United States District Court, E.D. Virginia, Richmond Division
J. IRVIN BEATLEY, Plaintiff,
CHARLES E. AYERS, JR., et al., Defendants.
A. Gibney, Jr. United States District Judge.
plaintiff, J. Irvin Beatley, sued the defendants in state
court for payments that the defendants owed him after a
failed real estate venture. The parties settled the case, but
the defendants failed to honor their end of the bargain.
Beatley now seeks a judgment in this Court against the
defendants for breach of contract and fraud. The defendants,
Charles E. Ayers, Jr., Ralph L. Costen, Jr., and Jesse L.
Barber, have moved for summary judgment, arguing that Beatley
cannot prove that he suffered damages. Beatley, however, has
shown that he has exposure to a third party for a judgment
because the defendants' failed to comply with certain
provisions of the settlement agreement. Because Beatley can
establish damages based on the defendants' alleged
breaches, the Court will deny the defendants' motion for
case arises from a soured business relationship concerning a
failed real estate development in Hopewell, Virginia. In
2017, Beatley sued the defendants in the Richmond Circuit
Court. On June 15, 2017, the parties entered into a
settlement agreement. Paragraph 2 of the settlement agreement
required the defendants to pay Beatley $134, 000 by July 17,
2017. Paragraph 3 provided that the defendants would (1)
assume Beatley's obligations on a loan from Fulton Bank
in the amount of $157, 149.79; (2) use "all best
efforts" to obtain Fulton's consent to assume the
loan; and (3) pay the monthly interest charges associated
with the loan.
now argues that the defendants never intended to honor the
settlement agreement. Although the parties dispute the
defendants' intent, they agree that the defendants failed
to pay Beatley $134, 000 by the July 17, 2017, deadline. To
fulfill the defendants' obligations under paragraph 3 to
use "all best efforts" to obtain Fulton's
consent to assume the loan, Ayers sent a letter and left a
voicemail for Timothy Robinson, the Vice President of Fulton.
The defendants' efforts to obtain Fulton's consent,
however, ultimately failed.
January 18, 2018, Beatley sued the defendants in this Court,
alleging (I) breach of contract; (II) conspiracy to breach
contract; (III) fraudulent inducement; and (IV) conspiracy to
commit fraud. The defendants moved to dismiss Count II under
Rule 12(b)(6), and the Court denied the motion. On February 23,
2018, Beatley moved for partial judgment as to Count I for
$134, 000. On April 13, 2018, the defendants finally paid
Beatley $134, 000 pursuant to paragraph 2 of the settlement
agreement, plus 6% interest.
15, 2018, Fulton sent a letter to Beatley notifying him that
the loan had been satisfied. John Woodfin, Sr., had put up
collateral years earlier to secure the loan. Fulton used
Woodfin's collateral to satisfy the balance on the loan.
Although the defendants have not assumed the loan pursuant to
paragraph 3 of the settlement agreement, the defendants did
make the required monthly interest payments.
the defendants have fulfilled their obligations under
paragraph 2 and the Fulton loan now has a zero balance, the
defendants say that Beatley cannot prove damages. Beatley
argues that he has suffered damages because he now has
exposure to Woodfin's estate for a claim in connection
with the Fulton loan.
claims all require proof of damages as an element, so he must
show that he suffered damages to survive a motion for summary
has made that showing. Because Fulton used Woodfin's
collateral to satisfy the loan, Beatley has exposure to
Woodfin's estate for the value of the collateral.
Virginia law authorizes a guarantor's personal
representative to "obtain a judgment or decree against
any person" for the amount the guarantor paid to secure
a loan. Va. Code Ann. § 49-27. Moreover, an estate's
personal representative "ha[s] not only the authority,
but most likely even the duty, to file suit to collect debts
owed to the decedent's estate." Campbell v.
Harmon, 271 Va. 590, 600, 628 S.E.2d 308, 313 (2006);
see also Isbellv. Flippen, 185 Va. 977, 981, 41
S.E.2d 31, 33 (1947) ("[F]ailure to proceed promptly
with the collection of assets due the decedent's estate
is negligence, for which the personal representative may be
liable."). Under Virginia law, therefore, Beatley has
shown that he has exposure to Woodfin's estate beyond
mere "uncertainties, contingencies, or
speculation." See Shepherd v. Davis, 265 Va.
108, 125, 574 S.E.2d 504, 524 (2003). Because Beatley could
establish damages at trial, the Court must deny the motion
for summary judgment.
whether the defendants used "all best efforts" to
obtain Fulton's consent to assume the loan is a disputed
material fact. The defendants have given conflicting
testimony regarding their efforts to obtain Fulton's
consent. See Zoroastrian Or. & Darb E-Mehr of Metro.
Wash., D.C. v. Rustam Guiv Found, of N.Y., 822 F.3d 739,
751 (4th Cir. 2016) ("While conflicting testimony can
indeed preclude summary judgment, any inconsistency must
concern a material fact."). For example, Costen
testified that he took no action to obtain Fulton's
consent to assume the loan. (Costen Dep. 19:17 - 21:4.)
Ayers, however, testified that Costen spoke to the President
of Fulton about the loan. (Ayers Dep. 24:16 - 25:8.) Due to
this disputed factual issue, the Court must deny the
defendants' motion for summary judgment.
Beatley can show that he suffered damages and has raised a
genuine dispute of material fact, the Court will deny the