Court Opinion

ID: 9483462
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:21:11.139588+00
Date Added: 2024-06-11T17:49:38.509626
License: Public Domain

LUTTIG, Circuit Judge,
dissenting.
Appellee Atalla and appellant Abdul-Baki entered into a “Settlement Agreement and Mutual Release” for the expressed purpose of “settl[ing] all disputes and claims they have or may have against each other.” J.A. at 82. Paragraph 10 of that agreement provided as follows:
10. Atalla ... releases, remises and forever discharges Abdul Baki from any and all claims, demands, damages and causes of action of any kind, whether past or present and whether or not now claimed or known, that he has had, now has or may hereafter have in connection with any matter whatsoever from the beginning of time through the date hereof.
Id. at 83-84. The sole issue in this appeal is whether this paragraph, which was drafted largely if not entirely by counsel, waived any equitable right to contribution under Virginia law that Atalla might have had against Abdul-Baki as a consequence of Atalla’s payment of a disproportionate share of the parties’ guaranty obligation to Arab Bank, Ltd.
Both parties at argument stated unequivocally that the case was appropriate for summary judgment and that a remand by this court for factual findings on their intent was unnecessary and would prove fruitless, because no relevant extrinsic evidence as to their intent exists. Notwithstanding these representations by the two individuals who presumably would know whether any purpose could possibly be served by a remand, the court remands for an evidentiary hearing on the actual intent of the parties in including paragraph 10 in their agreement — a hearing that even the court acknowledges might not be necessary. A remand is necessary, the court assures the parties, because paragraph 10 is “ambiguous.”
In my view, it would be difficult to conceive of a more comprehensive and less ambiguous waiver than that in paragraph 10. Atalla, in that paragraph, "release[d] ... and forever discharge^]” Abdul-Baki from “any and all claims, demands, damages and causes of action of any kind,” “past or present,” “whether or not [then] claimed or known,” “that he ha[d] had, [then] ha[d] or may [thereafter] have” “in connection with any matter whatsoever from the beginning of time through the date [t]hereof.” Indeed, in frank response to questioning from the court at argument, counsel for appellee himself could not conceive of a broader or clearer waiver.
The court appears to agree that the language of paragraph 10 is unambiguous that Atalla completely waived all claims that he had or might have against Abdul-Baki. However, the paragraph is rendered ambiguous, it says, because it is possible to read paragraph 5 of the agreement as an affirmative preservation of a right of contribution in Atalla against Abdul-Baki. *196Ante at 194. In paragraph 5, the parties “acknowledge their joint and several guaranty to both the Arab Bank Ltd. and Credit Commerciale de France and [agree to] sign the necessary documents as requested by the banks.” J.A. at 82 (emphasis added).
To contend that paragraph 10 is ambiguous because of the presence of paragraph 5 is, as Abdul-Baki suggests, “a legal non sequitur.” Appellant’s Br. at 15. Paragraph 5 is what its plain language says it is — an acknowledgment by the parties that each remains liable to the bank on the executed surety agreement and an undertaking to sign the documents requested by the bank. That is, it acknowledges that the bank may seek payment from either Atalla, Abdul-Baki, or both of them, under the terms of the surety agreement. Atalla’s right to contribution, of course, is not included within the surety agreement with the bank; if any such right exists, it is wholly a product of Virginia’s law of equity. Thus, the mere acknowledgment of the parties’ agreement with the bank cannot possibly “preserve” a contribution right.1
The court is unable to articulate how paragraph 5 is in any way inconsistent with, or for that matter how it could in any way affect, paragraph 10. It even concedes that paragraph 5 “does not explicitly recognize the continuing existence of the liability of each to the other for his share of the debt when repaid.” Ante at 194. The only asserted support for its possible alternative interpretation of the paragraph — textual or otherwise — is the fact that paragraph 8 purports to recognize “some claims” and commit their resolution to arbitration. Id. The court says that it must interpret paragraph 10 so as to “give[ ] effect to th[is] more specific treatment of claims referred to arbitration.” Id. at 193.
Nothing in paragraph 8, however, could transform the mere acknowledgement of liability to a third party and an agreement to sign requested documents in paragraph 5 into the affirmative reservation of an equitable contribution right in Atalla against Abdul-Baki. The court leaves the impression that at least Atalla contends that paragraph 8 references the contribution claim at issue here, thus (so the argument goes) confirming that paragraph 5 was intended to preserve this claim. Id. (“[B]oth parties agree clearly [that paragraph 8] preserves some claims for arbitration.”). In fact, in representations that I would regard as dispositive of the irrelevance of paragraph 8 to this dispute, both parties agree that paragraph 8 was never intended to encompass this contribution claim — an unambiguous statement of the parties’ intent that the court never mentions, yet must dismiss out of hand to find the ambiguity that it does. See J.A. at 364-65 (Atalla); Appellant’s Br. at 15 (Abdul-Baki).
The court completes its categorical rejection of the plain language of the settlement agreement with the revealing suggestion that even the meaning of the term “cause of action” in paragraph 10 must be plumbed on remand to ascertain what the parties intended, because the meaning of the term under Virginia law turns upon what the court fears is “so a technical distinction” that both parties may not have considered that the legal meaning would obtain. Ante at 194. Paragraph 10 was drafted and approved by parties with knowledge of the law, and the parties should be held to the legal meaning of the terms of art used throughout the document.2 Virginia law clearly recognizes a *197distinction between a “cause of action” and a “right of action.” See, e.g., Gemco-Ware, Inc. v. Rongene Mold & Plastics Corp., 234 Va. 54, 360 S.E.2d 342, 343-44 (1987); Shiflet v. Eller, 228 Va. 115, 319 S.E.2d 750, 754 (1984). And it appears that the cause of action for contribution on a guaranty from a co-surety arises at the time the guaranty is executed. The court all but concedes as much. Ante at 194. Because Atalla’s contribution cause of action existed at the time the parties entered into their settlement agreement, it was, by the plain terms of paragraph 10, waived.3
Although the court does not address the issue, Virginia’s distinction between causes of action and rights of action is irrelevant in the context of this case in any event, if the plain language of the parties’ agreement is respected. Atalla released and forever discharged Abdul-Baki not only from any and all causes of action, but also from “any and all” “claims” and “demands.” Any asserted “right of action” certainly would constitute a “claim” or “demand.” And given that Atalla discharged Abdul-Baki from any and all claims in futuro and whether or not then in existence, it would be irrelevant that that right of action arose after the agreement was executed.
The theme of the court’s opinion is that this is a case in which a “general release in broad terms” must be read so as to preserve “expressly stated” rights in other paragraphs of the same document. Id. at 193. Its underlying policy concern is that construing broad language of waiver so as to negate rights otherwise clearly recognized “would do violence to” “[agreements resolving complex commercial disputes.” Id. If the contribution right had been agreed upon in another provision of the document, then this general maxim of interpretation might have force. But its inapplicability is manifest where, as here, the predicate to it application, i.e., that the alleged right is “expressly stated” or preserved elsewhere, is absent.
The court’s opinion points up the costs that inhere in a jurisprudence of contract interpretation that attempts to divine the “intent of the parties” independent of the language that they choose to embody their intent. For adherents to this jurisprudence, no unambiguous contractual provision dictates an “unfair” result. As here, an “ambiguity” is always found, regardless of the clarity of the contractual language. And once found, the court is essentially free to give legal effect to its own sense of what would be fair as between the contracting parties.
The parties before us entered into a settlement agreement for the stated purpose of “settling] all disputes and claims they have or may have against each other.” I would give effect to this unambiguous agreement, and I respectfully dissent from the court’s unwillingness to do so.

. Nor is it true, contrary to Atalla’s argument, that paragraph 5 must refer to the contribution claim because otherwise the paragraph would not define any right as between the parties. Other paragraphs in the agreement similarly do not define rights of the two parties vis-a-vis each other. See, e.g., J.A. at 82, ¶¶ 3, 4.

. The court, curiously, suggests that the intent of the parties should govern over the "intricacies of state law unless [such intricacies] can be shown to have been within the contemplation of the parties when the agreement was reached," id. at 194, a proposition for which it cites 4 Williston on Contracts § 601, at 306 (H.E. Jaeger ed., 3d ed. 1961). In that passage, Professor Williston actually states what would appear to be the opposite principle of contract construction. He notes that “ '[w]ords generally bear their usual and common signification; but technical words, or words of art, or used in a particular trade or business, will be construed, general*197ly, to be used in reference to this peculiar meaning,' " absent special definition in the contract or pattern of dealing suggesting a contrary definition. Id. (quoting Johnson v. United States Fidelity & Guar. Co., 93 Ga.App. 336, 341, 91 S.E.2d 779 (1956), which was in turn quoting a statutory provision). Professor Williston goes on, supra at 309, to quote approvingly from Hicks v. Mid-Kansas Oil & Gas Co., 182 Okl. 61, 76 P.2d 269, 271-72 (1938) (internal quotations omitted, and modified to reflect case text accurately) (emphasis added), as follows:
[A] contract must be interpreted as to give effect to the mutual intention of the parties at the time of contracting, and in so doing the language of the contract governs if it is clear and does not involve an absurdity, and the intention of the parties to a written contract is to be ascertained from the writing alone, if possible.... [I]t is the duty of the courts to declare the meaning of what is written in the instrument, not of what was intended to be written.
The court also attempts to draw support for its general approach to contract interpretation from comment f to the Restatement (Second) of Contracts § 202(3). The actual Rule of which comment f is explanatory, however, states that "[u]nless a different intention is manifested, ... (b) technical terms and words of art are given their technical meaning when used in a transaction within their technical field.”

. While the court apparently does not appreciate the force of this argument, Atalla certainly does. Throughout his brief, he noticeably omits from his discussions of paragraph 10 its explicit reference to the waiver of any and all “causes of action," referring instead only to the paragraph’s waiver of all “claims.”