Present: Hassell, C.J., Keenan, Koontz, Kinser, Lemons, and
Agee, JJ., and Russell, S.J.
FORD MOTOR COMPANY, ET AL. OPINION BY
SENIOR JUSTICE CHARLES S. RUSSELL
v. Record No. 051769 January 12, 2007
BERTA BENITEZ
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Jonathan C. Thacher, Judge
This is an appeal from an order imposing monetary
sanctions against an attorney. The sanctions were imposed
because the trial court found that the attorney had filed a
pleading asserting affirmative defenses that were not “well
grounded in fact” in violation of Code § 8.01-271.1.
The facts pertinent to the appeal are not in dispute. In
2002, Berta Benitez filed an action in the trial court against
Ford Motor Company (Ford) and Koons Ford, Inc. (Koons)1 to
recover damages for injuries to her eyes caused by a defective
air bag that deployed when a car, in which she was a
passenger, collided with another vehicle. Extensive discovery
was had in that case, including depositions of witnesses as to
the facts of the accident, but the plaintiff suffered a
voluntary nonsuit on November 5, 2003, before the case came to
trial.
1
Ford and Koons are collectively referred to as "the
Defendants."
The plaintiff filed this suit on the same cause of action
on April 28, 2004. The defendants responded with grounds of
defense that contained, among other things, 13 affirmative
defenses. These were preceded by the statement: “Ford will
rely on the following affirmative defenses, if applicable, and
if proved at trial.” That was followed by allegations of (1)
contributory negligence, (2) assumption of the risk, (3)
negligence of third parties, (4) failure to state a cause of
action, (5) lack of notice of warranty claims as required by
the Uniform Commercial Code, (6) failure to mitigate damages,
(7) claim barred by terms of limited warranty, (8)
unauthorized misuse or alteration of vehicle by plaintiff or
others, (9) failure to comply with terms of warranty, (10)
constitutional bars respecting punitive damage claims, (11)
bars imposed by the applicable statute of limitations, (12)
“all other defenses that may become applicable or available up
to and including the time of trial,” and (13) “release and/or
accord and satisfaction.”
The trial court entered a scheduling order setting the
case for a jury trial, estimated to last eight days, beginning
on November 7, 2005. The order required expert witnesses to
be identified 90 days before trial by the plaintiff and 60
days before trial by the defendants. Discovery was to be
completed 30 days before trial.
2
On April 8, 2005, the plaintiff filed a motion to strike
the defendants’ affirmative defenses on the ground that she
had propounded interrogatories, requests for admissions and
for the production of any documents that would have provided
any factual support for the defenses, and that the defendants
had failed to furnish any such factual support for them.
The parties filed memoranda with the trial court and the
motion was argued on May 6, 2005. Plaintiff’s counsel pointed
out to the court that full factual discovery had been
completed in the previous action before it was nonsuited,
although experts had not been identified by the parties.
Plaintiff’s counsel also showed to the court an interrogatory
propounded to the defendants that asked: “State with
particularity all facts upon which you rely for your
contention that you are not liable in this action.” In their
response, the defendants stated, inter alia, that “Plaintiff
has also failed to provide any expert disclosures to explain
her theory of liability in this case. Without this
information, Ford cannot say exactly which affirmative
defenses it will continue to pursue.”
The trial court then went through the defenses seriatim,
asking defense counsel2 to state what factual basis the
2
Counsel representing the defendants at the hearing was
Katherine M. Henry. She advised the court of her belief that
3
defendants had for asserting them. Counsel responded:
“Presently we don’t have sufficient information” and argued
that the motion to strike the defenses was premature because
the cut-off time for discovery had not yet arrived. Defense
counsel also pointed out that the affirmative defenses had
been asserted “upon information and belief” and had merely
been reserved so that they would not be waived.
The trial court granted the plaintiff’s motion to strike
the defenses of contributory negligence, assumption of the
risk, negligence of a third party, failure to mitigate
damages, unconstitutionality of the claim for punitive
damages, and the statute of limitations. The court reserved
for future decision the motion to strike the defenses of
release and accord and satisfaction. The court denied the
motion to strike the three defenses relating to breach of
warranty and denied the motion to strike the defendants’
reservation of the right to assert additional defenses that
might later become applicable. The defendants withdrew the
remaining affirmative defenses.
At the end of the hearing, Plaintiff’s counsel moved the
court to impose sanctions pursuant to Code § 8.01-271.1 on the
the pleading in question had been drafted by Brian K. Telfair.
It was signed, however, only by Robert L. Wise. All three were
with the law firm of Bowman and Brooke, LLP, which had
represented the defendants in both cases.
4
ground that defense counsel had admitted that there was no
known factual basis for the stricken affirmative defenses when
asserting them. The court agreed that affirmative defenses 1,
2, 3, 4, 5 and 6 “were completely groundless.” In response,
defense counsel admitted: “In those defenses there were not
sufficient facts.”
The issue then became a question of defense counsel’s
knowledge that the defenses lacked factual support when
signing the pleading asserting them. Plaintiff’s counsel
contended that the defense had obviously known of the lack of
factual support because of the discovery the parties had
conducted in the original action before it was nonsuited. As
an example, plaintiff’s counsel referred to the response
defense counsel had made, earlier at the same hearing, when
the court asked for the factual basis supporting the defense
of contributory negligence. The defense had explained its
assertion of contributory negligence by arguing that evidence
might later become available showing that the plaintiff, a
passenger, “could have either been too close or potentially
out of position, possibly leaning forward or leaning up
against the door” when the car in which she was riding was
involved in a collision, causing the air bag to deploy, thus
incurring an injury that would not have resulted if she had
been sitting in a normal position.
5
Responding to that argument, Plaintiff’s counsel read to
the court part of a deposition that had been taken, in the
original action before it was nonsuited, of the driver of the
car in which the plaintiff had been a passenger at the time of
the collision:
[Q] Now, Berta, was she seated? You said she was
seated normally. And you gestured to your back.
She was back against the seatback?
[A] Yes.
[Q] And her head was leaning back?
[A] Yes.
[Q] And you noticed her in that condition before the
impact?
[A] Correct.
Plaintiff’s counsel argued that these responses showed
that defense counsel had knowledge when signing his
pleading that there was no factual support for his plea
of contributory negligence in the present case.
Plaintiff’s counsel stated that he had spent over fifteen
hours in preparation for argument on the motion to strike
the defenses and asked for an award of attorney’s fees in
the amount of $200 per hour pursuant to Code § 8.01-
271.1.
The court noted that the defense admitted a lack of
factual support for six of the affirmative defenses, and
6
also noted the evasive answer the defense had given to
the plaintiff’s interrogatory asking what factual basis
existed for the affirmative defenses. The court found
that affirmative defenses 1, 2, 3, 6, 10 and 11 were not
grounded in fact when the pleading asserting them was
signed, in violation of Code § 8.01-271.1, and awarded
sanctions in the amount of $2000 against Robert L. Wise,
the attorney for the Defendants who signed it.3 We
awarded the Defendants and Wise an appeal.4
Analysis
Code § 8.01-271.1, enacted in 1987, provides, in
pertinent part:
Every pleading, written motion, and other paper of a
party represented by an attorney shall be signed by
at least one attorney of record in his individual
name . . . .
The signature of an attorney . . . constitutes a
certificate by him that (i) he has read the
pleading, motion, or other paper, (ii) to the best
of his knowledge, information and belief, formed
after reasonable inquiry, it is well grounded in
fact and is warranted by existing law or a good
faith argument for the extension, modification, or
3
Wise contends that the quantum of the award is not
supported by the record and is not based on a rational
standard. Because this argument was never made to the trial
court, we will not address it. Rule 5:25.
4
Although the defendants are nominal parties to this
appeal, Wise, as the party aggrieved by the trial court's
award of sanctions, joined in the petition for appeal. Briefs
amici curiae were filed by the Virginia Association of Defense
Attorneys and the Virginia Trial Lawyers Association.
7
reversal of existing law, and (iii) it is not
interposed for any improper purpose, such as to
harass or to cause unnecessary delay or needless
increase in the cost of litigation.
. . . .
If a pleading, motion or other paper is signed or
made in violation of this rule, the court, upon
motion or upon its own initiative, shall impose upon
the person who signed the paper . . . an appropriate
sanction, which may include . . . a reasonable
attorney’s fee.
Wise argues that the trial court abused its
discretion in awarding sanctions and failed to follow the
clear wording of the statute. We begin our analysis by
examining the relevant statutory provisions. First, it
is apparent that the General Assembly had the opportunity
to make discretionary a court’s imposition of sanctions
upon finding a statutory violation, but elected not to do
so. Instead, it used the mandatory words “shall impose
. . . an appropriate sanction.” (Emphasis added.)
Nevertheless, we apply an abuse of discretion standard in
reviewing a trial court’s determination that the statute
has been violated. Flora v. Shulmister, 262 Va. 215,
220, 546 S.E.2d 427, 429 (2001).
The reason for applying that standard is that we are
usually confronted with a mixed question of law and fact
in such cases. Clause (ii) of the second paragraph of
8
Code § 8.01-271.1 provides that an attorney’s signature
to a pleading has a two-pronged effect: the attorney
certifies that the pleading is well-grounded in fact, to
the best of his knowledge, and also that it is warranted
by law, or a good faith argument for a change in the law.
Indeed, all the cases we have heretofore decided under
the statute have involved both prongs of clause (ii).
Thus, the trial courts have been required to assess the
attorney’s (or pro se litigant’s) actual knowledge, or
lack thereof, concerning the facts, “formed after
reasonable inquiry,” as well as the legal question
whether the challenged pleading is warranted by existing
law, or a good-faith argument that the law should be
changed. Such an inquiry into a person’s actual state of
knowledge in the light of applicable principles of law
can seldom present a clear-cut issue of fact, but
requires the exercise of sound judicial discretion.
Each of our prior decisions applying Code § 8.01-
271.1 turned on such mixed questions of fact and law.
See, e.g., Flora, 262 Va. at 220-21, 546 S.E.2d at 429-30
(should autopsy report have been produced under rules of
court?); Flippo v. CSC Assocs., 262 Va. 48, 65-66, 547
S.E.2d 216, 227 (2001) (did language used in a letter
constitute fraud?); Gilmore v. Finn, 259 Va. 448, 466-67,
9
527 S.E.2d 426, 436 (2000) (was pleading warranted by
good faith argument for extension, modification or
reversal of existing law?); Oxenham v. Johnson, 241 Va.
281, 287-88, 402 S.E.2d 1, 4 (1991) (did complainant’s
name on arrest warrant support inference of malice?);
Nedrich v. Jones, 245 Va. 465, 471-72, 429 S.E.2d 201,
204 (1993) (was it reasonable to believe pleading
warranted by existing law?); County of Prince William v.
Rau, 239 Va. 616, 620, 391 S.E.2d 290, 292-93 (1990) (was
it reasonable to believe defense warranted by existing
law?); Tullidge v. Board of Supervisors, 239 Va. 611,
613-15, 391 S.E.2d 288, 289-90 (1990) (was it reasonable
to believe pleading warranted by existing law?).
The present case differs in that the second prong of
clause (ii) is not involved. There is no contention here
that the affirmative defenses were not warranted by
existing law or a good-faith argument for its extension,
modification or reversal. Five of the defenses stricken
by the court were clearly based on valid principles of
existing law and the remaining one, the claimed
unconstitutionality of punitive damages, was based on a
good-faith argument for the modification or reversal of
existing law.
10
Unlike the cases cited above, this appeal turns upon
a single issue: was the pleading well grounded in fact to
the best of the knowledge, information and belief of the
attorney who signed it, formed after reasonable inquiry?
Because defense counsel admitted at the hearing that
“[p]resently, we don’t have sufficient information,” the
first part of the issue was conceded. The only question
remaining for the trial court’s determination was whether
defense counsel had knowledge, “formed after reasonable
inquiry,” when signing the grounds of defense, that there
was no factual support for the allegations he made. As
to that question, the trial court was not limited to the
record in the present case, but could properly consider
any relevant and admissible evidence tending to show the
attorney’s state of knowledge at the time in question.
This case, unlike its predecessors, is an action
refiled after the nonsuit of a previous case in which
full discovery was taken between the same parties by the
same counsel. All information obtained by counsel in
that earlier case was known to the attorney who signed
the grounds of defense in this case. The evidence of the
information defense counsel acquired when deposing the
driver of the car in which the plaintiff received her
injury was in itself a sufficient basis for a finding
11
that counsel knew, when signing the grounds of defense in
the present case, that no factual basis existed for the
defenses of contributory negligence or assumption of the
risk. See Oxenham, 241 Va. at 289, 402 S.E.2d at 5.
Accordingly, we find no abuse of discretion in the trial
court’s finding that defense counsel had violated clause
(ii) of the second paragraph of the statute.
Wise contends that even if a violation of clause
(ii) was shown, there was still no evidence to support a
finding that defense counsel had an improper purpose in
filing the pleading, such as an intent to harass, delay,
or drive up the cost of litigation for the plaintiff, and
that there was, therefore, no violation of clause (iii)
of the second paragraph of the statute. That argument is
based on the fallacious premise that a violation of all
three clauses must be shown before sanctions are
mandated. By clear statutory language, the General
Assembly stated the three clauses in the conjunctive.
Thus, an attorney’s signature to a pleading certifies
compliance with all three clauses, and the attorney is
subject to sanctions for failure to comply with any one
of them.
Wise further contends that the grounds of defense
did not really assert the affirmative defenses, but
12
merely reserved the right to rely on them “if applicable,
and if proved at trial.” He argues that such a
“reservation” was necessary to avoid waiving the
defenses, because facts might later be found to support
them. That argument ignores the fundamental purpose of
pleadings in judicial proceedings: to "inform[] the
opposite party of the true nature of the claim or
defense.” See Rule 1:4(d). “The purpose of a defensive
pleading is to inform the opposite party, and to permit
the court to determine, what is the true nature of the
defense.” Lumbermen’s Mut. Cas. Co. v. Hodge, 205 Va.
36, 39, 135 S.E.2d 187, 189 (1964) (emphasis added). A
pleading that puts the opposing party to the burden of
preparing to meet claims and defenses the pleader knows
to have no basis in fact is oppressive. It constitutes
an abuse of the pleading process and results in the wrong
that Code § 8.01-271.1 was enacted to prevent.
That wrong is not dispelled by couching the pleading
in language that merely threatens the use of the
unsupported claim if it should later become available.
The opposing party must still shoulder the burden of
preparing to meet it. The remedy for a party who hopes
that evidence may later come to light in support of a
claim or defense is to move to amend his pleadings when
13
such evidence becomes available. “Leave to amend shall
be liberally granted in furtherance of the ends of
justice.” Rule 1:8. That rule takes into account that
new evidence may come to light during discovery,
warranting the assertion of new claims or defenses. A
motion to amend gives the opposing party notice of the
claimed factual basis for the newly-asserted claim or
defense and an opportunity to prepare to meet it. It is
true that amendments are not a matter of right, but a
trial court’s decision refusing leave to amend after a
showing of good cause is, in ordinary circumstances, an
abuse of discretion. See Mortarino v. Consultant Eng'g
Servs., 251 Va. 289, 295-96, 467 S.E.2d 778, 782 (1996).5
Wise argues that it was premature for the trial
court to rule on the plaintiff’s motion before the cut-
off date for discovery had arrived in the present case.
That argument begs the question. The issue before the
trial court was the information defense counsel had at
5
The trial court stated to counsel: “I can not imagine a
single judge in this court [who wouldn’t rule] that if you
develop through discovery facts that would support one of
those defenses, you can move to amend.” The trial court
denied the motion to strike the defendants’ affirmative
defense 12, which stated “Ford reserves the right to rely upon
all other defenses that may become applicable or available,”
saying, “I think you have a right to reserve those. And if it
comes to a factual basis, then you can ask to amend.”
14
the time he signed the grounds of defense, not what
information might come to light thereafter.
In Flippo, 262 Va. at 65-66, 547 S.E.2d at 227, we
pointed out that in applying an abuse of discretion
standard to a trial court’s award of sanctions under Code
§ 8.01-271.1, we use an “objective standard of
reasonableness in determining whether a litigant and his
attorney, after reasonable inquiry, could have formed a
reasonable belief that the pleading was well grounded in
fact.”
Such an objective standard of reasonableness
requires consideration of several factors. As an
example, if a plaintiff employs an attorney near the
deadline of the statute of limitations, the attorney may
have no alternative except reliance on the information
his client imparts to him when preparing a last-minute
pleading. Similarly, a defendant may come to counsel at
the last minute, leaving counsel no alternative but
reliance on his client’s account if a responsive pleading
is to be filed in time to avoid default. The present
case, however, is not of that kind, and in any event,
Rule 1:8, as quoted above, permits amendment of the
pleading in furtherance of the ends of justice if and
when counsel acquires more complete information.
15
The foregoing examples are not an exhaustive list,
but they serve to show why an objective standard of
reasonableness must be applied to the question whether
the attorney "after reasonable inquiry, could have formed
a reasonable belief that the pleading was well grounded
in fact." In no event may counsel file a pleading he
knows to be unfounded in fact.
Conclusion
We find no abuse of discretion in the trial court’s
decision, and therefore will affirm the judgment appealed
from.
Affirmed.
16