Cohn v. Knowledge Connections, Inc.

PRESENT: ALL THE JUSTICES

LAURA E. COHN
OPINION BY
v. Record No. 022592 JUSTICE G. STEVEN AGEE
SEPTEMBER 12, 2003
KNOWLEDGE CONNECTIONS, INC.

FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Leslie M. Alden, Judge

This case arises out of the circumstances surrounding an

offer of employment to Laura E. Cohn ("Cohn") from Knowledge

Connections, Incorporated ("KCI"). At trial in the Circuit

Court of Fairfax County, Cohn alleged actual and constructive

fraud on the part of KCI, through Marion Bonhomme ("Bonhomme") 1 ,

the president and owner of KCI.

A jury awarded Cohn $125,000 in compensatory damages but

the trial court granted a motion to strike made by KCI which

previously had been taken under advisement. The trial court

then granted KCI's motion to set aside the verdict as to

liability and damages. For the reasons set forth below, we will

affirm the judgment of the trial court.

I. BACKGROUND AND PROCEEDINGS BELOW

From 1996 to 1999 Cohn worked as a manager with Omega World

Travel ("Omega") in northern Virginia. In addition to her

salary of $38,000, Cohn received health insurance, vacation

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During the pendency of the proceedings, Marion Bonhomme
Knox changed her marital status. In the record she is sometimes
referred to as Ms. Bonhomme and sometimes as Mrs. Knox.
time, and retirement benefits. In June 1999 Bonhomme contacted

Cohn and asked her to leave her job at Omega and become a

manager with KCI. Specifically, Bonhomme asked Cohn to work at

KCI's Pentagon office. Cohn expected to be assigned to the

Pentagon office, although she knew that she could have been

assigned to another KCI office. The parties agreed that Cohn's

employment with KCI was an "at-will" arrangement.

Cohn was concerned about potential workplace conflicts with

any employees at KCI who were qualified for the managerial

position but were not promoted from within the company. She

believed her new position at KCI would be more secure,

particularly during the probationary period, if she were the

most experienced employee at the KCI office to which she was

assigned. Cohn stated at trial that Bonhomme told her no one on

the existing KCI staff was qualified for the position offered to

Cohn in the Pentagon office.

Subsequently, Cohn learned from Bonhomme that Wayne Temple

("Temple"), a KCI employee, had ten more years of experience

than Cohn. Cohn alleged at trial that, upon further inquiry,

Bonhomme assured her that Temple did not have the supervisory

experience necessary to manage the Pentagon office. At trial,

however, Bonhomme testified that she could not recall Cohn ever

asking whether any current KCI employees were qualified for the

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manager's position. Nor did Bonhomme recall being asked why she

was not hiring from within.

On or around June 29, 1999, Bonhomme faxed a letter

offering employment to Cohn as an administrative travel office

manager at a salary of $48,000. The offer of employment did not

indicate a specific KCI office where Cohn would work. KCI did

not offer a retirement plan but did offer full medical benefits

coverage and paid vacation. Cohn accepted Bonhomme's offer of

employment and tendered her resignation to Omega. Cohn also

began, with Bonhomme's assistance, applying for the security

clearance necessary for work at the Pentagon.

Cohn stated at trial that she was to begin work at KCI on

August 2, 1999. Bonhomme testified, however, that she told Cohn

that if she wanted the Pentagon office position, she was

required to start work on July 12, 1999, or, in the alternative,

that she could accept the position in KCI's Crystal City office

and begin work two weeks later. On July 14, 1999, Bonhomme

telephoned Cohn to notify her that Temple had been elevated to

the managerial position at KCI's Pentagon office and that Cohn

would be the administrative travel office manager at the

company’s Crystal City office with the same salary and benefits.

Bonhomme reiterated this statement in a letter dated the same

day. It was during this conversation, Cohn testified at trial,

that Bonhomme expressed to her that the Department of Defense

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chief travel officer in the Pentagon, Stanley Jefferson

("Jefferson"), preferred working with men rather than women.

Cohn asserted that because of this alleged gender bias, Bonhomme

determined Temple should be in charge of KCI's Pentagon office.

On July 16, 1999, Bonhomme notified Cohn that any employment

offer from KCI was withdrawn because Cohn had not reported for

work.

Cohn subsequently filed an action against KCI in the

Circuit Court of Fairfax County alleging actual and constructive

fraud. At the conclusion of Cohn's evidence, KCI made a motion

to strike. The trial court took the motion under advisement and

allowed the jury to deliberate. The jury returned a verdict for

Cohn of $125,000 in compensatory damages. However, in

considering KCI's renewed motion to strike, the trial court

found, with respect to Cohn's allegations of actual fraud, that

she failed to present sufficient evidence that Bonhomme had

intended to conceal Jefferson's alleged bias against women. The

court further found that Bonhomme had no duty to disclose

whatever she knew or thought about Jefferson.

With respect to Cohn's allegations of constructive fraud,

the trial court found that Bonhomme's purported

misrepresentations of Temple's qualifications were statements of

opinion. The trial court also stated that even if the

statements were not statements of opinion, Cohn failed to

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present clear and convincing evidence that the statements were

false when made. The trial court granted KCI's motion to strike

as well as KCI's motion to set aside the verdict.

We awarded Cohn this appeal.

II. STANDARD OF REVIEW

Review of a trial court’s order striking the evidence

requires the appellate court to accept as true all the evidence

favorable to the plaintiff and any reasonable inferences from

that evidence. Lambert v. Downtown Garage, 262 Va. 707, 712,

553 S.E.2d 714, 716 (2001). Furthermore, when reviewing a trial

court’s order setting aside a jury verdict, the trial court's

decision will be sustained unless plainly wrong or without

evidence to support it. Henderson v. Gay, 245 Va. 478, 480, 429

S.E.2d 14, 16 (1993); Lane v. Scott, 220 Va. 578, 260 S.E.2d 238

(1979). However, if there is a conflict in the testimony, and

if reasonable people may differ in their conclusions or if a

conclusion is based on the weight to be given to the testimony,

the conclusion of the trial judge cannot be substituted for that

of the jury. Henderson, 245 Va. at 480-81, 429 S.E.2d at 16;

Lane, 220 Va. at 581, 260 S.E.2d at 240. Finally, this Court

must give the recipient of the verdict the benefit of all

substantial conflicts from the evidence and all reasonable

inferences which may be drawn from the evidence. Henderson, 245

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Va. at 481, 429 S.E.2d at 16; Graves v. National Cellulose

Corp., 226 Va. 164, 169-70, 306 S.E.2d 898, 901 (1983).

III. ANALYSIS

Cohn brought separate causes of action, for actual and

constructive fraud, based on two claimed misrepresentations.

First, she alleged that her prospective employer, KCI, failed to

inform her of Jefferson's alleged gender bias. Second, she

claimed that KCI misrepresented Temple's qualifications.

In her amended motion for judgment, Cohn alleged that each

of these misrepresentations was the basis for both fraud counts.

However, during a hearing on post-trial motions, Cohn agreed

with the trial court’s conclusion that the jury’s finding of

actual fraud related to the alleged concealment of Jefferson’s

gender bias and the finding of constructive fraud related to the

alleged misrepresentation of Temple’s qualifications. In her

brief submitted to this Court, Cohn argues that the concealment

of Jefferson’s alleged bias could be the basis for the claim of

constructive fraud. We do not consider Cohn's argument on this

point because "[n]o litigant . . . will be permitted to

approbate and reprobate — to invite error, as the [litigant]

. . . did here, and then to take advantage of the situation

created by his own wrong." Fisher v. Commonwealth, 236 Va. 403,

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417, 374 S.E.2d 46, 54 (1988); Sullivan v. Commonwealth, 157 Va.

867, 878, 161 S.E. 297, 300 (1931). 2

A. Actual Fraud

A cause of action for actual fraud requires the plaintiff

to prove: (1) a false representation, (2) of a material fact,

(3) made intentionally and knowingly, (4) with intent to

mislead, (5) reliance by the party misled, and (6) resulting

damage to the party misled. Evaluation Research Corp. v.

Alequin, 247 Va. 143, 148, 439 S.E.2d 387, 390 (1994); Bryant v.

Peckinpaugh, 241 Va. 172, 175, 400 S.E.2d 201, 203 (1991). The

trial court ruled that Cohn failed to prove her claim of actual

fraud because she failed to establish there was an intent to

conceal and that Bonhomme’s statement about Jefferson was

opinion and not fact.

Cohn claims that KCI failed to disclose Jefferson's alleged

preference not to work with women. Proof of fraud by

nondisclosure “requires evidence of a knowing and deliberate

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In any event, Cohn's argument misinterprets our decisions.
This Court in Nationwide Mutual Ins. Co. v. Hargraves, 242 Va.
88, 405 S.E.2d 848 (1991), held that concealment can give rise
to constructive fraud only in cases where there is a duty to
disclose the concealed fact. Id. at 92-93, 405 S.E.2d at 851.
In that case, a duty to inform arose by virtue of the
contractual obligation imposed by the insurance contract between
the parties, a circumstance not present in this case. Further,
in Norris v. Mitchell, 255 Va. 235, 495 S.E.2d 809 (1998), we
restated that concealment, in general, can only give rise to a
claim of actual fraud.

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decision not to disclose a material fact.” Lambert, 262 Va. at

714, 553 S.E.2d at 718 (quoting Norris v. Mitchell, 255 Va. 235,

241, 495 S.E.2d 809, 812 (1998)(internal quotation marks

omitted)). “A contracting party’s willful nondisclosure of a

material fact that he knows is unknown to the other party may

evince an intent to practice actual fraud.” Spence v. Griffin,

236 Va. 21, 28, 372 S.E.2d 595, 599 (1988).

It is apparent from the record, as the trial court

determined, that there was no proof of an intent to conceal.

Assuming Cohn's claim concerning Jefferson's bias is correct,

Cohn nonetheless produced no evidence that Bonhomme was aware of

this bias, much less that she intentionally concealed it, at the

time the employment offer was made. In that circumstance, a

claim for actual fraud based upon concealment cannot lie. See

Virginia Natural Gas Co. v. Hamilton, 249 Va. 449, 455, 457

S.E.2d 17, 21 (1995) (a claim failed where there was no evidence

that any employee of the party charged with actual fraud

"intentionally and knowingly" made a false statement or

concealed a material fact) (emphasis added).

Furthermore, although “[i]t is not always an easy matter to

determine whether a given statement is one of fact or opinion,”

Mortarino v. Consultant Engineering Services, Inc., 251 Va. 289,

293, 467 S.E.2d 778, 781 (1996), the evidence fails to show that

Bonhomme’s statement was about a matter of "material fact" as

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opposed to an opinion. “It is well settled that a

misrepresentation, the falsity of which will afford ground for

an action for damages, must be of an existing fact, and not the

mere expression of an opinion.” Id.

Cohn’s own testimony during direct examination proves that

Bonhomme expressed an opinion. Cohn stated: “[Bonhomme] had

advised me that in her opinion” Jefferson did not get along with

the prior female office manager. (Emphasis added). In her

cross-examination Cohn stated that Bonhomme’s statements

regarding Jefferson were “only [Bonhomme’s] interpretation of

the situation.” (Emphasis added). The trial court correctly

found that Bonhomme’s statements were opinions and, therefore,

could not provide the basis for sustaining a claim of actual

fraud.

B. Constructive Fraud

"Constructive fraud differs from actual fraud in that the

misrepresentation of material fact is not made with the intent

to mislead, but is made innocently or negligently although

resulting in damage to the one relying on it." Evaluation

Research, 247 Va. at 148, 439 S.E.2d at 390; Nationwide Mut.

Ins. Co. v. Hargraves, 242 Va. 88, 92, 405 S.E.2d 848, 851

(1991) (emphasis added). A person asserting a claim of

constructive fraud must prove that the misrepresentation forming

the basis of the claim caused damage to the one relying on it.

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Evaluation Research, 247 Va. at 148, 439 S.E.2d at 390. To

prevail in the case at bar, Cohn was required to prove that

Bonhomme's misrepresentation of Temple’s qualifications was the

cause of her failure to become the Pentagon office manager for

KCI.

"The proximate cause of an event is that act or omission

which, in natural and continuous sequence, unbroken by an

efficient intervening cause, produces the event, and without

which that event would not have occurred." Beale v. Jones, 210

Va. 519, 522, 171 S.E.2d 851, 853 (1970). Before the issue of

proximate cause may be properly submitted to the jury, however,

the evidence proving a causal connection must be "sufficient to

take the question out of the realm of mere conjecture, or

speculation, and into the realm of legitimate inference." Id.

(quoting Hawkins v. Beecham, 168 Va. 553, 561, 191 S.E. 640, 643

(1937)).

Assuming Cohn's evidence to be true, her constructive fraud

claim fails because the misrepresentation of Temple’s

qualifications is not the reason she failed to become the

Pentagon office manager for KCI (the injury Cohn claims she

incurred). Under Cohn's theory of the case, the concealment of

Jefferson’s attitude was the cause of the withdrawal of the job

offer and Cohn's failure to get the KCI Pentagon office manager

position. Cohn's evidence was that Bonhomme changed the

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position offered to Cohn as a result of Jefferson’s bias, not

because she desired to promote Temple. Therefore, any

misrepresentation about Temple, even if made, could not have

been the cause of Cohn's failure to receive the KCI Pentagon

office position, which is the basis of her claimed injury.

Therefore, her claim for constructive fraud must fail.

III. CONCLUSION

The trial court correctly granted KCI's motion to strike

the evidence and motion to set aside the verdict. As to the

claim of actual fraud, Cohn failed to prove both Bonhomme's

intent to conceal and that the statement at issue was about a

matter of "material fact" and not opinion. As to the claim of

constructive fraud, Cohn could not show a causal connection

between the alleged misrepresentation and the injury for which

she claimed damages.

We will, therefore, affirm the judgment of the trial court.

Affirmed.

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