Present: Hassell, C.J., Lacy, Keenan, Koontz, Kinser, and
Lemons, JJ., and Compton,∗ S.J.
AMERICAN PHYSICAL THERAPY ASSOCIATION
v. Record No. 051750 OPINION BY JUSTICE ELIZABETH B. LACY
April 21, 2006
FEDERATION OF STATE BOARDS OF
PHYSICAL THERAPY
FROM THE CIRCUIT COURT OF THE CITY OF ALEXANDRIA
John E. Kloch, Judge
In this appeal, we decide whether the trial court erred
in holding that Code § 8.01-246(2), the five-year statute of
limitations governing actions on written contracts, barred
this contract action in its entirety.
The American Physical Therapy Association (the APTA) is a
non-profit organization devoted to "foster[ing] advancements
in physical therapy practice, research, and education in the
United States." Its members include physical therapists,
their assistants, and students. During the period 1953-54,
the APTA developed the National Physical Therapy Examination
(the Examination), which remains the only licensure
examination in the physical therapy field in the United
States. On January 1, 1993, by a document entitled "Transfer
Agreement" (the Agreement), the APTA transferred the duties of
administering the Examination to the Federation of State
∗
Senior Justice Compton participated in the hearing and
decision of this case before his death on April 9, 2006.
Boards of Physical Therapy (the Federation), a distinct entity
incorporated to assume such duties. The APTA, however,
retained oversight over certain aspects of the Examination,
including the Examination fee. Section 4.08 of the Agreement,
entitled "Sale of the Examination and Related Products,"
states:
The Federation shall establish prices for the
Examination that are generally consistent
(taking inflation into account) with prior
levels and which are not unduly burdensome to
candidates.
When the Federation assumed ownership of the Examination, the
fee was $90. The Federation increased the fee to $185 on
January 1, 1995, and on July 1, 2000, it increased the fee to
$285 and imposed additional "sitting fees."
On November 8, 2004, the APTA filed a bill of complaint
against the Federation alleging, among other claims, that the
fee increases breached Section 4.08. The APTA included in its
allegations of breach of contract the Federation's proposed
fee increase to $350 for 2005, which the Federation
subsequently adopted on January 1, 2005. The Federation filed
a demurrer and special plea of the statute of limitations
asserting that, as pled by the APTA, the breach of contract
occurred on January 1, 1995 when the Federation increased the
fee to $185. Citing Westminster Investing Corp. v. Lamps
Unlimited, Inc., 237 Va. 543, 379 S.E.2d 316 (1989), the
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Federation argued that the original breach continued and the
subsequent fee increases only created additional damages.
Thus, the Federation contended that the APTA's breach of
contract claim accrued more than five years before the APTA
filed this action and was time-barred.
Following briefing and argument of counsel, the trial
court entered an order sustaining the Federation's special
plea of the statute of limitations and dismissing all the
APTA's claims based on an alleged breach of Section 4.08. We
awarded the APTA an appeal.
The sole issue before this Court is whether the trial
court erred in ruling that Code § 8.01-246(2) bars the APTA's
claims that the Federation breached Section 4.08 because the
three fee increases the Federation imposed gave rise only to
one cause of action that accrued on January 1, 1995 when the
Federation first increased the fee.
In Westminster, upon which the trial court and the
Federation rely, we held that where from the inception of a
lease, the landlord failed to enforce a provision pertaining
to uniform hours of operation for all tenants in a shopping
center, the complaining tenant's cause of action accrued on
the day of the landlord's initial breach. See id. at 549, 379
S.E.2d at 319.
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In contrast, the APTA asserts that the proper analysis is
that set out in Hampton Roads Sanitation Dist. v. McDonnell,
234 Va. 235, 360 S.E.2d 841 (1987). In that case, we examined
whether intermittent discharges of raw sewage and other
pollutants from a county pumping station onto a landowner's
property gave rise to one cause of action that accrued in
1969, when the first discharge occurred, or separate causes of
action that accrued with each discharge. We explained that
"[i]f the wrongful act is of a permanent nature and one that
produces 'all the damage which can ever result from it, [then]
the entire damages must be recovered in one action,' and the
statute of limitations begins to run from the date of the
wrongful act," but if the wrongful acts are not continuous and
"occur only at intervals, each occurrence inflicts a new
injury and gives rise to a new and separate cause of action."
Id. (quoting Norfolk & W. R. Co. v. Allen, 118 Va. 428, 435,
87 S.E. 558, 560 (1916), aff'g on rehearing, 118 Va. 428, 87
S.E. 558 (1915)). Because not all of the injury to the
landowner's property occurred with the first discharge in 1969
and because the discharges took place at intervals, we
determined the landowner could bring his claims for damages
that occurred in that five-year period directly preceding the
filing of his lawsuit. Id. at 239, 360 S.E.2d at 844.
Whether the Federation’s actions constituted a single
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continuing breach contemplated by Westminster or a series of
separate breaches addressed in Hampton Roads depends on the
relevant facts.
In this case, Section 4.08 mandates that the Federation
"shall establish prices for the Examination" that comply with
the requirements set out in that section. The term "shall
establish prices" does not, as the Federation suggests, impose
an obligation such as that of the landlord in Westminster that
is "continuing in nature" and remains "each day whether the
Federation increases, maintains, or decreases the Exam fee."
Rather, as the APTA argues, the term contemplates a distinct
obligation that arises each time the Federation imposes a new
fee. Furthermore, by referring to "prior levels" in
determining whether the new fees are consistent and not unduly
burdensome, the Section contemplates that the new fee will not
be evaluated by reference back solely to the amount of the
original fee. As in Hampton Roads, the first injury did not
inflict "all the damage which can ever result," 234 Va. at
239, 360 S.E.2d at 843; rather, each time the Federation
imposed a new fee, a new injury occurred and a separate cause
of action accrued. Under these circumstances, the
Federation’s actions constituted distinct, separate breaches
of the Agreement, and the APTA is entitled to bring its claims
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for those breaches of contract that occurred in the five years
preceding its filing of this suit.
Accordingly, we will reverse the ruling of the trial
court and remand the case for further proceedings.
Reversed and remanded.
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