Court Opinion

ID: 4261521
Source: CourtListenerOpinion
Date Created: 2018-04-05 13:50:30.016475+00
Date Added: 2024-06-11T07:49:21.331679
License: Public Domain

PRESENT: Lemons, C.J., Goodwyn, McClanahan, Powell, Kelsey, and McCullough, JJ., and
Koontz, S.J.

RECP IV WG LAND INVESTORS LLC
                                                              OPINION BY
v. Record No. 161506                                   ELIZABETH A. McCLANAHAN
                                                              April 5, 2018
CAPITAL ONE BANK (USA), N.A.

                    FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
                                 John M. Tran, Judge

       This case involves a dispute over contractual provisions in a real estate purchase

agreement (“Agreement”) allocating future development rights for properties located near a new

Metro rail station in Tysons Corner. Appellant RECP IV WG Land Investors LLC (“WG Land”)

is an assignee of certain rights of the seller under the Agreement and appellee Capital One Bank

(USA), N.A. (“Capital One”) is the assignee of the purchaser. WG Land challenges the circuit

court’s dismissal of its suit against Capital One instituted on allegations that Capital One

breached the Agreement and certain related covenants by Capital One’s development of the

property acquired under the Agreement. WG Land also challenges the court’s award of

attorney’s fees to Capital One. Concluding there is no reversible error in the judgment of the

circuit court, we affirm.

                                                 I.

                                                 A.

       In 2000, WG Land’s predecessor, West*Group Properties, LLC (“West*Group”),

subdivided an office park (“Office Park Property”) in the Tysons Corner area of Fairfax County

and sold approximately 29 acres of the park (“Capital One Property”) to Capital One’s

predecessor, Capital One Financial Corporation (“Capital One Financial”), pursuant to the terms

of the Agreement and a related Supplemental Declaration and Restrictive Covenant
(“Declaration”). At the time of the sale, the Office Park Property was subject to a numerical cap

on the development density under Fairfax County’s Comprehensive Plan by the allocation of a

maximum amount of floor area ratio (“FAR”) for the properties in that area. FAR is the

relationship between the total amount of a building’s usable floor area and the total area of the

parcel upon which the building stands. For example, a FAR of 1.0 means the gross floor area of

the building(s) must not exceed the area of the parcel, whereas a FAR of 2.0 means the gross

floor area of the building(s) must not exceed twice the area of the parcel. Thus, with this cap on

FAR in place, an allocation of more FAR for the Capital One Property meant that less FAR

would be available for West*Group’s remaining parcels, and vice versa. FAR is commonly

expressed in square footage and using that formulation, as set forth in the Agreement and

recorded Declaration, West*Group transferred 1.1 million square feet of FAR to Capital One

Financial from the total amount of FAR allocated for the Office Park Property by the County.

          The parties included provisions in the Agreement and Declaration restricting Capital One

Financial’s use and development of the Capital One Property. An eight-year restriction on

Capital One Financial’s right to apply for additional FAR rights from the County was imposed.

West*Group was also given the right to repurchase the Capital One Property if Capital One

Financial sought to sell or lease it, including any FAR associated with it, within a ten-year

period.

          Furthermore, because the parties anticipated that the Metro rail system’s expansion would

result in the County allowing more development density in the area, they included a specific

mathematical formula (“FAR formula”) to apportion between West*Group and Capital One

Financial any additional FAR that might become “available” to the Capital One Property. Under

this “shar[ing]” formula, Capital One Financial would receive the first 200,000 square feet of

                                                 2
such FAR and the remainder would be fractionally divided between the two parties. The

Agreement in § 28.7(b) and the Declaration in 4 contain identical language in setting forth the

FAR formula. Significantly, the FAR formula incorporated a portion of Fairfax County’s 2000

Comprehensive Plan (“2000 Plan”) entitled “Transit Station Areas,” which specified the

expected fixed amount of FAR that would be available to properties located around a new Metro

rail station in Tysons Corner such as the Capital One Property and neighboring properties.

Pursuant to the 2000 Plan, the FAR for the Capital One Property would range from 1.0 to 1.5

within what the FAR formula referred to as the County’s “Existing Metro Overlay” district.

       In 2010, West*Group assigned its rights under the Agreement and Declaration to WG

Land and transferred to WG Land ownership of the remaining parcels comprising the Office

Park Property. WG Land immediately assigned and transferred the same to various special

purpose entities of which WG Land was the majority owner. Those entities subsequently

assigned their intangible rights under the Agreement back to WG Land, including the right to

receive a portion of new FAR allocated to the Capital One Property. But those entities did not

transfer title to their respective properties. Thus, WG Land does not hold title to any of the

neighboring properties benefited by the Declaration (“Neighboring Properties”).

       Also in 2010, the County amended its Comprehensive Plan (“2010 Plan”) with an

“Amended Metro Overlay” district, which lifted the cap on FAR for properties located around

the new Metro rail stations in Tysons Corner. More specifically, the Amended Metro Overlay

provided that “[t]he highest intensities in Tysons should be built in areas closest to the Metro

station entrance. . . . [T]he intensity of redevelopment projects within 1/4 mile of the Metro

stations should be determined through the rezoning process; in other words, no individual site

within these areas should be subject to a maximum FAR.” (Emphasis added.) Such areas

                                                 3
included the Capital One Property and the Neighboring Properties owned by the above-

referenced special purpose entities.

       Capital One, as Capital One Financial’s assignee and the owner of the Capital One

Property, subsequently filed rezoning requests with the County for additional FAR, and in 2012

received approval to develop an additional 3.8 million square feet of FAR on the Capital One

Property, which was then the location of Capital One’s headquarters. 1 Capital One thereafter

began construction in furtherance of its plans approved by the County to use this additional FAR

for expansion of its corporate campus and other mixed-use development of the Capital One

Property.

                                               B.

       WG Land, in 2015, filed suit against Capital One based on Capital One’s use of its

additional FAR rights acquired from the County. The special purpose entities holding title to the

Neighboring Properties did not join the suit. WG Land alleged that additional FAR became

“available” under the terms of the FAR formula as a result of Capital One’s zoning requests, and

that Capital One breached its obligations under the FAR formula in the Agreement and

Declaration by developing the Capital One Property without allocating and conveying a portion

of those FAR rights to WG Land. WG Land’s complaint set forth three counts, all of which were

based on this alleged breach of contract. In Count I, WG Land sought a declaratory judgment

that the FAR allocations in the Agreement and Declaration were enforceable and Capital One’s

development activities violated the FAR formula governing those allocations. In Count II, WG

Land sought a prohibitory injunction to preserve the status quo and a permanent injunction

       1
         This resulted in a total of 4.9 million square feet of approved FAR on the Capital One
Property.

                                                4
against the development of the Capital One Property in excess of the development rights granted

under the Agreement and Declaration. In Count III, as an alternative to the injunction, WG Land

sought $120 million in damages against Capital One for this alleged breach of the Agreement

and Declaration.

       For its response, Capital One initially filed a demurrer and plea in bar. Capital One

asserted in the demurrer, inter alia, that WG Land’s request for declaratory judgment should be

dismissed because WG Land was not simply requesting a declaration of the parties’ rights and

obligations. Rather, WG land sought a finding that Capital One had actually breached the

Agreement and Declaration by failing to allocate and convey FAR rights to WG Land. Having

thus alleged a claim that had “accrued and matured,” WG Land was not entitled to a declaratory

judgment, Capital One argued.

       In support of the plea in bar, Capital One asserted as one of its principal defenses that the

changes in the County Comprehensive Plan in 2010 with the removal of the FAR cap through an

Amended Metro Overlay defeated the purpose of the FAR formula and rendered it impossible to

perform. Capital One argued that with this removal of the cap on development density for the

Capital One Property and the Neighboring Properties, there was no basis for the Neighboring

Properties to secure from Capital One an extra share of what was previously a maximum amount

of development density rights for the area. Moreover, Capital One argued, the removal of the

cap made the equations in the FAR formula impossible to calculate in the absence of a set

number for a maximum FAR. Thus, according to Capital One, its performance under the FAR

formula was excused by the doctrine of impossibility, thereby barring WG Land’s action against

it.

                                                 5
       Capital One also asserted in its plea in bar that property ownership was a requirement

under the FAR formula, which expressly provided that FAR may only be “conveyed, allocated or

otherwise made available to [West*Group or its successors], for their use in connection with

properties now or then owned by them in the area.” Because WG Land did not hold title to any

of the Neighboring Properties, Capital One argued, WG Land had no contractual right, i.e.,

standing, to seek enforcement of the FAR formula against Capital One, thereby presenting an

additional bar to WG Land’s action against it.

       The parties subsequently filed cross-motions for summary judgment on the issue of

liability. As stated in WG Land’s supporting memorandum, “[t]he parties agree that this case

turns on the interpretation of [the Agreement and Declaration]” and that interpretation presents a

“purely legal” issue “ripe for adjudication.” Furthermore, WG Land asserted, “because [its]

principal claims for declaratory and injunctive relief are equitable and do not depend on disputed

issues of fact, there is no reason to proceed to a trial on the merits; rather summary judgment

should be granted in [its] favor.” According to WG Land, the FAR formula plainly provided that

the “available” FAR should be determined by reference to actual development density Capital

One received through a rezoning application, and not by reference to the development density

available under the County Comprehensive Plan.

       Conversely, in support of its motion for summary judgment in regard to its interpretation

of the FAR formula, Capital One reiterated the central argument supporting its plea in bar.

Capital One again argued that the “available” density development under the FAR formula was

expressly based on the maximum FAR available under the County Comprehensive Plan’s Metro

Overlay; and when the 2010 Plan removed the FAR cap through an Amended Metro Overlay, the

FAR formula became impossible to calculate and perform.

                                                 6
       In further support of its motion for summary judgment, Capital One repeated the above-

stated argument supporting its plea in bar that WG Land had no contractual right to enforce any

of the rights or remedies under the Agreement or Declaration because WG Land was not a fee

simple owner of the Neighboring Properties. Also, Capital One argued that WG Land’s claim

for damages was invalid because it was not based on any legally recognized theory of damages. 2

                                                C.

       The circuit court issued a 26-page letter opinion in which it ultimately ruled in Capital

One’s favor on these dispositive motions and denied WG Land’s motion for summary judgment.

The opinion was later incorporated by reference into the final order.

        As a preliminary matter, the circuit court agreed with Capital One that WG Land, as a

non-landowner, lacked standing to enforce the Declaration under Virginia law. 3 However,

contrary to Capital One’s assertions, the court ruled that WG Land had standing to enforce the

Agreement as an assignee of West*Group. 4

       Turning to the merits of the three counts in WG land’s complaint, the circuit court first

sustained Capital One’s demurrer to WG Land’s request for declaratory judgment under Count I.

       2
         This argument was based on the fact that WG Land admitted that “the nature of its
damages is unquantifiable” in terms of any loss of value to the Neighboring Properties as a result
of the development of the Capital One Property. WG Land sought, instead, to offer as its
measure of damages the appraised value of the density rights related to the Capital One Property
in the sum of $120 million which Capital One contended was improper.
       3
        As authority for this ruling, the circuit court cited Mid-State Equip. Co. v. Bell, 217 Va.
133, 141, 225 S.E.2d 877, 884 (1976), and Old Dominion Iron & Steel Corp. v. Virginia Elec. &
Power Co., 215 Va. 658, 663, 212 S.E.2d 715, 719-20 (1975).
       4
         According to the circuit court, “the only difference in outcome in terms of whether WG
Land can enforce the contract or the covenant running with the land [i.e., the Declaration] would
have been WG Land’s ability to seek recovery of attorney’s fees under [the] Declaration [as
originally executed and recorded]. Otherwise, the potential relief is the same, whether an action
is brought under the Purchase Agreement or the Declaration.”

                                                 7
The court did so on the basis that, as alleged in the complaint, “Capital One has proceeded with

development [of the Capital One property] under its interpretation of the [Agreement] and the

rights of the parties have been fully invaded,” due to Capital One’s alleged “wrongful retention

of excess FAR” in the course of that development. Thus, the court concluded, WG Land was not

entitled to declaratory judgment because its claims had “accrue[d] and mature[d].”

       The circuit court then sustained Capital One’s plea in bar and granted its motion for

summary judgment as to Counts II and III. The court ruled, as a matter of law, that WG Land

had not established grounds for an injunction based on an alleged breach of contract under Count

II, and had not established, in the alternative, grounds for a breach of contract and damage award

under Count III. The court so ruled upon concluding that Capital One had not breached the FAR

formula because it was impossible to calculate and perform.

       The circuit court framed the issue as follows:

              Capital One argues that the [FAR] Formula is impossible to perform
       because the additional FAR available is infinity. WG Land argues that the actual
       number of FAR received in Capital One’s Rezoning Application . . . is the
       “Additional Metro FAR Number.” This issue turns on whether the phrase “If . . .
       additional FAR is ever available to the [Capital One] Property” means square
       footage made available due to a change in the FAR value (e.g., a change from a
       FAR of 1.5 to a FAR of 3.5 in a metro overlay), or the amount approved for
       development in a re-zoning application submitted to the County.

Upon a plain reading of its terms, the court reasoned, the FAR formula was rendered impossible

to perform when “the County eliminated the cap on FAR” in 2010 (for the first time) under the

terms of an Amended Metro Overlay, which was incorporated into the FAR formula by

reference. “[G]iven the now uncapped FAR associated with the Property,” the court determined,

“the value of ‘additional’ FAR under the Formula is infinity, which is no longer a numerical

value capable of being multiplied. As Capital One states, any number multiplied by infinity

equals infinity.” The court went on to explain that the FAR formula “depended on the existence

                                                8
of a fixed value of FAR. As the removal of the cap has rendered the Formula unworkable,

Capital One is excused from performing. This [c]ourt declines to rewrite the Formula to render

it workable in an ‘unlimited FAR’ scenario and will apply it [as] written.” 5

       Lastly, the circuit court awarded attorney’s fees, costs and expenses to Capital One

totaling $1,894,477.27. The court made this award to Capital One as the “prevailing party”

pursuant to the fee-shifting provision under § 32 of the Agreement. 6 In doing so, the court

rejected as relevant here the following arguments asserted by WG Land as reasons for denying

the award: (i) the fact that Capital One prevailed on its impossibility defense means that § 32 was

rendered unenforceable; (ii) Capital One lobbied the County for the elimination of the cap on

       5
          As an additional reason for dismissing Count II, the circuit court concluded from its
reading of the FAR formula and related provisions that the removal of the cap on FAR rendered
the purpose of the FAR formula unnecessary—which purpose was “to require the parties to
‘share’ additional FAR, rather than ‘limit’ Capital One’s use of its FAR rights” as WG Land
contended. Section 28.7(b) of the Agreement, the court explained, addresses circumstances in
which “the available FAR changes due to amendments in the existing ordinances”; and in the
event of such changes “the parties agreed to apply a Formula, the purpose of which is not to
restrict Capital One’s development rights, but to require the parties to share the FAR amongst the
sites within the parcel.” An exception to this sharing arrangement, the court further explained,
was the Agreement’s express eight-year limitation on Capital One’s right to seek additional FAR
(which had expired and was not at issue).
         The circuit court then ruled, as an additional reason for dismissing Count III, that WG
Land’s theory of damages based upon the value of the Capital One Property was an improper
measure of contract damages. In short, the court explained, “[e]vidence of Capital One’s gains is
not evidence of WG Land’s pecuniary loses.”
       6
           Section 32 of the Agreement states: “To the extent permitted by law, in any action or
proceeding brought by either party against the other under the Agreement, the prevailing party
shall be entitled to recover from the other party the professional fees incurred by the prevailing
party . . . [including] attorney’s fees . . . and other legal expenses and court costs. The provisions
of this Section 32 shall survive Closing and termination of this Agreement.”

                                                  9
FAR; and (iii) Capital One was not a “prevailing party” because the impossibility of the FAR

formula’s enforcement could be temporary. 7

       WG Land now appeals each of these rulings of the circuit court.

                                                II. 8

                                           A. Count I

       WG Land argues that it alleged a proper claim for declaratory judgment under Count I of

the complaint and thus the circuit court erred in sustaining Capital One’s demurrer to this claim.

We disagree.

       “The purpose of a demurrer is to determine whether a complaint states a cause of action

upon which the requested relief may be granted.” Collett v. Cordovana, 290 Va. 139, 144, 772
S.E.2d 584, 587 (2015) (alteration and citation omitted); see also Code § 8.01-273. “Because the

decision to sustain a demurrer presents an issue of law, we review the circuit court’s judgment de

novo.” Dye v. CNX Gas Co., LLC, 291 Va. 319, 323, 784 S.E.2d 703, 705 (2016); see La Bella

       7
          WG Land made a number of other arguments to the circuit court challenging Capital
One’s claim for attorney’s fees that are not asserted on appeal, including WG Land’s argument
that the requested fees were not reasonable and necessary.
       8
          As a threshold matter, we need not address WG Land’s assignment of error challenging
the circuit court’s ruling that, while it had standing to enforce the Agreement, it did not have
standing to enforce the Declaration. For the reasons discussed in Part II.B., supra, we agree with
the circuit court’s construction of the FAR formula and conclusion that the removal of the FAR
cap under the Amended Metro Overlay rendered the FAR formula impossible to calculate and
perform. We thus hold that Capital One did not breach the FAR formula by not allocating FAR
to WG Land. Accordingly, even if we assume WG Land had standing to enforce the
Declaration, as well as the Agreement, the result would be the same because the FAR formula is
identical in both the Agreement and Declaration. See Rastek Constr. & Dev. Corp. v. Gen. Land
Commercial Real Estate Co., 294 Va. 416, 423, 806 S.E.2d 740, 744 (2017) (“[T]he doctrine of
judicial restraint dictates that we decide cases ‘on the best and narrowest grounds available.’”
(quoting Commonwealth v. White, 293 Va. 411, 419, 799 S.E.2d 494, 498 (2017)).

                                                 10
Dona Skin Care, Inc. v. Belle Femme Enters., LLC, 294 Va. 243, 255, 805 S.E.2d 399, 405

(2017).

          WG Land’s central and repeated allegation in Count I of the complaint, as well as Counts

II and III, was that Capital One breached the Agreement and Declaration by its use of, and

refusal to allocate to WG Land, excess development density or FAR rights under the FAR

formula. This is exemplified by the following excerpts from the “Facts” section of the

complaint, which was incorporated into each of the three counts:

   •      [S]eeking to take advantage of the newly available density and no longer satisfied
          with the bargain it struck, Capital One intentionally breached its obligations by,
          among other things, filing with Fairfax County in August, 2010, and thereafter
          obtaining Fairfax County’s approval of an application to rezone the Capital One
          Property . . . (the “Rezoning”). In the Rezoning, Capital One improperly sought
          and obtained approval of a mixed-use development plan through which Capital
          One purported to retain for its exclusive use and enjoyment additional density
          rights far in excess of what is permitted under the [Agreement] and [Declaration].

   •      The purpose of Capital One’s Rezoning was to “re-plan the remainder of the
          Capital One campus to an exciting, vibrant, transformative, transit-oriented,
          mixed-use development” to contain in excess of 4.9 million square feet of
          development. Such a development would be roughly 3.8 million square feet of
          FAR more than the original Allocated FAR Rights, and in excess of any FAR
          allocable under the formula set forth in the [Agreement] and [Declaration].

   •      Capital One thereafter further breached the terms of the [Agreement] and
          [Declaration] by, among other things, filing and, on or about April 23, 2014,
          obtaining County approval of, the Final Development Plan Amendment . . . that
          likewise sought to exercise and keep for itself development rights grossly in
          excess of its allocation under the [Agreement] and [Declaration] without making
          any provision for allocation of any additional density rights to West*Group and/or
          its successors and assigns.

   Based on these and other similar allegations, WG Land further alleged that Capital One’s

“improper actions” had “impaired and otherwise undermined and devalued Plaintiff’s property

interests and development opportunities.” WG Land then asserted that “Capital One should be

declared in breach” of the Agreement and Declaration, and requested that the FAR related

                                                  11
provisions of the Agreement and Declaration be declared “valid and enforceable by the

Plaintiff.”

        As this Court has made clear, “[t]he General Assembly created the power to issue

declaratory judgments to resolve disputes ‘before the right is violated.’” Charlottesville Area

Fitness Club Operators Ass’n, 285 Va. 87, 98, 737 S.E.2d 1, 7 (2013) (quoting Patterson v.

Patterson, 144 Va. 113, 120, 131 S.E. 217, 219 (1926)). In other words, “[t]he intent of the

declaratory judgment statutes is not to give parties greater rights than those which they

previously possessed, but to permit the declaration of those rights before they mature.” Cherrie

v. Virginia Health Servs., 292 Va. 309, 317-318, 787 S.E.2d 855, 859 (2016) (quoting

Charlottesville Area Fitness Club Operators Ass’n, 285 Va. at 99, 737 S.E.2d at 7).

Accordingly, “where claims and rights asserted have fully matured, and the alleged wrongs have

already been suffered, a declaratory judgment proceeding . . . is not an available remedy.”

Charlottesville Area Fitness Club Operators Ass’n, 285 Va. at 99, 737 S.E.2d at 7 (quoting

Board of Supervisors v. Hylton Enters., 216 Va. 582, 585, 221 S.E.2d 534, 537 (1976)).

        WG Land’s contention on appeal that its claim for declaratory judgment under Count I

was not based on a “matured disputed issue” belies the central allegation, once again, upon

which its entire complaint was grounded: Capital One breached the Agreement and Declaration

by acquiring and using a certain percentage of FAR that it should have allocated to WG Land

under the FAR formula. Indeed, WG Land sought an injunction or alternatively $120 million in

damages under Counts II and III, respectively, based on those same alleged wrongful actions that

Capital One had already taken.

        We also reject WG Land’s assertion that it was entitled to declaratory relief based on the

circuit court’s finding, when addressing WG Land’s objection to Capital One’s request for

                                                 12
attorney’s fees, that the FAR formula was rendered only “temporarily impossible” to perform.

In its letter opinion awarding attorney’s fees to Capital One, the court stated:

               Here, when Fairfax County lifted the cap on the FAR associated with the
       affected properties, it rendered performance by either party of the density
       provisions temporarily impossible . . . . Thus, Capital One’s obligation to share
       FAR with WG Land is suspended, not discharged. If a cap or limitation is later
       imposed by governmental regulations, the duty to share additional FAR under the
       Agreement may be reinstated depending on the circumstances . . . .

To the extent WG Land sought declaratory judgment to resolve rights for a theoretical scenario

under a future County Plan, it was improperly requesting an advisory opinion. See Martin v.

Garner, 286 Va. 76, 83, 745 S.E.2d 419, 422 (2013) (“[T]he question involved [in a declaratory

judgment action] must be a real and not a theoretical question.” (quoting Patterson, 144 Va. at

120, 131 S.E. at 219); see also Charlottesville Area Fitness Club Operators Ass’n, 285 Va. at

107, 737 S.E.2d at 12 (Kinser, J., concurring) (“[R]endering a declaratory judgment in the

absence of an actual controversy constitutes an advisory opinion.”); Liberty Mut. Ins. Co. v.

Bishop, 211 Va. 414, 418, 177 S.E.2d 519, 522 (1970) (explaining, in the context of a

declaratory judgment, that “the rendering of advisory opinions is not a part of the function of the

judiciary in Virginia” (citations omitted)).

                                         B. Counts II & III

       We now turn to WG Land’s challenges to the circuit court’s construction of the FAR

formula and related application of the impossibility doctrine as grounds for sustaining Capital

One’s Plea in Bar and granting its Motion for Summary Judgment as to both Counts II and III.

                                                 1.

       The parties dispute the “plain meaning” of the FAR formula. Thus, we must determine if

the FAR formula has “a meaning discernible from the words alone, and if so, whether the trial

                                                 13
court correctly interpreted [it].” Babcock & Wilcox Co. v. Areva NP, Inc., 292 Va. 165, 178, 788
S.E.2d 237, 243 (2016). This presents an issue of law subject to de novo review. Id.

       The fundamental question before us in construing a contract is “what did the parties agree

to as evidenced by their contract,” and the “guiding light” for such construction is “the intention

of the parties as expressed by them in the words they have used.” Schuiling v. Harris, 286 Va.
187, 192, 747 S.E.2d 833, 836 (2013) (quoting Wilson v. Holyfield, 227 Va. 184, 187, 313 S.E.2d
396, 398 (1984)). In other words, “[w]e construe [a contract] as written, without adding terms

that were not included by the parties. When the terms in a contract are clear and unambiguous,

the contract is construed according to its plain meaning. Words that the parties used are

normally given their usual, ordinary, and popular meaning.” City of Chesapeake v. Dominion

SecurityPlus Self Storage, L.L.C., 291 Va. 327, 335, 785 S.E.2d 403, 406 (2016) (quoting Squire

v. Virginia Hous. Dev. Auth., 287 Va. 507, 516, 758 S.E.2d 55, 60 (2014)).

       “An instrument will be deemed unambiguous if its provisions are capable of only one

reasonable construction. Conversely, [it] will be deemed ambiguous . . . if its language admits of

being understood in more than one way or refers to two or more things at the same time.”

Wetlands America Trust, Inc. v. White Cloud Nine Ventures, L.P., 291 Va. 153, 161-62, 782
S.E.2d 131, 136 (2016) (citations and internal quotation marks omitted). 9

       9
         We note that “[a] contract is not ambiguous simply because the parties to the contract
disagree about the meaning of its language.” Babcock & Wilcox Co., 292 Va. at 179, 788 S.E.2d
at 244 (quoting Pocahontas Mining L.L.C. v. Jewell Ridge Coal Corp., 263 Va. 169, 173, 556
S.E.2d 769, 771 (2002)).

                                                 14
       Furthermore, when the disputed term of a written instrument is a restrictive covenant

imposing an encumbrance on land, as with the FAR formula, 10 to the extent it “suffer[s] from

any ‘substantial doubt or ambiguity’” it is to be “strictly construed against the party seeking to

enforce [it].” Id. at 162, 782 S.E.2d at 136 (quoting Friedberg v. Riverpoint Bldg. Comm., 218
Va. 659, 665, 239 S.E.2d 106, 110 (1977)). 11

       The dispute between the parties over the construction of the FAR formula centers on

whether FAR should be allocated (a) by reference to the development density allowed under the

County Plan’s Metro Overlay, as Capital One contends, or (b) by reference to FAR actually

received by Capital One through a rezoning application, as WG Land contends. We conclude

that the FAR formula, when read in the light of the governing rules of construction, can only

reasonably be construed as requiring the allocation of FAR in reference to the County Plan’s

Metro Overlay, as the circuit court correctly concluded.

       That determination is then the predicate for our further conclusion that, with the County’s

removal of the cap on FAR under the 2010 Plan, the FAR formula became impossible to

calculate and perform. This Court has long recognized an impossibility defense in contract

actions. See Hampton Rds. Bankshares, Inc. v. Harvard, 291 Va. 42, 53-54, 781 S.E.2d 172,

177-178 (2016); Long Signature Homes v. Fairfield Woods, 248 Va. 95, 98-99, 445 S.E.2d 489,

       10
          After setting forth the FAR formula, the Agreement expressly describes the
Declaration, in which the FAR formula “shall [also] be reflected,” as “a covenant encumbering
the [Capital One] Property.”
       11
           See also Anderson v. Lake Arrowhead Civic Ass’n, 253 Va. 264, 269-70, 483 S.E.2d
209, 212 (1997) (explaining that restrictive covenants are not favored under Virginia law and
must be strictly construed against the restrictions and in favor of the free use of property where
there is substantial doubt or ambiguity as to their meaning (citing Friedberg, 218 Va. at 665, 239
S.E.2d at 110)).

                                                 15
491 (1994); Housing Auth. of Bristol v. East Tenn. Light & Power Co., 183 Va. 64, 72, 31 S.E.2d
273, 276 (1944). As we recently explained in Hampton Rds. Bankshares, Inc.:

               The defense of impossibility of performance is an established principle of
       contract law. In Virginia, it is “well settled that where impossibility is due . . . to
       the fortuitous destruction or change in the character of something to which the
       contract related, or which by the terms of the contract was made a necessary
       means of performance, the promisor will be excused, unless he either expressly
       agreed in the contract to assume the risk of performance, whether possible or not,
       or the impossibility was due to his fault.”
291 Va. at 53-54, 781 S.E.2d at 177-178 (quoting Housing Auth. of Bristol, 183 Va. at 72, 31

S.E.2d at 276; and citing Restatement (Second) of Contracts §§ 261 & 264 (1981)) (footnotes

omitted). The County’s removal of the cap on FAR presented such a change relative to the

performance of the FAR formula. Thus, the circuit court was also correct in sustaining Capital

One’s impossibility defense, as asserted in its Plea in Bar and Motion for Summary Judgment, to

WG Land’s claims that Capital One breached the FAR formula. 12

       12
          Because, for the reasons discussed infra, we agree with the circuit court’s construction
of the FAR formula and application of the impossibility doctrine, which negates WG Land’s
allegations of breach of contract in Counts II and III, we need not address WG Land’s
assignments of error directed at the circuit court’s rulings setting forth additional grounds for
dismissing Counts II and III.
        In addition, WG Land failed to preserve the argument, asserted in this appeal as part of its
challenge to the circuit court’s application of the impossibility doctrine, that evidence of Capital
One’s lobbying efforts showed that Capital One caused or contributed to the County’s removal
of the FAR cap, and this should preclude the impossibility doctrine’s application. At trial, WG
Land only argued, after the dismissal of its claims, that Capital One’s lobbying efforts caused or
contributed to the impossibly of performance of the FAR formula, and this should preclude
Capital One from receiving attorney’s fees. Accordingly, pursuant to Rule 5:25, we will only
consider WG Land’s argument directed at Capital One’s lobbying efforts in that context, as
discussed in our review of the circuit court’s award of attorney’s fees to Capital One in Part II.C.,
infra.

                                                  16
                                                    2.

        It is undisputed that the parties to the Agreement executed in 2000 included the FAR

formula in § 28.7(b) of the Agreement in anticipation of the extension of the Metro rail system to

Tysons Corner. They anticipated that this extension would result in an increase in the

development density, i.e., FAR, permitted by the County when properties like the Capital One

Property and Neighboring Properties located near a new Metro rail station would be included

within a Metro Overlay district. Without an agreement to share in such increased development

rights, however, either party could have effectively monopolized such rights by being the first to

take the greatest advantage of them through a prompt plan of development. Accordingly, the

parties provided in § 28.7(b) of the Agreement as follows: 13

               If, as a direct result of the funding, design, potential extension and/or
        extension of Metro service to the Tysons Corner area, additional FAR is ever
        available to the [Capital One] Property as a result of either (i) the portion of the
        Fairfax County Comprehensive Plain entitled “Transit Station Areas” and
        attached hereto as Exhibit T (the “Existing Metro Overlay”) or (ii) any
        amendment to the Existing Metro Overlay or any similar overlay district in the
        Fairfax Comprehensive Plan based on Metrorail (each, an “Amended Metro
        Overlay”), then [that FAR is to be fractionally shared by the parties, subject to the
        Capital One Property retaining the first 200,000 square feet, through an allocation
        determined under mathematical equations set forth thereafter in subsections A
        through D of § 28.7(b)].

        The plain text of § 28.7(b) thus addresses FAR that becomes available to the Capital One

Property under the County Plan. It specifically covers “additional FAR [that] is ever available to

the [Capital One] Property as a result of either (i) . . . the Existing Metro Overlay . . . or (ii) . . .

an Amended Metro Overlay.” (Emphasis added.) Further, there can be no question that the

        13
           Because the FAR formula in § 28.7(b) of the Agreement is identical to its recitation in
¶ 4 of the Declaration, our analysis of § 28.7(b) is equally applicable to ¶ 4.

                                                    17
parties clearly understood what a Metro Overlay consisted of in relation to FAR under the

County Plan because they attached and incorporated the 2000 Metro Overlay to the Agreement

as an exhibit, referring to it as the “Existing Metro Overlay.” By doing so, they provided an

example of how additional FAR could become “available” to the Capital One Property by its

inclusion within a Metro Overlay district. If that turned out to be the Existing Metro Overlay,

then the share of FAR that the owner of the Capital One Property would be required to allocate

to West*Group or its successor would be determined by a mathematical equation set forth in the

FAR formula using the Existing Metro Overlay’s fixed numerical caps on FAR ranging from 1.0

to 1.5. 14 Otherwise, the numerical caps set forth in “any amendment to the Existing Metro

Overlay or any similar overlay district in the Fairfax Comprehensive Plan based on Metrorail

(each, an ‘Amended Metro Overlay’)” would be equally applicable, as provided in the FAR

formula. In this way, each party’s interest in the fractional share of the “additional FAR” would

be established.

       The FAR formula thus depends on the existence of the FAR set forth on the face of the

Existing Metro Overlay or an Amended Metro Overlay as a mathematical variable for

calculating the amount of “available” FAR to be allocated to West*Group or its successor by the

owner of the Capital One Property. Utilizing the numerical cap on FAR from a Metro Overlay is

therefore the only way to calculate the mathematical equations for that determination under the

FAR formula’s express design.

       14
          More specifically, the County’s 2000 Metro Overlay attached to the Agreement as
Exhibit T and referred to in the FAR formula as the “Existing Metro Overlay” capped the FAR
for property like the Capital One Property, in terms of proximity to the expected location of one
of the new Metro stations, at 1.5 within 1000 feet of a Metro station and 1.0 between 1000 and
1600 feet away.

                                                18
       Ten years later, the County passed the Amended Metro Overlay under the 2010 Plan,

and, for the first time, removed the FAR cap for the area in which the Capital One Property and

Neighboring Properties were located. This Amended Metro Overlay expressly stated, “no

individual site within [1/4 mile of a Metro station in Tysons Corner] should be subject to a

maximum FAR.” Instead, pursuant to this Amended Metro Overlay, “the intensity of

redevelopment projects within 1/4 mile of [those] Metro stations should be determined through

the rezoning process.” Without a numerical cap on FAR, the Amended Metro Overlay provided

no numerical variable necessary for calculating the amount of “available” FAR to be fractionally

shared under the FAR formula. As the circuit court characterized it, absent a cap on FAR, the

numerical value of the “additional FAR” that was then “available” under the terms of the

Amended Metro Overlay was “infinity,” which is not “a numerical value capable of being

multiplied.” In this context, as Capital One aptly states on brief, “[f]ractions of infinity, or any

unlimited quantity, are mathematical nonsense.”

       The Amended Metro Overlay thus “change[d] . . . the character of [the “available” FAR]

to which the [Agreement] related [and] by the terms of the [Agreement] was made a necessary

means of performance,” rendering the FAR formula under the Agreement impossible to calculate

and perform. Hampton Rds. Bankshares, Inc., 291 Va. at 53-54, 781 S.E.2d at 178.

       Challenging this construction of the FAR formula under § 28.7(b) and conclusion as to

the Amended Metro Overlay’s effect upon it, WG Land proposes a reading of the FAR formula

that is simply unsupported by its plain language. WG Land asserts that the additional FAR

available to the Capital One Property contemplated by the parties under the FAR formula was

that which might become available through a rezoning application submitted to the County by

                                                  19
the owner of the Capital One Property. But the FAR formula says nothing about additional FAR

becoming available in such a manner. The FAR formula is, instead, based on additional FAR

that might become available under a Metro Overlay, through an increase in the cap on FAR—

which cap, again, was eliminated by the Amended Metro Overlay in 2010 and thereby rendered

the FAR formula impossible to perform.

       The Agreement specifically addresses an increase in FAR for the Capital One Property

based on a rezoning application not in § 28.7(b), but rather in § 28.7(c). After setting forth the

FAR formula in § 28.7(b) as an exception to the eight-year limitation on the right of the owner of

the Capital One Property to seek additional FAR (as set forth in the first paragraph of § 28.7), the

Agreement provides in § 28.7(c) that such owner “shall have the right to seek a re-zoning . . . for

additional FAR to take effect following the expiration of the eight (8) year period.” As the

circuit court correctly reasoned in rejecting WG Land’s reading of § 28.7, “if, as WG Land

argues, seeking approval [of a rezoning application] is the only practicable way to obtain

additional FAR, there would be no need to have two separate paragraphs addressing the density

limitation.”

       Furthermore, as the circuit court also accurately observed, grafting § 28.7(c)’s rezoning

application procedure onto § 28.7(b) under GW Land’s view of these provisions would yield an

irrational procedural quagmire for obtaining County approval for new development. That

procedure would require Capital One to create a development plan, submit it for County

approval, gain approval, and then immediately go back to the drawing board to give up to some

other entity a portion of whatever development rights Capital One was seeking to implement

with its initially approved development plan. Capital One would then have to return to the

County a second time just to obtain approval to build some partial version of its original plan,

                                                 20
and then a third time, and so on, after giving up a portion of the approved development rights

each time. That is surely not what the parties intended. See Mount Aldie, LLC v. Land Trust of

Va., Inc., 293 Va. 190, 200, 796 S.E.2d 549, 555 (2017) (“Our presumption is always that the

parties ‘were trying to accomplish something rational. Common sense is as much a part of

contract interpretation as is the dictionary or the arsenal of canons.’” (quoting Fishman v.

LaSalle Nat’l Bank, 247 F.3d 300, 302 (1st Cir. 2001))).

       WG Land also disputes that the Amended Metro Overlay actually removed the cap on

FAR for the Capital One Property despite the fact it expressly states that “no” such property,

with its proximity to one of the new metro rail stations in Tysons Corner, is any longer “subject

to a maximum FAR.” WG Land’s assertions that this provision is contradicted and superseded

by other criteria in the Amended Metro Overlay that effectively equate to a site-specific cap on

FAR is without merit.

       Finally, we reject WG Land’s argument that the Amended Metro Overlay, in effecting a

change in zoning, should not be allowed to nullify or abrogate private contract rights by

rendering the FAR formula unenforceable. Citing Ault v. Shipley, 189 Va. 69, 75-76, 52 S.E.2d
56, 59 (1949), WG Land relies here on the legal principle that when a restrictive covenant limits

property to a certain use, a later zoning change that makes the property eligible for a different use

will not, in most cases, destroy the covenant. That is not what occurred in the present case.

Here, the Agreement specifically incorporated the Metro Overlays in the County Plan, i.e., the

existing one in 2000 and future ones. By design, changes in the Metro Overlays would change

the FAR available to each party. The impossibility arose when the Amended Metro Overlay

removed the cap on FAR from the FAR formula, leaving it unworkable, and therefore

unenforceable.

                                                 21
                                        C. Attorney’s Fees

       WG Land makes three arguments challenging the circuit court’s award of attorney’s fees

to Capital One under the Agreement’s fee-shifting provision at § 32. 15 First, WG Land asserts

that the fact Capital One prevailed on its impossibility defense as to the FAR formula means that

§ 32 was rendered unenforceable. In this assertion, WG Land is mistaken. WG Land relies on

the legal principle that when a contract is held impossible to perform, it is voided. 16 That

principle, however, is completely inapposite to § 32. As the circuit court correctly determined,

citing Osler Inst., Inc. v. Forde, 386 F.3d 816, 818 (7th Cir. 2004), where the provision at issue,

which is rendered impossible to perform, is not the “basic purpose” of the contract, only that

provision may be voided—not the entire contract. Id.; see also Carabetta Enters. v. United

States, 482 F.3d 1360, 1365 (Fed. Cir. 2007) (explaining doctrine of partial impossibility);

Daburlos v. Commercial Ins. Co., 521 F.2d 18, 23 n.7 (3rd Cir.1975) (same); see generally,

James P. Nehf, 14-75 Corbin on Contracts § 75.7 (Joseph M. Perillo ed., rev. ed. 2017). Here,

the basic purpose of the Agreement was the sale of the Capital One Property, including the

transfer of 1.1 million square feet of FAR, from West*Group to Capital One Financial, which

occurred nearly 15 years prior to WG Land’s institution of the present suit against Capital One

arising from the dispute over enforcement of the FAR formula. While the FAR formula—with

its allocation of density development rights that may or may not have become available in the

future as of the time of the execution of the Agreement—was certainly significant, it was not the

       15
            See note 6, infra.
       16
         See, e.g., Smith v. McGregor, 237 Va. 66, 75, 376 S.E.2d 60, 65 (1989) (holding an
executory real estate contract to be void where sellers could not perform a material condition
precedent to contract’s execution and purchaser did not agree to waive it) (cited in WG Land’s
opening brief).

                                                 22
basic purpose of the Agreement; and WG Land, of course, has not sought to unwind the

Agreement. Furthermore, the Agreement’s fee-shifting provision is saved under the

Agreement’s severability clause at § 22, which provides that “[t]he provisions of [the

Agreement] shall be deemed severable, and the invalidity or unenforceability of any one or more

provisions hereof shall not affect the validity or enforceability of the other provisions hereof.”

See Reistroffer v. Person, 247 Va. 45, 49-50, 439 S.E.2d 376, 379 (1994) (holding that

contractual fee-shifting provision survived under severability clause); Vega v. Chattan Assocs.,

246 Va. 196, 199-202, 435 S.E.2d 142, 143-45 (1993). (holding that contractual “deposit-refund

and cost-reimbursement provision” survived under severability clause).

       Second, WG Land argues Capital One was not entitled to an award of attorney’s fees

because Capital One, through its lobbying efforts with the County, “actively worked to create the

impossibility” of contract enforcement upon which it relies. WG Land cites to Appalachian

Power Co. v. John Stewart Walker, Inc., 214 Va. 524, 534-35, 201 S.E.2d 758, 766 (1974) as

support for the proposition that a party who created or contributed to the circumstances giving

rise to the impossibility is generally not allowed to rely upon it. The rule, accurately stated, is

that the “defense of impossibility of performance . . . is not available to a promisor when ‘the

impossibility was due to his fault.’” Id. (quoting Housing Auth. of Bristol, 183 Va. at 72, 31

S.E.2d at 276); see also Hampton Rds. Bankshares, Inc., 291 Va. at 53-54, 781 S.E.2d at 177-

178. To apply this principle here as WG Land urges, we would have to hold that Capital One

was not entitled to attorney’s fees because it was Capital One’s “fault” that the County removed

the cap on FAR, which resulted in the impossibility of the FAR formula’s calculation and

performance. We refuse to do so. It cannot be said that Capital One was at “fault” for the

legislative action taken by the County’s governing board. “Fault” in the context of the

                                                  23
impossibility doctrine implies the violation of a tort or contract duty, which WG Land has failed

to either allege or establish with regard to Capital One’s lobbying efforts. See Appalachian

Power Co., 214 Va. at 534-35, 201 S.E.2d at 766 (assessing “fault” in this context as an issue of

whether a party had committed a “breach of contractual duty which contributed to impossibility

of performance”). Indeed, as Capital One argues on brief, it “had no tort or contract duty to stay

silent as the County created a plan that would affect its property. Additionally, the lifting of the

FAR cap in the 2010 County Plan benefited all entities that own or control land within 1/4 mile

of a Metro station—including WG Land itself.” (Emphasis in original.)

       Third, WG Land argues that Capital One was not the “prevailing party” under § 32 of the

Agreement based on the circuit court’s observation that the impossibility of the FAR formula’s

enforcement could be temporary in light of the fact that the County might re-impose a cap on

FAR at some point in the future. While that is certainly a possibility, Capital One was

nevertheless unmistakably the prevailing party in this case. WG Land brought three claims

against Capital One, the circuit court granted judgment in Capital One’s favor on all three, and

we are affirming that judgment. Thus, Capital One “prevail[ed]” in “[an] action . . . brought by

either party against the other” under the plain meaning of § 32.

                                                 III.

       For the above reasons, we affirm the judgment of the circuit court in sustaining Capital

One’s demurrer as to Count I, sustaining its plea in bar and granting its motion for summary

judgment as to Counts II and III, and awarding attorney’s fees, costs and expenses to Capital

One.

                                                                                           Affirmed.

                                                 24