Quadros & Associates v. City of Hampton

Citations: 597 S.E.2d 90; 268 Va. 50; 2004 Va. LEXIS 80Docket: Record 032213.

Court: Supreme Court of Virginia; June 10, 2004; Virginia; State Supreme Court

Original Court Document: View Document

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In the case of Quadros Associates, P.C. v. City of Hampton, the Supreme Court of Virginia, presided over by Justice Barbara Milano Keenan, reviewed an appeal concerning a contract dispute following the Circuit Court of the City of Hampton's decision to grant the defendant's motion for summary judgment. The court analyzed the facts favorably for Quadros Associates, the plaintiff, while adhering to legal standards that prevent drawing unreasonable inferences.

Quadros, a law firm, had entered a three-year contract with the City in August 1997 to collect delinquent taxes and fees, with compensation based on recovery amounts and reimbursement for out-of-pocket expenses. The contract outlined specific duties, including sending a demand letter to delinquent debtors and initiating collection proceedings. 

Prior to March 1999, the City provided Quadros with critical data on delinquent accounts, which included information on abatements (tax liability reductions) and credits (payments affecting tax liability). However, following the installation of new software in the Treasurer’s Office, this information was no longer shared, despite Quadros' requests for the data necessary to proceed with collections. 

Frustrated by the lack of cooperation, Quadros halted work on accounts prior to 1999 in July 2000 and returned all related materials to the City. Subsequently, Quadros filed a motion against the City for breach of contract, citing the City's failure to provide essential abatement and credit information needed for effective collection efforts.

Quadros claimed that the City’s failure to provide necessary data hindered its ability to meet contractual obligations, leading to significant revenue losses. Quadros sought at least $160,000 in damages for net profits allegedly lost on delinquent accounts up to August 2000. The City responded with a motion for summary judgment, arguing it had no contractual obligation to refer accounts to Quadros for collection, based on the contract's clear language that required all necessary information to be provided before collection could begin. During a hearing, Quadros' counsel acknowledged the absence of a requirement for the City to refer a set number of accounts but argued an expectation of cooperation was implicit. Despite this, counsel also admitted that the City had not failed to pay for any amounts already collected by Quadros. The circuit court granted the City’s motion for summary judgment, which Quadros now appeals, asserting there were disputed material facts regarding the City's withholding of critical abatement and credit information necessary for determining delinquent taxes. The City contended there were no genuine disputes over material facts and that the contract did not mandate the provision of a specific number of accounts or information on a set schedule. Additionally, the City noted that Quadros did not claim any failure in payments for collected taxes. The court upheld the City's arguments, emphasizing that contracts must be interpreted as written without adding terms. The court declined to address Quadros’ separate claims regarding good faith obligations, as those were not part of the current appeal.

When contract terms are clear and unambiguous, courts must interpret them according to their plain meaning, focusing on the parties' expressed intentions. In this case, the contract required Quadros to initiate collection procedures on accounts referred by the City after receiving necessary information. Quadros was entitled to a percentage of recovered amounts and reimbursement for certain expenses. The contract did not mandate the City to refer a specific number of delinquent accounts or to provide data on a set schedule. Consequently, the City's provision of incomplete information for some accounts did not constitute a breach. Additionally, any dispute regarding the timing of data provision was not material to the City's contractual obligations. The circuit court's decision to rule in favor of the City on summary judgment was upheld.