Construction Law Insights

EvansStarrett PLC v. Goode & Preferred Gen. Contracting Co., 2020 Va. Cir. LEXIS 80 (Fairfax Cnty. Ct. June 8, 2020)

On February 21, 2019, Donn Milton and Rebecca Bowerman (“Milton/Bowermann”), the parties against whom the law firm EvansStarrett, PLC (“EvansStarrett”) had previously represented Goode & Preferred Gen. Contracting Co. (“Goode/Preferred”) in a dispute over construction invoices, offered to resolve all disputes between Milton/Bowerman and Goode/Preferred by wiring the total of the arbitration award for damages and attorney fees ($246,985.58) to EvansStarrett’s trust account by February 28, 2019. At that time, Goode/Preferred knew that it owed EvansStarrett

$228,098.17. That same day, (February 21, 2019), Goode/Preferred, with the intent to mislead, knowingly and falsely represented to EvansStarrett that, if EvansStarrett would agree to have the $246,985.58 payment wired to Goode/Preferred’s bank account instead of EvansStarrett’s trust account, Goode/Preferred would wire the money it owed EvansStarrett to EvansStarrett upon receipt of the funds, even though Goode/Preferred intended, when it made the representation, to pay EvansStarrett only $145,000 (the amount of legal fees awarded by the arbitrator).

Because the false representation made by Goode/Preferred was related to a duty that arose under the contract, the proposed amendment sounded in contract, not tort. Therefore, it is barred by the source-of-duty rule. As a result, the Court denied EvansStarrett’s motion to amend its complaint to add an actual fraud count.

PLDR Law Scott Kowalski 1 PLDR Law Mark Burgin 1

Thomas Wolf 002 Kenneth Stout 002 Jason Goldsmith 002

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