742 S.E.2d 59
Va.2013Background
- Board of Supervisors of Fluvanna County sues Davenport & Company LLC for breach of fiduciary duty, fraud, negligence, unjust enrichment, breach of contract, and Virginia Securities Act violations related to 2008 bond financing decisions.
- Davenport allegedly misrepresented stand-alone versus pool bond costs in August 2008, inducing the Board to issue stand-alone bonds at higher interest (5.95%) than pool bonds (4.75%).
- The Board claims nearly $18 million in excess interest and seeks damages, disgorgement of fees, and related relief.
- Circuit Court sustained Davenport's demurrer under the separation of powers doctrine, stating resolution would require inquiry into legislators’ motives.
- Board did not assert legislative immunity and voluntarily filed suit; the court held Board waived immunity and proceeded to adjudicate.
- Virginia Supreme Court reverses and remands, holding Board waived legislative immunity and the demurrer was improper on separation-of-powers grounds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether separation of powers bars judicial adjudication | Board argues case presents no invalidation of legislation, only duty/damages | Davenport asserts inquiry into Board members’ motives would violate separation of powers | No, case is justiciable; separation of powers not violated |
| Whether the Board waived legislative immunity | Board did not intend to invoke immunity and did not waive it | Board’s filing and statements effectively waived immunity | Board waived legislative immunity, so demurrer improper |
| Whether waiver of immunity circumvents separation-of-powers issues | Waiver dissolves immunity concerns; allows adjudication | Waiver does not permit improper judicial intrusion into legislative acts | Waiver defeats immunity defense; demurrer improper |
Key Cases Cited
- Greenberg v. Collier, 482 F.Supp. 200 (E.D. Va. 1979) (recognizes lack of Virginia precedent; uses speech-or-debate analogies for immunity principles)
- Lake Country Estates, Inc. v. Tahoe Reg'l Planning Agency, 440 U.S. 391 (1979) (discusses broad state/local immunity concepts under constitutional framework)
- Doe v. Pittsylvania County, 842 F.Supp.2d 906 (W.D. Va. 2012) (discusses limits of immunity applicability to local government entities)
- Miles-Un-Ltd. v. Town of New Shoreham, 917 F.Supp. 91 (D.N.H. 1996) (cites common-law legislative immunity protections for local legislators)
- Bogan v. Scott-Harris, 523 U.S. 44 (1998) (holds local legislators protected by common-law immunity)
- Supreme Court of Va. v. Consumers Union of the U.S., Inc., 446 U.S. 719 (1980) (recognizes legislative immunity as protecting independent legislative action)