ANALYSIS OF MARCH 17, 2022 SUPREME COURT OPINION

(Posted March 18, 2022) I was away from the keyboard yesterday, when the Robes slipped in one short published opinion. Let’s take a look and see what they have wrought. In doing so, I’ll be careful to type quietly, for the benefit of those of you who may be suffering from too much partying yesterday. I’m referring to the Richmond Spiders’ latest upset win in the NCAA Tournament, of course; not that other holiday.

Pleas in bar

The court takes up a challenge to a collection action in California Condominium Ass’n v. Peterson, from here in Virginia Beach. It relates to some old unpaid condo assessment fees. Peterson and his wife didn’t pay the assessment back in 2006, so the association slapped liens against their properties and allowed the matter to lie fallow for an extended amount of time.

In 2015, the husband and wife reached agreement on a divorce agreement. The husband got the condo units and agreed to hold his soon-to-be-ex harmless from “any liability, costs, and expenses she may incur as a result of Husband’s failure to pay the mortgage and all other expenses related to the property.”

The condo association somehow got wind of this agreement and sued the husband for nonpayment of the old assessment. The suit sought money damages for his breach of the condo declaration. The husband filed a special plea, asserting that two statutes of limitations shielded him from liability: the three-year limit for suing to enforce condo liens, and the general five-year limitation for breach of written contracts. Both of those deadlines had long expired by the time the association went to court.

The association replied that the husband’s agreement with his wife was a fresh undertaking to pay the debt, and it filed suit well within the limitations period after he signed it. It also pointed to a provision that required payment in full of unpaid fees and assessments whenever the property was sold.

While these are interesting legal and factual issues, this case turns on the procedure used in the ensuing plea-in-bar hearing. There, the association handed up a binder with numerous documents. The husband’s lawyer agreed that the lawyers could refer to these documents while examining witnesses, but reserved objections to their admission in evidence. The judge agreed to “simply lodge” the binder and to take up later the admission of exhibits into evidence.

Except no one ever got around to moving to admit the documents – other than the lien memoranda – into evidence. In a subsequent letter opinion, the judge noted this failure and ruled that he accordingly couldn’t consider the condo declaration in making his ruling. The court accordingly ruled in favor of the husband, sustaining the plea in bar and dismissing the case.

The justices today reverse this ruling and send the case back for reevaluation. They hold that while this was calendared as an evidentiary hearing on the plea in bar, in reality it asserted that the suit was legally nonmeritorious, regardless of the evidence. The justices today elect to treat this as effectively a demurrer – the husband called no witnesses at the hearing and asserted that he should win as a matter of law.

This means that the court reads the case with the exhibits attached to the complaint, and those included the declaration, the deed, and the settlement statement. Viewing these, a circuit court can indeed evaluate whether, as the association insists, the pay-on-sale language in the condo declaration constitutes a new undertaking. The court remands the case for that hearing, declining to make the judgment call in the first instance. It includes a subtle reference to an earlier opinion – like today’s, authored by Justice Kelsey – in which it evaluated similar issues.

Alas, that hearing will occur before a different jurist of the Virginia Beach Circuit Court. The judge who originally decided this case was Glenn Croshaw, a long-time friend of mine who died late last year after an extended illness. Glenn was a true gentleman who served the Commonwealth with distinction as a citizen legislator and then as a jurist. We here in Virginia Beach are the poorer for his passing.