Present: All the Justices
VIRGINIA POLYTECHNIC INSTITUTE
AND STATE UNIVERSITY, ET AL.
v. Record No. 030965 OPINION BY JUSTICE CYNTHIA D. KINSER
April 23, 2004
INTERACTIVE RETURN SERVICE, INC.
FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
Theodore J. Markow, Judge
The primary question in this appeal is whether a
reasonably prudent person in the position of the
contracting parties would have considered the type of
damages claimed in this case to be the natural consequence
of a breach of certain agreements dealing with the
assignment of intellectual property rights. Answering that
question affirmatively, we conclude that the circuit court
did not err by admitting evidence of consequential damages.
We also conclude that the circuit court did not err in
instructing the jury on the issue of waiver.
PRIOR PROCEEDINGS
Interactive Return Service, Inc. (“IRS”), filed a
breach of contract action against Virginia Polytechnic
Institute and State University (“Virginia Tech”), Virginia
Tech Intellectual Properties, Inc. (“VTIP”), and William
Landsidle, Comptroller.1 IRS sought damages against
Virginia Tech for its alleged breach of a sponsored
“Research Agreement” (“SRA”) entered into between IRS and
Virginia Tech, and damages against both Virginia Tech and
VTIP for their alleged breach of an “Industry Project
Agreement” (“IPA”) entered into between IRS, Virginia Tech,
VTIP and the Center for Innovative Technology (“CIT”). A
jury returned a verdict in favor of IRS against both
Virginia Tech and VTIP and fixed damages in the amount of
$110,000. The circuit court entered judgment against
Virginia Tech and VTIP, jointly and severally, in that
amount. Virginia Tech and VTIP (sometimes referred to as
“the defendants”) along with Landsidle appeal from that
judgment.2
RELEVANT FACTS
The terms of the SRA entered into between Virginia
Tech and IRS in January 1995 provided that IRS would
1
IRS sued Landsidle in his official capacity as
Comptroller for the Commonwealth of Virginia pursuant to
Code § 8.01-193.
2
At the close of the plaintiff’s evidence, Virginia
Tech and VTIP moved to strike the evidence and enter
judgment in their favor. The trial court granted the
motion with regard to IRS’s claims for breach of an oral
contract, inverse condemnation, and breach of an implied
contract. A claim for breach of the SRA and a separate
claim for breach of the IPA remained in the case and were
decided by the jury.
2
sponsor research at Virginia Tech to develop “an
Interactive Response Unit for use with IRS’ patent pending
[for an] [I]nteractive and [V]ideo [D]ata [S]ervice
[S]ystem.” According to the SRA, “[t]he Interactive
Response Unit . . . is a device that interprets a
television transmitted audio signal and analyzes
coordinates of a position on the television screen directed
by a laser beam and transmits a signal to a local repeater
station using IVDS (Interactive and Video Data Service).”
The Interactive Response Unit supposedly allows a
television viewer to interact with the television by
purchasing an advertised product, responding to a polling
question presented during a news program, or connecting to
the “Internet.”
Under the terms of the SRA, Virginia Tech was required
to “make every effort[] to develop mass production
engineering prototypes of the system . . . in compliance
with the Federal Communications Commission[’s] . . . rules
for IVDS that will allow manufacturers to produce reliable
products that are affordable to the general public and
reliable products for the IVDS network providers.” IRS
agreed to reimburse Virginia Tech, on a monthly basis, for
a portion of the costs of the research and development of
the prototype. Virginia Tech was to submit monthly
3
billings to IRS for the costs that had been incurred in the
performance of the SRA, and IRS was obligated to pay
promptly 80 percent of the billings, with the remaining 20
percent to be paid after Virginia Tech delivered the
prototype. Finally, Virginia Tech had “the right to cease
to perform any additional effort upon written notice to IRS
to that effect, only after a material breach of this
agreement [had] occurred.” In that event, Virginia Tech
was required to produce “a final report describing the
effort at such time as the effort ceased.”
The SRA also addressed the ownership of inventions
resulting from the research. The title and ownership of
inventions resulting from research conceived solely by
researchers at Virginia Tech would be assigned to CIT.3 For
inventions resulting from research conceived jointly by
Virginia Tech researchers and IRS, title and ownership
would reside jointly with IRS and CIT. Finally, inventions
resulting from research conceived solely by IRS would be
owned by IRS.
3
At about the same time Virginia Tech and IRS entered
into the SRA, IRS and CIT executed an agreement setting
forth the terms under which CIT would license to IRS any
inventions assigned to CIT by Virginia Tech pursuant to the
SRA. This agreement, among other things, granted IRS the
option to acquire an exclusive, worldwide license of the
Interactive Response Unit.
4
Virginia Tech began the research in 1995. The
research was supposed to be completed in nine months at a
cost of $201,505, but Virginia Tech requested several work
extensions and additional research costs. Although IRS
agreed to these extensions and increased costs, IRS
repeatedly advised Virginia Tech that it had no revenues
and that its only source of cash was to sell “equity
participation (IRS[] Shares) or by selling technology
rights.” According to IRS, its major assets were its
proprietary technology and the relationship with Virginia
Tech and CIT.
IRS paid Virginia Tech slightly more than $103,000.
However, after December 1995, IRS did not make any further
payments on the research costs owed to Virginia Tech under
the SRA.4 Virginia Tech sent several letters to IRS
demanding payment of the unpaid costs. IRS never denied
the indebtedness but responded by offering to work out a
payment schedule that delayed payment of the past due
amount until the research produced a working prototype.
IRS also offered to pay interest on the unpaid balance. In
approximately June 1996, IRS informed Virginia Tech that it
could not make any further payments until it received the
4
The last payment made in December 1995 was for the
July 1995 billing.
5
finished product. Nonetheless, IRS admitted at trial that
it owed Virginia Tech approximately $750,000.5
During the same period of time, June 1996, IRS,
Virginia Tech, VTIP, and CIT, entered into the IPA. In
that agreement, the parties acknowledged their desire that
the technology related to the Interactive Video and Data
Service System “be used in the public interest and be
available to the public quickly and efficiently.” CIT
agreed to “cost-share” the research project by providing
$73,500 to Virginia Tech. In return for CIT’s funding, IRS
agreed to repay CIT the amount of $147,000, double CIT’s
investment, out of “net revenues arising from the selling,
leasing, licensing, sublicensing, or in any other manner
generating revenue from the transfer or use of any products
and/or services using” the technology related to the
Interactive Video and Data Service System. IRS also agreed
to sponsor the research project at Virginia Tech by
providing $416,131 to Virginia Tech. Pursuant to the terms
of the IPA, Virginia Tech was obligated to assign any
“Discoveries . . . conceived, developed, or reduced to
practice during the Term of the Research Program” to VTIP,
5
Virginia Tech’s records showed that it had billed IRS
the cumulative amount of $678,745.01.
6
which would in turn “assign to CIT all intellectual
property rights related to the Discover[ies].”6
After execution of the IPA, Virginia Tech requested
additional extensions and cost increases for the research
project, but IRS still did not make any payments to
Virginia Tech. In a “Call/Visit Documentation” dated July
10, 1996, a contracts and grants administrator for the
Virginia Tech Office of Sponsored Programs noted “as of”
June 26, 1996 that “[s]ponsor [IRS] will not have money
until he receives finished product and can sell it. He
will pay us then. We are to keep invoicing him.”
According to IRS, Virginia Tech agreed in the fall of 1996
to continue the research project until a working prototype
was developed and to give IRS 90 days thereafter to pay its
indebtedness to Virginia Tech. In December 1996, Virginia
Tech requested a “no-cost extension” of the research
project to June 30, 1997.
However, soon after December 1996, Virginia Tech
stopped working on the project. It did not deliver a final
report to IRS as required by the SRA. In a July 1997
letter, Virginia Tech advised IRS that, in light of the
6
Virginia Tech and VTIP did not have any different
practices and procedures for dealing with inventions under
a sponsored research agreement than for dealing with
discoveries under an industry project agreement.
7
fact that the research results and intellectual property
derived from the project remained with Virginia Tech, it
would assign these rights to VTIP unless IRS’s obligation
was paid in full within 45 days. Virginia Tech further
advised IRS that VTIP, upon receiving the assignment,
intended to execute a license with Proceso Interactivo S.
A. de C.V. (“PISA”) and that the terms of that license
would include an obligation by PISA to repay to Virginia
Tech the outstanding indebtedness of IRS.7
IRS did not pay as requested. Consequently, in an
August 1997 document titled “Virginia Tech Intellectual
Property Disclosure,” Virginia Tech captured the results of
the research so that it could be licensed to PISA.8 The
type of work listed in the disclosure was “Interactive
Video Data Service (IVDS) System,” and the disclosure
7
In an email message dated June 17, 1997, Virginia
Tech indicated that it was proposing “to grant exclusive
world wide rights for all of the work done at [Virginia]
Tech (audio coding, circuit design and software) to PISA in
return for a down stream license payment.” Virginia Tech
took the position that the audio coding, circuit design and
software developed during the research project was
intellectual property belonging to Virginia Tech, not IRS.
8
Virginia Tech had previously prepared two other
intellectual property disclosures with regard to the
research project. In one of those documents, Virginia Tech
acknowledged that IRS had “exclusive licensing options for
use [of the intellectual property listed] in an interactive
television application.” All three intellectual property
disclosures arose out of the research project but none were
assigned to CIT.
8
stated that “the rights to use this technology will be
assigned to PISA.” Virginia Tech assigned the intellectual
property and research results to VTIP, and one day later,
VTIP licensed those rights to PISA. The intellectual
property rights related to the research project were never
assigned to CIT as required by the terms of both the SRA
and the IPA.
In October 1997, IRS entered into an agreement with
The HAGO Company, Inc. (“HAGO”) for the sale and exclusive
use of certain intellectual property rights in the United
States of America. In the agreement, IRS stipulated that
it had a research and development contract with Virginia
Tech and that the ownership of the software and other
results of that research were in dispute. Accordingly,
HAGO agreed to pay IRS “a monthly payment equal to the
greater amount between fifty US cents per each Audio-Link
in operation and the minimum monthly amount” of $10,000.
HAGO agreed to increase the minimum monthly amount to
$60,000 “thirty days after [Virginia Tech] deliver[ed] the
software and results of” the research and development
project and “a letter of no action against” IRS or “thirty
days after [a] final appealable order instruct[ed Virginia
Tech] to deliver the software and results of” the research
and development to IRS.
9
After executing the agreement with HAGO, IRS sent
Virginia Tech a copy of the contract. About two months
later, IRS presented a pecuniary claim against Virginia
Tech, and this litigation followed.
ANALYSIS
Armed with a jury verdict approved by the circuit
court, IRS holds “the most favored position known to the
law.” Stanley v. Webber, 260 Va. 90, 95, 531 S.E.2d 311,
314 (2000). On appeal, we view the evidence presented at
trial in the light most favorable to the prevailing party,
IRS, and we will not set aside the judgment of the circuit
court unless it is plainly wrong or without evidence to
support it. Id., Code § 8.01-680. Using these principles
of appellate review, we turn now to the assignments of
error presented in this appeal.
Virginia Tech and VTIP assign three errors to the
circuit court’s judgment. Initially, they assert that IRS
was the first party to commit a material breach of “the
contract” and that the circuit court, therefore, erred in
overruling the defendants’ motion to strike and Virginia
Tech’s motion to vacate the final order and enter summary
10
judgment in its favor.9 Next, Virginia Tech and VTIP
contend that the circuit court “erred by instructing the
jury on waiver and by denying [d]efendants’ motion to
strike” and Virginia Tech’s post-trial motion for summary
judgment because there was no “evidence that Virginia Tech
waived its right to payment under the contract.”10 In the
third assignment of error, Virginia Tech and VTIP assert
that the circuit court “erred by admitting evidence of
consequential damages even though the evidence failed to
establish that those damages were within the contemplation
of the parties at the time of contracting.”
In order to understand the posture of this case and to
address the first two assignments of error, we begin by
restating the questions presented to the jury for decision.
The circuit court instructed the jury that the issues in
the case were whether the SRA was a contract between IRS
and Virginia Tech, and if so, whether either party breached
it; and whether the IPA was a contract to which IRS,
Virginia Tech, and VTIP were parties, and if so, whether
any party breached it. The jury was further instructed
9
Only Virginia Tech filed a post-trial motion to
vacate the final order and enter summary judgment in its
favor.
10
By its terms, the second assignment of error speaks
only to Virginia Tech.
11
that it should find its verdict in favor of IRS and against
Virginia Tech if it found that there was a contract between
those parties; that IRS did not breach that contract, or if
it did, Virginia Tech waived the breach; and that Virginia
Tech breached the contract. The jury was similarly
instructed with regard to VTIP. Based on these
instructions, the jury necessarily concluded that VTIP
breached the IPA since that was the only contract to which
it was a party. However, given the general verdict form,
it is impossible to know whether the jury concluded that
Virginia Tech breached the SRA, the IPA, or both.
However, as IRS observes, the defendants’ argument in
the opening brief with regard to the first assignment of
error addresses only the SRA. Virginia Tech and VTIP state
that “[b]ecause it was undisputed that IRS committed the
first material breach of the [Sponsored] Research
Agreement, IRS was precluded as a matter of law from
recovering for breach of the agreement.” With regard to
VTIP, it is irrelevant whether IRS was the first party to
commit a material breach of the SRA because VTIP was not a
party to that contract. As to Virginia Tech, it is not
necessary to decide the merits of the first assignment of
error because we conclude that the circuit court properly
12
instructed the jury with regard to the issue of waiver,
which is the subject of the second assignment of error.
In that regard, Virginia Tech argues, and we agree,
that it never waived the contractual right to be paid under
both the SRA and the IPA. Even IRS acknowledged that fact
by its admission at trial that it owed Virginia Tech
approximately $750,000. Also, during closing argument, IRS
suggested that the jury should reduce any award of damages
to IRS by the amount of its indebtedness to Virginia Tech.
The relevant question, however, was whether Virginia Tech
waived its contractual right to timely payment by IRS, not
whether Virginia Tech waived the right to all payment.
On the issue of waiver, the circuit court instructed
the jury that “[a] waiver occurs when a party intentionally
gives up a contractual right which would have been
beneficial to it. A waiver may be expressly stated or it
may be implied from conduct. A party cannot waive a right
unless he has full knowledge of it.” The court further
instructed that “[t]he burden rests on a party claiming the
other party has waived a right under a contract to prove
the other party waived that [right] by clear, unequivocal,
and convincing evidence, direct or implied.” In addressing
the defendants’ objection to these instructions, the
circuit court correctly stated, “The waiver question is did
13
they waive prompt payment. Not payment but prompt
payment.”
“[W]aiver is an intentional relinquishment of a known
right.” Stanley’s Cafeteria, Inc. v. Abramson, 226 Va. 68,
74, 306 S.E.2d 870, 873 (1983). Two elements are necessary
to establish waiver: “knowledge of the facts basic to the
exercise of the right and the intent to relinquish that
right.” Employers Commercial Union Ins. Co. of America v.
Great American Ins. Co., 214 Va. 410, 412-13, 200 S.E.2d
560, 562 (1973); accord Horton v. Horton, 254 Va. 111, 117,
487 S.E.2d 200, 204 (1997); Stanley’s Cafeteria, 226 Va. at
74, 306 S.E.2d at 873. The party relying on a waiver has
the burden “to prove the essentials of such waiver . . . by
clear, precise and unequivocal evidence.” Utica Mut. Ins.
Co. v. Nat’l Indem. Co., 210 Va. 769, 773, 173 S.E.2d 855,
858 (1970).
Virginia Tech clearly knew of its contractual right
under the SRA to receive prompt payment from IRS of 80
percent of the research costs as billed on a monthly basis
and its right to stop the research project if IRS
materially breached its obligations under the SRA.
Virginia Tech also was aware that, as of December 1995, IRS
ceased making any payments on its indebtedness and that the
December 1995 payment was for the July 1995 billing. The
14
question here is whether Virginia Tech intended to
relinquish its contractual right to receive prompt payment
from IRS.
There is sufficient evidence to make that question a
jury issue. From the beginning of the research project,
IRS did not promptly pay the bills submitted by Virginia
Tech and failed to make any payments after December 1995.
Nevertheless, Virginia Tech continued to conduct research
and requested several extensions and cost increases for the
project. As early as August 1995, IRS informed Virginia
Tech that its only sources of cash for the next few years
would be by selling shares of stock in IRS and by selling
technology rights. IRS’s inability to pay until it
received a working prototype was the subject of discussions
and correspondence between IRS and Virginia Tech. A July
1996 internal Virginia Tech document acknowledged that
fact, and according to IRS, Virginia Tech agreed in the
fall of 1996 to give IRS 90 days after receipt of a working
prototype to pay the indebtedness to Virginia Tech. As
late as December 1996, Virginia Tech requested a no-cost
extension of the research project. All this evidence is
consistent with IRS’s position that Virginia Tech had
agreed to wait for payment until 90 days after it provided
a working prototype to IRS.
15
This is not a case in which Virginia Tech merely
acquiesced in IRS’s failure to pay its indebtedness
promptly. See Stanley’s Cafeteria, 226 Va. at 74, 306
S.E.2d at 874 (“[a]cquiescence, that is, the failure to
protest or object, is an element of waiver; but does not of
itself constitute waiver”). Instead, there is sufficient
evidence from which the jury could fairly infer that
Virginia Tech intended to relinquish its contractual right
to receive prompt payment by IRS in order to produce a
working prototype. Rather than standing on its contractual
rights and treating the SRA as ended, Virginia Tech, by its
conduct, see Cocoa Products Co. of Am. v. Duche, 156 Va.
86, 96, 158 S.E. 719, 722 (1931) (contractual rights may be
waived by course of dealing), kept the SRA alive for itself
and for IRS, see Richmond Leather Mfg. Co. v. Fawcett, 130
Va. 484, 506-07, 107 S.E. 800, 808 (1921) (“series of
dealings in which delayed deliveries are accepted and paid
for, and further deliveries demanded, justifies the party
in default in the absence of anything to the contrary, in
concluding that the contract will not be rescinded on
account of such delayed deliveries without notice,” thereby
“keep[ing] the contract alive”).
Therefore, we conclude that the circuit court did not
err in instructing the jury on the issue of waiver and in
16
refusing to grant the defendants’ motion to strike and
Virginia Tech’s post-trial motion. That conclusion renders
irrelevant the question whether IRS was the first party to
commit a material breach of the SRA. Assuming the jury’s
verdict against Virginia Tech was based on its finding that
Virginia Tech breached the SRA, not the IPA, the jury could
have reached that verdict either by finding, per its
instructions, that IRS did not breach the SRA, or that it
did but Virginia Tech waived the breach. For that reason
and because VTIP was not a party to the SRA, neither
defendant can obtain any relief under the first assignment
of error.
Virginia Tech and VTIP, nevertheless, argue in the
reply brief that IRS was also the first party to commit a
material breach of the IPA. They contend that the IPA did
not alter IRS’s obligation to pay Virginia Tech for the
costs of the research project and that, under the terms of
the IPA, IRS was required to sponsor the research by
providing $416,131 to Virginia Tech. However, the terms of
the IPA did not specify whether this sum reflected the
balance owed to Virginia Tech at the time the parties
entered into the IPA or whether it was additional money to
be paid by IRS. Nor does the evidence in the record answer
this question. Moreover, the IPA does not contain any
17
terms regarding when IRS was to pay that sum to Virginia
Tech. Thus, the evidence at trial failed to demonstrate a
material breach of the IPA by IRS.
Finally, with regard to the issue of consequential
damages, Virginia Tech and VTIP argue that, when they
contracted with IRS, they could not have contemplated that
IRS would create an arrangement with a third party that
tied royalty payments to IRS to its securing a final
judgment against Virginia Tech. They also contend that the
HAGO agreement was “a sham, nothing more than a thinly
veiled attempt to manufacture consequential damages where
no damages exist[ed].” Thus, according to the defendants,
the circuit court erred in admitting evidence of
consequential damages based on the HAGO agreement. We do
not agree.
“Consequential damages are those which arise from the
intervention of ‘special circumstances’ not ordinarily
predictable.” Roanoke Hosp. Ass’n v. Doyle & Russell,
Inc., 215 Va. 796, 801, 214 S.E.2d 155, 160 (1975); accord
NAJLA Assocs., Inc. v. William L. Griffith & Co. of Va.,
Inc., 253 Va. 83, 86, 480 S.E.2d 492, 494 (1997).
Consequential damages “are compensable only if it is
determined that the special circumstances were within the
‘contemplation’ of both contracting parties.” NAJLA
18
Assocs., 253 Va. at 87, 480 S.E.2d at 494. The term
“contemplation” used in this context means both “what was
actually foreseen and what was reasonably foreseeable.”
Roanoke Hosp., 215 Va. at 801 n. 4, 214 S.E.2d at 160 n. 4;
accord Danburg v. Keil, 235 Va. 71, 76, 365 S.E.2d 754, 757
(1988). The question “[w]hether special circumstances were
within the contemplation of the parties is a question of
fact.” Roanoke Hosp., 215 Va. at 801, 214 S.E.2d at 160.
We need look no further than the terms of the SRA and
IPA to conclude that the evidence was sufficient to make
the question whether the type of damages claimed by IRS was
within the contemplation of the parties an issue for the
jury to resolve. See Fairfax County Redevelopment &
Housing Auth. v. Hurst & Assocs. Consulting Eng’rs, Inc.,
231 Va. 164, 168, 343 S.E.2d 294, 296 (1986). Under the
terms of the SRA, Virginia Tech was obligated to “make
every effort[] to develop mass production engineering
prototypes of the system . . . that will allow
manufacturers to produce reliable products that are
affordable to the general public and reliable products for
the IVDS network providers.” The introductory section of
the IPA, which both Virginia Tech and VTIP executed, stated
that IRS had “an interest in developing and commercializing
technology related to [the] Interactive Video and Data
19
Service System.” In that same section, the parties to the
agreement expressed their desire that such technology be
made available to the public, and CIT stated its interest
in helping IRS commercialize the technology. In return for
CIT’s “cost-share funding” to Virginia Tech, IRS agreed to
repay CIT from its worldwide “net revenues arising from the
selling, leasing, licensing, sublicensing, or in any other
manner generating revenue from the transfer or use of any
products and/or services using” the technology developed in
the research program by Virginia Tech. In turn, CIT was
required to distribute to Virginia Tech a proportional
share of each payment received from IRS.
Based on the provisions of the SRA and the IPA, it was
reasonably foreseeable to the parties that, following
research and the development of intellectual property and
technology related to the Interactive Video and Data
Service System, there would be licensing, manufacturing,
and/or marketing contracts for those rights and that such
contracts would generate revenues to IRS. IRS’s agreement
to sell intellectual property rights to HAGO was such a
contract. Thus, the consequential damages claimed by IRS
were of the nature and type of damages within the
contemplation of the parties, i.e., reasonably foreseeable,
at the time of contracting. See Krauss v. Greenbarg, 137
20
F.2d 569, 570-71 (3rd Cir. 1943) (in Pennsylvania, the
determinative question is whether the breaching party knew
that the breach would probably result in the kind of
special damages claimed). Stated differently, a reasonably
prudent person in the position of Virginia Tech and VTIP at
the time of contracting would have considered this type of
damages to be the natural consequence of their breach of
the SRA and/or the IPA when they failed to assign the
intellectual property rights to CIT so those rights could
be licensed to IRS. See Contempo Design, Inc. v. Chicago &
Northeast Ill. Dist. Council of Carpenters, 226 F.3d 535,
554 (7th Cir. 2000), cert. denied, 531 U.S. 1078 (2001).
It was not necessary for the parties actually to
foresee that type of consequential damages. See Roanoke
Hosp., 215 Va. at 801 n. 4, 214 S.E.2d at 160 n. 4; see
also Passaic Distrib., Inc. v. The Sherman Co., 386 F.
Supp. 647, 651 (S.D.N.Y. 1974) (applying New Jersey law,
“[a]ctual foresight of the specific injury of a particular
amount in money is not required”). Neither was it
necessary that the HAGO agreement in particular or the
exact consequential damages claimed by IRS be in fact
foreseen or reasonably foreseeable by the parties.11 See
11
To the extent that Virginia Tech and VTIP argue that
the quantum of consequential damages claimed by IRS was
21
Sabraw v. Kaplan, 211 Cal. App. 2d 224, 228 (Cal. Ct. App.
1962) (“it is not necessary that the exact manner by which
damages occur by reason of breach of contract be
foreseeable”); Stern & Stern Assocs. v. Timmons, 423 S.E.2d
124, 125 (S.C. 1992) (“the defendant need not foresee the
exact dollar amount of the injury, the defendant [need
only] know or have reason to know the special
circumstances”). Accordingly, the circuit court did not
err in admitting evidence of consequential damages. There
was sufficient evidence of special circumstances within the
contemplation of the parties to submit this factual issue
to the jury and to sustain the jury’s verdict.
CONCLUSION
In summary, there is sufficient evidence from which
the jury could have concluded that Virginia Tech waived its
contractual right to receive prompt payment from IRS.
Thus, the circuit court did not err by instructing the jury
on the issue of waiver. Consequently, it is irrelevant
whether IRS was the first party to commit a material breach
of the SRA. And, there is no evidence that IRS was the
first party to commit a material breach of the IPA.
speculative or that the HAGO agreement was entered into for
fraudulent purposes, those arguments are not encompassed
within the assignment of error. See Rule 5:17(c). We note
that the defendants asserted those particular arguments in
their motion in limine before the circuit court.
22
Finally, the evidence demonstrated that special
circumstances giving rise to the type of consequential
damages claimed by IRS were within the contemplation of the
parties at the time of contracting. For these reasons, we
will affirm the judgment of the circuit court.
Affirmed.
23