Court Opinion

ID: 4422017
Source: CourtListenerOpinion
Date Created: 2019-08-01 12:50:47.271143+00
Date Added: 2024-06-11T12:33:09.823078
License: Public Domain

Present: All the Justices

FERGUSON ENTERPRISES, INC.
                                                                 OPINION BY
v. Record No. 171192                                       JUSTICE CLEO E. POWELL
                                                                 August 1, 2019
F.H. FURR PLUMBING, HEATING AND
AIR CONDITIONING, INC.

               FROM THE CIRCUIT COURT OF PRINCE WILLIAM COUNTY
                            Tracy Calvin Hudson, Judge

       Ferguson Enterprises, Inc. (“Ferguson”) appeals from the judgment of the Circuit Court

of Prince William County (“circuit court”) denying Ferguson’s motion to set aside a jury verdict

in favor of F.H. Furr Plumbing, Heating, and Air Conditioning, Inc. (“Furr”). Ferguson argues

that even after the circuit court admitted that it erroneously ruled that it had previously decided

Ferguson’s plea in bar of the statute of limitations, it still committed reversible error by ruling (1)

that Ferguson waived its statute of limitations argument when it did not refile a plea in bar after

Furr filed a second amended complaint; (2) that if there was no waiver for failing to refile the

plea in bar, Ferguson in any event waived the issue by failing to docket the plea in bar for a

hearing; and (3) that even if the statute of limitations issue had survived to trial, the proposed

jury instructions tendered on that issue were not a proper statement of the law. For the following

reasons, we will reverse the judgment of the circuit court finding that the statute of limitations

issue was waived and remand on the limited issue of whether the statute of limitations barred a

portion or all of Furr’s fraud claims.
                                         I. BACKGROUND

        Ferguson distributes Trane-manufactured HVAC equipment in the Mid-Atlantic Region.

To obtain competitive pricing for some of its customers, Ferguson negotiated with Trane to

provide rebates, known as “claim-backs,” if Ferguson sold Trane’s equipment at a specific

discounted price, known as a “contract price.” To obtain a claim-back, Ferguson provided

written confirmation to Trane that the resale price did not exceed the contract price. Ferguson

specifically negotiated with Trane to provide contract pricing for one of its customers, Furr. Furr

began purchasing Trane-manufactured equipment from Ferguson for retail installation and sale

in 1995.

        In April 2013, Furr initiated this lawsuit against Ferguson asserting claims of fraud,

constructive fraud, unjust enrichment, money had and received, and breach of contract. In its

first amended complaint, Furr alleged that Ferguson was selling equipment to Furr above

“contract prices” and then submitting falsified claims to Trane for claim-backs. Furr contended

that Ferguson represented that it was receiving the “special prices Trane had approved for it to

charge to [Furr], that the prices charged were the lowest prices [it] could charge . . . , and that it

was passing on to . . . Furr the pricing concessions it had received from Trane.” Furr argued that

these misrepresentations were intended to induce Furr to buy Trane-manufactured equipment

from Ferguson, and that Furr relied on these misrepresentations to enter into such purchase

agreements.

        Ferguson filed a demurrer and plea in bar, contending, among other things, that many of

the damages sought on the fraud claims were barred by the two-year statute of limitations.

Ferguson’s plea in bar to the statute of limitations stated that: “[Furr] therefore cannot make out a

claim for fraud predicated on conduct that occurred prior to April 19, 2011. Nevertheless, [Furr]

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repeatedly allege[d] that the conduct giving rise to its claims began more than fifteen years ago

[(i.e. 1995)].”

        The circuit court granted the demurrer as to Furr’s non-fraud claims, but expressly

“declined to rule on the special pleas” after concluding the issue would “require fact-finding after

an evidentiary hearing.” The court gave Furr 21 days to file a second amended complaint for the

non-fraud claims, but required that the fraud claims be restated “verbatim.” The order stated that

Ferguson could file “responsive pleadings” to any new claims, but directed Ferguson to “file an

[a]nswer” to the fraud claims. Furr filed a second amended complaint in July 2014, with the

same fraud claims and new non-fraud claims. Ferguson demurred to the new non-fraud claims.

Ferguson did not refile a plea in bar as to the statute of limitations for the fraud claims, but filed

an answer as directed by the circuit court. The circuit court again granted Ferguson’s demurrer

to the non-fraud claims, and the case proceeded on Furr’s fraud claims only.

        In April 2017, the circuit court held a nine-day jury trial. At the close of Furr’s evidence,

the circuit court granted Ferguson’s motion to strike the constructive fraud claim, but denied it as

to the actual fraud claim. Ferguson’s renewed motion to strike the actual fraud claim at the close

of the evidence was also denied.

        The parties then presented their proposed jury instructions to the circuit court. Ferguson

objected to Furr’s proposed Jury Instruction 10 (duty to investigate), contending that the burden

of proof shifted to Furr to prove that it could not have discovered the fraud before April 19,

2011, because it was apparent on the face of Furr’s second amended complaint that the two-year

statute of limitations had expired at the time of filing. In response to the objection, the circuit

court stated: “I think we’re talking apples and oranges. This is not related to the plea in bar

which I’ve overruled. And you’re not suggesting that I submit the plea in bar to the jury, are

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you?” Counsel for Ferguson responded, “We are, Your Honor, we are raising the statute of

limitations defense as to all of the so called alleged misrepresentations that [Furr] alleges

happened from 2002 until more than two years before their complaint was filed.” To which, the

circuit court stated:

                I overruled the plea in bar at least a year ago and [Ferguson] did
                not request a jury to determine the relative facts at that time. We
                decided it on argument. And today, I’ve overruled the motion to
                strike which raised it again. So, if we’re working our way around
                to letting the jury now decide facts that would determine a plea in
                bar, I’m sorry, I just don’t think we’re on the same page. I think
                that, that ship has sailed. I ruled on that before.

        Ferguson subsequently proffered proposed Jury Instruction N, which provided:

                Claims based on statements that were made to [Furr] before April
                19, 2011 are barred by the statute of limitations unless [Furr]
                proved by a preponderance of the evidence that, even if [Furr] had
                exercised due diligence, [Furr] could not have discovered the
                alleged fraud before April 19, 2011.

The circuit court refused to give this instruction, again stating that it already “ruled on the plea in

bar.” The circuit court also refused additional proposed Jury Instruction O and proposed Jury

Question F proffered by Ferguson, both relating to the statute of limitations defense. Jury

Instruction O, as proposed, provided the definition of due diligence:

                “Due diligence” is the measure of prudence that is properly to be
                expected from, and ordinarily exercised by, a reasonable and
                prudent corporation under the particular facts and circumstances of
                the case.

Similarly, as proposed, Jury Question F relating to the statute of limitations had yes or no options

for the jury to select in response to the question:

                Did F.H. Furr prove by a preponderance of the evidence that, even
                if F.H. Furr had exercised due diligence, it could not have
                discovered the fraud before April 19, 2011?

Following deliberations, the jury returned a $3 million verdict in favor of Furr.

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        Ferguson moved to set aside the verdict on multiple grounds. As relevant to this appeal,

Ferguson argued that the circuit court erred when it denied Ferguson’s proposed jury instructions

relating to the statute of limitations defense. Ferguson pointed out that the circuit court’s ruling

was based upon the mistaken belief that it had already overruled Ferguson’s plea in bar on the

statute of limitations when it had actually declined to do so after concluding that an evidentiary

hearing was necessary. A hearing on the motion was heard on June 1, 2017. At that hearing, the

circuit court addressed the plea in bar issue in detail, stating:

                On June 10, 2014, the [c]ourt overruled demurrers to counts one
                and two. The [c]ourt sustained demurrers to counts three, four and
                five of the first amended complaint and granted [Furr] leave to file
                a second amended complaint in which counts one and two fraud
                and construct[ive] fraud must be included verbatim. The order
                states that the [c]ourt “declined to rule on the special pleas, which
                require fact finding after an evidentiary hearing.” [Furr] then filed
                its second amended complaint on July 1, 2014. On July 22, 2014,
                Ferguson filed demurrers and an answer to the second amended
                complaint. Ferguson neither refiled nor incorporated the special
                pleas filed in response to the original complaint or the first
                amended complaint. I acknowledge that I was mistaken when I
                stated at trial that I had overruled the special plea previously. In
                reviewing this file and the file in the companion case, I discovered
                that it was the plea in bar in the companion case . . . Furr’s plea in
                bar in that case that was actually overruled. And so that’s that.

        Following argument, the circuit court made several alternative rulings in support of the

verdict against Ferguson. First, the circuit court ruled that Ferguson had waived the statute of

limitations issue by failing to refile or incorporate its plea in bar in response to the second

amended complaint. Next, the court ruled alternatively regarding Ferguson’s failure to docket

the special plea that

                [e]ven if the special pleas had survived the filing of the second
                amended complaint, at no time over the next two and a half years
                did Ferguson attempt to raise the special pleas or put them before
                the [c]ourt for a hearing. It is incumbent on a party asserting a
                claim or defense to bring it to the [c]ourt’s attention and request a

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               timely decision. If the failure to refile the pleas did not constitute a
               waiver the failure to docket them for a hearing did.

       Finally, the court addressed Ferguson’s proposed jury instructions stating:

               Even if the special plea was properly still before the [c]ourt
               . . . [I]nstruction [N] [im]properly sought to shift the burden of
               proof to [Furr] on the issue of when the fraud should’ve been
               reasonably discovered. It was not apparent from the face of the
               second amended complaint that the statute of limitations had
               expired on the fraud claims. The burden of proof on this
               affirmative defense remained with Ferguson and [I]nstruction [N]
               was not a proper statement of the law as applied to the facts of this
               case. Therefore, the plea was neither properly before the [c]ourt at
               the time of trial, nor was the correct instruction tendered by
               Ferguson.

The circuit court denied Ferguson’s motion to set aside the verdict and entered judgment

affirming the jury’s verdict in favor of Furr. Ferguson appeals arguing that each basis for the

circuit court’s ruling was in error. We agree.

                                          II. ANALYSIS

       Ferguson argues that the circuit court committed reversible error by refusing to set aside

the jury verdict. The essence of the argument is that the refusal was the culmination of several

errors that began with the circuit court’s mistaken belief that it had made a pretrial ruling

denying Ferguson’s statute of limitations defense. That error caused the court to erroneously

refuse Ferguson’s proffered jury instructions. Ferguson argues that post trial the court further

compounded its error by making several erroneous rulings as to waiver.

       Ferguson summarizes the issue as follows:

               This appeal presents a simple and straight forward question: Did
               the circuit court reversibly err when it refused to allow [Ferguson]
               to present its statute-of-limitations defense . . . to the jury based on
               the mistaken belief that it had previously overruled Ferguson’s
               special plea of the statute of limitations when in fact it had not?

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Furr appears to agree in that it states, “[t]his is a one-issue appeal concerning [Ferguson’s] claim

that it was improperly denied a jury hearing on its alleged statute of limitations plea in bar.”

       We agree that this question goes to the heart of the matter. To address it we must decide

whether the circuit court ruled correctly when it held that Ferguson waived its statute of

limitations defense by (1) not refiling its plea in response to the second amended complaint and

(2) not setting the matter down for a hearing pre-trial.

                                      A. Standard of Review

               [W]here the trial court has declined to . . . set aside a jury verdict,
               the standard of appellate review in Virginia requires this Court to
               consider whether the evidence presented, taken in the light most
               favorable to the plaintiff, was sufficient to support the jury verdict
               in favor of the plaintiff.

Parson v. Miller, 296 Va. 509, 523-24 (2018) (citation omitted). “We will not set aside a trial

court’s judgment sustaining a jury verdict unless it is plainly wrong or without evidence to

support it.” Id. at 524 (citations and quotations omitted).

       “Whether to give or deny jury instructions ‘rest[s] in the sound discretion of the [circuit]

court.” Hilton v. Commonwealth, 293 Va. 293, 302 (2017) (quoting Cooper v. Commonwealth,

277 Va. 377, 381 (2009)). It is “the duty of a reviewing court to consider the trial record as a

whole and to ignore errors that are harmless.” Commonwealth v. White, 293 Va. 411, 420 (2017)

(citation and quotations omitted).

               When it plainly appears from the record and the evidence given at
               the trial that the parties have had a fair trial on the merits and
               substantial justice has been reached, no judgment shall be arrested
               or reversed for any other defect, imperfection, or omission in the
               record, or for any error committed on the trial.

Code § 8.01-678.

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                                   B. Failure to Refile Plea in Bar

        Ferguson argues that the circuit court erred in finding that it waived the statute of

limitations defense by not filing an additional plea in bar after Furr filed the second amended

complaint. The statute of limitations defense was properly raised in the form of a plea in bar in

response to the first amended complaint. Based on the record before the Court, the circuit

court’s June 10, 2014 order was very specific as to its requirements. It required that Furr refile

the fraud counts “verbatim” if Furr were to file a second amended complaint. The same order

required that Ferguson file an answer to the existing fraud counts and “if a Second Amended

Complaint is filed, responsive pleadings to all additional counts.” The circuit court’s order did

not require that Ferguson refile any responsive pleadings previously lodged against the fraud

counts. “[A] circuit court speaks only through its written orders.” Roe v. Commonwealth, 271
Va. 453, 457 (2006). Because Ferguson had an outstanding plea in bar filed in response to the

previous pleading that had been held over for an “evidentiary hearing” and was not specifically

directed to refile its special plea, the circuit court erred in finding that Ferguson waived its plea

by not refiling it.

                                  C. Failure to Request a Hearing

        Ferguson also contends that the circuit court erred by ruling that Ferguson’s failure to

docket the plea in bar for a hearing also waived the issue of the statute of limitations. While a

plea in bar is generally heard pre-trial, it is not always necessary that it be. Also, there is no

requirement that a separate hearing be held to address a plea in bar on the statute of limitations.

        “[A] plea in bar is a defensive pleading that reduces the litigation to a single issue, which,

if proven, creates a bar to the plaintiff’s right of recovery.” Cooper Industries, Inc. v. Melendez,

260 Va. 578, 594 (2000) (citations and internal quotation marks omitted). “The party asserting a

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plea in bar carries the burden of proof.” Id. “The issue raised by a plea in bar may be submitted

to the circuit court for decision based on a discrete body of facts identified by the parties through

their pleadings, or developed through the presentation of evidence supporting or opposing the

plea.” Hawthorne v. VanMarter, 279 Va. 566, 577 (2010). “If the facts underlying the plea in

bar are contested, a party may demand that a jury decide the factual issues raised by the plea.”

Id. See also, e.g., Code § 8.01-336(B); Bethel Inv. Co. v. City of Hampton, 272 Va. 765, 770

(2006); Upper Occoquan Sewage Auth. v. Blake Constr. Co., Inc., 266 Va. 582, 585-86 (2003);

Kroger Co. v. Appalachian Power Co., 244 Va. 560, 562 (1992). “Conversely, if the facts are

disputed and no demand for a jury is made, the ‘whole matter of law and fact’ may be decided by

the court.” Hawthorne, 279 Va. at 578 (quoting Code § 8.01-336(B)).

        This proposition is exhibited by our holding in Bethel, 272 Va. at 768. There, the

defendant City raised pleas of the statute of limitations and the plaintiff requested a trial by jury.

The circuit court sustained the pleas of the statute of limitations without submitting the disputed

issues to a jury. We reversed, holding that “[t]he issue of the time at which Bethel’s land first

suffered damage as a result of the City’s acts was one of disputed fact. Bethel, having demanded

it, was entitled to a jury trial of that issue, and the trial court erred in denying it.” 272 Va. at 770.

Here, Ferguson raised a statute of limitations defense and Furr demanded a trial by jury under

Code § 8.01-336. Since that demand did not specify any limits on the issues on which a jury trial

was requested, Ferguson had no obligation under our Rules to make an additional demand. See

Rule 3:21(c) (providing an opponent the opportunity to file a separate jury demand if the

adversary specifies only limited issues in its jury demand). Therefore, Ferguson was entitled to

have its statute of limitations defense heard by a jury. This is especially true here where the

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issue was initially presented to the trial judge for decision and the judge declined to decide the

matter because evidence was required.

       Even though there are disputed facts underlying the plea in bar, Furr argues that Ferguson

is not entitled to a jury trial because, among other things, Ferguson did not request a jury trial.

Furr concedes that it requested a jury trial. However, Furr specifically asserts that in order for

Ferguson to be entitled to a jury, Ferguson must make its own demand and cannot rely on Furr’s

request. This is not now, nor has ever been, the law in the Commonwealth. Our statutes do not

require duplicate jury demands to preserve the right to a trial by jury. Code § 8.01-336 provides

“any demand for a trial by jury . . . shall be sufficient.” Thus, Ferguson was not required to file

an additional demand for a trial by jury because Furr had already demanded a jury trial as to all

issues. Ferguson was entitled to rely upon the demand for a jury trial made by Furr as to all

issues in controversy between them. See, e.g., Cram v. Sun Ins. Office, Ltd, 375 F.2d 670, 675

(4th Cir. 1967).

       While Ferguson could have requested the calendaring of a hearing on the plea in bar at

some point for a decision on the statute of limitations by the circuit court prior to trial, nothing

barred Ferguson from presenting its defense of the statute of limitations to the jury. Indeed, all

that is required to raise the affirmative defense of the statute of limitations is that the defense be

“specifically set forth in a responsive pleading” as required under Code § 8.01-235. Ferguson

“specifically set forth in a responsive pleading” its defense of the statute of limitations. Code

§ 8.01-235. Thereafter, the jury trial proceeded with both parties eliciting testimony as to when

and how Furr became aware of the alleged fraud, which was a key issue supporting Ferguson’s

statute of limitations defense. The issue of the statute of limitations should have been sent to the

jury to decide the factual issues presented in the plea in bar. Accordingly, we hold that at the

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time of trial, Ferguson had not waived its statute of limitations defense and was entitled to

present its theory of the case to the jury.

                                         D. Jury Instructions

        Having reached the conclusion that the circuit court erred in not permitting Ferguson to

present its statute of limitations defense to the jury, we will not address the remaining issue

regarding the correctness of the jury instructions proffered by Ferguson and refused by the circuit

court. Due to the manner in which the circuit court decided that the jury instructions on the

statute of limitations were not proper statements of the law, * Ferguson did not have the

opportunity at trial to argue whether the instructions were correct statements of the law and/or to

proffer other jury instructions supporting its defense of the statute of limitations. See White, 293
Va. at 419 (recognizing that “the doctrine of judicial restraint dictates that we decide cases ‘on

the best and narrowest grounds available’” (alteration and citation omitted)). Therefore, we will

not address that issue for the first time on appeal.

                                        E. Issues on Remand

        Ferguson asks the Court to reverse the judgment of the circuit court and to enter final

judgment on its behalf or, in the alternative, reverse and remand the case for an entirely new trial.

However, the only factual issues remaining for determination relate to whether the fraud claims

were barred by the statute of limitations. “[U]nless the ends of justice require that the whole case

be retried on its merits, the [appellate] court, in its order remanding the case, must designate

upon what questions or points the new trial is to be had.” See Burks Pleading and Practice § 428,

at 846 (4th ed. 1952); 1B Michie’s Jurisprudence Appeals and Errors § 311 (2018); Code § 8.01-

        *
         At trial, the circuit court rejected the jury instructions because it believed that the plea in
bar had been decided. It was not until after the trial that the court opined that the instructions
were not a correct statement of the law.

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678. Accordingly, we will reverse the judgment of the circuit court finding that the statute of

limitations defense was waived. We remand for a determination by the jury of the discrete issue

of whether the statute of limitations applied to bar a portion or all of Furr’s fraud claims

consistent with this opinion.

                                        III. CONCLUSION

       For the foregoing reasons, the circuit court erred in not sending the statute of limitations

issue to the jury. The case is remanded to the circuit court for a determination by a jury of

whether the statute of limitations applied to bar a portion or all of Furr’s fraud claims.

                                                                            Reversed and remanded.

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