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Eilber v. Floor Care Specialists, Inc.

Supreme Court of Virginia

December 7, 2017

RUSSELL EMORY EILBER
v.
FLOOR CARE SPECIALISTS, INC., ET AL.

         FROM THE CIRCUIT COURT OF THE CITY OF ROANOKE David B. Carson, Judge.

          OPINION

          WILLIAM C. MIMS JUSTICE.

         In this appeal, we consider whether judicial estoppel is an affirmative defense that is waived if not pled.

         In December 2012, Russell E. Eilber filed a Chapter 13 bankruptcy petition in the United States Bankruptcy Court for the Western District of Virginia. Included with his petition was a proposed Chapter 13 payment plan, which required that he make 36 monthly payments to the bankruptcy trustee for the benefit of his creditors. The bankruptcy court confirmed the proposed Chapter 13 plan after determining that it satisfied the requirements of 11 U.S.C. § 1325(a).

         Approximately one year later, Eilber began working as the "facilities manager" for New Horizons Healthcare, Inc. ("New Horizons"). In this role, he was responsible for supervising the work of Amanda Guthrie and Brittney Sigmon, who cleaned the New Horizons facility daily. Guthrie and Sigmon were employed by Floor Care Specialists, Inc. ("FCS"), an independent contractor that provided janitorial services for New Horizons.

         In September 2014, New Horizons terminated Eilber's employment. Eilber responded by filing a defamation action in the circuit court against FCS, Guthrie, Sigmon, and a FCS manager ("appellees"). His complaint asserted that he was fired as the result of defamatory statements made by Sigmon and Guthrie. He further claimed that these statements were defamatory per se because they prejudiced him in his trade or profession. Appellees demurred, arguing that the complaint failed to state a claim for defamation per se. After briefing and argument by counsel, the circuit court denied the demurrers.

         In April 2016, Eilber completed the payments required by the Chapter 13 plan. The bankruptcy court then ordered the discharge of his remaining unsecured debts. Appellees subsequently moved for summary judgment in the circuit court on the ground that Eilber lacked standing to prosecute his defamation action because he failed to disclose the claim to the bankruptcy court. After Eilber filed a brief in opposition to the motion for summary judgment, appellees filed a reply brief in which they argued for the first time that Eilber was judicially estopped from prosecuting his defamation action. They contended that Eilber's failure to timely disclose his claim to the bankruptcy court meant that he took the position that no such claim existed.

         After a hearing, the circuit court found that Eilber's defamation action arose after confirmation of the Chapter 13 plan, but prior to the bankruptcy discharge. It also found that he did not disclose his defamation action until after the discharge. Based on these findings, the court concluded that Eilber lacked standing and, alternatively, that the doctrine of judicial estoppel prohibited him from prosecuting his defamation claim after taking the position in the bankruptcy court that it did not exist. Accordingly, the court granted appellees' motion for summary judgment and dismissed Eilber's claim with prejudice.

         On appeal, Eilber presents two assignments of error:

1. The trial court erred when [it] held that Eilber as a debtor in a Chapter 13 bankruptcy did not have standing to bring a cause of action that acc[ru]ed subsequent to [the] filing of his Chapter 13 bankruptcy petition, subsequent to the confirmation of [his] Chapter 13 payment plan, but prior to . . . receiving a Chapter 13 discharge.
2. The trial court erred when [it] ruled that the doctrine of judicial estoppel bars Eilber from pursuing the cause(s) of action in [his] complaint because the defensive pleadings do not allege judicial estoppel as an affirmative defense . . . .

         Additionally, appellees present the following assignment of cross-error:

1. The circuit court erred in finding that [Eilber] stated a cause of action for defamation per se.

         We note at the outset that Eilber's second assignment of error does not challenge the circuit court's substantive application of judicial estoppel. Rather, it presents only the narrow question of whether judicial estoppel is an affirmative defense that is waived if not pled. We review this question of ...


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