGNAL Corp., 265 Va. at 46; Andrews, 292 Va. at 87.

       While this Court has not previously defined the term “incurred” in the context of

Code § 8.01-271.1, we have interpreted the term in instances involving automobile insurance

policies covering medical expenses under Code § 38.2-2201. The General Assembly legislated

that, in the context of medical payments in liability insurance policies, an expense is “incurred”

if the “insured is directly responsible for the payment of the expense.” Code § 38.2-

2201(A)(3)(a).

       In Virginia Farm Bureau Mut. Ins. Co. v. Hodges, 238 Va. 692 (1989), the plaintiff, who

injured her arm in an automobile accident, sued her insurer. On appeal, we considered whether

the plaintiff incurred certain medical expenses within a year under a former version of Code

§ 38.2-2201. The policy provided coverage for “all reasonable expenses . . . incurred within one

year * from the date of the accident for necessary medical services.” Hodges, 238 Va. at 693.

The plaintiff’s arm required several surgeries that could not be completed within one year. Id. at

694. In a signed memorandum, the plaintiff agreed to pay the cost of the necessary surgeries. Id.

The memorandum was forwarded to the insurer but not to the surgeon or hospital. Id. at 695-96.

Even though the plaintiff did not pay the surgeon during the year after her accident, she claimed

       *
         Code § 38.2-2201 now provides coverage for reasonable medical expenses “incurred
within three years after the date of the accident.” Code § 38.2-2201(A)(1).

                                                 17
that her signed memorandum obligated her to do so. Id. at 695. The plaintiff sued her insurer for

the cost of surgery even though she had not undergone the surgery and had not entered a binding

contract with the doctor to perform the surgery after the one year. Id. at 694-95. The circuit

court interpreted the term “incurred,” as used in the policy, as including future treatment costs of

medical needs that were diagnosed within the specified year, even if treatment would necessarily

extend beyond that year. Id. at 695. The circuit court ordered the insurer to pay the amount for

which the plaintiff was billed. Id. In reversing the circuit court, we stated that a medical

expense “can only be ‘incurred’ . . . when one has paid it or become legally obligated to pay it.”

Id. at 696. Because no binding contract existed between the plaintiff and the surgeon, the insurer

was under no obligation to pay the future medical bills. Id. Therefore, we concluded that

because the future medical expenses were not incurred within the first year after the plaintiff’s

accident, they were not recoverable from the insurer. Id.

       In State Farm Mut. Auto. Ins. Co. v. Bowers, 255 Va. 581, 585 (1998), we affirmed the

Hodges definition of “incurred.” In Bowers, after the plaintiff was injured in an automobile

accident, he challenged the amount he was owed under the medical payment provisions of his

contract with his automobile insurer. Id. at 583. The contract at issue stated that the insurer was

to pay “all reasonable and necessary expenses for medical . . . services . . . incurred.” Id. This

Court concluded that the “medical expenses [the plaintiff] ‘incurred’ were the amounts that the

health-care providers accepted as full payment for their services rendered to him. [The plaintiff]

has not paid nor is he ‘legally obligated to pay’ the amounts written off by the providers.” Id. at

585-86. We noted that “[t]o decide otherwise would be to grant [the plaintiff] a windfall because

he would be receiving an amount greater than that which he would ever be legally obligated to

pay.” Id.

                                                 18
       As evidenced by the clear language of the statute, the General Assembly’s definition of

the term in other contexts, and our prior interpretations of “incurred” in Hodges and Bowers, it is

evident that the term “incurred” as used in Code § 8.01-271.1 refers to attorney’s fees that were

personally paid by Gebreyessus, or attorney’s fees that Gebreyessus was legally obligated to pay.

       I am of the opinion that the majority opinion will result in the same outcome we avoided

in Bowers. Gebreyessus will receive a windfall, as she failed to assert on appeal that she

personally incurred any expenses for attorney’s fees. Gebreyessus maintains that Code § 8.01-

271.1 does not “require the moving party to have personally incurred attorney’s fees,” nor does it

say that the fees “must be incurred by a party” in the case. Prior to the filing of the motion for

sanctions on September 13, 2019, the invoices submitted by the law firms engaged in

Gebreyessus’ defense were not addressed or directed to Gebreyessus. The invoices were

addressed to her co-defendant or listed no recipient. The only invoices addressed to Gebreyessus

were submitted after the motion for sanctions was filed, which gave the false impression that

Gebreyessus was personally responsible for the fees. In actuality, the invoices were paid by

funds previously deposited into the law firms’ trust accounts.

       Significantly, Bavely, a non-party, in her sworn deposition testimony stated that she was

“paying the bills for Miss Gebreyessus for this case.” On appeal, Gebreyessus concedes that no

evidence in the record proves or disproves that she was obligated to repay attorney’s fees and

costs to Bavely. In fact, one of the fee invoices contains a line item for research on the

discoverability of their joint defense agreement. If Gebreyessus was required to reimburse

Bavely under their joint defense agreement, Gebreyessus’ attorneys certainly would have

trumpeted it as a basis for proving that Gebreyessus personally incurred the attorney’s fees.

                                                 19
       For these reasons, I would reverse the circuit court’s decision in reference to the award of

attorney’s fees as sanctions, and therefore, I dissent from the majority’s opinion as to this

question.

                                                 20