1924 Leonard Road, L.L.C. v. Van Roekel

PRESENT: Hassell, C.J., Lacy, Keenan, Kinser, Lemons, and Agee,
JJ., and Russell, S.J.

1924 LEONARD ROAD, L.L.C.

v. Record No. 052526 OPINION BY JUSTICE BARBARA MILANO KEENAN
November 3, 2006
DOROTHY VAN ROEKEL, ET AL.

FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Gaylord L. Finch, Jr., Judge

This appeal arises from the circuit court’s holding that a

resulting trust was established in favor of an alleged widow of

a previous co-tenant of certain real property. We consider

various evidentiary issues decided by the circuit court,

including (1) an application of Code § 8.01-397, commonly known

as the “dead man’s statute,” (2) the exclusion of several

documents purportedly failing to qualify for admission under the

business records exception to the hearsay rule, (3) the

admission of evidence concerning the alleged widow’s

“understanding” of the original purchase of the property, and

(4) the circuit court’s failure to apply the principle of

estoppel by deed. Because we hold that the circuit court erred

in certain of these evidentiary rulings, and that those errors

require a new trial, we do not reach the issue whether the

evidence was sufficient to support the circuit court’s judgment.

I.

This case began with a bill of complaint filed by 1924

Leonard Road, L.L.C. (the LLC), requesting partition of certain
real property in Fairfax County improved with a single-family

dwelling (the property). The LLC claimed that it and Dorothy E.

Van Roekel (Dorothy) each owned as tenants in common a one-half

undivided interest in the property. Dorothy filed a cross-bill

of complaint to quiet title, alleging she was the sole owner of

the property by virtue of a resulting trust or by adverse

possession.

The evidence at trial showed that Dorothy married Herman W.

Van Roekel (Herman) in 1946. Herman was employed by Francis E.

Malcolm, Sr. (Malcolm), a real estate broker. In November 1955,

Malcolm wrote a letter to Captain John S. Albright (Albright),

the property’s owner, regarding a potential sale of the

property.

In his letter, Malcolm explained that Herman and his family

needed a home but that Herman was “somewhat short of ready cash”

and was willing to accept the property “as is.” Malcolm asked

Albright to sell the property to Herman for “no additional

expense to [Herman]” other than the past due payments on the

house and any transfer expenses.

Ten days later, Malcolm again wrote to Albright, informing

him that Herman was willing to assume Albright’s loan on the

property in order to effect the sale. Malcolm explained that

because he knew Herman and was confident that Herman would make

timely payments on the deed of trust, Malcolm was willing “to

2
take title jointly with [Herman], thereby, making [Malcolm]

responsible on the financing and giving [Albright] extra

protection.”

Albright conveyed the property by deed (the original deed)

to Malcolm and Herman, as tenants in common. Malcolm and Herman

also assumed liability for repayment of the existing mortgage on

the property.

At this time, Herman and Dorothy were not living together.

Herman contacted Dorothy and informed her that he had purchased

a house for their family. Herman, Dorothy, and their children

moved to the property in the summer or fall of 1956.

After Dorothy moved into the house, she paid all the real

estate taxes and made all the mortgage payments on the property.

According to Dorothy, neither Herman nor Malcolm made any tax or

mortgage payments. In December 1961, Herman deserted his

family.

In November 1962, a fire damaged the property. Dorothy

contacted Malcolm to obtain his signature for an insurance

claim. According to handwritten notes Malcolm kept, when he

spoke with Dorothy a few days later, Dorothy informed him that

“[Herman] went to Mexico Christmas, 1961, and hadn’t been heard

from since.”

In December 1970, Malcolm wrote Herman a letter offering to

pay him $500 for Herman’s interest in the property. In the

3
letter, Malcolm also asked Herman to provide information about

his marital status, advising him that if he had remarried, his

present wife would also need to sign any sales contract.

Herman did not respond to Malcolm’s offer. According to

Malcolm’s notes, about one year later, when Dorothy spoke with

Herman, he promised to send “papers” on the property and also

mentioned that he had a “new” wife. Dorothy also asked Herman

to send her “divorce papers,” which Dorothy never received.

In 1972, Herman sent Dorothy a deed (the 1972 deed). The

1972 deed, which was later recorded, stated that Herman and his

wife, Billie Sue Van Roekel (Billie Sue), conveyed to Dorothy an

undivided one-half interest in the property. Dorothy made the

final deed of trust payment on the property in 1976.

Herman died in 1984. Although Herman’s death certificate

listed his marital status as “divorced,” Dorothy testified that

she and Herman had not obtained a divorce.

Dorothy also introduced evidence purporting to show

Malcolm’s intent at the time he and Herman purchased the

property. Over the LLC’s objection, the circuit court permitted

Dorothy to testify concerning her “understanding” of the reason

Malcolm’s name appeared as a grantee on the original deed.

Dorothy stated that Malcolm was named as a grantee in the

original deed in order that “[she and Herman] could buy the

house. And once it got paid for, it would be [Dorothy’s].”

4
 In 1977, Malcolm suffered a debilitating stroke that

rendered him incapable of conducting his business affairs.

After his stroke, his daughter, Ann B. Malcolm (Ann), served as

his attorney-in-fact. Malcolm also had established a revocable

living trust (the trust), naming his wife, Wilda P. Malcolm, and

his daughters, Ann and Joan M. Hottman (Joan), as trustees for

the benefit of Ann, Joan, and his son, Francis E. Malcolm, Jr.

(trust beneficiaries).

In 1996, Ann executed a quitclaim deed on Malcolm’s behalf,

conveying his one-half interest in the property to the surviving

trustees of the trust, Ann and Joan (trustees). Malcolm died

later that year.

In July 2003, the trust beneficiaries executed a quitclaim

deed, attempting to convey their right, title, and interest in

the property to the LLC. Because of an error in the deed’s

recitals, the LLC executed two additional quitclaim deeds (the

amended deeds), the more recent of which was recorded and

conveyed the interest in the property from the trustees to the

trust beneficiaries and from the trust beneficiaries to the LLC.

Dorothy objected to the admission of the amended deeds.

She asserted that the LLC had not timely produced the amended

deeds under terms of discovery orders entered by the court. The

circuit court sustained Dorothy’s objection.

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 The LLC made a motion in limine, asking that the circuit

court apply the principle of estoppel by deed and hold that

Dorothy was estopped from claiming that she was married to

Herman, or that she owned anything more than a one-half interest

in the property. The LLC asserted that this principle was

applicable because the 1972 deed, from which Dorothy obtained

her interest in the property, listed Billie Sue as Herman’s wife

and stated that Herman owned only a one-half interest in the

property. The circuit court denied the LLC’s request.

The LLC presented evidence that Malcolm regarded his

interest in the property as an investment interest. Ann

explained that her parents owned many single-family homes as

investment properties. She stated that her parents shared

ownership of “everything,” with the exception of two cemetery

plots and the property. With regard to the property, Ann

explained that her mother had refused to put her name on the

original deed “with a thief.”

After counsel asked Ann how she became aware of “this

story,” Dorothy raised a hearsay objection. The LLC responded

that Ann would testify regarding her father’s statements to her

about the property, and that such testimony was admissible under

the “dead man’s statute” exception to the hearsay rule found in

Code § 8.01-397. The circuit court sustained Dorothy’s

objection.

6
 The LLC proffered for the record the testimony that Ann

would have given in response to the LLC’s question concerning

Ann’s knowledge of the original transaction. This proffered

testimony included Ann’s statements that (1) Malcolm did not

agree to become liable on the property’s debt based on

“charitable concerns;” (2) Malcolm considered the property as

part of his investment portfolio; (3) Malcolm interceded with

the lender when Dorothy’s account fell past due; and (4) Malcolm

maintained an insurance policy on the property.

The LLC also attempted to admit as business records Exhibit

6, a series of five letters exchanged between Malcolm and the

National Bank of Washington (the bank), the holder of the deed

of trust on the property. The initial letter from the bank,

dated May 27, 1976, notified Malcolm and Herman that the deed of

trust had been paid in full. The letter also referenced

enclosed checks made payable to Malcolm and Herman for

overpayment of the loan and the remaining balance from the

mortgage escrow account.

Malcolm responded to the bank’s letter by correspondence

dated July 20, 1976, and explained that the checks should be

redrawn in equal amounts and made payable to Malcolm and Dorothy

because Herman had conveyed his one-half interest in the

property to Dorothy. Responding on July 23, 1976, the bank

asked Malcolm to send a copy of the deed from Herman to Dorothy.

7
Malcolm complied by letter dated August 10, 1976. In its August

16, 1976 letter, the bank sent Malcolm his half of the excess

funds, as he had requested. When Dorothy raised a hearsay

objection to the admission of Exhibit 6, the circuit court

sustained Dorothy’s objection.

After hearing all the evidence, the circuit court issued a

letter opinion holding that clear and convincing evidence

supported the court’s conclusion that Dorothy was the sole owner

of the property by virtue of a resulting trust. The circuit

court determined that Malcolm’s letters to Albright at the time

of the sale provided a “clear indication” that Malcolm took

title to facilitate the sale as an “accommodation” to Herman.

The circuit court also concluded that Dorothy’s interest derived

from either the 1972 deed or, because “no evidence of a divorce

was ever produced,” from Dorothy’s interest as Herman’s widow.

The circuit court did not address Dorothy’s claim of adverse

possession. The court entered a final decree incorporating the

letter opinion and dismissing the LLC’s bill of complaint. This

appeal followed.

II.

Initially, we observe that the circuit court made the

contested evidentiary rulings in the context of Dorothy’s cross-

bill seeking a resulting trust. Therefore, although we do not

reach the issue of the sufficiency of the evidence in support of

8
the court’s holding, we state basic principles relevant to the

circuit court’s consideration of Dorothy’s claim.

A resulting trust is an indirect trust that arises from the

parties’ intent or from the nature of the transaction and does

not require an express declaration of trust. Tiller v. Owen,

243 Va. 176, 180, 413 S.E.2d 51, 53 (1992); Salyer v. Salyer,

216 Va. 521, 525, 219 S.E.2d 889, 893 (1975). For a resulting

trust to arise, the alleged beneficiary must pay for the

property, or assume payment of all or part of the purchase money

before or at the time of purchase, and have legal title conveyed

to another without any mention of a trust in the conveyance.

Morris v. Morris, 248 Va. 590, 593, 449 S.E.2d 816, 818 (1994);

Tiller, 243 Va. at 180, 413 S.E.2d at 53; Leonard v. Counts, 221

Va. 582, 588, 272 S.E.2d 190, 194 (1980). The alleged

beneficiary also must have paid the purchase money as his own,

and not as an agent or lender of the title holder. Morris, 248

Va. at 593, 449 S.E.2d at 818; Tiller, 243 Va. at 180, 413

S.E.2d at 53; Salyer, 216 Va. at 526, 219 S.E.2d at 893.

A resulting trust can only arise from the parties’ original

transaction, at the time that transaction occurs, and at no

other time. Morris, 248 Va. at 594, 449 S.E.2d at 818; see

Ogden v. Halliday, 235 Va. 639, 642, 369 S.E.2d 417, 419 (1988).

Finally, because a resulting trust generally contravenes the

express language of a written document, a party seeking to

9
establish such a trust must do so by clear and convincing

evidence. Gifford v. Dennis, 230 Va. 193, 197-98, 335 S.E.2d

371, 373 (1985); Leonard, 221 Va. at 589, 272 S.E.2d at 195.

A. “Dead Man’s Statute”

We first consider the LLC’s argument that the circuit court

erred in refusing to apply the “dead man’s statute” exception to

the hearsay rule found in Code § 8.01-397. The LLC argues that

pursuant to this exception, the circuit court should have

permitted Ann to testify about statements Malcolm made

concerning his acquisition of the property and should have

admitted into evidence Exhibit 6, the series of letters between

Malcolm and the bank. In support of its argument, the LLC

relies on our decision in Nicholson v. Shockey, 192 Va. 270, 64

S.E.2d 813 (1951), contending that the “dead man’s statute”

permitted admission of the LLC’s proffered evidence because

Dorothy’s cross-bill was in effect an action against Malcolm’s

estate. We disagree with the LLC’s argument.

The hearsay exception provided in Code § 8.01-397 is plain

and unambiguous. Therefore, we are bound by the plain meaning

of that language and apply the statute as written. See Alcoy v.

Valley Nursing Homes, Inc., 272 Va. 37, 41, 630 S.E.2d 301, 303

(2006); Williams v. Commonwealth, 265 Va. 268, 271, 576 S.E.2d

468, 470 (2003); Woods v. Mendez, 265 Va. 68, 74-75, 574 S.E.2d

263, 266 (2003). The statute provides, in relevant part:

10
 In an action by or against a person who, from any
cause, is incapable of testifying, or by or against the
committee, trustee, executor, administrator, heir or other
representative of the person so incapable of testifying, no
judgment or decree shall be rendered in favor of an adverse
or interested party founded on his uncorroborated
testimony. In any such action . . . all entries,
memoranda, and declarations by the party so incapable of
testifying made while he was capable, relevant to the
matter in issue, may be received as evidence in all
proceedings.

Code § 8.01-397.

By its terms, this statutory language does not apply to the

LLC. The LLC received its interest in the property through a

quitclaim deed from Malcolm’s trustees. The LLC, a limited

liability company created under authority of the Virginia

Limited Liability Company Act, Code §§ 13.1-1000 through -1080,

is a distinct entity that bore no legal relationship to

Malcolm’s trust or estate. The LLC also is an entity separate

from its members. See Hagan v. Adams Prop. Assocs., Inc., 253

Va. 217, 220, 482 S.E.2d 805, 807 (1997).

The LLC’s separate legal identity distinguishes the facts

of the present case from those presented in Nicholson, in which

we applied a provision contained in the “dead man’s statute.”

There, a son claimed title to funds by virtue of a gift from his

deceased mother made during her lifetime. The son’s siblings

alleged that their mother’s transfer to the son was the result

of undue influence he exercised while acting as her attorney-in-

fact. Id. at 274, 64 S.E.2d at 815-16. The siblings asked that

11
the circuit court declare the funds at issue an asset of the

mother’s estate. Id. at 274, 64 S.E.2d at 816.

We held that although the son had not initiated the suit

against his mother’s estate or personal representative, the son

effectively had proceeded against her estate by asserting that

the disputed funds belonged to him, rather than to the estate,

as his siblings claimed. Id. at 283, 64 S.E.2d at 821.

Therefore, we applied a provision of the “dead man’s statute,”

and held that the decree was erroneously entered in favor of the

son based on the son’s uncorroborated testimony. 1 Id.

In contrast, the “dead man’s statute” is inapplicable here

because the present litigation involving the LLC is not

effectively a proceeding brought by or against Malcolm’s estate

or trust. Therefore, the LLC was not entitled to claim the

benefit of the hearsay exception in the “dead man’s statute,”

and the circuit court did not err in concluding that the

proffered evidence was inadmissible under Code § 8.01-397.

B. Business Records Exception

The LLC argues that the letters comprising Exhibit 6 were

alternatively admissible under the business records exception to

the hearsay rule, and that the circuit court erred in sustaining

1
At that time, we applied former Code § 8-286, the
predecessor statute of Code § 8.01-397, which contained
essentially the same provision prohibiting entry of a decree
based on the uncorroborated testimony of an adverse or
interested party.

12
Dorothy’s objection to their admission on this basis. The LLC

asserts that Ann’s testimony established the foundation for the

admission of these documents because she had been the custodian

of her father’s business records since his stroke in 1977.

In response, Dorothy asserts that letters comprising

Exhibit 6 were not verified regular business entries as required

under the business records exception. She contends that the LLC

failed to establish an adequate foundation for the admission of

these documents because the LLC did not demonstrate that the

records “were entries made in the course of business, rather

than old papers maintained in a file.” 2 We disagree with

Dorothy’s arguments.

In Virginia, the business records exception to the hearsay

rule, also referred to as the “modern shop book rule,” permits

the admission of verified regular entries of a business provided

that such evidence has a direct or circumstantial guarantee of

trustworthiness. Frank Shop, Inc. v. Crown Central Petroleum,

261 Va. 169, 175, 540 S.E.2d 897, 901 (2001); Kettler & Scott,

Inc. v. Earth Technology Companies, Inc., 248 Va. 450, 457, 449

S.E.2d 782, 785 (1994); “Automatic” Sprinkler Corp. of America

v. Coley & Petersen, Inc., 219 Va. 781, 792, 250 S.E.2d 765, 773

(1979); Frye v. Commonwealth, 231 Va. 370, 387, 345 S.E.2d 267,

2
Dorothy did not object to Exhibit 6 at trial on the
grounds of relevance, nor does she raise that argument in this
appeal.

13
279-80 (1986). We have further explained that the

trustworthiness or reliability of such records is guaranteed by

the fact that they are regularly prepared and relied on in the

conduct of business by the persons or entities for which the

records are kept. Frank Shop, 261 Va. at 175, 540 S.E.2d at

901; Kettler & Scott, 248 Va. at 457, 449 S.E.2d at 785-86;

Marefield Meadows, Inc. v. Lorenz, 245 Va. 255, 264, 427 S.E.2d

363, 368 (1993). Therefore, to be admissible as a business

record, a document must be produced by its proper custodian, be

a record kept in the ordinary course of business, and be made at

the time of an event by a person having a duty to keep a true

record of that event. Frank Shop, 261 Va. at 175-76, 540 S.E.2d

at 901; Kettler & Scott, 248 Va. at 457, 449 S.E.2d at 786;

“Automatic” Sprinkler, 219 Va. at 793, 250 S.E.2d at 773;

Marefield Meadows, 245 Va. at 264, 427 S.E.2d at 368; Ashley v.

Commonwealth, 220 Va. 705, 707-08, 261 S.E.2d 323, 324-25

(1980).

Here, the LLC presented testimony from Ann establishing

that she had worked in her father’s office for several years

when he was alive, had helped maintain the records there, and

was familiar with the manner in which her father conducted his

various businesses. She also stated that she had been the

custodian of her father’s business records since his stroke in

14
1977, and that she continued to maintain those records in the

same filing cabinets and file folders used by her father.

Ann explained that her father kept carbon copies of all

typed letters that he generated in the course of his property

management business. She stated that he maintained his records

on a “by property basis,” and that he kept notes on all

transactions concerning those properties. These properties

included the 10 single-family homes that Malcolm and his wife

owned, as well as between 15 and 20 homes that Malcolm

“managed.”

Ann stated that her father also maintained records

involving the “payoff” of mortgages on his properties. She

related that Malcolm would take such action as necessary to

ensure that “the payoff of any note” was properly recorded.

We hold that Ann’s testimony provided a sufficient

foundation for admission of the letters Malcolm wrote that were

part of Exhibit 6. 3 The reliability of those records was

guaranteed by the fact that the documents were regularly

3
In addition to challenging the foundation for Exhibit 6,
Dorothy raised an objection that the August 10, 1976 letter from
Malcolm to the bank, which was part of Exhibit 6, was
inadmissible because the LLC did not properly produce this
letter in discovery. The circuit court sustained this
objection. However, the LLC has not assigned error to the
circuit court’s ruling that the August 10, 1976 letter was
inadmissible because it was not timely produced in discovery.
Thus, the circuit court’s exclusion of the August 10, 1976
letter based on the LLC’s discovery violation precludes its
admission on retrial of this case.

15
prepared in the ordinary course of business, having been made as

part of the loan “payoff” transactions described in the

correspondence, and that Malcolm relied on them in the conduct

of his property management business.

We also hold that the correspondence Malcolm received from

the bank was admissible as Malcolm’s business records. We

initially recognize that the business records exception

generally does not apply to records merely received by a

business. Decipher, Inc. v. iTRiBE, Inc., 262 Va. 588, 595, 553

S.E.2d 718, 721 (2001); see Ford Motor Co. v. Phelps, 239 Va.

272, 276, 389 S.E.2d 454, 457 (1990). However, our

consideration of this general rule does not conclude our

analysis.

The central consideration in a business records exception

analysis is whether the records demonstrate reliability and

trustworthiness. Here, although Malcolm did not generate the

letters from the bank, those letters were part of a series of

correspondence between Malcolm and the bank discussing the

mortgage “payoff.” The reciprocal nature of these

communications demonstrates the reliability and trustworthiness

of the letters from the bank. Also, Malcolm kept the letters

from the bank in the regular course of his business and relied

on the accuracy of the information contained in the letters in

order to draft his responses and collect his reimbursement

16
funds. Thus, no additional foundation evidence was required for

admission of the bank’s letters to Malcolm. See Marefield

Meadows, 245 Va. at 263-64, 427 S.E.2d at 367-68; “Automatic”

Sprinkler, 219 Va. at 792-94, 250 S.E.2d at 773-74.

C. Evidence of Dorothy’s “Understanding”

We next consider the LLC’s argument that the circuit court

erred in allowing Dorothy to testify concerning her

“understanding” of the original purchase of the property. The

LLC contends that this testimony was inadmissible because

Dorothy did not have personal knowledge of the transaction, and

her testimony did not provide a factual basis for its admission.

In her brief, Dorothy does not address this assignment of

error. Based on our review of the record, we agree with the

LLC’s argument.

Dorothy’s testimony regarding her “understanding” of the

original transaction was not based on any personal knowledge of

the transaction, or on any information she received that would

have provided a basis for such testimony. Instead, her

testimony established that she did not learn of the purchase

until Herman told her that he had bought a house. Dorothy also

confirmed that she did not have any contact with Malcolm at the

time the property was purchased, and only spoke with him once in

1963 when she needed his signature for an insurance claim she

was filing on the property. She testified that at that time,

17
“He just asked why I was there and signed the paper and then

gave it back to me.”

This testimony, considered collectively, demonstrated that

Dorothy lacked an opportunity for knowing the intention of the

parties at the time the property was purchased, and that she did

not have a basis in fact for testifying about her

“understanding” of that transaction. Therefore, we hold that

the circuit court erred in permitting her to testify about her

purported “understanding” of the purchase. See 1 Kenneth S.

Broun, McCormick on Evidence § 10 (6th ed. 2006).

D. Estoppel by Deed

The LLC argues that the circuit court erred in overruling

the LLC’s motion in limine, which sought to enforce the doctrine

of estoppel by deed. The LLC contends that Dorothy attempted by

her evidence to contradict the clear wording of the 1972 deed

from which she derived her ownership interest. Thus, the LLC

maintains that Dorothy should have been estopped from claiming

that she owned more than a one-half interest in the property and

from asserting that she and Herman were not divorced. We

disagree with the LLC’s arguments.

In an action against a third party, the doctrine of

estoppel by deed binds a grantor and his privies, but does not

bind the grantee of a deed. As we have stated, “the doctrine of

estoppel by deed provides that equity will not permit a grantor,

18
or one in privity with him, to assert anything in derogation of

an instrument concerning an interest in real or personal

property as against the grantee or his successors.” Barris v.

Keswick Homes, L.L.C., 268 Va. 67, 73, 597 S.E.2d 54, 58 (2004);

accord VEPCO v. Buchwalter, 228 Va. 684, 688, 325 S.E.2d 95, 97

(1985). Here, Dorothy was the grantee, not the grantor, of the

1972 deed. Therefore, the doctrine of estoppel by deed was

inapplicable under the facts presented, and we hold that the

circuit court did not err in denying the LLC’s motion in limine.

E. Evidence of a Marriage

The LLC argues that the circuit court erred in determining

that Dorothy and Herman were still married at the time of

Herman’s death. The LLC contends that Herman had married a

second time and that, therefore, a presumption arose that his

prior marriage to Dorothy had ended in divorce. According to

the LLC, Dorothy’s evidence failed to overcome that presumption.

We disagree with the LLC’s arguments.

The LLC incorrectly characterizes the substance of the

presumption on which it relies. Under that “second marriage”

presumption, when two marriages of the same person are proved, a

rebuttable presumption arises that the second marriage is valid.

Deryder v. Metropolitan Life Ins. Co., 206 Va. 602, 607-08, 145

S.E.2d 177, 180-81 (1965); Parker v. American Lumber Corp., 190

Va. 181, 185-86, 56 S.E.2d 214, 216 (1949).

19
 Here, however, the LLC failed to present evidence proving

that Herman had married a second time. Herman’s recitation in

the 1972 deed that his wife was Billie Sue did not prove that

Billie Sue and Herman were legally married. Likewise, the fact

that his death certificate listed his marital status as

“divorced” provided no proof that Herman had been married a

second time, or that he had obtained a divorce from Dorothy.

Therefore, the facts before the circuit court did not give rise

to a presumption of a valid second marriage.

In the absence of such a presumption, the circuit court

relied on Dorothy’s testimony that she and Herman had not

divorced, and that she had never received “divorce papers” from

him. Based on this testimony, we conclude that the circuit

court did not err in determining that Dorothy and Herman were

married at the time of Herman’s death.

F. Defense of Laches

We find no merit in the LLC’s argument that the circuit

court erred in failing to consider its defense of laches. The

LLC bases its argument on the fact that Dorothy knew about

Malcolm’s interest in the property in 1956 and yet did not

assert any right of her own until 2003.

The doctrine of laches involves the failure of a party to

assert a known right or claim for an unexplained period of time

resulting in prejudice to the adverse party. Stewart v. Lady,

20
251 Va. 106, 114, 465 S.E.2d 782, 786 (1996); Masterson v. Board

of Zoning Appeals, 233 Va. 37, 47, 353 S.E.2d 727, 735 (1987).

The burden of proving this defense rests with the party

asserting it. Stewart, 251 Va. at 114, 465 S.E.2d at 786;

Morris v. Mosby, 227 Va. 517, 521-22, 317 S.E.2d 493, 496

(1984). Here, the LLC’s defense failed completely because the

LLC did not demonstrate that it was prejudiced by Dorothy’s

failure earlier to assert her ownership claim against the LLC.

III.

The circuit court’s error in excluding Exhibit 6 on the

basis that it was not admissible under the business records

exception and in admitting evidence of Dorothy’s “understanding”

of the original purchase of the property require that we remand

the case for a new trial. Therefore, we do not address the

LLC’s assignments of error concerning discovery issues involving

the amended deeds, because those issues do not affect our

judgment and will not arise at a new trial. We also do not

address the LLC’s assignment of error that the circuit court

erred in refusing to grant partition of the property. That

issue can be considered only after the circuit court determines

on retrial whether Dorothy met her evidentiary burden of proving

the allegations of her cross-bill. Finally, we do not reach

Dorothy’s assignment of cross-error that the circuit court erred

in failing to rule that Dorothy owned the property by virtue of

21
adverse possession, because that issue was not the subject of a

ruling by the circuit court.

For these reasons, we will affirm in part, and reverse in

part, the circuit court’s judgment and remand the case for a new

trial.

Affirmed in part,
reversed in part,
and remanded.

22