776 S.E.2d 808
Va.2015Background
- REVI, LLC purchased title insurance from Chicago Title for property later found subject to restrictive covenants; Chicago Title negotiated a Release and Easement Agreement and REVI signed in 2011.
- Chicago Title concluded the Release did not diminish value; REVI submitted an updated Proof of Loss claiming $1.6M diminution; Chicago Title denied the claim.
- REVI sued for breach of the title insurance policy and alleged bad faith, seeking attorney's fees under Va. Code § 38.2-209(A); REVI demanded a jury trial.
- Trial court bifurcated liability/damages and the bad-faith/fees issue; a jury found breach and bad faith and awarded damages plus $442,000 in fees.
- The trial judge sua sponte vacated the jury's fee award, held § 38.2-209(A) requires a judge (not a jury) to determine bad faith and award fees, reconsidered the evidence de novo, and found no bad faith.
- REVI appealed only the legal question whether "court" in § 38.2-209(A) permits a jury to decide bad faith and award fees; the Supreme Court of Virginia affirmed that "court" means judge and that no jury determination is required.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether "court" in Va. Code § 38.2-209(A) includes a jury for determining insurer bad faith and awarding attorney's fees | "Court" is ambiguous and can include jury; bad-faith is factual and traditionally jury-triable; recodification substituted "court" for "trial judge" to expand to jury | "Court" in context and related provisions means the judge; legislative history and parallel statutes show intent for judge to determine bad faith/fees | Held: "court" means judge; trial judge, not jury, must determine bad faith before awarding fees under § 38.2-209(A). |
Key Cases Cited
- Eberhardt v. Fairfax Cnty. Emps. Ret. Sys., 283 Va. 190 (2012) (statutory interpretation reviewed de novo; read statute in context)
- VEPCO v. Board of Cnty. Supervisors, 226 Va. 382 (1983) (statutes construed as a consistent whole to effectuate legislative goal)
- Lucy v. County of Albemarle, 258 Va. 118 (1999) (statutes in pari materia should be reconciled to make body of laws harmonious)
- Beasley v. Bosschermuller, 206 Va. 360 (1965) (in some contexts the word "court" may include a jury)
- CUNA Mutual Ins. Soc'y v. Norman, 237 Va. 33 (1989) (§ 38.2-209 does not create an independent bad-faith cause of action)
- Stanardsville Volunteer Fire Co. v. Berry, 229 Va. 578 (1985) (right to jury trial does not apply to proceedings lacking that right at the time the Constitution was adopted)