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The Virginia Appellate Lawyer’s Court of Appeals of Virginia Blog

Last two opinions of April -- Are Tort Claims by Former Prisoners Subject to Exhaustion of Administrative Remedies and Some Folks Just Don't Like Paying Debts

The last day of April saw two new published opinions for the Court of Appeals. Dawn Lewis Williams v. Commonwealth of Virginia is not, despite its name, a criminal appeal. While Williams was at some point convicted of a crime and remanded to the Custody of the Virginia Department of Corrections, this is not an appeal of that conviction, but rather an appeal of a denial of her claim under the Virginia Tort Claims Act for an injury she suffered while in the custody for that conviction. The action was brought originally while she was still in prison, but was nonsuited and refiled after she was released. The issue in the circuit court and on appeal was whether Williams was required to "exaust administrative remedies" within the VDOC system before filing her claim.

Because this case is almost certainly headed for en banc review and then to the Supreme Court, I will not keep you in suspense by going through the, frankly, superfluous nature of Williams claim. This is a meat and potatoes issue of statutory construction and the circuit court and one judge of the Court of Appeals panel read that statute to require any person claiming an injury while a prisoner to exhaust administrative in the VDOC system before filing a claim with under the VTCA. Unfortunately for the Commonwealth, two other judges, Judge Lorish, who wrote the opinion joined by Judge Ortiz, read the statute as requiring a prisoner who is in the custody of the VDOC to exhaust administrative remedies before filing under the VTCA.

When Williams filed the original suit, she was in custody and the majority would have tossed her case. But, they point out that after nonsuiting that case, she was not in custody when she filed the new action, and as a "non-prisoner" she had no administrative remedies to exhaust.

Judge AtLee, the dissenter, sees it differently. He says that the duty to assert exhaustion of remedies arises not when the suit is file, but when the notice of claim is sent to the Commonwealth. In this case, Williams' notice of claim was filed prior to the first suit, while she was still a prisoner. Since her suit filed after her release relates back to that original notice of claim, the suit is barred even though she was no longer in a position to seek administrative remedies.

My sympathies are with the majority, but logic seems to favor the dissent. I fully expect the Commonwealth to seek a rehearing en banc and regardless of the outcome of that effort, I suspect an appeal to the Supreme Court is inevitable.

Michael R. Agnew, et al. v. United Leasing Corporation is notable mostly because it shows the extreme lengths that some people will go to avoid paying a debt. In 2000, the Agnews entered into a forbearance agreement with United Leasing; the opinion tells us very little about the debt that was at issue other than it involved several leases and a promissory note. As part of the agreement the Agnews consented to a confessed judgment that included a lien against property they owned in Virginia Beach, and from the looks of it, a very nice property on Linkhorn Bay.

This Google Streetview picture really does not do the property justice. The see just how nice (and expensive) the property listing is, check out its listing on Zillow.

Here is a bonus fact not recounted in the opinion, but which you might find interesting. In 2007 the Agnews sought an injunction in the Circuit Court of Virginia Beach, which was refused as was their appeal of this decision to the Surpeme Court. This was the first of five appeals filed in the Supreme Court, the others following in 2010, 2020, 2021, and 2022. The last of these is the present case, which was transferred to the Court of Appeals because, it would seem, the Agnews and the counsel were not aware of the change in appellate jurisdiction for civil appeals. However, that puts us well ahead of the timeline.

By April 2008, the Agnews had "not paid the full amount they owed under the confessed judgment." United Leasing filed suit to enforce the lien on the property and the court order the property sold by a commissioner. In an effort to stop the sale, the Agnews tried to have the judgment set aside. It was October of 2010 before the court disposed of that effort.

For reasons not revealed in the opinion it took until 2013 for the commissioner to determine that the property should be sold at public auction. It took another year for the court to approve that. The Agnews, however, then filed for bankruptcy, which automatically stayed the sale three days prior to the auction.

In the bankruptcy proceeding, the Agnews raised "the same challenges to the confessed judgment they had raised in the circuit court in 2009. This effort was dismissed and on appeal to the 4th Circuit Court of Appeals their claims were described as "simply meritless." The bankruptcy was concluded in 2017 and the state court ordered the sale by auction to proceed.

The Agnews tried to stop the sale by filing a motion for reconsideration of the order or sale, raising the issues already rejected by the court earlier and by the federal court as "simply meritless." United Leasing responded with a plea in bar of res judicata. The court, naturally, agreed.

The property was final put under the gavel on March 9, 2021. I will do the math for you. this was 11 years and 11 months since United Leasing first sought to enforce its lien. And, of course, that was the end of the story. The Agnews realized that they could not avoid paying their just debts and accepted the sale with grace.

Nah, I just fooling. The sought to challenge the confirmation of the sale. The circuit court issued a letter opinion and order which likely explained in detail just how wrong the Agnews were and approved the sale. And the Agnews . . . wait for it . . . filed a "Motions to Set Aside Sale and Dismiss." This was based on the alleged failure of the purchaser to complete the sale within 21 days after it was confirmed. The court again by a letter opinion and order -- and again we can hope that this letter contained some choice language about how wrong the Agnews were -- overruling the motion.

Which brings us to the Court of Appeals opinion written by Judge Malveaux in which she is joined by Judge Raphael and Senior Judge Petty, because the Agnews appealed. The opinion is 19 pages long, 15 pages of which are a detailed explanation of why the Agnews' arguments are, to borrow a phrase for the federal court, "simply meritless."

To be fair, the arguments were not so much meritless as merely wholly inapplicable to the facts of this particular case. The Agnews were using good laws that are intended to be a shield against unduly hasty judicial sales as a sword to attack a creditor who was fully entitled to enforce a lien of a debt that was incurred a quarter of a century ago.

I would love to be able to end this summary by telling you that, apart from the likely petition for rehearing/rehearing en banc and petition for appeal the the Supreme Court (which will be refused -- I guarantee it), the Agnews are done clogging the courts with their childish effort to avoid paying their debts and trying to regain either their bayfront house or money damages. Unfortunately, I cannot tell you that. There is already another appeal pending in the Court of Appeals and there are at least two, and I suspect more, cases still pending in the circuit court one of which appears to be a malpractice action against one of their former attorneys.

There is a final, sad coda to this tale. The attorney who represented the Agnews in much of the proceedings outlined above was suspended by the Virginia State Bar for impairment earlier this year. The attorney in question practiced law in the Commonwealth for over 30 years, during which time he enjoyed success in the trial and appellate courts of both the Commonwealth and the Federal jurisdictions. However, in recent years his involvement with increasingly controversial cases involving allegations of conspiracies in the media, and his attention to his practice became lax. This resulted in several contempt sanctions and a bar investigation which resulted in a public reprimand with terms in 2022. For over a decade, the Virginia Supreme Court's Attorney Wellness issue has stressed the need for greater attention to the mental health of members of the bench and bar. It is a lesson that still needs to be repeated and taken to heart.

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