Subtitle I. Property Conveyances.

Chapter 1. Creation and Limitation of Estates.

Article 1. Creation and Transfer of Estates.

§ 55.1-100. Aliens may acquire, hold, and transmit real estate; when reciprocity required.

Any alien, not an enemy, may acquire by purchase or descent and hold real estate in the Commonwealth, and such real estate shall be transmitted in the same manner as real estate held by citizens. However, if, at the time of the transfer, a court of the Commonwealth determines that the laws of a foreign country or sovereignty effectively deny a Virginia resident, legatee, or distributee the benefit, use, or control of money or other property held in such foreign country or sovereignty, a judgment or order issued in the Commonwealth concerning the rights of a resident of that foreign country or sovereignty to the benefit, use, or control of money or property held in the Commonwealth may direct that the money or property be paid into the court for the benefit of the alien. The money or property paid into court shall be paid out only upon order of the court or pursuant to the order or judgment of a court of competent jurisdiction. Any of the money or property remaining with the court upon expiration of three years from the decedent’s death shall be paid out by the court as if the alien had predeceased the decedent.

History. Code 1919, § 66; Code 1950, § 55-1 ; 1993, c. 535; 2019, c. 712.

Transition provisions.

Acts 2019, c. 712, recodified Title 55 as Title 55.1, effective October 1, 2019. Where appropriate, the historical citations and annotations to former sections have been added to corresponding new sections. For Tables of Comparable sections, see Volume 10.

Acts 2019, c. 712, cl. 2 provides: “That whenever any of the conditions, requirements, provisions, or contents of any section or chapter of Title 55 or any other title of the Code of Virginia as such titles existed prior to October 1, 2019, are transferred in the same or modified form to a new section or chapter of Title 55.1 or any other title of the Code of Virginia and whenever any such former section or chapter is given a new number in Title 55.1 or any other title, all references to any such former section or chapter of Title 55.1 or other title appearing in this Code shall be construed to apply to the new or renumbered section or chapter containing such conditions, requirements, provisions, contents, or portions thereof.”

Acts 2019, c. 712, cl. 3 provides: “That the regulations of any department or agency affected by the revision of Title 55 or such other titles in effect on the effective date of this act shall continue in effect to the extent that they are not in conflict with this act and shall be deemed to be regulations adopted under this act.”

Acts 2019, c. 712, cl. 4 provides: “That the provisions of § 30-152 of the Code of Virginia shall apply to the revision of Title 55.1 so as to give effect to other laws enacted by the 2019 Session of the General Assembly, notwithstanding the delay in the effective date of this act.”

Acts 2019, c. 712, cl. 5 provides: “That the repeal of Title 55 and § 18.2-324.1 , effective as of October 1, 2019, shall not affect any act or offense done or committed, or any penalty incurred, or any right established, accrued, or accruing on or before such date, or any proceeding, prosecution, suit, or action pending on that day. Except as otherwise provided in this act, neither the repeal of Title 55 nor the enactment of Title 55.1 shall apply to offenses committed prior to October 1, 2019, and prosecution for such offenses shall be governed by the prior law, which is continued in effect for that purpose. For the purposes of this enactment, an offense was committed prior to October 1, 2019, if any of the essential elements of the offense occurred prior thereto.”

Acts 2019, c. 712, cl. 6 provides: “That any notice given, recognizance taken, or process or writ issued before October 1, 2019, shall be valid although given, taken, or to be returned to a day after such date, in like manner as if Title 55.1 had been effective before the same was given, taken, or issued.”

Acts 2019, c. 712, cl. 7 provides: “That if any clause, sentence, paragraph, subdivision, or section of Title 55.1 shall be adjudged in any court of competent jurisdiction to be invalid, the judgment shall not affect, impair, or invalidate the remainder thereof but shall be confined in its operation to the clause, sentence, paragraph, subdivision, or section thereof directly involved in the controversy in which the judgment shall have been rendered, and to this end the provisions of Title 55.1 are declared severable.”

Acts 2019, c. 712, cl. 8 provides: “That the repeal of Title 55, effective as of October 1, 2019, shall not affect the validity, enforceability, or legality of any loan agreement or other contract, or any right established or accrued under such loan agreement or other contract, that existed prior to such repeal.”

Acts 2019, c. 712, cl. 9 provides: “That the repeal of Title 55, effective October 1, 2019, shall not affect the validity, enforceability, or legality of any properly recorded deed that was recorded prior to such repeal.”

Acts 2019, c. 712, cl. 10 provides: “That the repeal of Title 55, effective as of October 1, 2019, shall not affect the validity, enforceability, or legality of any bond or other debt obligation authorized, issued, or outstanding prior to such repeal.”

Acts 2019, c. 712, cl. 11 provides: “That § 18.2-324.1 and Title 55 (§§ 55-1 through 55-559) of the Code of Virginia are repealed.”

Acts 2019, c. 712, cl. 12 provides: “That the provisions of this act shall not affect the existing terms of persons currently serving as members of any agency, board, authority, commission, or other entity and that appointees currently holding positions shall maintain their terms of appointment and continue to serve until such time as the existing terms might expire or become renewed. However, any new appointments made on or after October 1, 2019, shall be made in accordance with the provisions of this act.”

Acts 2019, c. 712, cl. 13 provides: “That the provisions of this act shall become effective on October 1, 2019.”

COMPARABLE SECTIONS OF TITLES 55 AND 55.1 AND OTHER CORRESPONDING SECTIONS

Former Section Present Section 55-1 55.1-100 55-2 55.1-101 55-3 55.1-102 55-4 55.1-103 55-5 55.1-104 55-6 55.1-105 55-7 55.1-106 55-7.1 Repealed 55-7.2 Repealed 55-8 55.1-107 55-9 55.1-108 55-10 55.1-109 55-11 55.1-110 55-12 55.1-111 55-12.1 55.1-124 55-12.2 55.1-125 55-12.3 55.1-126 55-12.4 55.1-127 55-12.5 55.1-128 55-12.6 55.1-129 55-13 55.1-130 55-13.1 55.1-131 55-13.2 55.1-132 55-13.3 55.1-133 55-14 55.1-112 55-14.1 55.1-113 55-15 55.1-114 55-16 55.1-115 55-17 55.1-116 55-17.1 55.1-117 55-18 55.1-118 55-19 Repealed 55-19.1 Repealed 55-19.2 Repealed 55-19.3 Repealed 55-19.4 Repealed 55-19.5 64.1-801.2 55-20 55.1-134 A 55-20.1 55.1-135 55-20.2 55.1-136 55-21 55.1-134 B 55-22 55.1-119 55-23 55.1-120 55-24 55.1-121 55-25 55.1-122 55-25.1 Repealed 55-26 Repealed 55-26.1 57-6.1 55-27 through 55-34 Repealed 55-34.1 through 55-34.19 Repealed 55-35 55.1-200 55-36 55.1-201 55-37 55.1-202 55-38 55.1-203 55-39 55.1-204 55-40 Repealed 55-41 55.1-205 55-42 Repealed 55-42.1 55.1-206 55-43 55.1-207 55-44, 55-45 Repealed 55-46 55.1-208 55-47 Repealed 55-47.01 55.1-209 55-47.1 55.1-210 55-48 55.1-300 55-49 55.1-301 55-49.1 55.1-302 55-50 55.1-303 55-50 55.1-304 55-50.1 55.1-305 55-50.2 55.1-306 55-50.3 55.1-307 55-50.4 55.1-308 55-51 55.1-309 55-52 55.1-310 55-53 55.1-311 55-54 55.1-312 55-55 55.1-313 55-56 55.1-314 55-57 55.1-1600 55-57.1 55.1-1601 55-57.2 55.1-315 55-58 55.1-316 55-58.1 55.1-317 55-58.2 55.1-318 55-58.3 55.1-319 55-59 55.1-320 55-59.1 55.1-321 55-59.1:1 Expired 55-59.2 55.1-322 55-59.3 55.1-323 55-59.4 55.1-324 55-60 55.1-325 55-60.1 55.1-326 55-61 55.1-327 55-61.1 55.1-328 55-62 55.1-329 55-63 55.1-330 55-64 55.1-331 55-64.1 55.1-332 55-65 55.1-333 55-65.1 55.1-334 55-66 55.1-335 55-66.01 55.1-336 55-66.1 Repealed 55-66.1:01 Repealed 55-66.1:1 55.1-337 55-66.2 55.1-338 55-66.3 55.1-339 55-66.3:1 55.1-340 55-66.4 55.1-341 55-66.4:1 55.1-342 55-66.4:2 55.1-343 55-66.5 55.1-344 55-66.6 55.1-345 55-66.7 Repealed 55-66.8 55.1-346 55-66.9 55.1-347 55-66.10 55.1-348 55-66.11 55.1-349 55-66.12 55.1-350 55-66.13 55.1-351 55-66.14 55.1-352 55-67 55.1-353 55-68 55.1-354 55-69 55.1-355 55-70 55.1-356 55-70.1 55.1-357 55-70.2 55.1-358 55-71 55.1-359 55-72 55.1-360 55-73 55.1-361 55-74 55.1-362 55-75 55.1-363 55-76 55.1-1602 55-77 55.1-1603 55-78 55.1-1604 55-79 55.1-1605 55-79.01 55.1-1500 55-79.02 55.1-1501 55-79.03 55.1-1502 55-79.04 55.1-1503 55-79.05 55.1-1504 55-79.06 55.1-1505 55-79.1 Deleted 55-79.2 55.1-2000 55-79.3 55.1-2003 55-79.4 55.1-2005 55-79.5 55.1-2006 55-79.6 55.1-2007 55-79.7 55.1-2008 55-79.8 55.1-2009 55-79.9 55.1-2010 55-79.10 55.1-2011 55-79.11 55.1-2012 55-79.12 55.1-2013 55-79.13 55.1-2014 55-79.14 55.1-2001 55-79.15 55.1-2015 55-79.16 Deleted 55-79.17 Deleted 55-79.18 Deleted 55-79.19 Deleted 55-79.20 Deleted 55-79.21 Deleted 55-79.21:1 55.1-2020 55-79.21:2 Deleted 55-79.22 Deleted 55-79.23 Deleted 55-79.24 Deleted 55-79.25 Deleted 55-79.26 Deleted 55-79.27 Deleted 55-79.28 Deleted 55-79.29 Deleted 55-79.30 Deleted 55-79.31 Deleted 55-79.32 55.1-2002 55-79.33 Deleted 55-79.34 55.1-2004 55-79.35 55.1-2016 55-79.36 55.1-2017 55-79.37 55.1-2018 55-79.38 55.1-2019 55-79.39 Deleted 55-79.40 55.1-1901 55-79.41 55.1-1900 55-79.41:1 55.1-1902 55-79.42 55.1-1903 55-79.42:1 55.1-1904 55-79.43 55.1-1905 55-79.44 55.1-1906 55-79.45 55.1-1907 55-79.46 55.1-1908 55-79.47 55.1-1909 55-79.48 55.1-1910 55-79.49 55.1-1911 55-79.50 55.1-1912 55-79.51 55.1-1913 55-79.52 55.1-1914 55-79.53 55.1-1915 55-79.54 55.1-1916 55-79.55 55.1-1917 55-79.56 55.1-1918 55-79.57 55.1-1919 55-79.58 55.1-1920 55-79.58:1 55.1-1921 55-79.59 55.1-1922 55-79.60 55.1-1923 55-79.61 55.1-1924 55-79.62 55.1-1925 55-79.63 55.1-1926 55-79.64 55.1-1927 55-79.65 55.1-1928 55-79.66 55.1-1929 55-79.67 55.1-1930 55-79.68 55.1-1931 55-79.69 55.1-1932 55-79.70 55.1-1933 55-79.71 55.1-1934 55-79.71:1 55.1-1935 55-79.71:2 55.1-1936 55-79.72 Repealed 55-79.72:1 55.1-1937 55-79.72:2 55.1-1938 55-79.72:3 55.1-1939 55-79.73 55.1-1940 55-79.73:1 55.1-1941 55-79.73:2 55.1-1942 55-79.74 55.1-1943 55-79.74:01 55.1-1944 55-79.74:1 55.1-1945 55-79.74:2 55.1-1946 55-79.74:3 55.1-1947 55-79.74:4 55.1-1948 55-79.75 55.1-1949 55-79.75:1 55.1-1950 55-79.75:2 55.1-1951 55-79.76 55.1-1952 55-79.77 55.1-1953 55-79.78 55.1-1954 55-79.79 55.1-1955 55-79.80 55.1-1956 55-79.80:01 55.1-1957 55-79.80:1 55.1-1958 55-79.80:2 55.1-1959 55-79.80:3 55.1-1960 55-79.81 55.1-1963 55-79.82 Repealed 55-79.83 55.1-1964 55-79.83:1 55.1-1965 55-79.84 55.1-1966 55-79.84:01 55.1-1967 55-79.84:1 55.1-1968 55-79.85 55.1-1969 55-79.86 55.1-1970 55-79.87 55.1-1972 55-79.87:1 55.1-1973 55-79.88 55.1-1974 55-79.89 55.1-1975 55-79.90 55.1-1976 55-79.91 55.1-1977 55-79.92 55.1-1978 55-79.93 55.1-1979 55-79.93:1 55.1-1980 55-79.93:2 55.1-1981 55-79.94 55.1-1982 55-79.95 55.1-1983 55-79.96 55.1-1984 55-79.97 K 1 55.1-1961 55-79.97 K 2 55.1-1962 55-79.97 A through C 55.1-1990 55-79.97 C, D, E, I and J 55.1-1991 55-79.97 F and G 55.1-1995 55-79.97:1 55.1-1992 55-79.97:2 55.1-1993 55-79.97:3 55.1-1994 55-79.98 55.1-1971 55-79.99 55.1-1985 55-79.100 55.1-1986 55-79.101 55.1-1987 55-79.102 55.1-1988 55-79.103 55.1-1989 55-80 55.1-400 55-81 55.1-401 55-82 55.1-402 55-82.1 55.1-403 55-82.2 55.1-404 55-83 through 55-86 Repealed 55-87 55.1-405 55-88 through 55-94 Repealed 55-95 55.1-406 55-96 55.1-407 55-96.1 Repealed 55-97 55.1-408 55-98, 55-99 Repealed 55-100 55.1-409 55-101 55.1-410 55-102 55.1-411 55-103 55.1-412 55-104 55.1-413 55-105 55.1-414 55-106 55.1-600 55-106.1 55.1-601 55-106.2 55.1-602 55-106.3 Repealed 55-106.4 55.1-603 55-106.5 55.1-604 55-107 55.1-605 55-108 55.1-606 55-109 55.1-607 55-109.1 55.1-608 55-109.2 55.1-609 55-110 55.1-610 55-111 Repealed 55-112 55.1-611 55-113 55.1-612 55-114 55.1-613 55-114.1 55.1-614 55-115 55.1-615 55-116 through 55-118 Repealed 55-118.1 55.1-616 55-118.2 55.1-617 55-118.3 55.1-618 55-118.4 55.1-619 55-118.5 55.1-620 55-118.6 55.1-621 55-118.7 55.1-622 55-118.8 55.1-623 55-118.9 Deleted 55-119 55.1-624 55-120 55.1-625 55-121 55.1-626 55-122 55.1-627 55-123 55.1-628 55-124 55.1-629 55-125 55.1-630 55-125.1 55.1-631 55-126 55.1-632 55-127 55.1-633 55-128 55.1-634 55-129 55.1-635 55-130 55.1-636 55-131 55.1-637 55-132 55.1-638 55-132.1 55.1-639 55-133 55.1-640 55-134 55.1-641 55-134.1 55.1-642 55-134.2 55.1-643 55-135 55.1-644 55-136 55.1-645 55-137 55.1-646 55-137.1 55.1-647 55-137.2 55.1-648 55-138 55.1-649 55-139 through 55-139.2 Repealed 55-140 55.1-650 55-141 55.1-651 55-142 Repealed 55-142.01 55.1-652 55-142.1 55.1-653 55-142.2 55.1-654 55-142.3 55.1-655 55-142.4 55.1-656 55-142.5 55.1-657 55-142.6 55.1-658 55-142.7 Deleted 55-142.8 55.1-659 55-142.9 55.1-660 55-142.10 55.1-661 55-142.11 55.1-662 55-142.12 55.1-663 55-142.13 55.1-664 55-142.14 55.1-665 55-142.15 55.1-666 55-143 through 55-151 Repealed 55-152 Repealed 55-153 55.1-123 55-154 45.1-161.311:9 55-154.1 Repealed 55-154.2 45.1-161.311:10 55-155 45.1-161.311:11 55-156 8.01-525.1 55-157 8.01-525.2 55-158 8.01-525.3 55-159 8.01-525.4 55-160 8.01-525.5 55-161 8.01-525.6 55-162 8.01-525.7 55-163 8.01-525.8 55-164 8.01-525.9 55-165 8.01-525.10 55-166 8.01-525.11 55-167 8.01-525.12 55-168 55.1-2401 55-169 55.1-2402 55-170 55.1-2403 55-170.1 55.1-2400 55-171 55.1-2404 55-172 55.1-2405 55-173 55.1-2406 55-174 55.1-2407 55-175 55.1-2408 55-176 55.1-2409 55-177 55.1-2410 55-178 55.1-2411 55-179 55.1-2412 55-180 55.1-2413 55-181 55.1-2414 55-182 55.1-2415 55-182.1 55.1-2416 55-182.2 55.1-2417 55-183 55.1-2418 55-184 Repealed 55-184.1 55.1-2419 55-184.2 55.1-2420 55-185 Repealed 55-186 55.1-2421 55-186.1 55.1-2422 55-186.2 55.1-2423 55-186.3 55.1-2424 55-187 55.1-2425 55-188 Repealed 55-189 55.1-2426 55-190 55.1-2427 55-190.1 55.1-2428 55-191 55.1-2429 55-192 55.1-2430 55-193 55.1-2431 55-194 55.1-2432 55-195 55.1-2433 55-196 55.1-2434 55-197 55.1-2435 55-198 55.1-2436 55-199 55.1-2437 55-200 55.1-2438 55-200.1 55.1-2439 55-201 55.1-2440 55-201.1 55.1-2441 55-202 Deleted 55-203 Deleted 55-204 Deleted 55-205 Deleted 55-206 Deleted 55-207 55.1-2700 55-208 55.1-2701 55-209 55.1-2702 55-210 55.1-2703 55-210.1 Deleted 55-210.2 55.1-2500 55-210.2:1 55.1-2501 55-210.2:2 55.1-2502 55-210.3 Repealed 55-210.3:01 55.1-2503 55-210.3:02 55.1-2504 55-210.3:1 Repealed 55-210.3:2 55.1-2505 55-210.3:3 55.1-2506 55-210.4 Repealed 55-210.4:01 55.1-2507 55-210.4:1 55.1-2508 55-210.4:2 55.1-2509 55-210.5 55.1-2510 55-210.6 Repealed 55-210.6:1 55.1-2511 55-210.6:2 55.1-2512 55-210.7 55.1-2513 55-210.8 55.1-2514 55-210.8:1 55.1-2515 55-210.8:2 55.1-2516 55-210.9 55.1-2517 55-210.9:1 55.1-2518 55-210.9:2 55.1-2519 55-210.10 Repealed 55-210.10:1 55.1-2520 55-210.10:2 55.1-2521 55-210.11 55.1-2522 55-210.11:01 55.1-2523 55-210.11:1 Repealed 55-210.12 55.1-2524 55-210.12:1 Repealed 55-210.13 55.1-2525 55-210.14 Repealed 55-210.15 55.1-2526 55-210.16 Repealed 55-210.16:1 55.1-2527 55-210.17 55.1-2528 55-210.18 55.1-2529 55-210.18:1 55.1-2530 55-210.19 55.1-2531 55-210.20 55.1-2532 55-210.21 55.1-2533 55-210.22 55.1-2534 55-210.23 55.1-2535 55-210.24 55.1-2536 55-210.24:1 55.1-2537 55-210.24:2 55.1-2538 55-210.25 55.1-2539 55-210.26 Repealed 55-210.26:1 55.1-2540 55-210.27 55.1-2541 55-210.27:1 55.1-2542 55-210.28 55.1-2543 55-210.28:1 55.1-2544 55-210.29 55.1-2545 55-210.30 Repealed 55-210.31 55.1-2600 55-210.32 55.1-2601 55-210.33 55.1-2602 55-210.34 55.1-2603 55-210.35 55.1-2604 55-210.36 55.1-2605 55-210.37 55.1-2606 55-210.38 55.1-2607 55-211 8.01-178.1 A 55-212 8.01-178.1 B 55-213 8.01-178.1 C 55-214 8.01-178.2 55-215 8.01-178.3 55-216 8.01-178.4 55-217 55.1-1400 55-217.1 55.1-1406 55-218 55.1-1407 55-218.1 55.1-1211 55-218.1 55.1-1401 55-219 55.1-1402 55-220 55.1-1408 55-220.1 55.1-1403 55-221 55.1-1409 55-221.1 55.1-1200 55-222 55.1-1410 55-222.1 Repealed 55-223 55.1-1413 55-224 55.1-1414 55-225 55.1-1415 55-225.01 Deleted 55-225.02 Deleted 55-225.1 Deleted 55-225.2 Deleted 55-225.3 Deleted 55-225.4 Deleted 55-225.5 Deleted 55-225.6 Deleted 55-225.7 Deleted 55-225.8 Repealed 55-225.9 Deleted 55-225.10 Deleted 55-225.11 Deleted 55-225.11:1 Deleted 55-225.12 Deleted 55-225.12:1 Deleted 55-225.13 Deleted 55-225.13:1 Deleted 55-225.14 Deleted 55-225.15 Deleted 55-225.16 Deleted 55-225.17 Deleted 55-225.18 Deleted 55-225.19 Deleted 55-225.20 Deleted 55-225.21 Deleted 55-225.22 Deleted 55-225.22:1 Deleted 55-225.23 Deleted 55-225.24 Deleted 55-225.25 Deleted 55-225.26 Deleted 55-225.27 Deleted 55-225.28 Deleted 55-225.29 Deleted 55-225.30 Deleted 55-225.31 Deleted 55-225.32 Deleted 55-225.33 Deleted 55-225.34 Deleted 55-225.35 Deleted 55-225.36 Deleted 55-225.37 Deleted 55-225.38 Deleted 55-225.39 Deleted 55-225.40 Deleted 55-225.41 Deleted 55-225.42 Deleted 55-225.43 Deleted 55-225.44 Deleted 55-225.45 Deleted 55-225.46 Deleted 55-225.47 Deleted 55-225.48 Deleted 55-225.49 Deleted 55-225.50 Deleted 55-226 55.1-1411 55-226.1 55.1-1412 55-226.2 55.1-1212 55-226.2 55.1-1404 55-227 8.01-130.1 55-228 8.01-130.2 55-229 8.01-130.3 55-230 8.01-130.4 55-230.1 8.01-130.5 55-231 8.01-130.6 55-232 8.01-130.7 55-232.1 Repealed 55-232.2 8.01-130.8 55-233 8.01-130.9 55-234 8.01-130.10 55-235 8.01-130.11 55-236 8.01-130.12 55-237 8.01-130.13 55-237.1 55.1-1416 55-238 55.1-1418 55-239 55.1-1419 55-240 55.1-1420 55-241 55.1-1421 55-242 55.1-1422 55-243 55.1-1423 55-244 55.1-1424 55-245 55.1-1425 55-246 55.1-1426 55-246.1 55.1-1257 55-246.1 55.1-1417 55-247 55.1-1427 55-248 55.1-1428 55-248.1 Repealed 55-248.2 Deleted 55-248.3 55.1-1201 E 55-248.3:1 55.1-1201 A through D 55-248.4 55.1-1200 55-248.5 Repealed 55-248.6 55.1-1202 55-248.6:1 55.1-1203 55-248.7 55.1-1204 55-248.7:1 55.1-1205 55-248.7:2 55.1-1206 55-248.8 55.1-1207 55-248.9 55.1-1208 55-248.9:1 55.1-1209 55-248.10 Repealed 55-248.10:1 55.1-1210 55-248.11 Repealed 55-248.11:1 55.1-1214 55-248.11:2 55.1-1215 55-248.12 55.1-1216 55-248.12:1 55.1-1217 55-248.12:2 55.1-1218 55-248.12:3 55.1-1219 55-248.13 55.1-1220 55-248.13:1 55.1-1221 55-248.13:2 55.1-1222 55-248.13:3 55.1-1223 55-248.14 55.1-1224 55-248.15 55.1-1225 55-248.15:1 55.1-1226 55-248.15:2 Repealed 55-248.16 55.1-1227 55-248.17 55.1-1228 55-248.18 55.1-1229 55-248.18:1 55.1-1230 55-248.18:2 55.1-1231 55-248.19 55.1-1232 55-248.20 55.1-1233 55-248.21 55.1-1234 55-248.21:1 55.1-1235 55-248.21:2 55.1-1236 55-248.21:3 55.1-1237 55-248.22 55.1-1238 55-248.23 55.1-1239 55-248.24 55.1-1240 55-248.25 55.1-1241 55-248.25:1 55.1-1242 55-248.26 55.1-1243 55-248.27 55.1-1244 55-248.28 through 55-248.30 Repealed 55-248.31 55.1-1245 55-248.31:01 55.1-1246 55-248.31:1 55.1-1247 55-248.32 55.1-1248 55-248.33 55.1-1249 55-248.34 Repealed 55-248.34:1 55.1-1250 55-248.35 55.1-1251 55-248.36 55.1-1252 55-248.37 55.1-1253 55-248.38 Repealed 55-248.38:1 55.1-1254 55-248.38:2 55.1-1255 55-248.38:3 55.1-1256 55-248.39 55.1-1258 55-248.40 55.1-1259 55-248.41 55.1-1300 55-248.42 55.1-1301 55-248.42:1 55.1-1302 55-248.43 55.1-1303 55-248.44 55.1-1304 55-248.44:1 55.1-1305 55-248.45 55.1-1306 55-248.45:1 55.1-1307 55-248.46 55.1-1308 55-248.46:1 55.1-1309 55-248.47 55.1-1310 55-248.48 55.1-1311 55-248.49 55.1-1312 55-248.49:1 55.1-1313 55-248.50 55.1-1314 55-248.50:1 55.1-1315 55-248.50:2 55.1-1316 55-248.51 55.1-1318 55-248.52 55.1-1319 55-249 55.1-1700 55-250 55.1-1701 55-251 55.1-1702 55-252 55.1-1703 55-252.1 55.1-3001 55-252.2 55.1-3002 55-252.3 55.1-3003 55-252.4 55.1-3004 55-253 through 55-268 Repealed 55-268.1 through 55-268.10 Repealed 55-268.11 through 55-268.20 Repealed 55-269 Repealed 55-269.1 55.1-500 55-270 55.1-501 A 55-271 55.1-501 B 55-272 Repealed 55-272.1 55.1-502 55-273 55.1-503 55-274 55.1-504 55-275 Repealed 55-276 55.1-505 55-277 55.1-506 55-277.1 through 55-277.33 Repealed 55-278 through 55-286.2 Repealed 55-287 1-600 55-288 Repealed 55-288.1 1-601 55-289 1-602 55-290 1-603 55-291 1-604 55-292 1-605 55-293 1-606 55-294 1-607 55-295 1-608 55-296 1-609 55-297 1-610 55-297.1 Repealed 55-297.2 Repealed 55-298 Repealed 55-298.1 55.1-2801 55-298.2 55.1-2802 A 55-298.3 55.1-2802 B 55-298.4 55.1-2800 55-298.5 55.1-2803 55-299 55.1-2804 55-300 55.1-2805 A 55-301 55.1-2805 B 55-302 55.1-2806 55-303 55.1-2807 55-304 55.1-2808 55-305 55.1-2809 55-306 55.1-2810 55-307 55.1-2811 55-308 55.1-2812 55-309 55.1-2813 55-310 55.1-2814 55-311 55.1-2815 55-312 55.1-2816 55-313 55.1-2817 55-314 55.1-2818 55-315 55.1-2819 55-316 55.1-2820 55-317 55.1-2821 55-318 55.1-2822 55-319 55.1-2823 55-320 55.1-2824 55-321 55.1-2825 55-322 55.1-2826 55-323 55.1-2827 55-324 55.1-2828 55-325 55.1-2829 55-326 55.1-2830 55-327 55.1-2831 55-328 55.1-2832 55-329 55.1-2833 55-330 55.1-2834 55-331 55.1-2835 55-332 55.1-2836 55-333 Repealed 55-334 55.1-2837 55-334.1 55.1-2838 55-334.2 55.1-2839 55-334.3 55.1-2840 55-335 55.1-2839 55-336 Deleted 55-337 55.1-2300 55-338 55.1-2301 55-339 through 55-340.1 Repealed 55-341 55.1-2302 55-342 55.1-2303 55-343 55.1-2304 55-344 55.1-2305 55-345, 55-346 Repealed 55-347 55.1-2306 55-348 Repealed 55-349 Repealed 55-350 Repealed 55-351 Deleted 55-352 Deleted 55-353 55.1-137 55-354 55.1-138 55-355 through 55-359 Deleted 55-360 Deleted 55-361 Repealed 55-361.1 55.1-2201 55-362 55.1-2200 55-362.1 55.1-2202 55-363 55.1-2203 55-364 55.1-2204 55-364.1 55.1-2205 55-365 Repealed 55-365.1 55.1-2206 55-366 55.1-2207 55-367 55.1-2208 55-368 55.1-2209 55-369 55.1-2210 55-370 55.1-2211 55-370.01 55.1-2212 55-370.1 55.1-2213 55-371 55.1-2214 55-372 55.1-2215 55-373 55.1-2216 55-374 55.1-2217 55-374.1 55.1-2218 55-374.2 55.1-2219 55-375 55.1-2220 55-376 55.1-2221 55-376.1 55.1-2222 55-376.2 55.1-2223 55-376.3 55.1-2224 55-376.4 55.1-2225 55-376.5 55.1-2226 55-377 through 55-378 Repealed 55-379 Repealed 55-380 55.1-2227 55-380.1 55.1-2228 55-381 55.1-2229 55-382 55.1-2230 55-383 55.1-2231 55-384 55.1-2232 55-385 55.1-2233 55-386 55.1-2234 55-387 55.1-2235 55-388 55.1-2236 55-389 55.1-2237 55-390 55.1-2238 55-391 Repealed 55-391.1 55.1-2239 55-392 Repealed 55-392.1 55.1-2240 55-393 Repealed 55-393.1 55.1-2241 55-394 Repealed 55-394.1 55.1-2242 55-394.2 55.1-2243 55-394.3 55.1-2244 55-394.4 55.1-2245 55-394.5 55.1-2246 55-395 Repealed 55-396 55.1-2247 55-397 55.1-2248 55-398 55.1-2249 55-399 55.1-2250 55-399.1 55.1-2251 55-400 55.1-2252 55-401 through 55-415 Repealed 55-416 Deleted 55-417 55.1-2900 55-418 55.1-2901 55-419 55.1-2902 55-419.1 55.1-2903 55-420 55.1-2904 55-421 55.1-2905 55-422 Repealed 55-423 55.1-2906 55-424 Deleted 55-425 55.1-2101 55-426 55.1-2100 55-427 55.1-2102 55-428 55.1-2103 55-429 55.1-2104 55-430 55.1-2105 55-431 55.1-2106 55-432 55.1-2107 55-433 55.1-2108 55-434 55.1-2109 55-435 55.1-2110 55-436 55.1-2111 55-437 Repealed 55-438 55.1-2112 55-439 55.1-2113 55-440 55.1-2114 55-441 55.1-2115 55-442 55.1-2116 55-443 55.1-2117 55-444 55.1-2118 55-445 55.1-2119 55-446 55.1-2120 55-447 55.1-2121 55-448 55.1-2122 55-449 55.1-2123 55-450 55.1-2124 55-451 55.1-2125 55-452 55.1-2126 55-453 55.1-2127 55-454 55.1-2128 55-455 55.1-2129 55-456 55.1-2130 55-457 55.1-2131 55-458 55.1-2132 55-459 55.1-2133 55-460 55.1-2134 55-461 55.1-2135 55-462 55.1-2136 55-463 55.1-2137 55-464 55.1-2138 55-464.1 55.1-2139 55-465 55.1-2140 55-466 55.1-2141 55-467 55.1-2142 55-468 55.1-2143 55-469 55.1-2144 55-470 55.1-2145 55-471 55.1-2146 55-471.1 55.1-2147 55-472 55.1-2148 55-473 55.1-2149 55-473.1 55.1-2150 55-474 55.1-2151 55-475 55.1-2152 55-476 55.1-2153 55-477 55.1-2154 55-478 55.1-2155 55-479 55.1-2156 55-480 55.1-2157 55-481 55.1-2158 55-482 55.1-2159 55-483 55.1-2160 55-484 55.1-2161 55-485 55.1-2162 55-486 55.1-2163 55-487 55.1-2164 55-488 55.1-2165 55-489 55.1-2166 55-490 55.1-2167 55-491 55.1-2168 55-492 55.1-2169 55-493 55.1-2170 55-494 55.1-2171 55-495 55.1-2172 55-496 55.1-2173 55-497 55.1-2175 55-498 55.1-2176 55-499 55.1-2177 55-500 55.1-2178 55-501 55.1-2179 55-502 55.1-2174 55-503 55.1-2180 55-504 55.1-2181 55-504.1 55.1-2182 55-505 55.1-2183 55-506 55.1-2184 55-507 55.1-1213 55-507 55.1-1317 55-507 55.1-1405 55-508 55.1-1801 55-509 55.1-1800 55-509.1 55.1-1802 55-509.1:1 55.1-1803 55-509.2 55.1-1804 55-509.3 55.1-1805 55-509.3:1 55.1-1806 55-509.3:2 55.1-1807 55-509.4 55.1-1808 55-509.4 J 1 55.1-1822 55-509.4 J 2 55.1-1823 55-509.5 55.1-1809 55-509.6 55.1-1810 55-509.7 55.1-1811 55-509.8 55.1-1812 55-509.9 55.1-1813 55-509.10 55.1-1814 55-510 55.1-1815 55-510.1 55.1-1816 55-510.2 55.1-1817 55-510.3 55.1-1818 55-511, 55-512 Repealed 55-513 55.1-1819 55-513.1 55.1-1820 55-513.2 55.1-1821 55-513.3 55.1-1824 55-514 55.1-1825 55-514.1 55.1-1826 55-514.2 55.1-1827 55-515 55.1-1828 55-515.1 55.1-1829 55-515.2 55.1-1830 55-515.2:1 55.1-1831 55-515.3 55.1-1832 55-516 55.1-1833 55-516.01 55.1-1834 55-516.1 55.1-1835 55-516.2 55.1-1836 55-517 55.1-701 55-517.1 55.1-700 55-518 55.1-702 55-519 55.1-703 55-519.1 55.1-704 55-519.2 55.1-705 55-519.2:1 55.1-706 55-519.3 55.1-707 55-519.4 55.1-708 55-520 55.1-709 55-521 55.1-710 55-522 55.1-711 55-523 55.1-712 55-524 55.1-713 55-525 55.1-714 55-525.1 55.1-800 55-525.2 55.1-801 55-525.3 55.1-802 55-525.4 55.1-803 55-525.5 55.1-804 55-525.6 55.1-805 55-525.7 55.1-806 55-525.8 55.1-900 55-525.9 55.1-901 55-525.10 55.1-902 55-525.11 55.1-903 55-525.12 55.1-904 55-525.13 55.1-905 55-525.14 55.1-906 55-525.15 55.1-907 55-525.16 55.1-1000 55-525.17 55.1-1001 55-525.18 55.1-1002 55-525.19 55.1-1003 55-525.20 55.1-1004 55-525.21 55.1-1005 55-525.22 55.1-1006 55-525.23 55.1-1007 55-525.24 55.1-1008 55-525.25 55.1-1009 55-525.26 55.1-1010 55-525.27 55.1-1011 55-525.28 55.1-1012 55-525.29 55.1-1013 55-525.30 55.1-1014 55-525.31 55.1-1015 55-525.32 55.1-1016 55-526 55.1-1100 55-527 55.1-1101 55-528 54.1-2354.1 55-529 54.1-2354.2 55-530 H 54.1-2349 55-530 B and D 54.1-2354.2 55-530 B and C 54.1-2354.3 55-530 E, F and G 54.1-2354.4 55-530.1 54.1-2354.4 55-531 32.1-373 55-532 32.1-374 55-533 32.1-375 55-541.01 through 55-551.06 Repealed 55-555 36-171 55-556 36-172 55-557 36-173 55-558 36-174 55-559 36-175

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Effective date.

This section is effective October 1, 2019.

Law Review.

For article, “Toward a Model Law of Estates and Future Interests,” see 66 Wash. & Lee L. Rev. 3 (2009).

Michie’s Jurisprudence.

For related discussion, see 6A M.J. Descent and Distribution, § 29.

CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decisions Under Prior Law.

    Seal. —

    Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    By its plain terms, the saving statute only saves deeds that fail to take effect by virtue of this chapter, and this saving statute appears in Chapter 4 of Title 55, but nowhere in that chapter is there a statutory requirement that deeds be under seal; that requirement comes from the common law and is incorporated into the definition of “deed” in the Statute of Conveyances, neither of which can be found in Chapter 4 of Title 55. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    § 55.1-101. When deed or will necessary to convey estate; no parol partition or gift valid.

    1. No estate of inheritance or freehold in lands shall be conveyed unless by deed or will, and no voluntary partition of lands by coparceners, having such an estate in such land, shall be made except by deed. In addition, no right to a conveyance of any such estate or term in land shall accrue to the donee of the land or those claiming under him, under a gift or promise of gift of such estate or term in land not in writing, even if such gift or promise is followed by possession and improvement of the land by the donee or those claiming under him.
    2. Any lease agreement or other written document conveying a non-freehold estate in land, which was entered into before, and which remains in effect as of, February 13, 2019, or which is entered into after February 13, 2019, shall not be invalid, unenforceable, or subject to repudiation by the parties to such agreement on account of, or otherwise affected by, the fact that the conveyance of the estate was not in the form of a deed.

    History. Code 1919, § 5141; Code 1950, § 55-2; 2019, cc. 11, 49, 712.

    Cross references.

    For statutes pertaining to partition, see § 8.01-81 et seq.

    Editor’s note.

    Acts 2019, cc. 11 and 49 amended § 55-2 from which this section is derived. Pursuant to § 30-152, the 2019 amendments have been given effect in this section by designating the existing text as subsection A and deleting “or for a term of more than five years” in the first sentence thereof and adding subsection B.

    Amendments by Acts 2019, cc. 11 and 49, were in response to Game Place, L.L.C. v. Fredericksburg 35, LLC , 295 Va. 396 , 813 S.E.2d 312 (2018). See the case notes below.

    At the direction of the Virginia Code Commission, “February 13, 2019,” was substituted for “the effective date of this subsection” twice in subsection B, as added by Acts 2019, cc. 11 and 49.

    Effective date.

    This section is effective October 1, 2019.

    The 2019 amendments.

    The 2019 amendments by c. 11, effective February 13, 2019, and c. 49, effective February 19, 2019, are identical, and designated the existing text as subsection A, in subsection A, deleted “or for a term of more than five years” following “inheritance or freehold”; and added subsection B.

    Law Review.

    For note on promised gifts of land, see 43 Va. L. Rev. 134 (1957).

    For article on the care of the aged and the Virginia Statute of Frauds, see 19 Wash. & Lee L. Rev. 23 (1962).

    For article, “The Virginia Land Trust — An Overlooked Title Holding Device for Investment, Business and Estate Planning Purposes,” see 30 Wash. & Lee L. Rev. 73 (1973).

    Michie’s Jurisprudence.

    For related discussion, see 1A M.J. Advancements, § 16.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.
    A.Conveyance of Estates.

    For history of this section, see Yancey v. Radford, 86 Va. 638 , 10 S.E. 972 , 1890 Va. LEXIS 24 (1890).

    In general. —

    Under this section no estate of inheritance or freehold or for a term of more than five years in lands shall be conveyed unless by deed or will. Smith v. Plaster, 151 Va. 252 , 144 S.E. 417 , 1928 Va. LEXIS 229 (1928).

    Seal. —

    One of the essential requisites of a deed is that it have a seal affixed thereto. Smith v. Plaster, 151 Va. 252 , 144 S.E. 417 , 1928 Va. LEXIS 229 (1928).

    Fifteen-year lease did not include a seal of any kind, and thus, it failed to satisfy the common-law seal requirement embedded in the definition of “deed” under the Statute of Conveyances, nor did the lease include any specific seal substitutes recognized in § 11-3 ; because rent was received on a monthly basis, the occupation of the premises and the monthly payment of rent implied a month-to-month tenancy, which was paid for through the last month of occupancy. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    Common-law seal requirement antedated the General Assembly’s existence, and the legislative antecedent to the Statute of Conveyances made its first appearance in the Code of Virginia in 1705; so, even if Chapter 4 of Title 55 never existed, the seal requirement would nevertheless govern deeds of lease with a term exceeding five years. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    By its plain terms, the saving statute only saves deeds that fail to take effect by virtue of this chapter, and this saving statute appears in Chapter 4 of Title 55, but nowhere in that chapter is there a statutory requirement that deeds be under seal; that requirement comes from the common law and is incorporated into the definition of “deed” in the Statute of Conveyances, neither of which can be found in Chapter 4 of Title 55. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    General Assembly has engaged the common-law seal requirement but has never abolished it altogether for deeds governed by the Statute of Conveyances. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer’s hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Legal title to property can be conveyed only by deed or will, and in this case the deed of trust did not convey the title to the property. FDIC v. Hish, 76 F.3d 620, 1996 U.S. App. LEXIS 4073 (4th Cir. 1996).

    Not applicable to easements. —

    Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court’s judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner’s two parcels for the benefit of the limited liability company’s parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

    Under this section leases for more than five years must be by deed, but there is no statutory provision in this State which in terms declares that other actual leases must be in writing. If the situation is covered at all, it must fall under either the sixth or seventh clause of the statute of frauds. Smith v. Payne, 153 Va. 746 , 151 S.E. 295 , 1930 Va. LEXIS 267 (1930).

    But section does not apply to lease for five years with option to renew. —

    A lease for a period of five years, with an option to the lessee to continue for another period of five years, is not a lease for a term of more than five years within the meaning of this section. James v. Kibler's Adm'r, 94 Va. 165 , 26 S.E. 417 , 1896 Va. LEXIS 155 (1896).

    Since an easement is not an estate, the provisions of § 55-2 do not control the conveyance of an easement. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

    And it has no application to the creation by parol of trusts in personalty or in the proceeds of real estate. Riggan's Adm'r v. Riggan, 93 Va. 78 , 24 S.E. 920 , 1896 Va. LEXIS 54 (1896).

    This section does not bar the establishment of an oral trust in land or in a leasehold for more than five years, nor does it bar the oral transfer of a beneficiary’s interest in a trust. Burns v. Equitable Assocs., 220 Va. 1020 , 265 S.E.2d 737, 1980 Va. LEXIS 197 (1980).

    No erasure or alteration in a conveyance, nor even the cancellation thereof by mutual consent of the parties, can divest an estate already vested by operation of the deed; for that would be in conflict with this section, which declares that no estate of inheritance or freehold, or for a term of more than five years in lands, shall be conveyed unless by deed or will. Brooks v. Clintsman, 124 Va. 736 , 98 S.E. 742 , 1919 Va. LEXIS 163 (1919).

    Nor is the grantee’s title divested by the return of the deed to be canceled. Graysons v. Richards, 37 Va. (10 Leigh) 57, 1839 Va. LEXIS 18 (1839); Jones v. Neale (1856).

    Husband’s expression of desire that wife own property together did not convey legal title subsequent to writing. —

    Since writing, where husband expressed his desire that he and his wife own property together, was neither a deed nor a will, it did not convey legal title or joint ownership of any kind to the real estate. Westbrook v. Westbrook, 5 Va. App. 446, 364 S.E.2d 523, 4 Va. Law Rep. 1770, 1988 Va. App. LEXIS 4 (1988).

    B.Parol Gift or Promise of Gift.

    Effect of statute. —

    Prior to May 1, 1888, the date upon which the Code of 1887 took effect, a parol gift or a promise of a gift of land, to be consummated by deed, if followed by possession and improvements of the land, was enforceable under the doctrine of such cases as Halsey v. Peters’ Ex’r, 79 Va. 60 (1884); and a contract for a gift to be perfected by will, under similar circumstances, was enforceable under the doctrine announced in Burdine v. Burdine’s Ex’r, 98 Va. 515 , 36 S.E. 992 , 81 Am. St. R. 741 (1900). But in view of the history and apparent purpose of this section, which first made its appearance in the Code of 1887, no such contract or gift is now enforceable. Wohlford v. Wohlford, 121 Va. 699 , 93 S.E. 629 , 1917 Va. LEXIS 69 (1917) (see Nicholas v. Nicholas, 100 Va. 660 , 42 S.E. 669 , rehearing denied, 100 Va. 665 , 42 S.E. 866 (1902); Brooks v. Clintsman, 124 Va. 736 , 98 S.E. 742 , rehearing denied, 124 Va. 749 , 100 S.E. 394 (1919); Frizzell v. Frizzell, 149 Va. 815 , 141 S.E. 868 (1928); Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 (1929)).

    At common law voluntary parol partition of lands between coparceners was valid without deed. Not until § 2413 of the Code of 1887 became effective on May 1, 1888, was a deed required to effect such partition. Rowe v. Big Sandy Coal Corp., 197 Va. 136 , 87 S.E.2d 763, 1955 Va. LEXIS 205 (1955).

    It was contended on behalf of the appellant that this section had no application, because the alleged contract was based upon a valuable consideration, to wit: the complainant’s change of position by leaving his own farm and bestowing his labor and care upon that of another, and the sale of his own land and application of the proceeds to improvements upon the place with reference to which he had a parol contract. But in this respect, the case cannot be distinguished in principle from Halsey v. Peter’s Ex’r, 79 Va. 60 (1884), the doctrine of which and the other Virginia cases of that type this section was expressly designed to abolish. Wohlford v. Wohlford, 121 Va. 699 , 93 S.E. 629 , 1917 Va. LEXIS 69 (1917).

    Prior to the adoption of this section, an oral promise to give or devise land, followed by possession and improvements, was sufficient to support a right to a conveyance of the same from the heirs or devisees of the donor, but since the adoption of this section such a promise must be in writing before it can be enforced. Mann v. Mann, 159 Va. 240 , 165 S.E. 522 , 1932 Va. LEXIS 187 (1932).

    It was intended by this section to require some evidence other than parol evidence of a gift of land. In the instant case complainant, who was asserting a gift of land from his father to him, has his evidence in writing and although this writing was crudely drawn it was quite clear that the father intended to give a tract of land to the son in consideration of the maintenance of the father and his wife. Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 , 1929 Va. LEXIS 245 (1929).

    But the evidence required need not be under seal but only in writing. Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 , 1929 Va. LEXIS 245 (1929).

    Oral contract for consideration fully performed. —

    This section had no application where plaintiff relied upon and proved an oral contract for the purchase of a business and what pertained to it in exchange for his services in conducting and operating said business for the lifetime of decedent, which consideration he fully performed. Clark v. Atkins, 188 Va. 668 , 51 S.E.2d 222, 1949 Va. LEXIS 238 (1949).

    An oral contract to devise land for a consideration fully performed is not embraced by the provisions of this section. Wright v. Dudley, 189 Va. 448 , 53 S.E.2d 29, 1949 Va. LEXIS 187 (1949).

    Oral promise supported by consideration may constitute contract of sale. —

    If an oral promise to make a conveyance of land is supported by valuable consideration, it is a contract of sale and not a promise to give. Mann v. Mann, 159 Va. 240 , 165 S.E. 522 (1932). But see §§ 11-1 and 11-2 as to necessity that contract for sale of realty be in writing .

    In considering what advancements are to be brought into hotchpot under the provisions of § 64.1-17 regard must also be had to this section. Nicholas v. Nicholas, 100 Va. 660 , 42 S.E. 669 , 1902 Va. LEXIS 72 (1902).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Virginia law requires deed to transfer legal title to real property. —

    Lease agreement did not create a life estate in favor of the mother because § 55-2 required that any purported life estate be transferred through a writing in a deed or a will. Harris v. Finnerty, 74 Va. Cir. 551, 2006 Va. Cir. LEXIS 200 (Fairfax County Oct. 26, 2006).

    Under this section leases for more than five years must be by deed. —

    Where a lease for more than five years was not in writing, a former tenant’s claim for breach of the lease was defeated by both the statute of frauds codified in § 11-2 , and by the statute of conveyances, codified in § 55-2; therefore, the demurrers thereto were sustained. Flamingo Lounge & Rest., Inc. v. Pure Gold Gentlemen's Club & Sports Bar, L.L.C., 62 Va. Cir. 507, 2003 Va. Cir. LEXIS 306 (Norfolk Sept. 23, 2003).

    Defendant’s demurrer to a motion for judgment seeking recovery on a commercial lease was overruled because, although § 55-2 required that a lease for a term of more than five years had to be conveyed by deed, all that was required of the deed was a manifest intent to grant. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County Oct. 12, 2005).

    No oral contract found. —

    Trial court granted a trust the possession of a residence because the court found that there was not an oral contract between the trust and the occupant of the residence that permitted the occupant to reside therein absent a written lease. The court accepted the testimony of the attorney who drafted the trust that the grantor made no mention of an oral agreement that would have allowed the occupier to remain in the property, and the trust document did not mention allowing the occupier to remain in the property during the occupier’s lifetime. Stanley v. Stanley, 102 Va. Cir. 366, 2019 Va. Cir. LEXIS 353 (Orange County Aug. 16, 2019).

    Quiet title. —

    Plaintiff was granted a judgment on its claim to quiet title to the subject properties as to any claims by heirs, except the non-party heirs, because a memorandum between two of the heirs to portion of the subject property did not constitute a valid deed or will and did not convey an interest in the property where it specifically referenced a “quit claim deed,” the first heir had no ownership interest in the property to convey to a second heir, a third heir was not a bona fide purchaser of the property where he had both actual and inquiry notice that the first heir had conveyed his interest to the second heir, and the deed of partition conveyed no greater title or interest to other heirs than they had before it was made. Wintergreen Homestead, L.L.C. v. Ray M. Pennington & Bettie's Wintergreen, L.L.C., 104 Va. Cir. 362, 2020 Va. Cir. LEXIS 43 (Nelson County Mar. 23, 2020).

    § 55.1-102. When gift of personal property invalid.

    No gift of any personal property is valid (i) unless conveyed by deed or will or (ii) unless the donee or a person claiming under the donee has and remains in actual possession of such personal property. If the donor and donee reside together at the time of the gift, possession at the place of their residence is not a sufficient possession within the meaning of this section. This section shall not apply to personal paraphernalia used exclusively by the donee.

    History. Code 1919, § 5142; Code 1950, § 55-3; 1973, c. 401; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 2C M.J. Bankruptcy, § 97.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    History of statute. —

    For history of the various acts on this subject, from 1757, referring only to slaves, to the present, see the cases of Thomas’ Adm’r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892); First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901).

    This section and § 55-96 are so closely related as to subject matter of gifts that they may be said to be in pari materia, and should be construed together. Both relate to goods and chattels, this section wholly, and § 55-96 in part. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901).

    This section has no application to the creation by parol of trusts in personalty or in the proceeds of real estate. Riggan's Adm'r v. Riggan, 93 Va. 78 , 24 S.E. 920 , 1896 Va. LEXIS 54 (1896).

    Nor does it apply to gifts causa mortis. —

    The words “no gift” do not refer to gifts causa mortis, nor does the section embrace them. Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 , 1892 Va. LEXIS 73 (1892).

    The words “goods or chattels” do not apply to choses in action. —

    The words “goods or chattels” used in this section, relating to gifts, do not apply to choses in action, but only to visible and tangible property. A chose in action is the money, damages or thing owing; the bond or note, etc., is but the evidence of it. Bank stock is a chose in action. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901) (see Gardner v. Moore’s Adm’r, 122 Va. 10 , 94 S.E. 162 (1917)).

    This section, § 55-87, former §§ 55-88 through 55-90 and former § 55-94 relate to gifts, loans, sales, or partition of the same kind of property, described by the same terms namely, “goods or chattels” or “goods and chattels.” They are closely connected in subject matter and in the language employed, and it can hardly be doubted that whatever was meant by the words “goods or chattels” or “goods and chattels” in either one of these sections must have been intended of the same words in each of the other sections. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901).

    Where an alleged gift by a mother to her daughter, with whom she resided, was not of money, but was a part of a judgment which the donor had recovered against her son, a mere chose in action, the provision of this section, relating to the residence together of the donor and donee at their place of residence, has no application thereto. Gardner v. Moore's Adm'r, 122 Va. 10 , 94 S.E. 162 , 1917 Va. LEXIS 78 (1917).

    “Paraphernalia” defined. —

    For purposes of this section, the Supreme Court would adopt the following definition of “paraphernalia” found in the Oxford English Dictionary (1971): “personal belongings, esp., articles of adornment or attire, trappings; also the articles that compose an apparatus, outfit or equipment; . . . appointments or appurtenances in general.” Teed v. Powell, 236 Va. 36 , 372 S.E.2d 131, 5 Va. Law Rep. 474, 1988 Va. LEXIS 113 (1988).

    Requirements for gift are intention and actual or constructive delivery. —

    In order for a gift inter vivos to be effective there must be an intention in praesenti on the part of the donor to make the gift and there must be such actual or constructive delivery as divests the donor of all dominion and control over the property and invests it in donee. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160, 1958 Va. LEXIS 135 (1958).

    In Virginia, in order for there to be a valid gift of personal property, it must be shown that there existed a present intention on the part of the donor to make a gift, coupled with a delivery, either actual or constructive, such as to divest the donor of all dominion and control over the property and place it in the donee. In addition to the common-law requirements of a valid gift, this section requires a deed or will, unless actual possession comes to and remains with the donee or some person claiming under him. Sadler v. Garrett, 45 Bankr. 190, 1984 Bankr. LEXIS 4429 (Bankr. E.D. Va. 1984).

    What constitutes delivery. —

    The delivery of possession may be actual, constructive or symbolical, depending upon the nature of the thing given. Yancey v. Field, 85 Va. 756 , 8 S.E. 721 , 1889 Va. LEXIS 88 (1889); Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 , 1892 Va. LEXIS 73 (1892).

    To render a gift effectual, the thing given, or the means of obtaining it, must be delivered by the donor to the donee, or to his agent, and accepted by him. Yancey v. Field, 85 Va. 756 , 8 S.E. 721 , 1889 Va. LEXIS 88 (1889).

    Delivery vesting equitable title is all that is necessary. —

    A delivery which vests an equitable title only in the donee is all that is necessary to constitute a valid gift. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901); Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 , 1892 Va. LEXIS 73 (1892).

    Not necessary that deed be recorded. —

    Under this statute, a deed is valid between the parties even without being recorded. Henry v. Graves, 57 Va. (16 Gratt.) 244, 1861 Va. LEXIS 5 (1861).

    Donor and donee residing together. —

    If the donor and donee reside together, possession or delivery at their common place of residence will not be sufficient to constitute a valid gift. Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 , 1892 Va. LEXIS 73 (1892); First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 , 1901 Va. LEXIS 70 (1901).

    This section applies to a husband and wife residing together regardless of whether there were any creditors of the donor at the time the alleged gifts were made. Kendrick v. Watkins, 121 F.2d 287, 1941 U.S. App. LEXIS 3202 (4th Cir. 1941).

    This section was held applicable where husband bought furniture and other household articles several years before he went bankrupt and gave them to his wife without executing a deed or other writing. Kendrick v. Watkins, 121 F.2d 287, 1941 U.S. App. LEXIS 3202 (4th Cir. 1941).

    Sale to wife and resale to husband. —

    A husband, a merchant, conveyed to his wife a stock of goods which she immediately resold to him. There was no valuable consideration for either transfer. After these transfers the husband became indebted to complainant for purchases of merchandise in the ordinary course of business. These purchases from complainant by the husband were made in his own name and solely on his own credit. The husband at the time of the sale to his wife and resale, and thereafter, continued in actual possession of the stock of goods. It was held that neither this section nor former § 55-83 in any way affected the title which the husband took under the contract of resale, and that the sale and resale between husband and wife did not make the wife a debtor as to purchases from complainant made by her husband. Canada v. C.H. Beasley & Bros., 132 Va. 166 , 111 S.E. 251 (1922), overruled in part by Lofton Ridge, LLC v. Norfolk S. Ry. Co., 268 Va. 377 , 601 S.E.2d 648 (2004), to the extent that it suggests judicial estoppel applies in cases where the parties are not the same and do not have a derivative liability relationship .

    Jewelry as marital property. —

    Where husband testified that he gave his wife jewelry valued at $5,000 during the course of the marriage, the commissioner omitted the jewelry completely from the property that was valued for purposes of making an equitable distribution award, and the wife argued that the jewelry should have been excluded because it was “personal paraphernalia” and, thus, was exempt as a gift under this section, the court rejected the wife’s argument and classified the jewelry as marital property. Rein v. Rein, 1994 Va. App. LEXIS 699 (Va. Ct. App. Nov. 29, 1994).

    Burden of proof. —

    The one claiming the validity of the gift has the burden of proving by clear and convincing evidence all the facts and circumstances which would show that the gift was, in fact, a valid one. Sadler v. Garrett, 45 Bankr. 190, 1984 Bankr. LEXIS 4429 (Bankr. E.D. Va. 1984).

    When a donee claims title to personal property in a gift inter vivos, the burden of proof rests upon him to establish by clear and convincing evidence every fact and circumstance necessary to show that validity of the gift. The intention of the donor to part with title and delivery of possession are essential requirements. Nelson v. Liggan, 189 Va. 637 , 53 S.E.2d 798, 1949 Va. LEXIS 207 (1949).

    The law does not presume a gift and where a donee claims title to personal property by virtue of a gift inter vivos, the burden of proof rests upon him to show every fact and circumstance necessary to constitute a valid gift by clear and convincing evidence. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160, 1958 Va. LEXIS 135 (1958).

    Evidence was insufficient to establish a gift of money found, after the alleged donor’s death, in a safety deposit box which had been rented by the alleged donor in the name of the alleged donee. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160, 1958 Va. LEXIS 135 (1958).

    Three shotguns and a rifle given by decedent to her son did not qualify as gifts inter vivos where the son lived all his life with the decedent and therefore no actual possession existed. Teed v. Powell, 236 Va. 36 , 372 S.E.2d 131, 5 Va. Law Rep. 474, 1988 Va. LEXIS 113 (1988).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    No relinquishment of dominion and control. —

    When a testator and his widow had saved cash in a fruitcake tin, the cash belonged to the widow by virtue of the will, not as an inter vivos gift, as the gift had not been completed. The testator, who told his son to give the money to the widow after his death, had not relinquished dominion and control over it, and the widow admitted that she did not know where the tin was and that she relied upon the son to deliver it to her after the testator died. Davenport v. Walters, 69 Va. Cir. 334, 2005 Va. Cir. LEXIS 332 (Norfolk Nov. 30, 2005).

    § 55.1-103. Suicide or attainder of felony.

    Neither suicide nor attainder of felony shall cause a corruption of blood or forfeiture of estate.

    History. Code 1919, § 4762; Code 1950, § 55-4; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Homicide, § 8.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    One cannot suffer an unlawful forfeiture of something he has gained contrary to law or the terms of his own undertaking. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787, 1980 Va. LEXIS 240 (1980), cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414, 1981 U.S. LEXIS 2367 (1981).

    Consent or participation in an immoral or unlawful act by plaintiff precludes recovery for injuries sustained as a result of that act. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861, 8 Va. Law Rep. 3230, 1992 Va. LEXIS 58 (1992).

    Although punishment for suicide rescinded, suicide remains common-law crime. —

    That the legislature affirmatively rescinded the punishment for suicide without decriminalizing the act confirmed to the district court that, although the State cannot punish a suicide in the respects indicated, it in fact remains a common-law crime. Hill v. Nicodemus, 755 F. Supp. 692, 1991 U.S. Dist. LEXIS 1479 (W.D. Va. 1991), aff'd, 979 F.2d 987, 1992 U.S. App. LEXIS 30063 (4th Cir. 1992).

    Although the General Assembly has rescinded the punishment for suicide, it has not decriminalized the act. Suicide, therefore, remains a common-law crime in Virginia as it does in a number of other common-law states. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861, 8 Va. Law Rep. 3230, 1992 Va. LEXIS 58 (1992).

    Suicide remains a common-law crime in Virginia. Hill v. Nicodemus, 979 F.2d 987, 1992 U.S. App. LEXIS 30063 (4th Cir. 1992).

    To constitute suicide at common law the person must be of years, of discretion and of sound mind; this common-law rule comports with a contemporary definition of suicide. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861, 8 Va. Law Rep. 3230, 1992 Va. LEXIS 58 (1992).

    Where the plaintiff alleged that her decedent was of unsound mind when he killed himself, if this were so, then he was not guilty of the common-law crime of suicide, and his act would not be a bar per se to the administrator’s action. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861, 8 Va. Law Rep. 3230, 1992 Va. LEXIS 58 (1992).

    Convict may take, hold and dispose of his property. —

    There is no statute in Virginia that deprives a convict of the power to make contracts or conveyances of his real estate, and corruption of blood and forfeiture of estate on conviction of felony as at common law has been expressly abolished by this section. So, in Virginia, the right of a person to take, hold, and dispose of his property, real and personal, is not affected by his attainder of felony. Therefore, a convict is capable of executing a valid power of attorney. Haynes v. Peterson, 125 Va. 730 , 100 S.E. 471 , 1919 Va. LEXIS 62 (1919).

    Slayer statute did not implicate prohibition against corruption of blood. —

    Version of the Virginia Slayer Statute, § 55-401 et seq., which was in effect on the date of the decedent’s murder in 2005 neither implicated nor violated Virginia’s prohibition against corruption of blood or forfeiture of estate. Bell v. Casper, 282 Va. 203 , 717 S.E.2d 783, 2011 Va. LEXIS 187 (2011), cert. denied, 566 U.S. 962, 132 S. Ct. 1971, 182 L. Ed. 2d 819, 2012 U.S. LEXIS 3127 (2012).

    § 55.1-104. Estates to lie in grant as well as in livery.

    All real estate shall, as regards the conveyance of the immediate freehold thereof, be deemed to lie in grant as well as in livery.

    History. Code 1919, § 5146; Code 1950, § 55-5; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Cotenancy, § 30.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    A deed operates as a conveyance without any acknowledgment, under this section. Acknowledgment is necessary for recordation, but not to pass title. Title passes by the execution and delivery of the deed. Gannaway v. Federal Land Bank, 148 Va. 176 , 138 S.E. 564 , 1927 Va. LEXIS 219 (1927); Peatross v. Gray, 181 Va. 847 , 27 S.E.2d 203, 1943 Va. LEXIS 233 (1943).

    § 55.1-105. Same estates may be created by deed as by will.

    Any interest in or claim to real estate, including easements in gross, may be transferred by deed or will. Any estate may be made to commence at a future date, by deed, in like manner as by will, and any estate that would be valid as an executory devise or bequest is valid if created by deed.

    History. Code 1919, § 5147; Code 1950, § 55-6; 1962, c. 169; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 2A M.J. Assignments for the Benefit of Creditors, § 5.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    In general. —

    Under this statute every conceivable interest in or claim to real estate, whether present or future, vested or contingent, and however acquired may be disposed of by deed or will. Young v. Young, 89 Va. 675 , 17 S.E. 470 , 1893 Va. LEXIS 86 (1893) (see Carrington v. Goddin, 54 Va. (13 Gratt.) 587 (1857); Wilson v. Langhorne, 102 Va. 631 , 47 S.E. 871 (1904); Heuser v. Belvin, 118 Va. 346 , 87 S.E. 594 (1916)).

    Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court’s judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner’s two parcels for the benefit of the limited liability company’s parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

    Construction with other law. —

    Virginia Conservation Easement Act [§§ 10.1-1009 through 10.1-1016 ] did not create a new right to burden land by a negative easement in gross for the purpose of land conservation and historic preservation, but facilitated the continued creation of such easements by providing a clear statutory framework under which tax exemptions are made available to charitable organizations devoted to those purposes and tax benefits and incentives are provided to the grantors of such easements, contrary to the common law; moreover, the easement at issue was not of a novel character and is consistent with the statutory recognition of negative easements in gross for conservation and historic purposes. United States v. Blackman, 270 Va. 68 , 613 S.E.2d 442, 2005 Va. LEXIS 69 (2005).

    Section changed common-law rule. —

    Under this section, the common-law rule was changed and every conceivable interest in or claim to real estate, whether present or future, vested or contingent, and however acquired, may be disposed of by deed or will. Weddle v. Nunley, 43 Bankr. 415, 1984 Bankr. LEXIS 4775 (Bankr. W.D. Va. 1984).

    The statute changed the common-law rule by declaring that “any interest in or claim to real estate may be disposed of by deed or will.” Carrington v. Goddin, 54 Va. (13 Gratt.) 587, 1857 Va. LEXIS 22 (1857); Mustard v. Wohlford's Heirs, 56 Va. (15 Gratt.) 329, 1859 Va. LEXIS 19 (1859).

    Right of entry or action. —

    A party having an interest in or claim to land held adversely by another may, under this section, sell and convey the same, and his grantee may maintain ejectment for it. Carrington v. Goddin, 54 Va. (13 Gratt.) 587, 1857 Va. LEXIS 22 (1857) (see Dobson v. Culpepper, 64 Va. (23 Gratt.) 352 (1873); Mustard v. Wohlford’s Heirs, 56 Va. (15 Gratt.) 329 (1859)).

    Future estates. —

    Under this section future estates may be created both by will and deed. Harlan v. Weatherly, 183 Va. 49 , 31 S.E.2d 263, 1944 Va. LEXIS 129 (1944).

    Contingent remainders. —

    Under this section a contingent remainder may be conveyed by deed. Young v. Young, 89 Va. 675 , 17 S.E. 470 , 1893 Va. LEXIS 86 (1893) (see Heuser v. Belvin, 118 Va. 346 , 87 S.E. 594 (1916)).

    Under this section contingent remainders and executory devises may be disposed of by deed or will. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 , 1930 Va. LEXIS 178 (1930); In re Camden, 217 F. Supp. 634, 1963 U.S. Dist. LEXIS 10194 (W.D. Va. 1963).

    Under this section the right of contingent remaindermen to convey their interests in property cannot be questioned. Larkin v. Wright, 185 Va. 447 , 39 S.E.2d 355, 1946 Va. LEXIS 216 (1946); In re Camden, 217 F. Supp. 634, 1963 U.S. Dist. LEXIS 10194 (W.D. Va. 1963).

    At common law, a contingent remainder passed only by estoppel, but under this section any interest in, or claim to, real estate may be transferred by deed or will. Hence, the deed of the debtor, conveying all of his property of every description includes his interest in a contingent remainder. Wilson v. Langhorne, 102 Va. 631 , 47 S.E. 871 , 1904 Va. LEXIS 110 (1904).

    Under the provisions of this section and §§ 55-49, 55-75, the effect of a joint devise to testator’s three sons, with a conditional limitation over that if one or more of them shall die, leaving no issue, his or their share, as the case may be, shall go to his surviving brothers or brother, is to invest the devisees under such a will with the authority to convey and relinquish all their right, title and interest in the land devised, and the grantee of them takes a fee simple estate. Smith v. Smith, 112 Va. 617 , 72 S.E. 119 , 1911 Va. LEXIS 127 (1911).

    Vested remainder subject to divestment. —

    Whether interest acquired was a vested remainder subject to divestment or a contingent remainder, it was nevertheless transferable under this section and so passed to trustee in bankruptcy. In re Camden, 217 F. Supp. 634, 1963 U.S. Dist. LEXIS 10194 (W.D. Va. 1963).

    Executory interests. —

    An executory devise stands upon precisely the same footing as contingent remainders insofar as transmissibility of the subject thereof is concerned, and an interest in such subject may be conveyed (certainly by virtue of such a statute as this section) prior to the happening of the contingency upon which the interest is appointed by the will to vest in right of possession, provided the grantor has at the time of conveyance a possibility of taking coupled with an interest. This he has, according to the authorities, if he, at such time, is an ascertained person to take under the devise. And he is such an ascertained person if he is designated by name or by class, all of which class are to take, and one of which he is. Medley v. Medley, 81 Va. 265 , 1886 Va. LEXIS 95 (1886); Prince v. Barham, 127 Va. 462 , 103 S.E. 626 , 1920 Va. LEXIS 64 (1920).

    Where a possible taker under an executory devise is designated by class, and he should die before the testator, if the will speaks as of that time in designating the person to take, the survivors of the class will take; but if he survives such time, his interest, under an executory devise, equally as if it were a contingent remainder, is descendible, and assignable in equity, and also at law, certainly by virtue of this statute in Virginia. Many of the authorities hold that the same is true at common law since the statute of uses and of wills dispenses with livery of seisin. Prince v. Barham, 127 Va. 462 , 103 S.E. 626 , 1920 Va. LEXIS 64 (1920).

    Possibility of reverter. —

    Though possibilities of reverter were inalienable at common law by deed or will, they are alienable by both deed and will under the provisions of this section and § 64.1-46. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 , 1930 Va. LEXIS 178 (1930) (see County School Bd. v. Dowell, 190 Va. 676 , 58 S.E.2d 38 (1950); Sanford v. Sims, 192 Va. 644 , 66 S.E.2d 495 (1951)).

    Under these sections a possibility of reverter, whether it depends upon a base or qualified fee or upon a fee simple limited upon a condition subsequent, is alienable by either deed or will, at any time, either before or after the happening of the contingency or the breach of the condition subsequent upon which the possibility of reverter depends. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 , 1930 Va. LEXIS 178 (1930).

    Right to construct sewer. —

    A deed conveying part of a tract of land (consisting of 47.5 acres) provided that the grantee should have a right to construct a sewer through the property of the grantor. The deed contemplated the use of the easement not only for the drainage of the 47.5 acres conveyed, but also as essential to the drainage of an incorporated town, and other lands not included in that particular tract. It was held that the easement was not appurtenant to the 47.5 acres conveyed by the deed. It was either an easement in gross, or else extends the area of the land to which it is appurtenant, so as, at least, to include land naturally drained by the channel. If it is to be regarded as an easement in gross, it is still “an interest in land,” and, therefore, may be disposed of by deed or will under this section. City of Richmond v. Richmond Sand & Gravel Co., 123 Va. 1 , 96 S.E. 204 , 1918 Va. LEXIS 1 (1918).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Contingent remainders. —

    Because there was no reason that would prevent a beneficiary from alienating a part of the beneficiary’s interest in a trust, pursuant to §§ 55-6 and 55-52, a commissioner’s determination that a beneficiary’s expectancy went directly to the beneficiary’s surviving children was affirmed. Bowman v. Mericle, 69 Va. Cir. 87, 2005 Va. Cir. LEXIS 259 (Norfolk Aug. 31, 2005).

    § 55.1-106. Power of disposal in life tenant not to defeat remainder unless exercised; power of disposal held by fiduciary.

    If any interest in or claim to real estate or personal property is disposed of by deed or will for life, with a limitation in remainder over, and the same instrument confers expressly or by implication a power upon the life tenant in his lifetime or by will to dispose absolutely of such property, the limitation in remainder over shall not fail, or be defeated, except to the extent that the life tenant lawfully exercised such power of disposal. A deed of trust or mortgage executed by the life tenant shall not be construed to be an absolute disposition of the estate, unless such estate is sold under the deed of trust or mortgage. A power of disposal held by any person in a fiduciary capacity under an express trust in writing shall not be deemed to be held by such fiduciary in a beneficial capacity and shall not be construed in any manner to enlarge the beneficial interest otherwise given to him under such trust.

    History. Code 1919, § 5147; Code 1950, § 55-7; 1978, c. 659; 2005, c. 935; 2019, c. 712.

    Editor’s note.

    Clause 2 of the 1978 amendatory act provides that “the provisions of this act shall not be construed to restrict the powers possessed by Virginia courts of equity to supervise the fiduciary in the conduct of his duties, to instruct such fiduciary in response to a suit for guidance or for construction of instruments, or to provide appropriate remedies for those affected by any breach of fiduciary duty.”

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For discussion of powers of appointment in Virginia, see 47 Va. L. Rev. 711 (1961).

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 87.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    The effect of this section is to validate remainders in such property as remains undisposed of by the life tenant where a fee simple estate arises when the first taker is given a life estate coupled with the power of absolute disposition. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211, 1973 Va. LEXIS 252 (1973).

    The effect of this section is to validate the gift over where the first taker is given an express estate for life, coupled with the absolute power of disposition. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851, 1982 Va. LEXIS 275 (1982).

    This section modifies the rule of May v. Joynes. Clarkson v. Bliley, 185 Va. 82 , 38 S.E.2d 22, 1946 Va. LEXIS 182 (1946); Crisman v. Swanson, 193 Va. 247 , 68 S.E.2d 502, 1952 Va. LEXIS 130 (1952); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601, 1954 Va. LEXIS 159 (1954); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594, 1954 Va. LEXIS 168 (1954); Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851, 1982 Va. LEXIS 275 (1982).

    The application of the doctrine of May v. Joynes , 61 Va. (20 Gratt.) 692 (1871), is limited by this section to the property that remains after a life estate with power in the life tenant to dispose of such property if he desires. Rule v. First Nat'l Bank, 182 Va. 227 , 28 S.E.2d 709, 1944 Va. LEXIS 172 (1944).

    Under this section that which was void for repugnancy and uncertainty under the doctrine of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), is made valid. Now the gift over is validated where the first taker is given an express estate for life, coupled with the power of absolute disposition. Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594, 1954 Va. LEXIS 168 (1954).

    The rule of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871) held that a life estate coupled with the absolute power of disposition created a fee simple estate invalidating the remainder; this rule obviously could defeat a testator’s intent, and, therefore, a statute was enacted to validate the remainder to the extent that the life tenant had not disposed of it. First Va. Bank v. United States, 490 F.2d 532, 1974 U.S. App. LEXIS 10638 (4th Cir. 1974).

    But does not save property lawfully disposed of by life tenant during lifetime. —

    This section does not save property from the operation of the rule in May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), where the life tenant, with the full power of sale and disposition, lawfully disposed of it during her lifetime. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211, 1973 Va. LEXIS 252 (1973).

    The following requirements must be met in order to apply this section: (1) The first taker must be given an express estate “for life.” (2) There must be “conferred expressly or by implication a power upon the life tenant in his lifetime or by will to dispose absolutely of said property.” (3) There must be “a limitation in remainder over.” (4) There must be a corpus on which the “limitation in remainder over” can operate. Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594, 1954 Va. LEXIS 168 (1954); Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851, 1982 Va. LEXIS 275 (1982).

    This section does not preclude creation of life estate by implication. —

    This section does not require that a life estate be created by express words or preclude creation of such an estate by implication where there is no power of disposal in the first taker. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852, 1958 Va. LEXIS 195 (1958); Edwards v. Bradley, 227 Va. 224 , 315 S.E.2d 196, 1984 Va. LEXIS 236 (1984).

    But it applies only to an estate granted expressly for life. Hall v. Hoak, 184 Va. 821 , 36 S.E.2d 567, 1946 Va. LEXIS 145 (1946); Crisman v. Swanson, 193 Va. 247 , 68 S.E.2d 502, 1952 Va. LEXIS 130 (1952); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601, 1954 Va. LEXIS 159 (1954); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594, 1954 Va. LEXIS 168 (1954); Gardner v. Worrell, 201 Va. 355 , 111 S.E.2d 285, 1959 Va. LEXIS 234 (1959).

    This section, by its express terms, applies only when there is a life estate in the first taker, and is not applicable when the estate of the first taker is a fee, whether created by express words or by implication. Clarkson v. Bliley, 185 Va. 82 , 38 S.E.2d 22, 1946 Va. LEXIS 182 (1946); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594, 1954 Va. LEXIS 168 (1954).

    The amendment of 1908 applied to “any estate,” whether for life or in fee, and permitted a valid remainder, even after a fee, if power of disposition, where granted, was not exercised and there remained anything after the death of the devisee. Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 , 1934 Va. LEXIS 248 (1934).

    This was so unsatisfactory to the Code revisors of 1919 that they changed the amendment and limited the remainder over to cases where there was only an express estate for life. Therefore, subsequent to the revision of 1919, except where there is an express estate for life, the remainder is void just as it was prior to the amendment of 1908. Moore v. Holbrook, 175 Va. 471 , 9 S.E.2d 447, 1940 Va. LEXIS 192 (1940).

    Coupled with the absolute power of disposition. Mowery v. Coffman, 185 Va. 491 , 39 S.E.2d 285, 1946 Va. LEXIS 221 (1946); Voigt v. Selander, 190 Va. 638 , 58 S.E.2d 25, 1950 Va. LEXIS 157 (1950); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601, 1954 Va. LEXIS 159 (1954).

    This section is expressly limited to devises and bequests for life with absolute power of disposition. In such circumstances the doctrine of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), which holds that whenever in any devise or conveyance a life estate is given and there is afterwards given to the life tenant or first taker power to dispose of or consume the corpus of the estate, the first taker is vested with a fee simple estate, has been abolished, and the estate of the remaindermen preserved. The section is remedial and should be liberally construed. Christian v. Wilson's Ex'rs, 153 Va. 614 , 151 S.E. 300 , 1930 Va. LEXIS 257, cert. denied, 282 U.S. 840, 51 S. Ct. 21, 75 L. Ed. 746, 1930 U.S. LEXIS 133 (1930); Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 , 1934 Va. LEXIS 248 (1934).

    Thus, this section has no application where there is a limitation over after conveyance of a fee simple. —

    Notwithstanding this section, where a testator has given his wife a fee simple estate, an attempted limitation over by him of any portion remaining at her death is void. This section has no application because the gift to the first taker was not of a life estate but of a fee simple. Skinner v. Skinner's Adm'r, 158 Va. 326 , 163 S.E. 90 , 1932 Va. LEXIS 257 (1932) (see Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 (1934)).

    In. Moore v. Holbrook , 175 Va. 471 , 9 S.E.2d 447 (1940), this section was held inapplicable because the estate was granted in general terms by language that unmistakably implied an estate in fee .

    And it is inapplicable where no powers of disposal are conferred on first takers. —

    Where no powers of disposal are conferred upon the first takers by a will, this section cannot be successfully relied upon. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852, 1958 Va. LEXIS 195 (1958).

    Words creating life estate. —

    The words “shall immediately upon my decease become the property of my wife . . . to be used for her decent support during her natural life,” create an express life estate in the testator’s property. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851, 1982 Va. LEXIS 275 (1982).

    Words creating limitation in remainder over. —

    The words “It is my will and desire that upon the death of my said wife whatever residue of my estate either real or personal which she has not consumed or disposed of shall become the property of . . .” satisfy the requirement that there be a limitation in remainder over. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851, 1982 Va. LEXIS 275 (1982).

    Residuary clause. —

    Residuary clause in a testator’s will unambiguously granted the testator’s wife a life estate in the residual property. Along with directing the disposition of the residual property following the wife’s death, the residuary clause placed limitations on the wife’s use of the property during her life, and these limitations were irreconcilable with an absolute power of disposition. Feeney v. Feeney, 295 Va. 312 , 811 S.E.2d 830, 2018 Va. LEXIS 35 (2018).

    Power of widow to terminate life estate by remarrying. —

    Where a testator gave to his wife a life estate with power of disposition and remainder over to his children, and provided that in the event of his wife’s remarriage the life estate should terminate and one third of the remainder should belong to her absolutely, the power of the wife voluntarily to terminate her life estate by remarrying did not convert her estate into a fee simple interest, and, under the provisions of this section, the remainder over was valid and was not affected by the doctrine of May v. Joynes . Voigt v. Selander, 190 Va. 638 , 58 S.E.2d 25, 1950 Va. LEXIS 157 (1950).

    This section does not restrict the life tenant’s power of disposition. First Va. Bank v. United States, 490 F.2d 532, 1974 U.S. App. LEXIS 10638 (4th Cir. 1974).

    A life tenant’s right to dispose, sell, trade or use stock during her lifetime for her comfort and care as she may see fit is not limited by this section to an ascertainable standard relating to her health, support, or maintenance, for the purpose of federal estate tax exemption. First Va. Bank v. United States, 490 F.2d 532, 1974 U.S. App. LEXIS 10638 (4th Cir. 1974).

    Absolute dominion over property given to life tenant. —

    Language used in a testator’s will giving the life tenant the power to sell any and all residue of the property at her discretion shows that the testator intended to give her absolute dominion over the property with full power of disposition, and this section did not save it. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211, 1973 Va. LEXIS 252 (1973).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Rule inapplicable. —

    Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix’s daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County Apr. 3, 2007).

    § 55.1-107. Default or surrender of tenant for life not to prejudice remainderman.

    If any tenant for life of land make default or surrender, the heirs or those entitled to the remainder may, before judgment, be admitted to defend their right or, after judgment, may assert their right without prejudice from such default or surrender.

    History. Code 1919, § 5443; Code 1950, § 55-8; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-108. Conveyance of estate or interest in property by grantor to himself and another.

    Any person having an estate or interest in real or personal property may convey such estate or interest to himself or to himself and another or others, including to himself and his spouse as tenants by the entirety or otherwise, and the fact that one or more persons are both grantor or grantee or grantors and grantees in the same conveyance shall be no objection to the conveyance. The grantee or grantees in any such conveyance shall take title in like manner, and the estate vested in them shall be the same as if the conveyance had been made by one or more persons who are not also grantee or grantees.

    All such conveyances made prior to July 1, 1986, are validated notwithstanding defects in the form thereof that do not affect vested rights.

    History. 1945, p. 39; Michie Suppl. 1946, § 5147a; Code 1950, § 55-9; 1986, c. 583; 1987, c. 186; 1999, c. 196; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 17 M.J. Spendthrift Trusts, § 2.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Husband and wife may join in deed to one of themselves. —

    A husband and wife unquestionably can join in a deed conveying the entirety to a third party, and in Virginia this section permits a husband and wife to join in a deed conveying land to himself or herself. Vasilion v. Vasilion, 192 Va. 735 , 66 S.E.2d 599, 1951 Va. LEXIS 222 (1951).

    § 55.1-109. Deed valid for grantor’s right; operation of warranty.

    A writing that purports to pass or assure a greater right or interest in real estate than the person making it may lawfully pass or assure shall operate as an alienation of such right or interest in such real estate as such person might lawfully convey or assure; and when the deed of the alienor mentions that he and his heirs will warrant what it purports to pass or assure, if anything descends from him, his heirs shall be barred for the value of what is so descended or liable for such value.

    History. Code 1919, § 5148; Code 1950, § 55-10; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, § 24.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Provision as to warranties applies only to descent of realty. —

    This section, taken from the statute of Gloucester, and extended generally to common-law warranties, applies only to cases of real assets descending from the warranting ancestor, and not to personal assets, or assets, whether real or personal, accruing from him by devise or bequest. Norman's Ex'x v. Cunningham, 46 Va. (5 Gratt.) 63, 1848 Va. LEXIS 26 (1848).

    And is not applicable where a husband conveys the property of his wife, with warranty against the claims of himself and his heirs. His children, deriving title from their mother, will not be affected by the warranty. Urquhart v. Clarke, 23 Va. (2 Rand.) 549, 1824 Va. LEXIS 35 (1824).

    § 55.1-110. Conveyance, devise, or grant without words of limitation.

    When any real estate is conveyed, devised, or granted to any person without any words of limitation, such conveyance, devise, or grant shall be construed to pass the fee simple or other whole estate or interest that the testator or grantor has power to dispose of in such real estate, unless a contrary intention is apparent in the conveyance, devise, or grant.

    History. Code 1919, § 5149; Code 1950, § 55-11; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For discussion of construction of instruments, see 45 Va. L. Rev. 1459 (1959).

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 87.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Words of inheritance or perpetuity unnecessary to create estate of inheritance. —

    The act passed in 1785 (the original of this section) dispensed with the necessity of words of inheritance or perpetuity to create an estate of inheritance. Goodrich v. Harding, 24 Va. (3 Rand.) 280, 1825 Va. LEXIS 19 (1825); Bells v. Gillespie, 26 Va. (5 Rand.) 273, 1827 Va. LEXIS 57 (1827); Ball v. Payne, 27 Va. (6 Rand.) 73, 1827 Va. LEXIS 48 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368, 1829 Va. LEXIS 31 (1829); Seekright on Demise of Bramble v. Billups, 31 Va. (4 Leigh) 90, 1833 Va. LEXIS 1 (1833); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449, 1836 Va. LEXIS 74 (1836); Tinsley v. Jones, 54 Va. (13 Gratt.) 289, 1856 Va. LEXIS 17 (1856).

    The word “heirs” is not necessary to create an estate of inheritance. Daniel v. Lipscomb, 110 Va. 563 , 66 S.E. 850 , 1910 Va. LEXIS 95 (1910).

    Fee simple or whole estate or interest of grantor passes in absence of words of limitation in deed. —

    The grantee, in a deed for land conveyed without any words of limitation, usually succeeds to every right of his grantor therein, or, as expressed in this section, such a deed passes the fee simple or whole estate or interest which the grantor had power to dispose of, unless a contrary intention shall appear by the conveyance. Gordon Metal Co. v. Kingan & Co., 132 Va. 229 , 111 S.E. 99 , 1922 Va. LEXIS 20 (1922).

    Language construed to pass greatest estate it is capable of conveying. —

    The language in a deed will be construed to pass to the grantee the greatest estate which the language employed is capable of conveying. Goodson v. Capehart, 232 Va. 232 , 349 S.E.2d 130, 3 Va. Law Rep. 961, 1986 Va. LEXIS 250 (1986).

    Whole deed must be looked to in order to ascertain intention of grantor. —

    Since under this statute the whole deed is to be looked to in order to ascertain the intention of the parties, the common-law rule that the habendum clause of a deed must yield to the granting clause in case of repugnance between the two no longer applies where the intention of the grantor can be ascertained with reasonable certainty. Temple's Adm'r v. Wright, 94 Va. 338 , 26 S.E. 844 , 1897 Va. LEXIS 80 (1897) (see Mauzy v. Mauzy, 79 Va. 537 (1884)).

    Language disclosing intent to create mere life estates. —

    Where testator and his wife owned certain lots jointly, and he devised all his real estate to his wife and provided that “at her death it is to go to” his nephew “and at his death to his two boys,” and she died some years later having devised her half interest in the property to the nephew “and at his death goes to his two sons,” the language of the respective devises clearly disclosed an intent to create mere life estates in the first takers with remainder over, nor was there any policy, statute or canon of property which would override this intent. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852, 1958 Va. LEXIS 195 (1958).

    A deed to a person “forever to hold for life” was held to create only a life estate in. Humphrey v. Foster, 54 Va. (13 Gratt.) 653, 1857 Va. LEXIS 26 (1857).

    Grant to remaindermen held a fee. —

    If a remainder, after the death of the life tenant, be given to such persons as shall at that time answer the description of his heirs at law, that is a valid gift of a remainder to such persons, who will be entitled, as purchasers, to an estate in fee simple. Taylor v. Cleary, 70 Va. (29 Gratt.) 330, 70 Va. (29 Gratt.) 448, 1877 Va. LEXIS 25 (1877).

    Fee simple interest transferred by deed. —

    Grant of summary judgment in favor of the town in its action against the property owner for quiet title and for ejectment was appropriate because a fee simple interest was previously transferred to the railroad by the 1909 deed and the town was currently the fee simple owner of that strip of land conveyed by that 1909 deed after the railroad abandoned their railroad line and donated the railroad corridor to the town. Bailey v. Town of Saltville, 279 Va. 627 , 691 S.E.2d 491, 2010 Va. LEXIS 53 (2010).

    Residuary clause. —

    Residuary clause in a testator’s will unambiguously granted the testator’s wife a life estate in the residual property. Along with directing the disposition of the residual property following the wife’s death, the residuary clause placed limitations on the wife’s use of the property during her life, and these limitations were irreconcilable with an absolute power of disposition. Feeney v. Feeney, 295 Va. 312 , 811 S.E.2d 830, 2018 Va. LEXIS 35 (2018).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Application of rule. —

    Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix’s daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County Apr. 3, 2007).

    § 55.1-111. Fee tail converted into fee simple.

    Every estate in lands so limited that, as the law was on October 7, 1776, such estate would have been an estate tail shall be deemed an estate in fee simple, and every limitation upon such an estate shall be held valid if the same would be valid when limited upon an estate in fee simple created by technical language.

    History. Code 1919, § 5150; Code 1950, § 55-12; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 87.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    An estate tail is an estate limited to the issue of the donee. Jiggetts v. Davis, 28 Va. (1 Leigh) 368, 1829 Va. LEXIS 31 (1829).

    Estates tail were unknown to the common law. They were created by the statute de donis conditionalibus. Bells v. Gillespie, 26 Va. (5 Rand.) 273, 1827 Va. LEXIS 57 (1827).

    History of section abolishing estates tail. —

    The acts of 1776 and 1785 abolished entails and converted estates tail into fee simple estates. See Carter v. Tyler, 5 Va. (1 Call) 165, 1797 Va. LEXIS 20 (1797); Tate v. Tally, 7 Va. (3 Call) 354, 1803 Va. LEXIS 6 (1803); Smith v. Chapman, 11 Va. (1 Hen. & M.) 240, 1807 Va. LEXIS 9 (1807); Bells v. Gillespie, 26 Va. (5 Rand.) 273, 1827 Va. LEXIS 57 (1827); Broaddus v. Turner, 26 Va. (5 Rand.) 308, 1827 Va. LEXIS 56 (1827); Ball v. Payne, 27 Va. (6 Rand.) 73, 1827 Va. LEXIS 48 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368, 1829 Va. LEXIS 31 (1829); Orndoff v. Turman, 29 Va. (2 Leigh) 200, 1830 Va. LEXIS 30 (1830); Seekright on Demise of Bramble v. Billups, 31 Va. (4 Leigh) 90, 1833 Va. LEXIS 1 (1833); Doe on Demise of Thomason v. Andersons, 31 Va. (4 Leigh) 118, 1833 Va. LEXIS 3 (1833); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449, 1836 Va. LEXIS 74 (1836); Nowlin v. Winfree, 49 Va. (8 Gratt.) 346, 1852 Va. LEXIS 71 (1852); East v. Garrett, 84 Va. 523 , 9 S.E. 1112 , 1888 Va. LEXIS 107 (1888); Hawthorne v. Beckwith, 89 Va. 786 , 17 S.E. 241 , 1893 Va. LEXIS 105 (1893); Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 , 1894 Va. LEXIS 26 (1894).

    The act of 1776 operated upon all estates tail in possession, and those in reversion or remainder, after the determination of an estate for life, or lives, or of any lesser estate; but a greater estate than for life or lives, was not within the operation of the act. An estate tail in remainder, after the determination of a preceding estate tail, e.g., was not affected by the act. Roy v. Garnett, 2 Va. (2 Wash.) 9 (1794). Hence, the statute of 1785, abolishing all entails, was reenacted from the statute of 1776, which had failed to accomplish its avowed purpose. Bells v. Gillespie, 26 Va. (5 Rand.) 273, 1827 Va. LEXIS 57 (1827).

    It was held that by the act of 1776, for docking entails, all remainders, contingent as well as vested, were utterly barred, whether the entail was created before or after passage of the act. Hence, a devise of lands to A. and if the said A. should die not having any lawful heir of his body, then the land to go to B., created an estate tail in A., which by the statute was converted into a fee simple, and the limitation over was void. Carter v. Tyler, 5 Va. (1 Call) 165, 1797 Va. LEXIS 20 (1797) (see Hunter v. Haynes’ Lessee, 1 Va. (1 Wash.) 71 (1792); Hill v. Burrow, 7 Va. (3 Call) 342 (1802); Tate v. Tally, 7 Va. (3 Call) 354 (1802); Eldridge v. Fisher, 11 Va. (1 Hen. & M.) 559 (1807); Sydnor v. Sydnors, 16 Va. (2 Munf.) 263 (1811); M’Clintic v. Manns, 18 Va. (4 Munf.) 328 (1814); Tidball v. Lupton, 22 Va. (1 Rand.) 194 (1822); Kendall v. Eyre, 22 Va. (1 Rand.) 288 (1823); Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827); Broaddus v. Turner, 26 Va. (5 Rand.) 308 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368 (1829); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449 (1836); Callis v. Kemp, 52 Va. (11 Gratt.) 78 (1854); Tinsley v. Jones, 54 Va. (13 Gratt.) 289 (1856); Hood v. Haden, 82 Va. 588 (1886). But this doctrine of Carter v. Tyler, 5 Va. (1 Call) 165 (1797), was abrogated after January 1, 1820 by the provision of this section that “every limitation upon such estate shall be held valid if the same would be valid when limited upon an estate in fee simple created by technical language.”).

    Statute liberally construed. —

    The statute abolishing entails is a highly remedial statute and should be liberally construed. Orndoff v. Turman, 29 Va. (2 Leigh) 200, 1830 Va. LEXIS 30 (1830).

    Presumption against intention to create entailed estate. —

    Since the act of 1776 abolishing entails, it is not to be supposed that a man intended to convey an estate tail unless plain and unequivocal words were used, such as would of themselves create a fee tail without resorting to implication. Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 , 1894 Va. LEXIS 26 (1894) (see Smith v. Chapman, 11 Va. (1 Hen. & M.) 240 (1807); Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877)).

    § 55.1-112. Estate of freehold to one with remainder to heirs, etc.; rule in Shelley’s Case abolished.

    Wherever any person by deed, will, or other writing takes an estate of freehold in land, or takes such an interest in personal property as would be an estate of freehold if it were an estate in land, and in the same deed, will, or writing an estate is afterwards limited by way of remainder to his heirs, or the heirs of his body, or his issue, the words “heirs,” “heirs of his body,” and “issue,” or other words of like import used in the deed, will, or writing in the limitation therein by way of remainder shall not be construed as words of limitation carrying to such person the inheritance as to the land, or the absolute estate as to the personal property, but they shall be construed as words of purchase, creating a remainder in the heirs, heirs of the body, or issue.

    History. Code 1919, § 5152; Code 1950, § 55-14; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For note on law revision and reform in the common-law countries, see 13 Wm. & Mary L. Rev. 253 (1971).

    For article, “The Future of Future Interests,” see 60 Wash. & Lee L. Rev. 513 (2003).

    For article, “Toward a Model Law of Estates and Future Interests,” see 66 Wash. & Lee L. Rev. 3 (2009).

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 86.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Statement of the rule in Shelley’s Case. —

    Whenever the ancestor, by any will, gift, or conveyance, takes an estate of freehold in lands, or tenements, and in the same will, gift, or conveyance, an estate is afterwards limited by way of remainder, either mediately or immediately, to his heirs, or to the heirs of his body, the words “heirs,” or “heirs of the body,” are words of limitation of the estate, carrying the inheritance to the ancestor, and not words of purchase creating a contingent remainder in the heirs. Moore v. Brooks, 53 Va. (12 Gratt.) 135, 1855 Va. LEXIS 11 (1855); Taylor v. Cleary, 70 Va. (29 Gratt.) 330, 70 Va. (29 Gratt.) 448, 1877 Va. LEXIS 25 (1877); King v. Johnson, 117 Va. 49 , 83 S.E. 1070 , 1915 Va. LEXIS 9 (1915); Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920).

    History and effect of statute. —

    Code 1849, c. 146, § 11, essaying to abolish the rule in Shelley’s Case, applied only where the grantor or testator was competent to, and did vest in the heir a remainder in fee simple after an estate for the ancestor’s life. Hood v. Haden, 82 Va. 588 (1886). This is not true under the present statute, which is coordinate with the rule itself .

    The parties of the first part in a deed granted property to the party of the second part: “To have and to hold unto the party of the second part for her lifetime and then to her heirs forever.” It was held that under this section the language used gave to the grantee an estate for life and to her children a remainder in fee. Puckett v. Campbell, 151 Va. 213 , 144 S.E. 434 , 1928 Va. LEXIS 225 (1928).

    Rule of property; not of construction. —

    The rule in Shelley’s Case, where the requisites concur, controls the intention of the testator, or grantor, and overrides his purpose, often very clearly expressed, to limit the ancestor to an estate of freehold. The rule is not a means to discover the intent of the grantor, or testator, but, supposing the intent ascertained, the rule controls it. Taylor v. Cleary, 70 Va. (29 Gratt.) 330, 70 Va. (29 Gratt.) 448, 1877 Va. LEXIS 25 (1877); Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920) (see Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894)).

    Words must be used to import class of persons to take indefinitely in succession. —

    It is a part of the rule in Shelley’s Case and essential to its operation, that the words used to indicate the persons to whom the estate is limited, by way of remainder, must import a class of persons to take indefinitely in succession. If they do import such a class, then the rule is of inflexible application; but if the words are used to designate particular individuals, the words so used are words of purchase and not of limitation, e.g. , grant to A. for life, remainder to the heirs of A. now living, or remainder to the sons of A. and their heirs, or remainder to the children of A. In all of these instances, particular individuals are indicated by the words used; hence, the rule does not apply. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920).

    “Descendants” and “heirs of the body” are of equivalent meaning. —

    The rule in Shelley’s Case applies when the limitation in remainder is to the “heirs of the body” of the tenant of the freehold. The words “descendants” and “heirs of the body” are of equivalent meaning. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920).

    Who are “descendants.” —

    While the word “descendants” is not a technical word to the extent that the law has not impressed it with a different meaning from that accorded in common acceptation and general understanding, it is a word much used in law and of very clear and definite meaning. A descendant is an individual proceeding from an ancestor in any degree. It is synonymous with issue. It is offspring, near or remote. The word “child” is not synonymous with the word “descendant,” though a child is a descendant and a descendant may be a child; but a descendant may also proceed from an ancestor in the remotest as well as the nearest degree. Obviously, this is not true as to a child. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920).

    Application of rule. —

    Under a will which took effect before the abolition of the rule in Shelley’s Case, a testator gave land to two of his sons during their lifetime to hold jointly and after the death of the last of the two to their descendants, if they have any; if not, to a third party or his descendants. Held, that by force of this rule in Shelley’s Case the two sons took an estate tail, which, by operation of the statute, then as now in force, was converted into a joint fee. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 , 1920 Va. LEXIS 68 (1920).

    The court held that where a testator gave his estate to his wife during her life, and at her death to be equally divided amongst all of his children and the shares of his two daughters to be held by them during their natural lives and no longer, and then equally to be divided between their heirs lawfully begotten, the words “heirs lawfully to be begotten” (or similar words) were words of limitation and the daughters took the whole interest in their shares of the estate. Moore v. Brooks, 53 Va. (12 Gratt.) 135, 1855 Va. LEXIS 11 (1855) (see Tinsley v. Jones, 54 Va. (13 Gratt.) 289 (1856); Hall’s Ex’r v. Smith, 66 Va. (25 Gratt.) 70 (1874); Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894)).

    Rule not applicable. —

    The court held that a grant by D. to his grandson R., his executors, administrators and assigns, from and after the grantor’s death, for and during his life only; and after his death the said piece of land to go to such person or persons as shall at that time answer the description of heir or heirs at law of the said R., and such person or persons shall take the said land under that description as purchasers under and by virtue of this deed, and not by inheritance as heirs of the said R., created in R. but a life estate in the land; and the persons who at the time of R.’s death answered the description of his heirs at law took as purchasers under the deed. Taylor v. Cleary, 70 Va. (29 Gratt.) 330, 70 Va. (29 Gratt.) 448, 1877 Va. LEXIS 25 (1877).

    The statute does not apply to a trust deed for the benefit of the grantor’s wife “for life and the remainder to the heirs of her body begotten by” the grantor in the trust deed. Halsey v. Fulton, 119 Va. 571 , 89 S.E. 912 , 1916 Va. LEXIS 130 (1916).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Application of rule. —

    Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix’s daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County Apr. 3, 2007).

    § 55.1-113. Doctrine of worthier title abolished.

    The doctrine of worthier title is abolished in the Commonwealth as a rule of law and as a rule of construction.

    History. 2007, c. 215, § 55-14.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “Toward a Model Law of Estates and Future Interests,” see 66 Wash. & Lee L. Rev. 3 (2009).

    § 55.1-114. When contingent remainder not to fail.

    A contingent remainder shall not fail for want of a particular estate to support it.

    History. Code 1919, § 5153; Code 1950, § 55-15; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “The Future of Future Interests,” see 60 Wash. & Lee L. Rev. 513 (2003).

    For article, “Toward a Model Law of Estates and Future Interests,” see 66 Wash. & Lee L. Rev. 3 (2009).

    Michie’s Jurisprudence.

    For related discussion, see 16 M.J. Remainders, Reversions and Executory Interests, § 11.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Where some of children were born after testator’s death, the interest or estate that had vested in those in being when testator died would open up and let in the after-born members of the class as each came into being. Newsome v. Scott, 200 Va. 833 , 108 S.E.2d 369, 1959 Va. LEXIS 175 (1959).

    § 55.1-115. When remainders not defeated.

    The alienation of a particular estate on which a remainder depends, or the union of such estate with the inheritance by purchase or descent, shall not operate, by merger or otherwise, to defeat, impair, or otherwise affect such remainder.

    History. Code 1919, § 5154; Code 1950, § 55-16; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 16 M.J. Remainders, Reversions and Executory Interests, § 11.

    § 55.1-116. In what conveyances possession transferred to the use.

    By deed of bargain and sale, or by deeds of lease and release, or by covenant to stand seized to the use, or deed operating by way of covenant to stand seized to the use, the possession of the grantor shall be deemed transferred to the grantee or other person entitled to the use, for the estate or interest that such person has in the use, as perfectly as if the grantee or other person entitled to the use had been enfeoffed with livery of seisin of the land intended to be conveyed by such deed or covenant.

    History. Code 1919, § 5155; Code 1950, § 55-17; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For comment on effect of statute of uses on land trusts, see 7 Wm. & Mary L. Rev. 368 (1966).

    For article, “The Virginia Land Trust — An Overlooked Title Holding Device for Investment, Business and Estate Planning Purposes,” see 30 Wash. & Lee L. Rev. 73 (1973).

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 5.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    History of statute. —

    The English statute of uses (St. 27 Hen. VIII, Ch. 10) was not in force in Virginia after 1792. This section, the only one ever enacted in Virginia, is materially different from the English statute. See Jones v. Tatum, 60 Va. (19 Gratt.) 720, 1870 Va. LEXIS 17 (1870).

    This section does not apply to uses created by devise nor transfer such uses into the possession of the cestui que use. Bass v. Scott, 29 Va. (2 Leigh) 356, 1830 Va. LEXIS 43 (1830) (see Jones v. Tatum, 60 Va. (19 Gratt.) 720 (1870)).

    § 55.1-117. Land trusts not to fail because no beneficiaries are specified by name and no duties laid on trustee; when interest of beneficiaries deemed personal property; liens.

    No trust relating to real estate shall fail nor shall any use relating to real estate be defeated because no beneficiaries are specified by name in the recorded deed of conveyance to the trustee or because no duties are imposed upon the trustee. The power conferred by any such instrument on a trustee to sell, lease, encumber, or otherwise dispose of property described in such instrument shall be effective, and no person dealing with such a trustee shall be required to make further inquiry as to the right of such trustee to act, nor shall he be required to inquire as to the disposition of any proceeds.

    In any case under this section where there is a recorded deed of conveyance to a trustee, the interest of the beneficiaries thereunder shall be deemed to be personal property. Judgments against a beneficiary and consensual liens against real property of a beneficiary do not attach to real property that is the subject of such a deed of conveyance unless the judgment is docketed or the lien recorded in the county or city where the property is located (i) before recordation of the deed creating the land trust and (ii) while the beneficiary has record title to the real property.

    In any case under this section where there is a recorded deed of conveyance to a trustee and the trustee named in the deed declines to serve, resigns, is disqualified or removed, or is adjudicated incapacitated and there is (a) no successor trustee named in the deed, (b) no successor trustee designated by the terms of the trust instrument, or (c) no procedure set forth in the deed or trust instrument to designate a successor trustee, the beneficiaries of the trust, by majority decision, shall name a successor trustee. However, if the identities of the beneficiaries of the trust cannot be identified from the recorded deed of conveyance or a majority of the beneficiaries are unable to agree upon a successor trustee, the circuit court of the county or city in which the deed was recorded, upon the motion of any party interested in the administration of the trust, shall appoint a successor trustee whenever the court considers the appointment necessary for the administration of the trust. The name and address of any successor trustee so named or appointed shall be recorded with the clerk of the circuit court of the county or city in which the deed was recorded, and such successor trustee shall succeed to all the rights, powers, and privileges, and shall be subject to all the duties, liabilities, and responsibilities imposed upon, the original trustee unless the deed of conveyance expressly provides to the contrary.

    Nothing in this section shall be construed to (1) affect any right that a creditor may otherwise have against a trustee or beneficiary except as provided in this section, (2) enlarge upon the power of a corporation to act as trustee under § 6.2-1001 , or (3) affect the rule against perpetuities.

    History. 1962, c. 452, § 55-17.1; 1975, c. 375; 1993, c. 454; 2011, c. 661; 2012, c. 558; 2019, c. 712.

    Cross references.

    As to Uniform Trust Code, see § 64.2-700 et seq.

    Editor’s note.

    Acts 1993, c. 454, which amended this section, in cl. 2 provides: “That this act is declaratory of existing law.”

    Effective October 1, 2010, “§ 6.2-1001 ” was substituted for “§ 6.1-5” to conform to the recodification of Title 6.1 by Acts 2010, c. 794.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “The Virginia Land Trust — An Overlooked Title Holding Device for Investment, Business and Estate Planning Purposes,” see 30 Wash. & Lee L. Rev. 73 (1973).

    For article discussing due-on-sale clauses in home-purchasing contracts, see 16 U. Rich. L. Rev. 35 (1982).

    For article, “Virginia’s Augmented Estate System: An Overview,” see 24 U. Rich. L. Rev. 513 (1990).

    For annual survey article, “Wills, Trusts, and Estates,” see 46 U. Rich. L. Rev. 243 (2011).

    For annual survey of Virginia law article, “Wills, Trusts, and Estates,” see 47 U. Rich. L. Rev. 343 (2012).

    Michie’s Jurisprudence.

    For related discussion, see 3C M.J. Commercial Law, § 101.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Trustee in a land trust receives both legal and equitable title. —

    Unlike a creditor trust where legal title resides in the trustee while the beneficiary retains equitable title, the trustee in a land trust receives both legal and equitable title to the property. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768, 9 Va. Law Rep. 533, 1992 Va. LEXIS 114 (1992).

    Beneficiary receives no interest in property in a land trust. —

    In a land trust, the beneficiary retains no interest, legal or equitable, in the property itself, but instead holds only a personal property interest in the rents, proceeds, and profits from the property. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768, 9 Va. Law Rep. 533, 1992 Va. LEXIS 114 (1992).

    Third party has no responsibility to notify beneficiary of action against property. —

    The provisions of this section effectively eliminate a third party’s responsibility, and ability, to notify land trust beneficiaries of any action against the property which that party may contemplate. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768, 9 Va. Law Rep. 533, 1992 Va. LEXIS 114 (1992).

    Beneficiary was proper but not necessary party in mechanics lien action. —

    A beneficiary may be a proper party to an action to enforce a mechanic’s lien, which would provide notice and the opportunity to preserve its interests in the proceeds from a potential judicial sale; nevertheless, the beneficiary is not a necessary party to the enforcement suit. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768, 9 Va. Law Rep. 533, 1992 Va. LEXIS 114 (1992).

    Status of land trust. —

    Where the facts in the record were insufficient to support a finding that an entity other than a land trust was actually created, and the trust agreement specifically provided that it would not be deemed to create or evidence the existence of a corporation, association, joint venture, or partnership, a land trust created under this section was not some type of business organization. Curtis v. Lee Land Trust, 235 Va. 491 , 369 S.E.2d 853, 4 Va. Law Rep. 2993, 1988 Va. LEXIS 75 (1988).

    Limitation on use of trust. —

    Owner-borrowers should not be permitted to use a Virginia statutory land trust as a device to defeat the rights of the defendant savings and loan associations from accelerating the payment of their secured notes as provided for by due on sale clauses. Williams v. First Fed. Sav. & Loan Ass'n, 500 F. Supp. 307, 1980 U.S. Dist. LEXIS 17253 (E.D. Va. 1980), aff'd, 651 F.2d 910, 1981 U.S. App. LEXIS 12924 (4th Cir. 1981).

    In Virginia, it is clear that the land trust statute may not be used as an artifice to avoid creditors. Bluff Ventures Ltd. Partnership v. Chicago Title Ins. Co., 950 F.2d 139, 1991 U.S. App. LEXIS 26759 (4th Cir. 1991).

    Lack of beneficiary’s signature held not to affect trustees’ power under due-on-sale clause. See Barnes v. VNB Mtg. Corp., 230 Va. 4 , 334 S.E.2d 531, 1985 Va. LEXIS 243 (1985).

    “Deemed to be personal property” provision ineffectual to extent noteholder’s rights affected. —

    To the extent that a “deemed to be personal property” provision in a land trust agreement would affect the noteholder’s right to invoke the due-on-sale clause in a deed of trust against the beneficiary thereunder, the provision is ineffectual. Barnes v. VNB Mtg. Corp., 230 Va. 4 , 334 S.E.2d 531, 1985 Va. LEXIS 243 (1985).

    Liability imposed only upon promise to pay. —

    Because of the nature of the land trust, before personal liability can be imposed upon the beneficiaries, they must expressly or by implication promise to pay. Curtis v. Lee Land Trust, 235 Va. 491 , 369 S.E.2d 853, 4 Va. Law Rep. 2993, 1988 Va. LEXIS 75 (1988).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Applicability. —

    Section 55-17.1 did not apply as it focused on the interest of the beneficiary, not the authority of the grantor of the settlor to convey property once conveyed to the trust. Barksdale v. Haynes, 100 Va. Cir. 160, 2018 Va. Cir. LEXIS 339 (Lynchburg Oct. 5, 2018).

    § 55.1-118. Deed of release effectual.

    Every deed of release of any estate or interest capable of passing by deed of lease or release shall be as effectual for the purposes expressed in such deed of release, without the execution of a lease, as if the same had been executed.

    History. Code 1919, § 5156; Code 1950, § 55-18; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Cotenancy, § 4.

    § 55.1-119. When person not a party, etc., may take or sue under instrument.

    An immediate estate or interest in or the benefit of a condition respecting any estate may be taken by a person under an instrument, although he is not a party to such instrument; and if a covenant or promise is made for the benefit, in whole or in part, of a person with whom it is not made, or with whom it is made jointly with others, such person, whether named in the instrument or not, may maintain in his own name any action thereon that he might maintain as though it had been made with him only and the consideration had moved from him to the party making such covenant or promise. In such action, the covenantor or promisor shall be permitted to make all defenses he may have, not only against the covenantee or promisee, but also against such beneficiary.

    History. Code 1919, § 5143; Code 1950, § 55-22; 2019, c. 712.

    Cross references.

    As to action for damages from legal malpractice concerning estate planning, see § 64.2-520.1 .

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For note, “Whose Beneficiaries are They Anyway? Copenhaver v. Rogers and the Attorney’s Contract to Prepare A Will in Virginia,” see 24 U. Rich. L. Rev. 415 (1990).

    Michie’s Jurisprudence.

    For related discussion, see 2A M.J. Assumpsit, § 36.

    CASE NOTES

  • Analysis
  • I.Decided under current law.

    Property owner as third party beneficiary. —

    Family sufficiently alleged that its contract with a home owner made the property owner a third-party beneficiary where the complaint alleged that the home builder was aware that the improvements to the real property were to solely benefit the record title owner of the property and the owner desired to build living quarters for the family to live on site while performing valuable services for the owner. Tingler v. Graystone Homes, Inc., 298 Va. 63 , 834 S.E.2d 244, 2019 Va. LEXIS 138 (2019).

    II.Decided Under Prior Law.
    A.In General.

    Purpose of statute. —

    The statute was enacted for a double purpose. One was to change the rule of the common law that one not a party to a deed inter partes could not sue for a breach of a covenant therein made for his benefit. The other purpose was to change the common-law rule that a suit for breach of a covenant made with two persons for the benefit of one of them must be jointly brought by both the covenantees. City of Newport News v. Potter, 122 F. 321, 1903 U.S. App. LEXIS 4760 (4th Cir. 1903).

    As to purpose of 1919 revision of this section, see Horney v. Mason, 184 Va. 253 , 25 S.E.2d 78 (1945).

    It was not the purpose of this section to limit or restrict the powers of parties to contract, or their right to select the parties with whom they would contract, or to prevent parties from limiting the right of action to the immediate parties with whom the contract was made, nor to create beneficiaries not made so by the contract, but to extend the remedy on the contracts mentioned in the section to beneficiaries under the contracts, where such extension was not forbidden by the terms of the contract itself. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 , 1925 Va. LEXIS 337 (1925); Indemnity Ins. Co. v. Davis' Adm'r, 150 Va. 778 , 143 S.E. 328 , 1928 Va. LEXIS 351 (1928); Norfolk-Portsmouth Newspapers, Inc. v. Stott, 208 Va. 228 , 156 S.E.2d 610, 1967 Va. LEXIS 208 (1967).

    This section is highly remedial and should be liberally construed in order to accomplish the ends manifestly intended. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 , 1925 Va. LEXIS 337 (1925); Indemnity Ins. Co. v. Davis' Adm'r, 150 Va. 778 , 143 S.E. 328 , 1928 Va. LEXIS 351 (1928); Bristol Steel & Iron Works, Inc. v. Plank, 163 Va. 819 , 178 S.E. 58 , 1935 Va. LEXIS 242 (1935).

    This section is remedial and is to be liberally interpreted and applied. Graybar Elec. Co. v. Doley, 273 F.2d 284, 1959 U.S. App. LEXIS 4644 (4th Cir. 1959).

    Remedy provided is cumulative. —

    The instant case was a suit against vendees who had assumed the payment of a mortgage. Defendants demurred on the ground that the complainant had a complete and adequate remedy at law under this section. Upon the question of whether under this section the complainant might sue the defendants at law on their assumption of the mortgage debt due complainant, the Supreme Court expressed no opinion. However, the statutory remedy by an action at law under this section is cumulative only in such cases, and does not oust courts of chancery from the jurisdiction they have long exercised to grant relief to a mortgage creditor against the grantee of mortgaged property who has assumed the mortgage debt, under the doctrine of subrogation. Blanton v. Keneipp, 155 Va. 668 , 156 S.E. 413 , 1931 Va. LEXIS 260 (1931).

    And equity power is not diminished. —

    The power given by this section to law courts in nowise diminishes that theretofore exercised in equity. It is but cumulative and concurrent. Buchanan v. Buchanan, 174 Va. 255 , 6 S.E.2d 612, 1940 Va. LEXIS 209 (1940).

    This section does not forbid a suit in the name of the original obligee. Glens Falls Ins. Co. v. Sherritt, 95 F.2d 823, 1938 U.S. App. LEXIS 4794 (4th Cir. 1938).

    Limited liability of purchaser of property subject to existing lien. —

    When one purchases property subject to an existing lien the purchaser is not personally liable for any deficiency. In such a case the defaulter can only lose the underlying property. Unlike taking property subject to an existing lien, when a purchaser takes property and assumes the underlying lien the purchaser is personally liable for the indebtedness including any deficiency that may result from foreclosure. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579, 1985 U.S. Dist. LEXIS 17099 (E.D. Va. 1985).

    Mortgagee has no direct action at law against second mortgagor. —

    The mortgagee’s right to hold a subsequent purchaser liable is not grounded in contract between the mortgagee and the subsequent purchaser, as generally no such contract exists, but on the theory that the covenant of the subsequent purchaser is a collateral security obtained by the mortgagor, which by equitable subrogation inures to the benefit of the mortgagee. Thus, as between the original mortgagor and the subsequent purchaser, the latter is the principal debtor and the mortgagor is his surety. The promise of a subsequent purchaser to assume the mortgage debt upon the property is a contract only between the two of them absent an independent undertaking by the purchaser and the mortgagee. Admittedly, the contract benefits the mortgagee but the primary beneficiary of this collateral undertaking is the mortgagor. Therefore, absent some statutory authority, no direct action at law (as distinguished from equity) by the mortgagee against the second mortgagor will lie. If upon foreclosure the property does not bring enough to satisfy the entire debt, the mortgage creditor may proceed in an equity court against the subsequent purchaser for any deficiency. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579, 1985 U.S. Dist. LEXIS 17099 (E.D. Va. 1985).

    Mortgagee need not first foreclose prior to obtaining a judgment against a subsequent purchaser who assumes in writing the obligation secured by the property, as there need be no privity of contract under the present third-party beneficiary statute of Virginia. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579, 1985 U.S. Dist. LEXIS 17099 (E.D. Va. 1985).

    Restrictive covenant enforceable by beneficiary. —

    Where a covenant is for the benefit of third persons they have the right to enforce it in their own names, under this section. Cheatham v. Taylor, 148 Va. 26 , 138 S.E. 545 , 1927 Va. LEXIS 207 (1927).

    A restrictive covenant for the benefit of a third party may be enforced in his own name under this section. Meagher v. Appalachian Elec. Power Co., 195 Va. 138 , 77 S.E.2d 461, 1953 Va. LEXIS 184 (1953).

    Section not applicable. —

    Where premises are subleased to an assignee of the lessees who does not assume the obligation of maintaining fire insurance on the premises, which obligation was a covenant in the lease between lessor and lessees, this section has no application, since it does not purport to create a contract where no contract exists. Burton v. Chesapeake Box & Lumber Corp., 190 Va. 755 , 57 S.E.2d 904, 1950 Va. LEXIS 166 (1950).

    Section held inapplicable. Benoit v. Baxter, 196 Va. 360 , 83 S.E.2d 442, 1954 Va. LEXIS 228 (1954).

    Contract found not to be made for the benefit of third party. Graybar Elec. Co. v. Doley, 273 F.2d 284, 1959 U.S. App. LEXIS 4644 (4th Cir. 1959).

    Because the benefit to the third-party referred to in the first phrase of the statute derives from an instrument, this section must refer to a benefit from a written document. Thorsen v. Richmond SPCA, 292 Va. 257 , 786 S.E.2d 453, 2016 Va. LEXIS 68 (2016) (but see § 64.2-520.1 and notes thereunder).

    This section did not apply to an oral contract between an attorney and a testator where although the statute clearly applied to a written instrument, it did not abrogate the common law, which allowed third-party beneficiaries to sue upon oral contracts. Thorsen v. Richmond SPCA, 292 Va. 257 , 786 S.E.2d 453, 2016 Va. LEXIS 68 (2016) (but see § 64.2-520.1 and notes thereunder).

    Implied guarantee not within section. —

    Where defendants, for whom a building was being erected, agreed with plaintiff to retain sufficient funds and pay plaintiff for materials furnished, an action on the agreement was to recover upon an implied guarantee made by defendants to plaintiff and was not a suit upon a contract made by defendants for plaintiff’s benefit, such as is dealt with in this section. Nicholas v. Harrisonburg Bldg. & Supply Co., 181 Va. 207 , 24 S.E.2d 452, 1943 Va. LEXIS 169 (1943).

    B.Intended Beneficiary.
    1.In General.

    A person may have a beneficial interest in a contract to which he is not a named party. Horney v. Mason, 184 Va. 253 , 35 S.E.2d 78, 1945 Va. LEXIS 146 (1945).

    A third-party beneficiary to a contract is entitled to enforce the terms of the contract and is subject to defenses arising out of it. Levine v. Selective Ins. Co. of Am., 250 Va. 282 , 462 S.E.2d 81, 12 Va. Law Rep. 244, 1995 Va. LEXIS 103 (1995).

    Where evidence was clear that subordination agreement between plaintiff and corporation was intended to confer a benefit upon lender, a nonparty, lender took its interests under the subordination agreement subject to the plaintiff’s right to rescind the agreement because of fraud, even through lender had no knowledge of the fraud. Ashmore v. Herbie Morewitz, Inc., 252 Va. 141 , 475 S.E.2d 271, 1996 Va. LEXIS 88 (1996), cert. denied, 520 U.S. 1120, 117 S. Ct. 1254, 137 L. Ed. 2d 335, 1997 U.S. LEXIS 1712 (1997).

    Like a party to an agreement, a third-party beneficiary is entitled to enforce the terms of the agreement and is subject to the defenses arising from that agreement. First Sec. Fed. Sav. Bank, Inc. v. McQuilken, 253 Va. 110 , 480 S.E.2d 485, 1997 Va. LEXIS 17 (1997).

    But it must be shown that contract was made for his benefit. —

    This section limits the right of a third person to sue upon a contract to which he is not a party to a case where it can be shown that the contract was made for his benefit. Graybar Elec. Co. v. Doley, 273 F.2d 284, 1959 U.S. App. LEXIS 4644 (4th Cir. 1959); Norfolk-Portsmouth Newspapers, Inc. v. Stott, 208 Va. 228 , 156 S.E.2d 610, 1967 Va. LEXIS 208 (1967).

    The third-party beneficiary doctrine is subject to the limitation that the third party must show that the parties to the contract clearly and definitely intended it to confer a benefit upon him. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810, 1976 Va. LEXIS 195 (1976); Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120, 1977 Va. LEXIS 187 (1977); Richmond Shopping Center, Inc. v. Wiley N. Jackson Co., 220 Va. 135 , 255 S.E.2d 518, 1979 Va. LEXIS 245 (1979).

    The third-party beneficiary statute has no application unless the party sought to be held liable has assumed an obligation for the benefit of a third party. The statute does not purport to create a contract when no contract exists. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810, 1976 Va. LEXIS 195 (1976); Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120, 1977 Va. LEXIS 187 (1977).

    If a promise or covenant is made for the benefit of a third party, that party may maintain an action on the promissory instrument in his own name. However, the third party must show that the parties to the instrument clearly intended to confer a benefit on him. Sinicrope v. Black Diamond Sav. & Loan Ass'n, 21 Bankr. 476, 1982 Bankr. LEXIS 4248 (Bankr. W.D. Va. 1982).

    Defendants’ motion to dismiss plaintiff’s breach of implied warranty claim in regard to a construction contract was denied. The contract evinced an intent to directly benefit plaintiff by conferring third-party beneficiary status upon him; thus, the privileges associated with privity were also conferred, pursuant to § 55-22, and plaintiff was entitled to sue based on an implied warranty of fitness for a particular purpose. Wal-Mart Stores, Inc. v. J.A. Fielden Co., 440 F. Supp. 2d 523, 2006 U.S. Dist. LEXIS 49901 (W.D. Va. 2006).

    And showing benefit incidental to contract is insufficient. —

    To come within the purview of this provision it is insufficient for a person to show that incidental to the contract he would benefit from its enforcement. The person “must show that the parties to the contract clearly and definitely intended to confer a benefit upon him.” In re County Green Ltd. Partnership, 438 F. Supp. 693, 1977 U.S. Dist. LEXIS 14662 (W.D. Va. 1977).

    A clear intent to benefit the third person must appear to enable him to sue on the contract; incidental beneficiaries cannot maintain an action thereon. Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120, 1977 Va. LEXIS 187 (1977).

    Incidental beneficiaries may not sue on a contract as a third-party beneficiary. Richmond Shopping Center, Inc. v. Wiley N. Jackson Co., 220 Va. 135 , 255 S.E.2d 518, 1979 Va. LEXIS 245 (1979).

    The fact that a building contractor would be incidentally benefited by a proper performance of duties on the part of the architect is not sufficient to make the contractor a third-party beneficiary of a contract between the architect and the owner. Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120, 1977 Va. LEXIS 187 (1977).

    A mere incidental beneficiary of a contract does not have standing to sue on the contract. Kelley v. Griffin, 252 Va. 26 , 471 S.E.2d 475, 1996 Va. LEXIS 65 (1996).

    Incidental and intended beneficiaries distinguished. —

    An incidental beneficiary is so far removed from the obligations assumed by the contracting parties that a court will not allow him to sue on that contract, whereas an intended beneficiary is such an integral part of the obligations assumed by the contracting parties that a court will permit him to sue on that contract. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037, 1987 U.S. Dist. LEXIS 338 (W.D. Va. 1987).

    Subcontractor was not an intended third-party beneficiary entitled to sue on a services contract between the City of Richmond and the contractor because the subcontractor was not a party to the contract; the primary purpose of the contract was to benefit the City with a working records management system; and, thus, the subcontractor was merely an incidental beneficiary and not an intended third-party beneficiary. BIS Computer Solutions, Inc. v. City of Richmond, 122 Fed. Appx. 608, 2005 U.S. App. LEXIS 651 (4th Cir. 2005).

    Third-party beneficiary must demonstrate intent of contracting parties to benefit him. —

    In order for a third-party beneficiary to qualify as an intended beneficiary, he must demonstrate that the contracting parties clearly and definitely intended to directly benefit him. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037, 1987 U.S. Dist. LEXIS 338 (W.D. Va. 1987).

    Trial court properly found that investors were not third-party beneficiaries arising from transactions in which a third party opened accounts at the bank; evidence of the bank’s intention in setting up the accounts was provided by a vice president’s testimony that his main concern was to protect the bank from any involvement with criminal activity. There was no direct evidence of the intentions of the third party, the other contracting party, but the circumstantial evidence of the conduct of its principals was sufficient to support the trial court in concluding that conferring a benefit upon the investors was the farthest thing from their minds. Collins v. First Union Nat'l Bank, 272 Va. 744 , 636 S.E.2d 442, 2006 Va. LEXIS 95 (2006).

    Chapter 7 debtor suffered dismissal with prejudice of his adversary complaint against the malpractice insurer for his former bankruptcy lawyer who allegedly failed to persuade a bank that held mortgages on certain real estate to renegotiate the terms of those mortgages because debtor was neither an insured under the policy nor a third-party beneficiary with a right to enforce the policy per § 55-22. Debtor’s assertion of a direct claim against the insurer also was precluded by § 38.2-2200 , which permitted the pursuit of such a direct action only after the putative claimant has obtained an unsatisfied judgment against the insured under the policy. Reynolds Living Trust v. Wells Fargo Bank, N.A. (In re Reynolds), No. 09-71964, No. 11-07012, 2011 Bankr. LEXIS 3352 (Bankr. W.D. Va. Sept. 6, 2011).

    Bondholders not intended beneficiaries of underlying contracts. —

    Bondholders were not the intended beneficiaries of a contract between a county and a contractor hired to construct and operate a solid waste facility where there was no provision, express or implied, of the construction contract or the operations contract that clearly and definitely showed an intent to confer a benefit upon the bondholders as third-party beneficiaries of those contracts. Caudill v. County of Dinwiddie, 259 Va. 785 , 529 S.E.2d 313, 2000 Va. LEXIS 78 (2000).

    Intent of parties evidenced by contract. —

    The four concerns of a contract evidence whether contracting parties clearly and definitely intended to directly benefit a third party. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037, 1987 U.S. Dist. LEXIS 338 (W.D. Va. 1987).

    Condition precedent to insurer’s obligation to pay for loss applied to third-party additional insured. —

    Under a personal liability umbrella policy, a provision requiring an insured to perform the affirmative act of maintaining underlying insurance at policy limits greater than the amount required by § 46.2-472 was enforceable against a third-party additional insured because the provision was a condition precedent to the insurer’s obligation to pay for loss that exceeded an insured’s underlying policy limits and a third-party additional insured’s rights could not be greater than the rights of the named insured. State Farm Fire & Cas. Co. v. Nationwide Mut. Ins. Co., 596 F. Supp. 2d 940, 2009 U.S. Dist. LEXIS 8263 (E.D. Va. 2009).

    Person must be intended beneficiary of contract and not third-party beneficiary of estate. —

    Remaindermen failed to assert third-party beneficiary claims against attorney who wrote will of remaindermen’s grandparents; although remaindermen were third-party beneficiaries of the estate, they were not the intended beneficiaries of the contract between the grandparents and the attorney. Copenhaver v. Rogers, 238 Va. 361 , 384 S.E.2d 593, 6 Va. Law Rep. 499, 1989 Va. LEXIS 146 (1989).

    Nonparty, partial beneficiary may directly sue promisor. —

    The legislative history of this section reveals that the statute was amended, in part, in order to enable one not a party to a contract but who is only a partial beneficiary rather than a sole beneficiary to directly sue the promisor. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579, 1985 U.S. Dist. LEXIS 17099 (E.D. Va. 1985).

    Buyer evinced no intent to benefit broker. —

    Where plaintiff-broker sought to recover cash commission from buyers who breached the sales contract, the presence of the sellers’ express covenant to pay the commission and the absence thereof as to the buyers evinces an intent not to confer a benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810, 1976 Va. LEXIS 195 (1976).

    The buyers’ promise to purchase ran in favor of the sellers; that promise was made in consideration of the sellers’ promise to sell, not in consideration of brokerage services rendered, and cannot fairly be construed to evince an intent by the buyers to confer a gratuitous benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810, 1976 Va. LEXIS 195 (1976).

    Seller’s intent to benefit broker. —

    Both the sellers’ covenant to sell to the buyers and the sellers’ covenant to pay a commission for services rendered by the broker ran in favor of the broker, and together they evince the sellers’ intent to confer a benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810, 1976 Va. LEXIS 195 (1976).

    Any person having an interest in property insured, though no party to the policy, may institute and maintain an action in his own name to extent of loss occasioned him by its destruction. Tilley v. Connecticut Fire Ins. Co., 86 Va. 811 , 11 S.E. 120 , 1890 Va. LEXIS 46 (1890).

    A remote beneficiary in an insurance policy might, under this section, maintain an action thereon in his own name. Clemmitt v. New York Life Ins. Co., 76 Va. 355 , 1882 Va. LEXIS 39 (1882).

    Creditor may sue surety on bond. —

    Where the principal contracted to liquidate and pay in full all of the liabilities of a corporation then existing or thereafter arising, and the surety guaranteed the performance of his contract, the contract of the surety was not for the exclusive benefit of the parties therein named, but inured to the benefit of the creditors of the corporation, and under this section a creditor not named could prosecute his action against the surety in his own name. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 , 1925 Va. LEXIS 337 (1925).

    Under this section, a creditor of a road contractor for labor and material may maintain an action on the contractor’s bond against his surety, such bond being made in part for his benefit. Aetna Cas. & Sur. Co. v. Earle-Lansdell Co., 142 Va. 435 , 129 S.E. 263 , 1925 Va. LEXIS 350 (1925).

    Under this section, one furnishing labor and material for the construction of a highway may sue the surety on the contractor’s undertaking bond for labor and material furnished in or about the construction of the highway. Fidelity & Deposit Co. v. Mason, 145 Va. 138 , 133 S.E. 793 , 1926 Va. LEXIS 380 (1926).

    A judgment creditor of an insured may bring an action under this section only for the breach of covenant or promise which was made for his benefit in whole or in part. Rowe v. United States Fid. & Guar. Co., 421 F.2d 937, 1970 U.S. App. LEXIS 11044 (4th Cir. 1970).

    2.Illustrative Cases.

    Prospective purchasers held not able to bring action. —

    Where there was no allegation in the motion for judgment to support a conclusion that the listing agreement clearly and definitely intended to confer a benefit upon prospective purchasers, prospective purchasers could not bring an action. Allen v. Lindstrom, 237 Va. 489 , 379 S.E.2d 450, 5 Va. Law Rep. 2205, 1989 Va. LEXIS 77, cert. denied, 493 U.S. 849, 110 S. Ct. 145, 107 L. Ed. 2d 104, 1989 U.S. LEXIS 4350 (1989).

    Railroad may sue member of coal exchange. —

    Where a member of a coal exchange in joining such exchange contracted to abide by its rules, one of which obligated the payment of demurrage, and later the member shipped coal under the contract, under this section he was liable to a railroad company for demurrage incurred. Smokeless Fuel Co. v. C & O Ry., 142 Va. 355 , 128 S.E. 624 , 1925 Va. LEXIS 343 (1925).

    The touchstone for application of this section to construction contractors is whether the architects’ contract was made for builders’ benefit “in whole or in part.” That determination depends in turn upon the intent of the primary contracting parties, which may be gleaned either upon the face of the contract or from extrinsic evidence in that regard. McCloskey & Co. v. Wright, 363 F. Supp. 223, 1973 U.S. Dist. LEXIS 13097 (E.D. Va. 1973).

    Subcontractor as beneficiary under performance bond. —

    Where performance bond was written in such a way that general contractor and surety were bound, jointly and severally, to owner for any liability arising under construction contract, the subcontractors were clearly third-party beneficiaries under the bond. Sinicrope v. Black Diamond Sav. & Loan Ass'n, 21 Bankr. 476, 1982 Bankr. LEXIS 4248 (Bankr. W.D. Va. 1982).

    Subcontractor not intended beneficiary of a contract. —

    Subcontractor failed to allege sufficient facts under Fed. R. Civ. P. 8(a) to maintain a breach of contract claim against a tiling company and a grout distributor based on stained and discolored grout at a certain construction site because it did not aver any facts showing that it was an intended third-party beneficiary of the contract between the tiling company and the grout distributor, as required for a claim as a third-party beneficiary of a contract under § 55-22. RCI Contrs. & Eng'rs, Inc. v. Joe Rainero Tile Co., 677 F. Supp. 2d 914, 2010 U.S. Dist. LEXIS 1674 (W.D. Va. 2010).

    Materialman held not entitled to recover on contractor’s bond given to city where bond and contract between contractor and city did not evidence an intent to protect materialmen. Century Indem. Co. v. Esso Std. Oil Co., 195 Va. 502 , 79 S.E.2d 625, 1954 Va. LEXIS 128 (1954).

    Engineer may enforce forfeiture provision in contract with city. —

    Under this section where a contract with a city for the construction of a sewer required the city to deduct from the amount due the contractor a specified sum for each day’s delay in the completion of the work beyond a time specified, and to pay such sum to the engineer employed by the city to superintend the work, the engineer may maintain an action on such covenant in his own name. City of Newport News v. Potter, 122 F. 321, 1903 U.S. App. LEXIS 4760 (4th Cir. 1903).

    Public service corporation may enforce covenant as beneficiary. —

    There is no public policy that would prohibit a public service corporation from enforcing an otherwise valid covenant as third-party beneficiary thereto. Kempsville Util. Corp. v. Wills, 213 Va. 679 , 194 S.E.2d 740, 1973 Va. LEXIS 206 (1973).

    The beneficiary should be given the opportunity to explain the business justification of a covenant which benefits it. Kempsville Util. Corp. v. Wills, 213 Va. 679 , 194 S.E.2d 740, 1973 Va. LEXIS 206 (1973).

    Purchaser of cargo held beneficiary. —

    A purchaser, for whose benefit and at whose risk cargo was being transported after it was loaded by the seller f.o.b. Roanoke, was a third-party beneficiary to the contract of carriage, entitled to sue on the contract, bound by the terms of the contract, and subject to defenses arising out of the contract. Sydnor & Hundley, Inc. v. Wilson Trucking Corp., 213 Va. 704 , 194 S.E.2d 733, 1973 Va. LEXIS 212 (1973).

    Injured party as beneficiary under contract of insurance. —

    If the injured party is a beneficiary under the contract of insurance and the policy is made for his benefit, then he should be entitled to maintain an action in his own name for a breach of that contract. Davis v. National Grange Ins. Co., 281 F. Supp. 998, 1968 U.S. Dist. LEXIS 8336 (E.D. Va. 1968), disapproved, Rowe v. United States Fidelity & Guaranty Co., 421 F.2d 937, 1970 U.S. App. LEXIS 11044 (4th Cir. 1970).

    Tort claimants had standing to seek indemnification on insurance policies issued to tortfeasors. —

    Tort claimants had standing to seek a declaration that the insurance policies issued to the first tortfeasor required its insurer to defend and indemnify it for any damages awarded in the underlying tort suit because the denial of coverage would injure the claimants if they obtained judgment against the first tortfeasor and the judgment went unsatisfied as subdivision 2 of § 38.2-2200 allowed the claimants to sue defendant directly for the outstanding amount of an unsatisfied judgment against the first tortfeasor, Virginia law conferred on tort claimants the right to sue on the policy as a third-party beneficiary, and the claimant’s were third-party beneficiaries from the moment of injury pursuant to § 55-22; the second tortfeasor and its insurer, however, could not establish that they suffered an injury-in-fact as a result of defendant’s denial of coverage to the first tortfeasor, and thus, they were dismissed from the action. Lott v. Scottsdale Ins. Co., 811 F. Supp. 2d 1224, 2011 U.S. Dist. LEXIS 104803 (E.D. Va. 2011).

    No evidence established injured third parties as intended beneficiaries to insurance contract. —

    Where defendants claimed there was a well-recognized duty owed by insurers to injured third parties, which provided a right to an independent action against an insurer, no evidence was before the court that established the defendants as intended beneficiaries to the insurance contract between insurance company and the original named insureds under this section. Without such evidence, the defendants lacked proper standing to bring an action alleging bad faith by insurance company. Fireman's Fund Ins. Co. v. St. Asaph Lawyer's Title Co. (In re Dameron), 213 Bankr. 482, 1997 Bankr. LEXIS 1757 (Bankr. E.D. Va. 1997).

    Lot owner not intended beneficiary of covenant as to multifamily dwellings. —

    Under a third-party beneficiary theory, the third party must show that the parties to the contract clearly and definitely intended it to confer a benefit upon him. Where the evidence showed that a resort imposed special covenants as to multifamily residences to protect its own interests, only incidentally benefiting the lot owners, the lot owners did not clearly show that the contracting parties definitely intended the contract to confer a benefit upon them. Forbes v. Schaefer, 226 Va. 391 , 310 S.E.2d 457, 1983 Va. LEXIS 296 (1983).

    Where a covenant in a deed of trust is for the benefit of the holder of notes secured, the right to sue thereon comes squarely within the provisions of this statute. Holcomb v. Webley, 185 Va. 150 , 37 S.E.2d 762, 1946 Va. LEXIS 188 (1946).

    The assumption of the payment of a lien on land as a part of the purchase price thereof, for which the grantee’s immediate grantor is not personally bound, is a promise for the sole benefit of the holder of the lien within the meaning of this section and may be enforced by such holder against the party so promising. Casselman v. Gordon, 118 Va. 553 , 88 S.E. 58 , 1916 Va. LEXIS 37 (1916) (see Swain v. Virginia Bank & Trust Co., 151 Va. 655 , 144 S.E. 645 (1928)).

    Purchasers of a home were third-party beneficiaries under certain “Insurance/Warranty Documents” entered into by their builder, a home warranty corporation, and a home warranty insurer, where the documents showed that the contracting parties clearly and definitely intended to confer a benefit upon the purchasers. Cobert v. Home Owners Warranty Corp., 239 Va. 460 , 391 S.E.2d 263, 6 Va. Law Rep. 2005, 1990 Va. LEXIS 84 (1990).

    Court did not commit plain error in failing to address third-party beneficiary status. —

    In a boat owner’s negligence action against a subcontractor, the district court did not commit plain error in failing to address whether the owner was a third-party beneficiary of the contract between his general contractor and the subcontractor, and, thus, could maintain an action against the subcontractor pursuant to § 55-22, because the owner informed the district court that it need not address the issue, and he presented absolutely no argument on the matter. Dur v. W. Branch Diesel, 240 Fed. Appx. 568, 2007 U.S. App. LEXIS 16237 (4th Cir. 2007).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Applicability. —

    When a comatose nursing home patient sued the general partner of the limited liability partnership that owned the nursing home, as well as current and former nursing home employees, a claim that the patient had to engage in arbitration since the patient was a third-party beneficiary of a contract signed by the patient’s sister upon admitting the patient to the nursing home was irrelevant because the patient’s claims were not based on the contract. Gibson v. Medical Facilities of Am., Inc., 79 Va. Cir. 329, 2009 Va. Cir. LEXIS 269 (Norfolk Sept. 25, 2009).

    Beneficiaries distinguished. —

    Homebuilder was, at most, an incidental beneficiary of a contract between its subcontractor and the manufacturer of a building product for the purchase and sale of the product, since there was no evidence the parties to that contract knowingly intended to benefit the builder. MacConkey v. F.J. Matter Design, Inc., 54 Va. Cir. 1, 2000 Va. Cir. LEXIS 390 (Virginia Beach Feb. 8, 2000).

    Intent of parties. —

    Condominium owners were not third-party beneficiaries of a contract between the builder of their condominiums and an insurer to provide insurance against defects in the construction of the condominiums, because the owners were each issued individual insurance policies; there was no intent in the contract between the builder and the insurer that the owners were beneficiaries of that contract. Bay Point Condo. Ass'n Bd. of Dirs. v. Mid-Atlantic Ins. Corp., 54 Va. Cir. 124, 2000 Va. Cir. LEXIS 555 (Norfolk Sept. 20, 2000).

    Subcontractor was not an intended third-party beneficiary of a contractor’s separate subcontract with a tile remover, and, at most, the subcontractor was an incidental beneficiary of the tile removal contract and, therefore, had no right to enforce the warranties under that contract in seeking contribution and indemnification from the tile remover. Metro Panel Sys. v. Sordoni Skanska Constr. Co., 56 Va. Cir. 399, 2001 Va. Cir. LEXIS 478 (Norfolk Sept. 17, 2001).

    Intent of parties evidenced by contract. —

    Where a second amended motion for judgment alleged the existence of consulting agreements between an equine services provider and each veterinarian, and that the clients of the provider were the intended third-party beneficiaries of the agreements, demurrers filed by the veterinarians were overruled. Washington v. Equine Reprod. Concepts, L.L.C., 61 Va. Cir. 727, 2002 Va. Cir. LEXIS 431 (Rappahannock County Dec. 19, 2002).

    Guarantor alleged not only that the bank and the car dealership considered him when entering into financing documents, but that they did so with the intention of allowing him to satisfy his creditors (including the bank) while protecting his personal estate. Although it was by no means clear whether it was to be proven that the parties intended to confer a direct benefit upon the guarantor, he alleged sufficient facts on the bank’s demurrer to allege that he was a third-party beneficiary. Wachovia Bank, N.A. v. Ranson Tyler Chevrolet, L.L.C., 73 Va. Cir. 143, 2007 Va. Cir. LEXIS 43 (Roanoke Mar. 27, 2007).

    Although a company’s claim that it was a third-party beneficiary of a December 24, 2003 contract because the company was a party to a December 29, 2003 contract between itself and an excess insurer and an insurance group was rejected, the company stated a valid cause of action for breach of a third-party beneficiary contract under Va. Code § 55-22 by adequately alleging under Va. Sup. Ct. R. 1:4(d) that when the excess insurers entered into the December 24, 2003 contract with a hospital, those parties intended to directly benefit the company by settling the hospital’s claims for payment of company’s employee’s medical bills, which were covered by the company plan and the excess coverage. Old Dominion Freight Line, Inc. v. Std. Sec. Life Ins. Co., 73 Va. Cir. 441, 2007 Va. Cir. LEXIS 135 (Richmond July 18, 2007).

    Plaintiff’s deceased patient was a third-party beneficiary, i.e., was an intended beneficiary, not an incidental beneficiary, of the 9/16/11 Radiology Services Agreement between defendant radiological associates, and the physician services corporation; thus, based on the totality of the agreement, the whole intent of the parties was to meet the care, services, and requirements of unnamed unknown future patients. Rauchfuss v. Peninsula Radiological Assocs., 94 Va. Cir. 8, 2016 Va. Cir. LEXIS 60 (Newport News Apr. 28, 2016).

    Contract clearly bestowed a benefit. —

    Because an agreement provided that third-party defendant would provide a transfer station location for various sources of waste and thereby the language bestowed a benefit upon third-party plaintiff, third-party plaintiff could maintain a breach of contract claim pursuant to the terms of this section. Rivanna Solid Waste Auth. v. Van Der Linde, 78 Va. Cir. 418, 2009 Va. Cir. LEXIS 190 (Charlottesville July 21, 2009).

    Borrowers were not intended beneficiaries. —

    Borrowers were not a party to or an intended beneficiary of the assignment, and therefore lacked standing to challenge its validity under § 55-22. Buzbee v. United States Bank, N.A., 84 Va. Cir. 485, 2012 Va. Cir. LEXIS 39 (Fairfax County May 2, 2012).

    Standing to sue. —

    Injured person’s parents had no standing as parties to a suit brought by the injured person against an insurer relating to the injured person’s claims under the medical pay provisions of a policy issued by the insurer to the parents; the injured person was a third-party beneficiary of the insurance contract between his parents and the insurer, and as such, had standing to initiate a breach of contract claim. Tolbert v. Dwyer, 2000 Va. Cir. LEXIS 651 (Nelson County Mar. 9, 2000).

    Because there was no express agreement between a patient and a doctor, and the patient was not a third-party beneficiary of an agreement between the doctor and a health plan, the patient lacked standing to sue the doctor for breach of contract. Hughes v. Olin, 69 Va. Cir. 46, 2005 Va. Cir. LEXIS 191 (Prince William County May 26, 2005).

    In a case alleging the mismanagement of irrevocable trusts, a beneficiary was permitted to proceed in a malpractice action where she alleged that she was an intended third-party beneficiary of an attorney client relationship between a lawyer and a trustee. Burton v. Dolph, 89 Va. Cir. 101, 2014 Va. Cir. LEXIS 129 (Norfolk June 27, 2014).

    § 55.1-120. Informalities in deeds made by attorneys-in-fact.

    If, in a deed made by one as attorney-in-fact for another, the words of conveyance or the signature is in the name of the attorney, it is as much the principal’s deed as if the words of conveyance or the signature were in the name of the principal by the attorney, if it is manifest on the face of the deed that it should be construed to be that of the principal to give effect to its intent.

    History. Code 1919, § 5145; Code 1950, § 55-23; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 1A M.J. Agency, § 46.

    § 55.1-121. Time for objections to irregularities in advertising sales made by trustees.

    All deeds made and executed prior to January 1, 1940, by trustees conveying property sold under deeds of trust in which default was made in the debt secured and as to which irregularities in advertising such sales have occurred shall be held and the same are hereby declared valid in all respects, if otherwise valid according to law then in force, after the expiration of 15 years from the date on which such sale was made by such trustees.

    History. 1924, p. 308; Michie Code 1942, § 5827b; Code 1950, § 55-24; 1952, c. 375; 1960, c. 105; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-122. Recovery at death of life tenant of taxes paid on life estate.

    When any person dies possessed of a life estate in real estate that was assessed with taxes in the name of such life tenant for the year in which such life tenant dies and such taxes are paid for that year by any person other than the remainderman entitled to such real estate, such person or his estate so paying such taxes shall be entitled to recover from such remainderman such proportionate part of the sum so paid as that part of the year following the death of the life tenant bears to the entire year, provided, however, that if upon the death of the life tenant the real estate shall come into the possession of another life tenant, such recovery shall be had from the subsequent life tenant and not from the remainderman.

    History. 1932, p. 331; Michie Code 1942, § 5392a; Code 1950, § 55-25; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-123. Removal of a cloud on title; nature of plaintiff’s title.

    When a petition is filed to remove a cloud on the title to real estate, relief shall not be denied the complainant because he has only an equitable title to such real estate and is out of possession, but the court shall grant to the complainant such relief as he would be entitled to if he held the legal title and was in possession. If an issue of fact is raised which but for this section would entitle either party to a trial by jury, the court shall, upon the request of the party so entitled, order such issue to be tried by a jury.

    History. Code 1919, § 6248; Code 1950, § 55-153; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article on title examination in Virginia, see 17 U. Rich. L. Rev. 229 (1983).

    Michie’s Jurisprudence.

    For related discussion, see 15 M.J. Quieting Title, §§ 2, 7, 8, 10, 11.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section made a decided change in the law in regard to suits to quiet title. Kennedy Coal Corp. v. Buckhorn Coal Corp., 140 Va. 37 , 124 S.E. 482 , 1924 Va. LEXIS 155 (1924).

    It extends equity jurisdiction in case of removal of a cloud from title to conditions where the plaintiff is both out of possession and has only an equitable title. United States v. McIntosh, 2 F. Supp. 244, 1932 U.S. Dist. LEXIS 1618 (D. Va. 1932).

    Prior to Acts 1912, p. 76, from which this section was derived, only those who had a complete legal and equitable title to land, accompanied by possession, could invoke the jurisdiction of a court of equity to remove a cloud upon their title. Buchanan Co. v. Heirs of Smyth, 115 Va. 704 , 80 S.E. 794 , 1914 Va. LEXIS 123 (1914).

    Possession is not necessary. —

    Under the provisions of this section it is immaterial whether the complainant in a suit to quiet title is in or out of possession of the land. Kennedy Coal Corp. v. Buckhorn Coal Corp., 140 Va. 37 , 124 S.E. 482 , 1924 Va. LEXIS 155 (1924) (see Buchanan Co. v. Heirs of Smyth, 115 Va. 704 , 80 S.E. 794 (1914); Payne v. Buena Vista Extract Co., 124 Va. 296 , 98 S.E. 34 (1919); Buchanan Coal Co. v. Street, 175 Va. 531 , 9 S.E.2d 339 (1940)).

    It is doubtful whether this statute can be legally effective to expand federal equity jurisdiction to remove a cloud from title to all cases where the plaintiff is both out of possession and has only an equitable title. It could hardly be properly extended to cases where the plaintiff out of possession but with legal title has adequate remedy in an ejectment suit. United States v. McIntosh, 2 F. Supp. 244, 1932 U.S. Dist. LEXIS 1618 (D. Va. 1932).

    A void commissioner’s deed conveying property to a divorced wife constituted a cloud on the husband’s title which a court of equity, under this section, had jurisdiction and power to remove by cancelling and setting aside said deed. Watson v. Mose, 165 Va. 661 , 183 S.E. 428 , 1936 Va. LEXIS 251 (1936).

    As to quieting title involving grants of public lands, see Chapman v. Kite, 130 Va. 70 , 107 S.E. 702 , 1921 Va. LEXIS 142 (1921).

    Settlement of disputes as to title and boundaries. —

    Except when the relief which is authorized by this section is sought, and in the absence of some peculiar equity, courts of equity are without jurisdiction to settle disputes regarding the title and boundaries of land. Duty v. Honaker Lumber Co., 131 Va. 31 , 108 S.E. 863 , 1921 Va. LEXIS 4 (1921); Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 , 1924 Va. LEXIS 171 (1924).

    Judgment lien did not constitute good title to property. —

    Judgment creditor’s action for quiet title failed because the creditor’s claim of superior title failed because the creditor’s judgment lien did not constitute good title to the property, and the creditor cited absolutely no support for the proposition that its claimed interest in the form of a judgment lien that had attached to the property was itself a title to the estate. PEI P'ship Architects, LLC v. Celebrate Va. South, LLC, No. 3:13-CV-48, 2013 U.S. Dist. LEXIS 38030 (E.D. Va. Mar. 19, 2013).

    When there is another remedy. —

    The fact that complainants owned the fee simple title to a tract of land and the mineral rights in an adjacent tract did not deprive them of the right to have the established boundary lines of the adjacent tract fixed and determined by a court of equity, even though, as owners of the fee in the first-mentioned tract, they might have proceeded under §§ 8.01-179 through 8.01-183 , as coterminous owners of the surface with the owners of the surface of the adjacent tract, to have the boundary line between the tracts determined. Buchanan Coal Co. v. Street, 175 Va. 531 , 9 S.E.2d 339, 1940 Va. LEXIS 198 (1940).

    Determination of title as between hostile claims. —

    A court of equity is without jurisdiction in a suit to remove a cloud upon title to determine the question of title as between several independent, distinct and hostile claims. Such an independent and hostile claim, involving the whole property and denying in toto and ab initio the title of the complainants, cannot be set up and adjudicated in a suit in equity. To permit this would authorize an adverse claimant to implead other claimants of the title in such a way as to substitute an equity suit for an action of ejectment. Duty v. Honaker Lumber Co., 131 Va. 31 , 108 S.E. 863 , 1921 Va. LEXIS 4 (1921).

    Recovery of possession. —

    As to jurisdiction under this section of a suit to try title and recover possession from an adverse claimant, see Roller v. Armentrout, 118 Va. 173 , 86 S.E. 906 , 1915 Va. LEXIS 137 (1915), writ of error dismissed, 245 U.S. 642, 38 S. Ct. 221, 62 L. Ed. 527, 1918 U.S. LEXIS 1654 (1918).

    Forfeiture for breach of condition not within section. —

    A suit in equity to annul and rescind a deed for breach of a condition subsequent cannot be treated as a suit to remove a cloud from title where the complainant has neither legal nor equitable title, and therefore does not fall within the class of persons who may bring a suit to quiet title under this section. Until the consummation of the forfeiture, the grantor in a case like this has nothing but a right of action. Pence v. Tidewater Townsite Corp., 127 Va. 447 , 103 S.E. 694 , 1920 Va. LEXIS 63 (1920).

    Relief against fraud and enforcement of trusts. —

    It was never intended, either by this section, or by the cases which have construed it, to deny to a court of equity jurisdiction either to relieve against fraud or to declare and enforce trusts resulting therefrom. Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 , 1924 Va. LEXIS 171 (1924).

    In a suit to remove clouds upon title and to establish a resulting trust, equity had jurisdiction and it was not harmful to deny a jury trial. Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 , 1924 Va. LEXIS 171 (1924).

    Amendment of bill. —

    In a suit involving title to a tract of land, the original bill sought to have a grant from the Commonwealth to appellants cancelled but after the court decided that appellee had failed to prove that the grant had been procured through fraud, the bill was amended so as to pray to have the deed to appellants removed as a cloud upon appellee’s title. It was held that the procedure adopted by the trial court conformed to the provisions of this section. French v. Clinchfield Coal Corp., 171 Va. 211 , 198 S.E. 503 , 1938 Va. LEXIS 274 (1938).

    Article 2. Rule Against Perpetuities.

    § 55.1-124. Uniform Statutory Rule Against Perpetuities.

    1. A nonvested property interest is invalid unless:
      1. When the interest is created, it is certain to vest or terminate no later than 21 years after the death of an individual then alive; or
      2. The interest either vests or terminates within 90 years after its creation.
    2. A general power of appointment not presently exercisable because of a condition precedent is invalid unless:
      1. When the power is created, the condition precedent is certain to be satisfied or becomes impossible to satisfy no later than 21 years after the death of an individual then alive; or
      2. The condition precedent either is satisfied or becomes impossible to satisfy within 90 years after its creation.
    3. A nongeneral power of appointment or a general testamentary power of appointment is invalid unless:
      1. When the power is created, it is certain to be irrevocably exercised or otherwise to terminate no later than 21 years after the death of an individual then alive; or
      2. The power is irrevocably exercised or otherwise terminates within 90 years after its creation.
    4. In determining whether a nonvested property interest or a power of appointment is valid under subdivision A 1, B 1, or C 1, the possibility that a child will be born to an individual after the individual’s death is disregarded.
    5. If, in measuring a period from the creation of a trust or other property arrangement, language in a governing instrument (i) seeks to disallow the vesting or termination of any interest or trust beyond, (ii) seeks to postpone the vesting or termination of any interest or trust until, or (iii) seeks to operate in effect in any similar fashion upon, the later of (a) the expiration of a period of time not exceeding 21 years after the death of the survivor of specified lives in being at the creation of the trust or other property arrangement or (b) the expiration of a period of time that exceeds or might exceed 21 years after the death of the survivor of lives in being at the creation of the trust or other property arrangement, that language is inoperative to the extent it produces a period of time that exceeds 21 years after the death of the survivor of the specified lives.

    History. 2000, c. 714, § 55-12.1; 2019, c. 712.

    Uniform law cross references.

    For other signatory state provisions, see:

    Alabama: Code of Ala. § 35-4A-1 et seq.

    Arkansas: A.C.A. § 18-3-101 et seq.

    California: California Prob. Code §§ 21200 to 21225.

    Colorado: C.R.S. §§ 15-11-1101 to 15-11-1107.

    Connecticut: Conn. Gen. Stat. §§ 45a-490 to 45a-496.

    District of Columbia: D.C. Code §§ 19-901 to 19-907.

    Florida: Fla. Stat. § 689.225.

    Georgia: O.C.G.A. §§ 44-6-200 to 44-6-206.

    Hawaii: H.R.S. §§ 525-1 to 525-6.

    Indiana: Burns Ind. Code §§ 32-17-8-1 to 32-17-8-6.

    Kansas: K.S.A. §§ 59-3401 to 59-3408.

    Massachusetts: Mass. Ann. Laws ch. 184A §§ 1 to 11.

    Michigan: M.C.L.S. §§ 554.71 to 554.78.

    Minnesota: Minn. Stat. §§ 501A.01 to 501A.07.

    Mississippi: Miss. Code Ann. § 89-25-1 et seq.

    Montana: Mont. Code Anno. §§ 72-2-1001 to 72-2-1017.

    Nebraska: R.R.S. Neb §§ 76-2001 to 76-2008.

    Nevada: Nev. Rev. Stat. Ann. §§ 111.103 to 111.1039.

    New Mexico: N.M. Stat. Ann. §§ 45-2-901 to 45-2-906.

    North Carolina: N.C. Gen. Stat. §§ 41-15 to 41-23.

    Oregon: O.R.S. §§ 105.950 to 105.975.

    South Carolina: S.C. Code Ann. §§ 27-6-10 to 27-6-80.

    Tennessee: Tenn. Code Ann. §§ 66-1-201 to 66-1-208.

    Utah: Utah Code Ann. §§ 75-2-1201 to 75-2-1208.

    West Virginia: W. Va. Code §§ 36-1 A-1 to 36-1 A-8.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “The Future of Future Interests,” see 60 Wash. & Lee L. Rev. 513 (2003).

    For article, “Toward a Model Law of Estates and Future Interests,” see 66 Wash. & Lee L. Rev. 3 (2009).

    For annual survey of Virginia law article, “Wills, Trusts, and Estates,” see 47 U. Rich. L. Rev. 343 (2012).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Interpretation of holographic codicil. —

    Although a trust established by a holographic codicil violated the common-law rule against perpetuities and the statutory rule against perpetuities set forth in this section, the court was authorized by § 55-12.3 to reform the disposition of a will in a manner that most closely approximated the testatrix’s plan of distribution. Eubank v. Eubank, 68 Va. Cir. 33, 2005 Va. Cir. LEXIS 86 (Amherst County Apr. 29, 2005).

    Provision inapplicable. —

    Where the contract for the sale of land provided that, if the property was not subdivided by the date of closing, that date was to be extended day-for-day until the sellers’ subdivision and/or adjustment of property lines was approved, the Virginia version of the Uniform Statutory Rule Against Perpetuities under § 55-12.1 was inapplicable because § 55-12.1 did not apply to a nonvested property interest that arose out of a nondonative transfer. Bel-Aire, Inc. v. RB Trexlertown, LLC, 68 Va. Cir. 108, 2005 Va. Cir. LEXIS 138 (Virginia Beach May 24, 2005).

    OFFICIAL COMMENT

    A. General Purpose
    B. Section 1(a)(1): Nonvested Property Interests that are Initially Valid
    C. Section 1(a)(2): Wait-and-See — Nonvested Property Interests whose Validity is Initially in Abeyance
    1. The 90-Year Permissible Vesting Period
    2. Technical Violations of the Common-Law Rule
    D. Sections 1(b)(1) and 1(c)(1): Powers of Appointment that are Initially Valid
    E. Sections 1(b)(2) and 1(c)(2): Wait-and-See — Powers of Appointment whose Validity is Initially in Abeyance
    F. The Validity of the Donee’s Exercise of a Valid Power
    G. Section 1(e): Effect of Certain “Later-of” Type Language; Coordination of Generation-Skipping Transfer Tax Regulations With Uniform Act
    H. Subsidiary Common-Law Doctrines: Whether Superseded by this Act

    Official Comments for Uniform Statutory Rule Against Perpetuities, § 55-12.1 et seq.: Copyright 1990 by the National Conference of Commissioners on Uniform State Laws. Reprinted with permission.

    Common-Law Rule Against Perpetuities Superseded. As provided in Section 9, this Act supersedes the common-law Rule Against Perpetuities (Common-law Rule) in jurisdictions previously adhering to it (or repeals any statutory version or variation thereof previously in effect in the jurisdiction). The Common-law Rule (or the statutory version or variation thereof) is replaced by the Statutory Rule Against Perpetuities (Statutory Rule) set forth in this section and by the other provisions in this Act.

    Subsidiary Doctrines Continue in Force Except to the Extent the Provisions of Act Conflict with Them. The courts in interpreting the Common-law Rule developed several subsidiary doctrines. In accordance with the general principle of statutory construction that statutes in derogation of the common law are to be construed narrowly, a subsidiary doctrine is superseded by this Act only to the extent the provisions of the Act conflict with it. A listing and discussion of such subsidiary doctrines, such as the constructional preference for validity, the all-or-nothing rule for class gifts, and the doctrine of infectious invalidity, appears later, in Part G of this Comment.

    Application. Unless excluded by Section 4, the Statutory Rule Against Perpetuities (Statutory Rule) applies to nonvested property interests and to powers of appointment over property or property interests that are nongeneral powers, general testamentary powers, or general powers not presently exercisable because of a condition precedent.

    The Statutory Rule does not apply to vested property interests (e.g., X’s interest in Example (23) of this Comment) or to presently exercisable general powers of appointment (e.g., G’s power in Example (19) of this Comment; G’s power in Example (1) in the Comment to Section 2; A’s power in Example (2) in the Comment to Section 2; X’s power in Example (3) in the Comment to Section 2; A’s noncumulative power of withdrawal in Example (4) in the Comment to Section 2).

    The Common-law Rule’s Validating and Invalidating Sides. The Common-law Rule Against Perpetuities is a rule of initial validity or invalidity. At common law, a nonvested property interest is either valid or invalid as of its creation. Like most rules of property law, the Common-law Rule has both a validating and an invalidating side. Both sides are derived from John Chipman Gray’s formulation of the Common-law Rule:

    Validating Side of the Common-law Rule. A nonvested property interest is valid when it is created (initially valid) if it is then certain to vest or terminate (fail to vest) — one or the other — no later than 21 years after the death of an individual then alive.

    Invalidating Side of the Common-law Rule. A nonvested property interest is invalid when it is created (initially invalid) if there is no such certainty.

    Notice that the invalidating side focuses on a lack of certainty, which means that invalidity under the Common-law Rule is not dependent on actual post-creation events but only on possible post-creation events. Actual post-creation events are irrelevant, even those that are known at the time of the lawsuit. It is generally recognized that the invalidating side of the Common-law Rule is harsh because it can invalidate interests on the ground of possible post-creation events that are extremely unlikely to happen and that in actuality almost never do happen, if ever.

    The Statutory Rule Against Perpetuities. The essential difference between the Common-law Rule and its statutory replacement is that the Statutory Rule preserves the Common-law Rule’s overall policy of preventing property from being tied up in unreasonably long or even perpetual family trusts or other property arrangements, while eliminating the harsh potential of the Common-law Rule. The Statutory Rule achieves this result by codifying (in slightly revised form) the validating side of the Common-law Rule and modifying the invalidating side by adopting a wait-and-see element. Under the Statutory Rule, interests that would have been initially valid at common law continue to be initially valid, but interests that would have been initially invalid at common law are invalid only if they do not actually vest or terminate within the permissible vesting period set forth in Section 1(a)(2). Thus, the Uniform Act recasts the validating and invalidating sides of the Rule Against Perpetuities as follows:

    As indicated, this modification of the invalidating side of the Common-law Rule is generally known as the wait-and-see method of perpetuity reform. The wait-and-see method of perpetuity reform was approved by the American Law Institute as part of the Restatement (Second) of Property (Donative Transfers)

    §§ 1.1-1.6 (1983). For a discussion of the various methods of perpetuity reform, including the wait-and-see method and the Restatement (Second)’s version of wait-and-see, see Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718 (1983).

    Section 1(a)(1) Codifies the Validating Side of the Common-law Rule. The validating side of the Common-law Rule is codified in Section 1(a)(1) (and, with respect to powers of appointment, in Sections 1(b)(1) and 1(c)(1)).

    A nonvested property interest that satisfies the requirement of Section 1(a)(1) is initially valid. That is, it is valid as of the time of its creation. There is no need to subject such an interest to the waiting period set forth in Section 1(a)(2), nor would it be desirable to do so.

    For a nonvested property interest to be valid as of the time of its creation under Section 1(a)(1), there must then be a certainty that the interest will either vest or terminate — an interest terminates when vesting becomes impossible — no later than 21 years after the death of an individual then alive. To satisfy this requirement, it must be established that there is no possible chain of events that might arise after the interest was created that would allow the interest to vest or terminate after the expiration of the 21-year period following the death of an individual in being at the creation of the interest. Consequently, initial validity under Section 1(a)(1) can be established only if there is an individual for whom there is a causal connection between the individual’s death and the interest’s vesting or terminating no later than 21 years thereafter. The individual described in subsection (a)(1) (and subsections (b)(1) and (c)(1) as well) is often referred to as the “validating life,” the term used throughout the Comments to this Act.

    Determining Whether There is a Validating Life. The process for determining whether a validating life exists is to postulate the death of each individual connected in some way to the transaction, and ask the question: Is there with respect to this individual an invalidating chain of possible events? If one individual can be found for whom the answer is No, that individual can serve as the validating life. As to that individual there will be the requisite causal connection between his or her death and the questioned interest’s vesting or terminating no later than 21 years thereafter.

    In searching for a validating life, only individuals who are connected in some way to the transaction need to be considered, for they are the only ones who have a chance of supplying the requisite causal connection. Such individuals vary from situation to situation, but typically include the beneficiaries of the disposition, including the taker or takers of the nonvested property interest, and individuals related to them by blood or adoption, especially in the ascending and descending lines. There is no point in even considering the life of an individual unconnected to the transaction — an individual from the world at large who happens to be in being at the creation of the interest. No such individual can be a validating life because there will be an invalidating chain of possible events as to every unconnected individual who might be proposed: Any such individual can immediately die after the creation of the nonvested property interest without causing any acceleration of the interest’s vesting or termination. (The life expectancy of any unconnected individual, or even the probability that one of a number of new-born babies will live a long life, is irrelevant.)

    Example (1) — Parent of Devisees as the Validating Life. G devised property “to A for life, remainder to A’s children who attain 21.” G was survived by his son (A), by his daughter (B), by A’s wife (W), and by A’s two children (X and Y).

    The nonvested property interest in favor of A’s children who reach 21 satisfies Section 1(a)(1)’s requirement, and the interest is initially valid. When the interest was created (at G’s death), the interest was then certain to vest or terminate no later than 21 years after A’s death.

    The Rule of Subsection (d). The rule established in subsection (d) plays a significant role in the search for a validating life. Subsection (d) declares that the possibility that a child will be born to an individual after the individual’s death is to be disregarded. It is important to note that this rule applies only for the purposes of determining the validity of an interest (or power of appointment) under paragraph (1) of subsection (a), (b), or (c). The rule of subsection (d) does not apply, for example, to questions such as whether or not a child who is born to an individual after the individual’s death qualifies as a taker of a beneficial interest — as a member of a class or otherwise. Neither subsection (d), nor any other provision of this Act, supersedes the widely accepted common-law principle, sometimes codified, that a child in gestation (a child sometimes described as a child en ventre sa mere ) who is later born alive is regarded as alive at the commencement of gestation.

    The limited purpose of subsection (d) is to solve a perpetuity problem caused by advances in medical science. The problem is illustrated by a case such as Example (1), above — “to A for life, remainder to A’s children who reach 21.” When the Common-law Rule was developing, the possibility was recognized, strictly speaking, that one or more of A’s children might reach 21 more than 21 years after A’s death. The possibility existed because A’s wife (who might not be a life in being) might be pregnant when A died. If she was, and if the child was born viable a few months after A’s death, the child could not reach his or her 21st birthday within 21 years after A’s death. The device then invented to validate the interest of A’s children was to “extend” the allowable perpetuity period by tacking on a period of gestation, if needed. As a result, the common-law perpetuity period was comprised of three components: (1) a life in being (2) plus 21 years (3) plus a period of gestation, when needed. Today, thanks to sperm banks, frozen embryos, and even the possibility of artificially maintaining the body functions of deceased pregnant women long enough to develop the fetus to viability (see Detroit Free Press, July 31, 1986, at 5A; Ann Arbor News, Oct. 30, 1978, at C5 (AP story); N.Y. Times, Dec. 6, 1977, at 30; N.Y. Times, Dec. 2, 1977, at B16) — advances in medical science unanticipated when the Common-law Rule was in its developmental stages — having a pregnant wife at death is no longer the only way of having children after death. These medical developments, and undoubtedly others to come, make the mere addition of a period of gestation inadequate as a device to confer initial validity under Section 1(a)(1) on the interest of A’s children in the above example. The rule of subsection (d), however, does insure the initial validity of the children’s interest. Disregarding the possibility that children of A will be born after his death allows A to be the validating life. None of his children, under this assumption, can reach 21 more than 21 years after his death.

    Note that subsection (d) subsumes not only the case of children conceived after death, but also the more conventional case of children in gestation at death. With subsection (d) in place, the third component of the common-law perpetuity period is unnecessary and has been jettisoned. The perpetuity period recognized in paragraph (1) of subsections (a), (b), and (c) has only two components: (1) a life in being (2) plus 21 years.

    As to the legal status of conceived-after-death children, that question has not yet been resolved. For example, if in Example (1) it in fact turns out that A does leave sperm on deposit at a sperm bank and if in fact A’s wife does become pregnant as a result of artificial insemination, the child or children produced thereby might not be included at all in the class gift. Cf. Restatement (Second) of Property (Donative Transfers) Introductory Note to Ch. 26 at pp. 2-3 (Tent. Draft No. 9, 1986). Without trying to predict how that matter will be settled in the future, the best way to handle the problem from the perpetuity perspective is subsection (d)’s rule requiring the possibility of post-death children to be disregarded.

    Recipients as Their Own Validating Lives. It is well established at common law that, in appropriate cases, the recipient of an interest can be his or her own validating life. See, e.g., Rand v. Bank of California, 236 Or. 619, 388 P.2d 437 (1964). Given the right circumstances, this principle can validate interests that are contingent on the recipient’s reaching an age in excess of 21, or are contingent on the recipient’s surviving a particular point in time that is or might turn out to be in excess of 21 years after the interest was created or after the death of a person in being at the date of creation.

    Example (2) — Devisees as Their Own Validating Lives. G devised real property “to A’s children who attain 25.” A predeceased G. At G’s death, A had three living children, all of whom were under 25.

    The nonvested property interest in favor of A’s children who attain 25 is validated by Section 1(a)(1). Under subsection (d), the possibility that A will have a child born to him after his death (and since A predeceased G, after G’s death) must be disregarded. Consequently, even if A’s wife survived G, and even if she was pregnant at G’s death or even if A had deposited sperm in a sperm bank prior to his death, it must be assumed that all of A’s children are in being at G’s death. A’s children are, therefore, their own validating lives. (Note that subsection (d) requires that in determining whether an individual is a validating life, the possibility that a child will be born to “an” individual after the individual’s death must be disregarded. The validating life and the individual whose having a post-death child is disregarded need not be the same individual.) Each one of A’s children, all of whom under subsection (d) are regarded as alive at G’s death, will either reach the age of 25 or fail to do so within his or her own lifetime. To say this another way, it is certain to be known no later than at the time of the death of each child whether or not that child survived to the required age.

    Validating Life Can Be Survivor of Group. In appropriate cases, the validating life need not be individualized at first. Rather the validating life can initially (i.e., when the interest was created) be the unidentified survivor of a group of individuals. It is common in such cases to say that the members of the group are the validating lives, but the true meaning of the statement is that the validating life is the member of the group who turns out to live the longest. As the court said in Skatterwood v. Edge, 1 Salk. 229, 91 Eng. Rep. 203 (K.B. 1697), “for let the lives be never so many, there must be a survivor, and so it is but the length of that life; for Twisden used to say, the candles were all lighted at once.”

    Example (3) — Case of Validating Life Being the Survivor of a Group. G devised real property “to such of my grandchildren as attain 21.” Some of G’s children are living at G’s death.

    The nonvested property interest in favor of G’s grandchildren who attain 21 is valid under Section 1(a)(1). The validating life is that one of G’s children who turns out to live the longest. Since under subsection (d), it must be assumed that none of G’s children will have post-death children, it is regarded as impossible for any of G’s grandchildren to be alive and under 21 beyond the 21-year period following the death of G’s last surviving child.

    Different Validating Lives Can and in Some Cases Must Be Used. Dispositions of property sometimes create more than one nonvested property interest. In such cases, the validity of each interest is treated individually. A validating life that validates one interest might or might not validate the other interests. Since it is not necessary that the same validating life be used for all interests created by a disposition, the search for a validating life for each of the other interests must be undertaken separately.

    Perpetuity Saving Clauses and Similar Provisions. Knowledgeable lawyers almost routinely insert perpetuity saving clauses into instruments they draft. Saving clauses contain two components, the first of which is the perpetuity-period component. This component typically requires the trust or other arrangement to terminate no later than 21 years after the death of the last survivor of a group of individuals designated therein by name or class. (The lives of corporations, animals, or sequoia trees cannot be used.) The second component of saving clauses is the gift-over component. This component expressly creates a gift over that is guaranteed to vest at the termination of the period set forth in the perpetuity-period component, but only if the trust or other arrangement has not terminated earlier in accordance with its other terms.

    It is important to note that regardless of what group of individuals is designated in the perpetuity-period component of a saving clause, the surviving member of the group is not necessarily the individual who would be the validating life for the nonvested property interest or power of appointment in the absence of the saving clause. Without the saving clause, one or more interests or powers may in fact fail to satisfy the requirement of paragraph (1) of subsections (a), (b), or (c) for initial validity. By being designated in the saving clause, however, the survivor of the group becomes the validating life for all interests and powers in the trust or other arrangement: The saving clause confers on the last surviving member of the designated group the requisite causal connection between his or her death and the impossibility of any interest or power in the trust or other arrangement remaining in existence beyond the 21-year period following such individual’s death.

    Example (6) — Valid Saving Clause Case. A testamentary trust directs income to be paid to the testator’s children for the life of the survivor, then to the testator’s grandchildren for the life of the survivor, corpus on the death of the testator’s last living grandchild to such of the testator’s descendants as the last living grandchild shall by will appoint; in default of appointment, to the testator’s then-living descendants, per stirpes. A saving clause in the will terminates the trust, if it has not previously terminated, 21 years after the death of the testator’s last surviving descendant who was living at the testator’s death. The testator was survived by children.

    In the absence of the saving clause, the nongeneral power of appointment in the last living grandchild and the nonvested property interest in the gift-in-default clause in favor of the testator’s descendants fail the test of Sections 1(a)(1) and 1(c)(1) for initial validity. That is, were it not for the saving clause, there is no validating life. However, the surviving member of the designated group becomes the validating life, so that the saving clause does confer initial validity on the nongeneral power of appointment and on the nonvested property interest under Sections 1(a)(1) and 1(c)(1).

    If the governing instrument designates a group of individuals that would cause it to be impracticable to determine the death of the survivor, the common-law courts have developed the doctrine that the validity of the nonvested property interest or power of appointment is determined as if the provision in the governing instrument did not exist. See cases cited in Restatement (Second) of Property (Donative Transfers) (1983), Reporter’s Note No. 3 at p. 45. See also Restatement (Second) of Property (Donative Transfers) § 1.3(1) Comment a (1983); Restatement of Property § 374 and Comment l (1944); 6 American Law of Property § 24.13 (A. Casner ed. 1952); 5A R. Powell, The Law of Real Property Para. 766[5] (1985); L. Simes & A. Smith, The Law of Future Interests § 1223 (2d ed. 1956). If, for example, the designated group in Example (6) were the residents of X City (or the members of Y Country Club) living at the time of the testator’s death, the saving clause would not validate the power of appointment or the nonvested property interest. Instead, the validity of the power of appointment and the nonvested property interest would be determined as if the provision in the governing instrument did not exist. Since without the saving clause the power of appointment and the nonvested property interest would fail to satisfy the requirements of Sections 1(a)(1) and 1(c)(1) for initial validity, their validity would be governed by Sections 1(a)(2) and 1(c)(2).

    The application of the above common-law doctrine, which is not superseded by this Act and so remains in full force, is not limited to saving clauses. It also applies to trusts or other arrangements where the period thereof is directly linked to the life of the survivor of a designated group of individuals. An example is a trust to pay the income to the grantor’s descendants from time to time living, per stirpes, for the period of the life of the survivor of a designated group of individuals living when the nonvested property interest or power of appointment in question was created, plus the 21-year period following the survivor’s death; at the end of the 21-year period, the corpus is to be divided among the grantor’s then-living descendants, per stirpes, and if none, to the XYZ Charity. If the group of individuals so designated is such that it would be impracticable to determine the death of the survivor, the validity of the disposition is determined as if the provision in the governing instrument did not exist. The term of the trust is therefore governed by the 90- year permissible vesting period of paragraph (2) of subsections (a), (b), or (c) of the Statutory Rule.

    Additional references. Restatement (Second) of Property (Donative Transfers) § 1.3(1) (1983), and the Comments thereto; Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718, 1720-1726 (1983).

    1. The 90-Year Permissible Vesting Period

    Since a wait-and-see rule against perpetuities, unlike the Common-law Rule, makes validity or invalidity turn on actual post-creation events, it requires that an actual period of time be measured off during which the contingencies attached to an interest are allowed to work themselves out to a final resolution. The Statutory Rule Against Perpetuities establishes a permissible vesting period of 90 years. Nonvested property interests that have neither vested nor terminated at the expiration of the 90-year permissible vesting period become invalid.

    As explained in the Prefatory Note, the permissible vesting period of 90 years is not an arbitrarily selected period of time. On the contrary, the 90-year period represents a reasonable approximation of — a proxy for — the period of time that would, on average, be produced through the use of an actual set of measuring lives identified by statute and then adding the traditional 21-year tack-on period after the death of the survivor.

    2. Technical Violations of the Common-Law Rule

    One of the harsh aspects of the invalidating side of the Common-Law Rule, against which the adoption of the wait-and-see element in Section 1(a)(2) is designed to relieve, is that nonvested property interests at common law are invalid even though the invalidating chain of possible events almost certainly will not happen. In such cases, the violation of the Common-law Rule could be said to be merely technical. Nevertheless, at common law, the nonvested property interest is invalid.

    Cases of technical violation fall generally into discrete categories, identified and named by Professor Leach in Perpetuities in a Nutshell, 51 Harv.L.Rev. 638 (1938), as the fertile octogenarian, the administrative contingency, and the unborn widow. The following three examples illustrate how Section 1(a)(2) affects these categories.

    Example (7) — Fertile Octogenarian Case. G devised property in trust, directing the trustee to pay the net income therefrom “to A for life, then to A’s children for the life of the survivor, and upon the death of A’s last surviving child to pay the corpus of the trust to A’s grandchildren.” G was survived by A (a female who had passed menopause) and by A’s two adult children (X and Y).

    The remainder interest in favor of G’s grandchildren would be invalid at common law, and consequently is not validated by Section 1(a)(1). There is no validating life because, under the common law’s conclusive presumption of lifetime fertility, which is not superseded by this Act (see Part H, below), A might have a third child (Z), conceived and born after G’s death, who will have a child conceived and born more than 21 years after the death of the survivor of A, X, and Y.

    Age Contingencies in Excess of 21. Another category of technical violation of the Common-Law Rule arises in cases of age contingencies in excess of 21 where the takers cannot be their own validating lives (unlike Example (2), above). The violation of the Common-law Rule falls into the technical category because the insertion of a saving clause would in almost all cases allow the disposition to be carried out as written. In effect, the Statutory Rule operates like the perpetuity-period component of a saving clause.

    Example (10) — Age Contingency in Excess of 21 Case. G devised property in trust, directing the trustee to pay the income “to A for life, then to A’s children; the corpus of the trust is to be equally divided among A’s children who reach the age of 30.” G was survived by A, by A’s spouse (H), and by A’s two children (X and Y), both of whom were under the age of 30 when G died.

    The remainder interest in favor of A’s children who reach 30 is a class gift. At common law, the interests of all potential class members must be valid or the class gift is totally invalid. Leake v. Robinson, 2 Mer. 363, 35 Eng. Rep. 979 (Ch. 1817). This Act does not supersede the all-or-nothing rule for class gifts (see Part G, below), and so the all-or-nothing rule continues to apply under this Act. Although X and Y will either reach 30 or die under 30 within their own lifetimes, there is at G’s death the possibility that A will have an afterborn child (Z) who will reach 30 or die under 30 more than 21 years after the death of the survivor of A, H, X, and Y. The class gift would be invalid at common law and consequently is not validated by Section 1(a)(1).

    The various persons connected to a power of appointment are identified by a special terminology. The “donor” is the person who created the power of appointment. The “donee” is the person who holds the power of appointment, i.e., the powerholder. The “objects” are the persons to whom an appointment can be made. The “appointees” are the persons to whom an appointment has been made. The “takers in default” are the persons whose property interests are subject to being defeated by the exercise of the power of appointment and who take the property to the extent the power is not effectively exercised. Restatement (Second) of Property (Donative Transfers) § 11.2 (1986).

    A power of appointment is “general” if it is exercisable in favor of the donee of the power, the donee’s creditors, the donee’s estate, or the creditors of the donee’s estate. A power of appointment that is not general is a “nongeneral” power of appointment. Restatement (Second) of Property (Donative Transfers) § 11.4 (1986).

    A power of appointment is “presently exercisable” if, at the time in question, the donee can by an exercise of the power create an interest in or a power of appointment over the appointive property. Restatement (Second) of Property (Donative Transfers) § 11.5 (1986). A power of appointment is “testamentary” if the donee can exercise it only in the donee’s will. Restatement of Property § 321 (1940). A power of appointment is “not presently exercisable because of a condition precedent” if the only impediment to its present exercisability is a condition precedent, i.e., the occurrence of some uncertain event. Since a power of appointment terminates on the donee’s death, a deferral of a power’s present exercisability until a future time (even a time certain) imposes a condition precedent that the donee be alive at that future time.

    A power of appointment is a “fiduciary” power if it is held by a fiduciary and is exercisable by the fiduciary in a fiduciary capacity. A power of appointment that is exercisable in an individual capacity is a “nonfiduciary” power. As used in this Act, the term “power of appointment” refers to “fiduciary” and to “nonfiduciary” powers, unless the context indicates otherwise.

    Although Gray’s formulation of the Common-law Rule Against Perpetuities does not speak directly of powers of appointment, the Common-law Rule is applicable to powers of appointment (other than presently exercisable general powers of appointment). The principle of subsections (b)(1) and (c)(1) is that a power of appointment that satisfies the Common-law Rule Against Perpetuities is valid under the Statutory Rule Against Perpetuities, and consequently it can be validly exercised, without being subjected to a waiting period during which the power’s validity is in abeyance.

    Two different tests for validity are employed at common law, depending on what type of power is at issue. In the case of a nongeneral power (whether or not presently exercisable) and in the case of a general testamentary power, the power is initially valid if, when the power was created, it is certain that the latest possible time that the power can be exercised is no later than 21 years after the death of an individual then in being. In the case of a general power not presently exercisable because of a condition precedent, the power is initially valid if it is then certain that the condition precedent to its exercise will either be satisfied or become impossible to satisfy no later than 21 years after the death of an individual then in being. Subsections (b)(1) and (c)(1) codify these rules. Under either test, initial validity depends on the existence of a validating life. The procedure for determining whether a validating life exists is essentially the same procedure explained in Part B, above, pertaining to nonvested property interests.

    Example (11) — Initially Valid General Testamentary Power Case. G devised property “to A for life, remainder to such persons, including A’s estate or the creditors of A’s estate, as A shall by will appoint.” G was survived by his daughter (A).

    A’s power, which is a general testamentary power, is valid as of its creation under Section 1(c)(1). The test is whether or not the power can be exercised beyond 21 years after the death of an individual in being when the power was created (G’s death). Since A’s power cannot be exercised after A’s death, the validating life is A, who was in being at G’s death.

    Sections 1(b)(2) and 1(c)(2), by adopting the wait-and-see method of perpetuity reform, shift the ground of invalidity from possible to actual post-creation events. Under these subsections, a power of appointment that would have violated the Common-law Rule, and therefore fails the subsection (b)(1) or (c)(1) tests for initial validity, is nevertheless not invalid as of the time of its creation. Instead, its validity is in abeyance. A general power not presently exercisable because of a condition precedent is invalid only if in actuality the condition neither is satisfied nor becomes impossible to satisfy within the 90-year permissible vesting period. A nongeneral power or a general testamentary power is invalid only if in actuality it does not terminate (by irrevocable exercise or otherwise) within the 90-year permissible period.

    Example (14) — General Testamentary Power Case. G devised property “to A for life, then to A’s first born child for life, then to such persons, including the estate or the creditors of the estate of A’s first born child, as A’s first born child shall by will appoint; in default of appointment, to G’s grandchildren in equal shares.” G was survived by his daughter (A), who was then childless, and by his son (B), who had two children (X and Y).

    Since the general testamentary power conferred on A’s first born child fails the test of Section 1(c)(1) for initial validity, its validity is governed by Section 1(c)(2). If A has a child, such child’s death must occur within 90 years of G’s death for any provision in the child’s will purporting to exercise the power to be valid.

    Fiduciary Powers. Purely administrative fiduciary powers are excluded from the Statutory Rule under Sections 4(2) and (3), but the only distributive fiduciary power that is excluded is the power described in Section 4(4). Otherwise, distributive fiduciary powers are subject to the Statutory Rule. Such powers are usually nongeneral powers.

    Example (17) — Trustee’s Discretionary Powers Over Income and Corpus. G devised property in trust, the terms of which were that the trustee was authorized to accumulate the income or pay it or a portion of it out to A during A’s lifetime; after A’s death, the trustee was authorized to accumulate the income or to distribute it in equal or unequal shares among A’s children until the death of the survivor; and on the death of A’s last surviving child to pay the corpus and accumulated income (if any) to B. The trustee was also granted the discretionary power to invade the corpus on behalf of the permissible recipient or recipients of the income.

    The trustee’s nongeneral powers to invade corpus and to accumulate or spray income among A’s children are not excluded by Section 4(4), nor are they initially valid under Section 1(c)(1). Their validity is, therefore, governed by Section 1(c)(2). Both powers become invalid thereunder, and hence no longer exercisable, 90 years after G’s death.

    Example (18) — Exercise of a Nongeneral Power of Appointment. G was the life income beneficiary of a trust and the donee of a nongeneral power of appointment over the succeeding remainder interest, exercisable in favor of M’s descendants (except G). The trust was created by the will of G’s mother, M, who predeceased him. G exercised his power by his will, directing the income to be paid after his death to his brother B’s children for the life of the survivor, and upon the death of B’s last surviving child, to pay the corpus of the trust to B’s grandchildren. B predeceased M; B was survived by his two children, X and Y, who also survived M and G.

    G’s power and his appointment are valid. The power and the appointed interests were created at M’s death when the power was created, not on G’s death when it was exercised. See Section 2. G’s power passes Section 1(c)(1)’s test for initial validity: G himself is the validating life. G’s appointment also passes Section 1(a)(1)’s test for initial validity: Since B was dead at M’s death, the validating life is the survivor of B’s children, X and Y.

    Common-Law “Second-look” Doctrine. As indicated above, both at common law and under this Act (except for purposes of Section 5 only, as explained in the Comment to Section 5), appointed interests and powers established by the exercise of a general testamentary power or a nongeneral power are created when the power was created, not when the power was exercised. In applying this principle, the common law recognizes a so-called doctrine of second look, under which the facts existing on the date of the exercise are taken into account in determining the validity of appointed interests and appointed powers. E.g., Warren’s Estate, 320 Pa. 112, 182 A. 396 (1930); In re Estate of Bird, 225 Cal.App.2d 196, 37 Cal.Rptr. 288 (1964). The common-law’s second-look doctrine in effect constitutes a limited wait-and-see doctrine, and is therefore subsumed under but not totally superseded by this Act. The following example, which is a variation of Example (18) above, illustrates how the second-look doctrine operates at common law and how the situation would be analyzed under this Act.

    Example (21) — Second-look Case. G was the life income beneficiary of a trust and the donee of a nongeneral power of appointment over the succeeding remainder interest, exercisable in favor of G’s descendants. The trust was created by the will of his mother, M, who predeceased him. G exercised his power by his will, directing the income to be paid after his death to his children for the life of the survivor, and upon the death of his last surviving child, to pay the corpus of the trust to his grandchildren. At M’s death, G had two children, X and Y. No further children were born to G, and at his death X and Y were still living.

    The common-law solution of this example is as follows: G’s appointment is valid under the Common-law Rule. Although the period of the Rule begins to run at M’s death, the facts existing at G’s death can be taken into account. This second look at the facts discloses that G had no additional children. Thus the possibility of additional children, which existed at M’s death when the period of the Rule began to run, is disregarded. The survivor of X and Y, therefore, becomes the validating life for the remainder interest in favor of G’s grandchildren, and G’s appointment is valid. The common-law’s second-look doctrine would not, however, save G’s appointment if he actually had one or more children after M’s death and if at least one of these after-born children survived G.

    Additional References. Restatement (Second) of Property (Donative Transfers) § 1.2, Comments d, f, g, and h; § 1.3, Comment g; § 1.4, Comment l (1983).

    In general, perpetuity saving or termination clauses can be used in either of two ways. The predominant use of such clauses is as an override clause. That is, the clause is not an integral part of the dispositive terms of the trust, but operates independently of the dispositive terms; the clause provides that all interests must vest no later than at a specified time in the future, and sometimes also provides that the trust must then terminate, but only if any interest has not previously vested or if the trust has not previously terminated. The other use of such a clause is as an integral part of the dispositive terms of the trust; that is, the clause is the provision that directly regulates the duration of the trust. Traditional perpetuity saving or termination clauses do not use a “later-of” approach; they mark off the maximum time of vesting or termination only by reference to a 21-year period following the death of the survivor of specified lives in being at the creation of the trust.

    Section 1(e) applies to a non-traditional clause called a “later-of” (or “longer-of”) clause. Such a clause might provide that the maximum time of vesting or termination of any interest or trust must occur no later than the later of (A) 21 years after the death of the survivor of specified lives in being at the creation of the trust or (B) 90 years after the creation of the trust.

    Under the Uniform Act as originally promulgated, this type of “later-of” clause would not achieve a “later-of” result. If used as an override clause in conjunction with a trust whose terms were, by themselves, valid under the Common-law Rule, the “later-of” clause did no harm. The trust would be valid under the Common-law Rule as codified in Section 1(a)(1) because the clause itself would neither postpone the vesting of any interest nor extend the duration of the trust. But, if used either (1) as an override clause in conjunction with a trust whose terms were not valid under the Common-law Rule or (2) as the provision that directly regulated the duration of the trust, the “later-of” clause would not cure the perpetuity violation in case (1) and would create a perpetuity violation in case (2). In neither case would the clause qualify the trust for validity at common law under Section 1(a)(1) because the clause would not guarantee that all interests will be certain to vest or terminate no later than 21 years after the death of an individual then alive. ** In any given case, 90 years can turn out to be longer than the period produced by the specified-lives-in-being-plus-21-years language. **

    Because the clause would fail to qualify the trust for validity under the Common-law Rule of Section 1(a)(1), the nonvested interests in the trust would be subject to the wait-and-see element of Section 1(a)(2) and vulnerable to a reformation suit under Section 3. Under Section 1(a)(2), an interest that is not valid at common law is invalid unless it actually vests or terminates within 90 years after its creation. Section 1(a)(2) does not grant such nonvested interests a permissible vesting period of either 90 years or a period of 21 years after the death of the survivor of specified lives in being. Section 1(a)(2) only grants such interests a period of 90 years in which to vest.

    The operation of Section 1(a), as outlined above, is also supported by perpetuity policy. If Section 1(a) allowed a “later-of” clause to achieve a “later-of” result, it would authorize an improper use of the 90-year permissible vesting period of Section 1(a)(2). The 90-year period of Section 1(a)(2) is designed to approximate the period that, on average, would be produced by using actual lives in being plus 21 years. Because in any given case the period actually produced by lives in being plus 21 years can be shorter or longer than 90 years, an attempt to utilize a 90-year period in a “later-of” clause improperly seeks to turn the 90-year average into a minimum.

    Set against this background, the addition of Section 1(e) is quite beneficial. Section 1(e) limits the effect of this type of “later-of” language to 21 years after the death of the survivor of the specified lives, in effect transforming the clause into a traditional perpetuity saving/termination clause. By doing so, Section 1(e) grants initial validity to the trust under the Common-law Rule as codified in Section 1(a)(1) and precludes a reformation suit under Section 3.

    Note that Section 1(e) covers variations of the “later-of” clause described above, such as a clause that postpones vesting until the later of (A) 20 years after the death of the survivor of specified lives in being or (B) 89 years. Section 1(e) does not, however, apply to all dispositions that incorporate a “later-of” approach. To come under Section 1(e), the specified-lives prong must include a tack-on period of up to 21 years. Without a tack-on period, a “later-of” disposition, unless valid at common law, comes under Section 1(a)(2) and is given 90 years in which to vest. An example would be a disposition that creates an interest that is to vest upon “the later of the death of my widow or 30 years after my death.”

    Coordination of the Federal Generation-Skipping Transfer Tax with the Uniform Statutory Rule. In 1990, the Treasury Department announced a decision to coordinate the tax regulations under the “grandfathering” provisions of the federal generation-skipping transfer tax with the Uniform Act. Letter from Michael J. Graetz, Deputy Assistant Secretary of the Treasury (Tax Policy), to Lawrence J. Bugge, President, National Conference of Commissioners on Uniform State Laws (Nov. 16, 1990) (hereinafter Treasury Letter ).

    Section 1433(b)(2) of the Tax Reform Act of 1986 generally exempts (“grandfathers”) trusts from the federal generation-skipping transfer tax that were irrevocable on September 25, 1985. This section adds, however, that the exemption shall apply “only to the extent that such transfer is not made out of corpus added to the trust after September 25, 1985.” The provisions of Section 1433(b)(2) were first implemented by Temp. Treas. Reg. § 26.2601-1, promulgated by T.D. 8187 on March 14, 1988. Insofar as the Uniform Act is concerned, a key feature of that temporary regulation is the concept that the statutory reference to “corpus added to the trust after September 25, 1985” not only covers actual post-9/25/85 transfers of new property or corpus to a grandfathered trust but “constructive” additions as well. Under the temporary regulation as first promulgated, a “constructive” addition occurs if, after 9/25/85, the donee of a nongeneral power of appointment exercises that power “in a manner that may postpone or suspend the vesting, absolute ownership or power of alienation of an interest in property for a period, measured from the date of creation of the trust, extending beyond any life in being at the date of creation of the trust plus a period of 21 years. If a power is exercised by creating another power it will be deemed to be exercised to whatever extent the second power may be exercised.” Temp. Treas. Reg. § 26.2601- 1(b)(1)(v)(B)(2) (1988).

    Because the Uniform Act was promulgated in 1986 and applies only prospectively, any “grandfathered” trust would have become irrevocable prior to the enactment of the Uniform Act in any state. Nevertheless, the second sentence of Section 5(a) extends the wait-and-see approach to post-effective-date exercises of nongeneral powers even if the power itself was created prior to the effective date of the Uniform Act in any state. Consequently, a post-effective-date exercise of a nongeneral power of appointment created in a “grandfathered” trust could come under the provisions of the Uniform Act.

    The literal wording, then, of Temp. Treas. Reg. § 26.2601-1(b)(1)(v)(B)(2) (1988), as first promulgated, could have jeopardized the grandfathered status of an exempt trust if (1) the trust created a nongeneral power of appointment, (2) the donee exercised that nongeneral power, and (3) the Uniform Act is the perpetuity law applicable to the donee’s exercise. This possibility arose not only because the donee’s exercise itself might come under the 90-year permissible vesting period of Section 1(a)(2) if it otherwise violated the Common-law Rule and hence was not validated under Section 1(a)(1). The possibility also arose in a less obvious way if the donee’s exercise created another nongeneral power. The last sentence of the temporary regulation states that “if a power is exercised by creating another power it will be deemed to be exercised to whatever extent the second power may be exercised.”

    In late March 1990, the National Conference of Commissioners on Uniform State Laws (NCCUSL) filed a formal request with the Treasury Department asking that measures be taken to coordinate the regulation with the Uniform Act. By the Treasury Letter referred to above, the Treasury Department responded by stating that it “will amend the temporary regulations to accommodate the 90-year period under USRAP as originally promulgated [in 1986] or as amended [in 1990 by the addition of subsection (e)].” This should effectively remove the possibility of loss of grandfathered status under the Uniform Act merely because the donee of a nongeneral power created in a grandfathered trust inadvertently exercises that power in violation of the Common-law Rule or merely because the donee exercises that power by creating a second nongeneral power that might, in the future, be inadvertently exercised in violation of the Common-law Rule.

    The Treasury Letter states, however, that any effort by the donee of a nongeneral power in a grandfathered trust to obtain a “later-of” specified-lives-in-being-plus-21-years or 90-years approach will be treated as a constructive addition, unless that effort is nullified by state law. As explained above, the Uniform Act, as originally promulgated in 1986 or as amended in 1990 by the addition of Section 1(e), nullifies any direct effort to obtain a “later-of” approach by the use of a “later-of” clause.

    The Treasury Letter states that an indirect effort to obtain a “later-of” approach would also be treated as a constructive addition that would bring grandfathered status to an end, unless the attempt to obtain the later-of approach is nullified by state law. The Treasury Letter indicates that an indirect effort to obtain a “later-of” approach could arise if the donee of a nongeneral power successfully attempts to prolong the duration of a grandfathered trust by switching from a specified-lives-in-being-plus-21-years perpetuity period to a 90-year perpetuity period, or vice versa. Donees of nongeneral powers in grandfathered trusts would therefore be well advised to resist any temptation to wait until it becomes clear or reasonably predictable which perpetuity period will be longer and then make a switch to the longer period if the governing instrument creating the power utilized the shorter period. No such attempted switch and no constructive addition will occur if in each instance a traditional specified-lives-in-being-plus-21-years perpetuity saving clause is used.

    Any such attempted switch is likely in any event to be nullified by state law and, if so, the attempted switch will not be treated as a constructive addition. For example, suppose that the original grandfathered trust contained a standard perpetuity saving clause declaring that all interests in the trust must vest no later than 21 years after the death of the survivor of specified lives in being. In exercising a nongeneral power created in that trust, any indirect effort by the donee to obtain a “later-of” approach by adopting a 90-year perpetuity saving clause will likely be nullified by Section 1(e). If that exercise occurs at a time when it has become clear or reasonably predictable that the 90-year period will prove longer, the donee’s exercise would constitute language in a governing instrument that seeks to operate in effect to postpone the vesting of any interest until the later of the specified-lives-in-being-plus-21-years period or 90 years. Under Section 1(e), “that language is inoperative to the extent it produces a period of time that exceeds 21 years after the death of the survivor of the specified lives.”

    Quite apart from Section 1(e), the relation-back doctrine generally recognized in the exercise of nongeneral powers stands as a doctrine that could potentially be invoked to nullify an attempted switch from one perpetuity period to the other perpetuity period. Under that doctrine, interests created by the exercise of a nongeneral power are considered created by the donor of that power. See, e.g., Restatement (Second) of Property, Donative Transfers § 11.1 comment b (1986). As such, the maximum vesting period applicable to interests created by the exercise of a nongeneral power would apparently be covered by the perpetuity saving clause in the document that created the power, notwithstanding any different period the donee purports to adopt.

    Constructional Preference for Validity. Professor Gray in his treatise on the Common-law Rule Against Perpetuities declared that a will or deed is to be construed without regard to the Rule, and then the Rule is to be “remorselessly” applied to the provisions so construed. J. Gray, The Rule Against Perpetuities § 629 (4th ed. 1942). Some courts may still adhere to this proposition. Colorado Nat’l Bank v. McCabe, 143 Colo. 21, 353 P.2d 385 (1960). Most courts, it is believed, would today be inclined to adopt the proposition put by the Restatement of Property § 375 (1944), which is that where an instrument is ambiguous — that is, where it is fairly susceptible to two or more constructions, one of which causes a Rule violation and the other of which does not — the construction that does not result in a Rule violation should be adopted. Cases supporting this view include Southern Bank & Trust Co. v. Brown, 271 S.C. 260, 246 S.E.2d 598 (1978); Davis v. Rossi, 326 Mo. 911, 34 S.W.2d 8 (1930); Watson v. Goldthwaite, 184 N.E.2d 340, 343 (Mass. 1962); Walker v. Bogle, 244 Ga. 439, 260 S.E.2d 338 (1979); Drach v. Ely, 703 P.2d 746 (Kan. 1985).

    The constructional preference for validity is not superseded by this Act, but its role is likely to be different. The situation is likely to be that one of the constructions to which the ambiguous instrument is fairly susceptible would result in validity under Section 1(a)(1), 1(b)(1), or 1(c)(1), but the other construction does not necessarily result in invalidity; rather it results in the interest’s validity being governed by Section 1(a)(2), 1(b)(2), or 1(c)(2). Nevertheless, even though the result of adopting the other construction is not as harsh as it is at common law, it is expected that the courts will incline toward the construction that validates the disposition under Section 1(a)(1), 1(b)(1), or 1(c)(1).

    Conclusive Presumption of Lifetime Fertility. At common law, all individuals — regardless of age, sex, or physical condition — are conclusively presumed to be able to have children throughout their entire lifetimes. This principle is not superseded by this Act, and in view of new advances in medical science that allow women to become pregnant after menopause by way of test-tube fertilization (see Sauer, Paulson & Lobo, A Preliminary Report on Oocyte Donation Extending Reproductive Potential to Women Over 40, 323 N.Eng.J.Med. 1157 (1990)) and the widely accepted rule of construction that adopted children are presumptively included in class gifts, the conclusive presumption of lifetime fertility is not unrealistic. Since even elderly individuals probably cannot be excluded from adopting children based on their ages alone, the possibility of having children by adoption is seldom extinct. See, generally, Waggoner In re Lattouf’s Will and the Presumption of Lifetime Fertility in Perpetuity Law, 20 San Diego L.Rev. 763 (1983). Under this Act, the main force of this principle is felt in Example (7), above, where it prevents a nonvested property interest from passing the test for initial validity under Section 1(a)(1).

    Act Supersedes Doctrine of Infectious Invalidity. At common law, the invalidity of an interest can, under the doctrine of infectious invalidity, be held to invalidate one or more otherwise valid interests created by the disposition or even invalidate the entire disposition. The question turns on whether the general dispositive scheme of the transferor will be better carried out by eliminating only the invalid interest or by eliminating other interests as well. This is a question that is answered on a case-by-case basis. Several items are relevant to the question, including who takes the stricken interests in place of those the transferor designated to take.

    The doctrine of infectious invalidity is superseded by this Act by Section 3, under which courts, upon the petition of an interested person, are required to reform the disposition to approximate as closely as possible the transferor’s manifested plan of distribution when an invalidity under the Statutory Rule occurs.

    Separability. The common law’s separability doctrine is that when an interest is expressly subject to alternative contingencies, the situation is treated as if two interests were created in the same person or class. Each interest is judged separately; the invalidity of one of the interests does not necessarily cause the other one to be invalid. This common-law principle was established in Longhead v. Phelps, 2 Wm.Bl. 704, 96 Eng. Rep. 414 (K.B. 1770), and is followed in this country. L. Simes & A. Smith, The Law of Future Interests § 1257 (2d ed. 1956); 6 American Law of Property § 24.54 (A. Casner ed. 1952); Restatement of Property § 376 (1944). Under this doctrine, if property is devised “to B if X-event or Y-event happens,” B in effect has two interests, one contingent on X-event happening and the other contingent on Y-event happening. If the interest contingent on X-event but not the one contingent on Y-event is invalid, the consequence of separating B’s interest into two is that only one of them, the one contingent on X-event, is invalid. B still has a valid interest — the one contingent on the occurrence of Y-event.

    The separability principle is not superseded by this Act. As illustrated in the following example, its invocation will usually result in one of the interests being initially validated by Section 1(a)(1) and the validity of the other interests being governed by Section 1(a)(2).

    Example (22) — Separability Case. G devised real property “to A for life, then to A’s children who survive A and reach 25, but if none of A’s children survives A or if none of A’s children who survives A reaches 25, then to B.” G was survived by his brother (B), by his daughter (A), by A’s husband (H), and by A’s two minor children (X and Y).

    The remainder interest in favor of A’s children who reach 25 fails the test of Section 1(a)(1) for initial validity. Its validity is, therefore, governed by Section 1(a)(2) and depends on each of A’s children doing any one of the following things within 90 years after G’s death: predeceasing A, surviving A and failing to reach 25, or surviving A and reaching 25.

    The “All-or-Nothing” Rule with Respect to Class Gifts; the Specific Sum and Sub-Class Doctrines. The common law applies an “all-or-nothing” rule with respect to class gifts, under which a class gift stands or falls as a whole. The all-or-nothing rule, usually attributed to Leake v. Robinson, 2 Mer. 363, 35 Eng. Rep. 979 (Ch. 1817), is commonly stated as follows: If the interest of any potential class member might vest too remotely, the entire class gift violates the Rule. Although this Act does not supersede the basic idea of the much-maligned “all-or-nothing” rule, the evils sometimes attributed to it are substantially if not entirely eliminated by the wait-and-see feature of the Statutory Rule and by the availability of reformation under Section 3, especially in the circumstances described in Sections 3(2) and (3). For illustrations of the application of the all-or-nothing rule under this Act, see Examples (3), (4), and (6) in the Comment to Section 3.

    The common law also recognizes a doctrine called the specific-sum doctrine, which is derived from Storrs v. Benbow, 3 De G.M. & G. 390, 43 Eng. Rep. 153 (Ch. 1853), and states: If a specified sum of money is to be paid to each member of a class, the interest of each class member is entitled to separate treatment and is valid or invalid under the Rule on its own. The common law also recognizes a doctrine called the sub-class doctrine, which is derived from Cattlin v. Brown, 11 Hare 372, 68 Eng. Rep. 1318 (Ch. 1853), and states: If the ultimate takers are not described as a single class but rather as a group of subclasses, and if the share to which each separate subclass is entitled will finally be determined within the period of the Rule, the gifts to the different subclasses are separable for the purpose of the Rule. American Security & Trust Co. v. Cramer, 175 F. Supp. 367 (D.D.C. 1959); Restatement of Property § 389 (1944). The specific-sum and sub-class doctrines are not superseded by this Act. The operation of the specific-sum doctrine under this Act is illustrated in the following example.

    Example (23) — Specific-Sum Case. G bequeathed “$10,000 to each child of A, born before or after my death, who attains 25.” G was survived by A and by A’s two children (X and Y). X but not Y had already reached 25 at G’s death. After G’s death a third child (Z) was born to A.

    If the phrase “born before or after my death” had been omitted, the class would close as of G’s death under the common-law’s rule of construction known as the rule of convenience: The after-born child, Z, would not be entitled to a $10,000 bequest, and the interests of both X and Y would be valid upon their creation at G’s death. X’s interest would be valid because it was initially vested; neither the Common-law Rule nor the Statutory Rule applies to interests that are vested upon their creation. Although the interest of Y was not vested upon its creation, it would be initially valid under Section 1(a)(1) because Y would be his own validating life; Y will either reach 25 or die under 25 within his own lifetime.

    Duration of Indestructible Trusts — Termination of Trusts by Beneficiaries. The widely accepted view in American law is that the beneficiaries of a trust other than a charitable trust can compel its premature termination if all beneficiaries consent and if such termination is not expressly restrained or impliedly restrained by the existence of a “material purpose” of the settlor in establishing the trust. Restatement (Second) of Trusts § 337 (1959); IV A. Scott, The Law of Trusts § 337 (3d ed. 1967). A trust that cannot be terminated by its beneficiaries is called an indestructible trust.

    It is generally accepted that the duration of the indestructibility of a trust, other than a charitable trust, is limited to the applicable perpetuity period. See Restatement (Second) of Trusts § 62, Comment o (1959); Restatement (Second) of Property (Donative Transfers) § 2.1 and Legislative Note and Reporter’s Note (1983); I A. Scott, The Law of Trusts § 62.10(2) (3d ed. 1967); J. Gray, The Rule Against Perpetuities § 121 (4th ed. 1942); L. Simes & A. Smith, The Law of Future Interests §§ 1391-93 (2d ed. 1956).

    Nothing in this Act supersedes this principle. One modification, however, is necessary: As to trusts that contain a nonvested property interest or power of appointment whose validity is governed by the wait-and-see element adopted in Section 1(a)(2), 1(b)(2), or 1(c)(2), the courts can be expected to determine that the applicable perpetuity period is 90 years.

    ** By substantial analogous authority, the specified-lives-in-being-plus-21-years prong of the “later-of” clause under discussion is not sustained by the separability doctrine (described in Part H of the Comment to Section 1). See, e.g., Restatement of Property § 376 Comments e and f and illustration 3 (1944); Easton v. Hall, 323 Ill. 397, 154 N.E. 216 (1926); Thorne v. Continental Nat’l Bank & Trust Co., 305 Ill. App. 222, 27 N.E.2d 302 (1940). The inapplicability of the separability doctrine is also supported by perpetuity policy, as described in the text above.

    ** By substantial analogous authority, the specified-lives-in-being-plus-21-years prong of the “later-of” clause under discussion is not sustained by the separability doctrine (described in Part H of the Comment to Section 1). See, e.g., Restatement of Property § 376 Comments e and f and illustration 3 (1944); Easton v. Hall, 323 Ill. 397, 154 N.E. 216 (1926); Thorne v. Continental Nat’l Bank & Trust Co., 305 Ill. App. 222, 27 N.E.2d 302 (1940). The inapplicability of the separability doctrine is also supported by perpetuity policy, as described in the text above.

    § 55.1-125. When nonvested property interest or power of appointment created.

    1. Except as provided in subsections B and C and in § 55.1-128 , the time of creation of a nonvested property interest or a power of appointment is determined under general principles of property law.
    2. For the purposes of §§ 55.1-124 through 55.1-129 , if there is a person who alone can exercise a power created by a governing instrument to become the unqualified beneficial owner of (i) a nonvested property interest or (ii) a property interest subject to a power of appointment described in subsection B or C in § 55.1-124 , the nonvested property interest or power of appointment is created when the power to become the unqualified beneficial owner terminates.
    3. For the purposes of §§ 55.1-124 through 55.1-129 , a nonvested property interest or a power of appointment arising from a transfer of property to a previously funded trust or other existing property arrangement is created when the nonvested property interest or power of appointment in the original contribution was created.

    History. 2000, c. 714, § 55-12.2; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    OFFICIAL COMMENT

    Subsection (a): General Principles of Property Law; When Nonvested Property Interests and Powers of Appointment are Created. Under Section 1, the period of time allowed by the Statutory Rule Against Perpetuities is marked off from the time of creation of the nonvested property interest or power of appointment in question. Section 5, with certain exceptions, provides that the Act applies only to nonvested property interests and powers of appointment created on or after the effective date of the Act.

    Except as provided in subsections (b) and (c), and in the second sentence of Section 5(a) for purposes of that section only, the time of creation of nonvested property interests and powers of appointment is determined under general principles of property law.

    Since a will becomes effective as a dispositive instrument upon the decedent’s death, not upon the execution of the will, general principles of property law determine that the time when a nonvested property interest or a power of appointment created by will is created is at the decedent’s death.

    With respect to a nonvested property interest or a power of appointment created by inter vivos transfer, the time when the interest or power is created is the date the transfer becomes effective for purposes of property law generally, normally the date of delivery of the deed.

    With respect to a nonvested property interest or a power of appointment created by the testamentary or inter vivos exercise of a power of appointment, general principles of property law adopt the “relation back” doctrine. Under that doctrine, the appointed interests or powers are created when the power was created not when it was exercised, if the exercised power was a nongeneral power or a general testamentary power. If the exercised power was a general power presently exercisable, the relation back doctrine is not followed; the time of creation of the appointed property interests or appointed powers is regarded as the time when the power was irrevocably exercised, not when the power was created.

    Subsection (b): Postponement, for Purposes of this Act, of the Time when a Nonvested Property Interest or a Power of Appointment is Created in Certain Cases. The reason that the significant date for purposes of this Act is the date of creation is that the unilateral control of the interest (or the interest subject to the power) by one person is then relinquished. In certain cases, all beneficial rights in a property interest (including an interest subject to a power of appointment) remain under the unilateral control of one person even after the delivery of the deed or even after the decedent’s death. In such cases, under this subsection, the interest or power is created, for purposes of this Act, when no person, acting alone, has a power presently exercisable to become the unqualified beneficial owner of the property interest (or the property interest subject to the power of appointment).

    Example (1) — Revocable Inter-Vivos Trust Case. G conveyed property to a trustee, directing the trustee to pay the net income therefrom to himself (G) for life, then to G’s son A for his life, then to A’s children for the life of the survivor of A’s children who are living at G’s death, and upon the death of such last surviving child, the corpus of the trust is to be distributed among A’s then-living descendants, per stirpes. G retained the power to revoke the trust.

    Because of G’s reservation of the power to revoke the trust, the creation for purposes of this Act of the nonvested property interests in this case occurs at G’s death, not when the trust was established. This is in accordance with common law, for purposes of the Common-law Rule Against Perpetuities. Cook v. Horn, 214 Ga. 289, 104 S.E.2d 461 (1958).

    The rationale that justifies the postponement of the time of creation in such cases is as follows. A person, such as G in the above example, who alone can exercise a power to become the unqualified beneficial owner of a nonvested property interest is in effect the owner of that property interest. Thus, any nonvested property interest subject to such a power is not created for purposes of this Act until the power terminates (by release, expiration at the death of the donee, or otherwise). Similarly, as noted above, any property interest or power of appointment created in an appointee by the irrevocable exercise of such a power is created at the time of the donee’s irrevocable exercise.

    For the date of creation to be postponed under subsection (b), the power need not be a power to revoke, and it need not be held by the settlor or transferor. A presently exercisable power held by any person acting alone to make himself the unqualified beneficial owner of the nonvested property interest or the property interest subject to a power of appointment is sufficient. If such a power exists, the time when the interest or power is created, for purposes of this Act, is postponed until the termination of the power (by irrevocable exercise, release, contract to exercise or not to exercise, expiration at the death of the donee, or otherwise). An example of such a power that might not be held by the settlor or transferor is a power, held by any person who can act alone, fully to invade the corpus of a trust.

    An important consequence of the idea that a power need not be held by the settlor for the time of creation to be postponed under this section is that it makes postponement possible even in cases of testamentary transfers.

    Example (2) — Testamentary Trust Case. G devised property in trust, directing the trustee to pay the income “to A for life, remainder to such persons (including A, his creditors, his estate, and the creditors of his estate) as A shall appoint; in default of appointment, the property to remain in trust to pay the income to A’s children for the life of the survivor, and upon the death of A’s last surviving child, to pay the corpus to A’s grandchildren.” A survived G.

    If A exercises his presently exercisable general power, any nonvested property interest or power of appointment created by A’s appointment is created for purposes of this Act when the power is exercised. If A does not exercise the power, the nonvested property interests in G’s gift-in-default clause are created when A’s power terminates (at A’s death). In either case, the postponement is justified because the transaction is the equivalent of G’s having devised the full remainder interest (following A’s income interest) to A and of A’s having in turn transferred that interest in accordance with his exercise of the power or, in the event the power is not exercised, devised that interest at his death in accordance with G’s gift-in-default clause. Note, however, that if G had conferred on A a nongeneral power or a general testamentary power, A’s power of appointment, any nonvested property interest or power of appointment created by A’s appointment, if any, and the nonvested property interests in G’s gift-in-default clause would be created at G’s death.

    Unqualified Beneficial Owner of the Nonvested Property Interest or the Property Interest Subject to a Power of Appointment. For the date of creation to be postponed under subsection (b), the presently exercisable power must be one that entitles the donee of the power to become the unqualified beneficial owner of the nonvested property interest (or the property interest subject to a nongeneral power of appointment, a general testamentary power of appointment, or a general power of appointment not presently exercisable because of a condition precedent). This requirement was met in Example (2), above, because A could by appointing the remainder interest to himself become the unqualified beneficial owner of all the nonvested property interests in G’s gift-in-default clause. In Example (2) it is not revealed whether A, if he exercised the power in his own favor, also had the right as sole beneficiary of the trust to compel the termination of the trust and possess himself as unqualified beneficial owner of the property that was the subject of the trust. Having the power to compel termination of the trust is not necessary. If, for example, the trust in Example (2) was a spendthrift trust or contained any other feature that under the relevant local law (see Claflin v. Claflin, 149 Mass. 19, 20 N.E. 454 (1889); Restatement (Second) of Trusts § 337 (1959)) would prevent A as sole beneficiary from compelling termination of the trust, A’s presently exercisable general power over the remainder interest would still postpone the time of creation of the nonvested property interests in G’s gift-in-default clause because the power enables A to become the unqualified beneficial owner of such interests.

    Furthermore, it is not necessary that the donee of the power have the power to become the unqualified beneficial owner of all beneficial rights in the trust. In Example (2), the property interests in G’s gift-in-default clause are not created for purposes of this Act until A’s power expires (or on A’s appointment, until the power’s exercise) even if someone other than A was the income beneficiary of the trust.

    Presently Exercisable Power. For the date of creation to be postponed under subsection (b), the power must be presently exercisable. A testamentary power does not qualify. A power not presently exercisable because of a condition precedent does not qualify. If the condition precedent later becomes satisfied, however, so that the power becomes presently exercisable, the interests or powers subject thereto are not created, for purposes of this Act, until the termination of the power. The common-law decision of Fitzpatrick v. Mercantile Safe Deposit Co., 220 Md. 534, 155 A.2d 702 (1959), appears to be in accord with this proposition.

    Example (3) — General Power in Unborn Child Case. G devised property “to A for life, then to A’s first-born child for life, then to such persons, including A’s first-born child or such child’s estate or creditors, as A’s first-born child shall appoint.” There was a further provision that in default of appointment, the trust would continue for the benefit of G’s descendants. G was survived by his daughter (A), who was then childless. After G’s death, A had a child, X. A then died, survived by X.

    As of G’s death, the power of appointment in favor of A’s first-born child and the property interests in G’s gift-in-default clause would be regarded as having been created at G’s death because the power in A’s first-born child was then a general power not presently exercisable because of a condition precedent.

    At X’s birth, X’s general power became presently exercisable and excluded from the Statutory Rule. X’s power also qualifies as a power exercisable by one person alone to become the unqualified beneficial owner of the property interests in G’s gift-in-default clause. Consequently, the nonvested property interests in G’s gift-in-default clause are not created, for purposes of this Act, until the termination of X’s power. If X exercises his presently exercisable general power, before or after A’s death, the appointed interests or powers are created, for purposes of this Act, as of X’s exercise of the power.

    Partial Powers. For the date of creation to be postponed under subsection (b), the person must have a presently exercisable power to become the unqualified beneficial owner of the full nonvested property interest or the property interest subject to a power of appointment described in Section 1(b) or 1(c). If, for example, the subject of the transfer was an undivided interest such as a one-third tenancy in common, the power qualifies even though it relates only to the undivided one-third interest in the tenancy in common; it need not relate to the whole property. A power to become the unqualified beneficial owner of only part of the nonvested property interest or the property interest subject to a power of appointment, however, does not postpone the time of creation of the interests or powers subject thereto, unless the power is actually exercised.

    Example (4) — “5 and 5” Power Case. G devised property in trust, directing the trustee to pay the income “to A for life, remainder to such persons (including A, his creditors, his estate, and the creditors of his estate) as A shall by will appoint;” in default of appointment, the governing instrument provided for the property to continue in trust. A was given a noncumulative power to withdraw the greater of $5,000 or 5% of the corpus of the trust annually. A survived G. A never exercised his noncumulative power of withdrawal.

    G’s death marks the time of creation of: A’s testamentary power of appointment; any nonvested property interest or power of appointment created in G’s gift-in-default clause; and any appointed interest or power created by a testamentary exercise of A’s power of appointment over the remainder interest. A’s general power of appointment over the remainder interest does not postpone the time of creation because it is not a presently exercisable power. A’s noncumulative power to withdraw a portion of the trust each year does not postpone the time of creation as to all or the portion of the trust with respect to which A allowed his power to lapse each year because A’s power is a power over only part of any nonvested property interest or property interest subject to a power of appointment in G’s gift-in-default clause and over only part of any appointed interest or power created by a testamentary exercise of A’s general power of appointment over the remainder interest. The same conclusion has been reached at common law. See Ryan v. Ward, 192 Md. 342, 64 A.2d 258 (1949).

    If, however, in any year A exercised his noncumulative power of withdrawal in a way that created a nonvested property interest (or power of appointment) in the withdrawn amount (for example, if A directed the trustee to transfer the amount withdrawn directly into a trust created by A), the appointed interests (or powers) would be created when the power was exercised, not when G died.

    Incapacity of the Donee of the Power. The fact that the donee of a power lacks the capacity to exercise it, by reason of minority, mental incompetency, or any other reason, does not prevent the power held by such person from postponing the time of creation under subsection (b), unless the governing instrument extinguishes the power (or prevents it from coming into existence) for that reason.

    Joint Powers — Community Property; Marital Property. For the date of creation to be postponed under subsection (b), the power must be exercisable by one person alone. A joint power does not qualify, except that, if the bracketed sentence of subsection (b) is enacted, a joint power over community property or over marital property under the Uniform Marital Property Act held by individuals married to each other is, for purposes of this Act, treated as a power exercisable by one person acting alone. See Restatement (Second) of Property (Donative Transfers) § 1.2, Comment b and illustrations 5, 6, and 7 (1983), for the rationale supporting the enactment of the bracketed sentence and examples illustrating its principle.

    Subsection (c): No Staggered Periods. For purposes of this Act, subsection (c) in effect treats a transfer of property to a previously funded trust or other existing property arrangement as having been made when the nonvested property interest or power of appointment in the original contribution was created. The purpose of subsection (c) is to avoid the administrative difficulties that would otherwise result where subsequent transfers are made to an existing irrevocable trust. Without subsection (c), the allowable period under the Statutory Rule would be marked off in such cases from different times with respect to different portions of the same trust.

    Example (5) — Series of Transfers Case. In Year One, G created an irrevocable inter vivos trust, funding it with $20,000 cash. In Year Five, when the value of the investments in which the original $20,000 contribution was placed had risen to a value of $30,000, G added $10,000 cash to the trust. G died in Year Ten. G’s will poured the residuary of his estate into the trust. G’s residuary estate consisted of Blackacre (worth $20,000) and securities (worth $80,000). At G’s death, the value of the investments in which the original $20,000 contribution and the subsequent $10,000 contribution were placed had risen to a value of $50,000.

    Were it not for subsection (c), the permissible vesting period under the Statutory Rule would be marked off from three different times: Year One, Year Five, and Year Ten. The effect of subsection (c) is that the permissible vesting period under the Statutory Rule starts running only once — in Year One — with respect to the entire trust. This result is defensible not only to prevent the administrative difficulties inherent in recognizing staggered periods. It also is defensible because if G’s inter vivos trust had contained a perpetuity saving clause, the perpetuity-period component of the clause would be geared to the time when the original contribution to the trust was made; this clause would cover the subsequent contributions as well. Since the major justification for the adoption by this Act of the wait-and-see method of perpetuity reform is that it amounts to a statutory insertion of a saving clause (see the Prefatory Note), subsection (c) is consistent with the theory of this Act.

    Additional References. Restatement (Second) of Property (Donative Transfers) §§ 1.1, 1.2 (1983) and the Comments thereto.

    § 55.1-126. Reformation.

    Upon the petition of an interested person, a circuit court in the county or city in which the affected property or the greater part of such property is located shall reform a disposition in the manner that most closely approximates the transferor’s manifested plan of distribution and is within the 90 years allowed by subdivision A 2, B 2, or C 2 of § 55.1-124 if:

    1. A nonvested property interest or a power of appointment becomes invalid under § 55.1-124 ;
    2. A class gift is not but might become invalid under § 55.1-124 and the time has arrived when the share of any class member is to take effect in possession or enjoyment; or
    3. A nonvested property interest that is not validated by subdivision A 1 of § 55.1-124 can vest but not within 90 years after its creation.

    History. 2000, c. 714, § 55-12.3; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Interpretation of holographic codicil. —

    Although a trust established by a holographic codicil violated the common-law rule against perpetuities and the statutory rule against perpetuities set forth in § 55-12.1, the court was authorized by this section to reform the disposition of a will in a manner that most closely approximated the testatrix’s plan of distribution. Eubank v. Eubank, 68 Va. Cir. 33, 2005 Va. Cir. LEXIS 86 (Amherst County Apr. 29, 2005).

    OFFICIAL COMMENT

    Reformation. This section requires a court, upon the petition of an interested person, to reform a disposition whose validity is governed by the wait-and-see element of Section 1(a)(2), 1(b)(2), or 1(c)(2) so that the reformed disposition is within the limits of the 90-year period allowed by those subsections, in the manner deemed by the court most closely to approximate the transferor’s manifested plan of distribution, in three circumstances: First, when (after the application of the Statutory Rule) a nonvested property interest or a power of appointment becomes invalid under the Statutory Rule; second, when a class gift has not but still might become invalid under the Statutory Rule and the time has arrived when the share of one or more class members is to take effect in possession or enjoyment; and third, when a nonvested property interest can vest, but cannot do so within the allowable 90-year period under the Statutory Rule.

    It is anticipated that the circumstances requisite to reformation will seldom arise, and consequently that this section will be applied infrequently. If, however, one of the three circumstances arises, the court in reforming is authorized to alter existing interests or powers and to create new interests or powers by implication or construction based on the transferor’s manifested plan of distribution as a whole. In reforming, the court is urged not to invalidate any vested interest retroactively (the doctrine of infectious invalidity having been superseded by this Act, as indicated in the Comment to Section 1). The court is also urged not to reduce an age contingency in excess of 21 unless it is absolutely necessary, and if it is deemed necessary to reduce such an age contingency, not to reduce it automatically to 21 but rather to reduce it no lower than absolutely necessary. See Example (3), below; Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718, 1755-1759 (1983); Langbein & Waggoner, Reformation of Wills on the Ground of Mistake: Change of Direction in American Law?, 130 U.Pa.L.Rev. 521, 546-49 (1982).

    Judicial Sale of Land Affected by Future Interests. Although this section — except for cases that fall under subsections (2) or (3) — defers the time when a court is directed to reform a disposition until the expiration of the 90-year permissible vesting period, this section is not to be understood as preventing an earlier application of other remedies. In particular, in the case of interests in land not in trust, the principle, codified in many states, is widely recognized that there is judicial authority, under specified circumstances, to order a sale of land in which there are future interests. See 1 American Law of Property §§ 4.98-.99 (A. Casner ed. 1952); L. Simes & A. Smith, The Law of Future Interests §§ 1941-1946 (2d ed. 1956); see also Restatement of Property § 179 at pp. 485-95 (1936); L. Simes & C. Taylor, Improvement of Conveyancing by Legislation 235-38 (1960). Nothing in Section 3 of this Act should be taken as precluding this type of remedy, if appropriate, before the expiration of the 90-year permissible vesting period.

    Duration of the Indestructibility of Trusts — Termination of Trusts by Beneficiaries. As noted in Part G of the Comment to Section 1, it is generally accepted that a trust cannot remain indestructible beyond the period of the rule against perpetuities. Under this Act, the period of the rule against perpetuities applicable to a trust whose validity is governed by the wait-and-see element of Section 1(a)(2), 1(b)(2), or 1(c)(2) is 90 years. The result of any reformation under Section 3 is that all nonvested property interests in the trust will vest in interest (or terminate) no later than the 90th anniversary of their creation. In the case of trusts containing a nonvested property interest or a power of appointment whose validity is governed by Section 1(a)(2), 1(b)(2), or 1(c)(2), courts can therefore be expected to adopt the rule that no purpose of the settlor, expressed in or implied from the governing instrument, can prevent the beneficiaries of a trust other than a charitable trust from compelling its termination after 90 years after every nonvested property interest and power of appointment in the trust was created.

    Subsection (1): Invalid Property Interest or Power of Appointment. Subsection (1) is illustrated by the following examples.

    Example (1) — Multiple Generation Trust. G devised property in trust, directing the trustee to pay the income “to A for life, then to A’s children for the life of the survivor, then to A’s grandchildren for the life of the survivor, and on the death of A’s last surviving grandchild, the corpus of the trust is to be divided among A’s then living descendants per stirpes; if none, to” a specified charity. G was survived by his child (A) and by A’s two minor children (X and Y). After G’s death, another child (Z) was born to A. Subsequently, A died, survived by his children (X, Y, and Z) and by three grandchildren (M, N, and O).

    There are four interests subject to the Statutory Rule in this example: (1) the income interest in favor of A’s children, (2) the income interest in favor of A’s grandchildren, (3) the remainder interest in the corpus in favor of A’s descendants who survive the death of A’s last surviving grandchild, and (4) the alternative remainder interest in the corpus in favor of the specified charity. The first interest is initially valid under Section 1(a)(1); A is the validating life for that interest. There is no validating life for the other three interests, and so their validity is governed by Section 1(a)(2).

    If, as is likely, A and A’s children all die before the 90th anniversary of G’s death, the income interest in favor of A’s grandchildren is valid under Section 1(a)(2).

    If, as is also likely, some of A’s grandchildren are alive on the 90th anniversary of G’s death, the alternative remainder interests in the corpus of the trust then become invalid under Section 1(a)(2), giving rise to Section 3(1)’s prerequisite to reformation. A court would be justified in reforming G’s disposition by closing the class in favor of A’s descendants as of the 90th anniversary of G’s death (precluding new entrants thereafter), by moving back the condition of survivorship on the class so that the remainder interest is in favor of G’s descendants who survive the 90th anniversary of G’s death (rather than in favor of those who survive the death of A’s last surviving grandchild), and by redefining the class so that its makeup is formed as if A’s last surviving grandchild died on the 90th anniversary of G’s death.

    Example (2) — Sub-Class Case. G devised property in trust, directing the trustee to pay the income “to A for life, then in equal shares to A’s children for their respective lives; on the death of each child the proportionate share of corpus of the one so dying shall go to the descendants of such child surviving at such child’s death, per stirpes.” G was survived by A and by A’s two children (X and Y). After G’s death, another child (Z) was born to A. Subsequently, A died, survived by X, Y, and Z.

    Under the sub-class doctrine, each remainder interest in favor of the descendants of a child of A is treated separately from the others. Consequently, the remainder interest in favor of X’s descendants and the remainder interest in favor of Y’s descendants are valid under Section 1(a)(1): X is the validating life for the one, and Y is the validating life for the other.

    The remainder interest in favor of the descendants of Z is not validated by Section 1(a)(1) because Z, who was not alive when the interest was created, could have descendants more than 21 years after the death of the survivor of A, X, and Y. Instead, the validity of the remainder interest in favor of Z’s descendants is governed by Section 1(a)(2), under which its validity depends on Z’s dying within 90 years after G’s death.

    Although unlikely, suppose that Z is still living 90 years after G’s death. The remainder interest in favor of Z’s descendants will then become invalid under the Statutory Rule, giving rise to subsection (1)’s prerequisite to reformation. In such circumstances, a court would be justified in reforming the remainder interest in favor of Z’s descendants by making it indefeasibly vested as of the 90th anniversary of G’s death. To do this, the court would reform the disposition by eliminating the condition of survivorship of Z and closing the class to new entrants after the 90th anniversary of G’s death.

    Subsection (2): Class Gifts Not Yet Invalid. Subsection (2), which, upon the petition of an interested person, requires reformation in certain cases where a class gift has not but still might become invalid under the Statutory Rule, is illustrated by the following examples.

    Example (3) — Age Contingency in Excess of 21. G devised property in trust, directing the trustee to pay the income “to A for life, then to A’s children; the corpus of the trust is to be equally divided among A’s children who reach the age of 30.” G was survived by A, by A’s spouse (H), and by A’s two children (X and Y), both of whom were under the age of 30 when G died.

    Since the remainder interest in favor of A’s children who reach 30 is a class gift, at common law ( Leake v. Robinson, 2 Mer. 363, 35 Eng. Rep. 979 (Ch. 1817)) and under this Act (see Part G of the Comment to Section 1) the interests of all potential class members must be valid or the class gift is totally invalid. Although X and Y will either reach 30 or die under 30 within their own lifetimes, there is at G’s death the possibility that A will have an afterborn child (Z) who will reach 30 or die under 30 more than 21 years after the death of the survivor of A, H, X, and Y. There is no validating life, and the class gift is therefore not validated by Section 1(a)(1).

    Under Section 1(a)(2), the children’s remainder interest becomes invalid only if an interest of a class member neither vests nor terminates within 90 years after G’s death. If in fact there is an afterborn child (Z), and if upon A’s death, Z has at least reached an age such that he cannot be alive and under the age of 30 on the 90th anniversary of G’s death, the class gift is valid. (Note that at Z’s birth it would have been known whether or not Z could be alive and under the age of 30 on the 90th anniversary of G’s death; nevertheless, even if it was then certain that Z could not be alive and under the age of 30 on the 90th anniversary of G’s death, the class gift could not then have been declared valid because, A being alive, it was then possible for one or more additional children to have later been born to or adopted by A.)

    Although unlikely, suppose that at A’s death (prior to the expiration of the 90-year period), Z’s age was such that he could be alive and under the age of 30 on the 90th anniversary of G’s death. Suppose further that at A’s death X and Y were over the age of 30. Z’s interest and hence the class gift as a whole is not yet invalid under the Statutory Rule because Z might die under the age of 30 within the remaining part of the 90-year period following G’s death; but the class gift might become invalid because Z might be alive and under the age of 30, 90 years after G’s death. Consequently, the prerequisites to reformation set forth in subsection (2) are satisfied, and a court would be justified in reforming G’s disposition to provide that Z’s interest is contingent on reaching the age he can reach if he lives to the 90th anniversary of G’s death. This would render Z’s interest valid so far as the Statutory Rule Against Perpetuities is concerned, and allow the class gift as a whole to be declared valid. X and Y would thus be entitled immediately to their one-third shares each. If Z’s interest later vested, Z would receive the remaining one-third share. If Z failed to reach the required age under the reformed disposition, the remaining one-third share would be divided equally between X and Y or their successors in interest.

    Example (4) — Case Where Subsection (2) Applies, Not Involving an Age Contingency in Excess of 21. G devised property in trust, directing the trustee to pay the income “to A for life, then to A’s children; the corpus of the trust is to be equally divided among A’s children who graduate from an accredited medical school or law school.” G was survived by A, by A’s spouse (H), and by A’s two minor children (X and Y).

    As in Example (3), the remainder interest in favor of A’s children is a class gift, and the common-law principle is not superseded by this Act by which the interests of all potential class members must be valid or the class gift is totally invalid. Although X and Y will either graduate from an accredited medical or law school, or fail to do so, within their own lifetimes, there is at G’s death the possibility that A will have an after-born child (Z), who will graduate from an accredited medical or law school (or die without having done either) more than 21 years after the death of the survivor of A, H, X, and Y. The class gift would not be valid under the Common-law Rule and is, therefore, not validated by Section 1(a)(1).

    Under Section 1(a)(2), the children’s remainder interest becomes invalid only if an interest of a class member neither vests nor terminates within 90 years after G’s death.

    Suppose in fact that there is an afterborn child (Z), and that at A’s death Z was a freshman in college. Suppose further that at A’s death X had graduated from an accredited law school and that Y had graduated from an accredited medical school. Z’s interest and hence the class gift as a whole is not yet invalid under Section 1(a)(2) because the 90-year period following G’s death has not yet expired; but the class gift might become invalid because Z might be alive but not a graduate of an accredited medical or law school 90 years after G’s death. Consequently, the prerequisites to reformation set forth in Section 3(2) are satisfied, and a court would be justified in reforming G’s disposition to provide that Z’s interest is contingent on graduating from an accredited medical or law school within 90 years after G’s death. This would render Z’s interest valid so far as the Section 1(a)(2) is concerned and allow the class gift as a whole to be declared valid. X and Y would thus be entitled immediately to their one-third shares each. If Z’s interest later vested, Z would receive the remaining one-third share. If Z failed to graduate from an accredited medical or law school within the allowed time under the disposition as so reformed, the remaining one-third share would be divided equally between X and Y or their successors in interest.

    Subsection (3): Interests that Can Vest But Not Within the 90-Year Permissible Vesting Period. In exceedingly rare cases, an interest might be created that can vest, but not within the 90-year permissible vesting period of the Statutory Rule. This may be the situation when the interest was created (See Example (5)), or it may become the situation at some time thereafter (see Example (6)). Whenever the situation occurs, the court, upon the petition of an interested person, is required by subsection (3) to reform the disposition within the limits of the 90-year permissible vesting period.

    Example (5) — Case of an Interest, as of its Creation, being Impossible to Vest Within the 90-Year Period. G devised property in trust, directing the trustee to divide the income, per stirpes, among G’s descendants from time to time living, for 100 years. At the end of the 100-year period following G’s death, the trustee is to distribute the corpus and accumulated income to G’s then-living descendants, per stirpes; if none, to the XYZ Charity.

    The nonvested property interest in favor of G’s descendants who are living 100 years after G’s death can vest, but not within the 90-year period of Section 1(a)(2). The interest would violate the Common-law Rule, and hence is not validated by Section 1(a)(1), because there is no validating life. In these circumstances, a court is required by Section 3(3) to reform G’s disposition within the limits of the 90-year period. An appropriate result would be for the court to lower the period following G’s death from a 100-year period to a 90-year period.

    Note that the circumstance that triggers the direction to reform the disposition under this subsection is that the nonvested property interest still can vest, but cannot vest within the 90-year period of Section 1(a)(2). It is not necessary that the interest be certain to become invalid under that subsection. For the interest to be certain to become invalid under Section 1(a)(2), it would have to be certain that it can neither vest nor terminate within the 90-year period. In this example, the interest of G’s descendants might terminate within the period (by all of G’s descendants dying within 90 years of G’s death). If this were to happen, the interest of XYZ Charity would be valid because it would have vested within the allowable period. However, it was thought desirable to require reformation without waiting to see if this would happen: The only way that G’s descendants, who are G’s primary set of beneficiaries, would have a chance to take the property is to reform the disposition within the limits of the 90-year period on the ground that their interest cannot vest within the allowable period and subsection (3) so provides.

    Example (6) — Case of an Interest after its Creation Becoming Impossible to Vest Within the 90-Year Period. G devised property in trust, with the income to be paid to A. The corpus of the trust was to be divided among A’s children who reach 30, each child’s share to be paid on the child’s 30th birthday; if none reaches 30, to the XYZ Charity. G was survived by A and by A’s two children (X and Y). Neither X nor Y had reached 30 at G’s death.

    The class gift in favor of A’s children who reach 30 would violate the Common-law Rule Against Perpetuities and, thus, is not validated by Section 1(a)(1). Its validity is therefore governed by Section 1(a)(2).

    Suppose that after G’s death, and during A’s lifetime, X and Y die and a third child (Z) is born to or adopted by A. At A’s death, Z is living but her age is such that she cannot reach 30 within the remaining part of the 90-year period following G’s death. As of A’s death, it has become the situation that Z’s interest cannot vest within the allowable period. The circumstances requisite to reformation under subsection (3) have arisen. An appropriate result would be for the court to lower the age contingency to the age Z can reach 90 years after G’s death.

    Additional References. For additional discussion and illustrations of the application of some of the principles of this section, see the Comments to Restatement (Second) of Property (Donative Transfers) § 1.5 (1983).

    § 55.1-127. Exclusions from statutory rule against perpetuities.

    1. Section 55.1-124 does not apply to:
      1. A nonvested property interest or a power of appointment arising out of a nondonative transfer, except a nonvested property interest or a power of appointment arising out of (i) a premarital or postmarital agreement; (ii) a separation or divorce settlement; (iii) a spouse’s election; (iv) a similar arrangement arising out of a prospective, existing, or previous marital relationship between the parties; (v) a contract to make or not to revoke a will or trust; (vi) a contract to exercise or not to exercise a power of appointment; (vii) a transfer in satisfaction of a duty of support; or (viii) a reciprocal transfer;
      2. A fiduciary’s power relating to the administration or management of assets, including the power of a fiduciary to sell, lease, or mortgage property, and the power of a fiduciary to determine principal and income;
      3. A power to appoint a fiduciary;
      4. A discretionary power of trustee to distribute principal before termination of a trust to a beneficiary having an indefensibly vested interest in the income and principal;
      5. A nonvested property interest held by a charity, government, or governmental agency or subdivision, if the nonvested property interest is preceded by an interest held by another charity, government, or governmental agency or subdivision;
      6. A nonvested property interest in or a power of appointment with respect to a trust or other property arrangement forming part of a pension, profit-sharing, stock bonus, health, disability, death benefit, income deferral, or other current or deferred benefit plan for one or more employees, independent contractors, or their beneficiaries or spouses, to which contributions are made for the purpose of distributing to or for the benefit of the participants or their beneficiaries or spouses the property, income, or principal in the trust or other property arrangement, except a nonvested property interest or a power of appointment that is created by an election of a participant or a beneficiary or spouse;
      7. A property interest, power of appointment, or arrangement that was not subject to the common-law rule against perpetuities or is excluded by another statute of the Commonwealth; or
      8. A nonvested interest in or power of appointment over personal property held in trust, or a power of appointment over personal property granted under a trust, if the trust instrument, by its terms, provides that § 55.1-124 shall not apply.
    2. The exception to the Uniform Statutory Rule Against Perpetuities under subdivision A 8 shall not extend to real property held in trust. For purposes of this subsection, real property does not include an interest in a corporation, limited liability company, partnership, business trust, or other entity, even if such entity owns an interest in real property.

    History. 2000, c. 714, § 55-12.4; 2013, c. 323; 2019, c. 712.

    Editor’s note.

    Acts 2013, c. 323, cl. 2 provides: “That the provisions of this act are declarative of existing law.”

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For annual survey article, see “Wills, Trusts, and Estates,” 48 U. Rich. L. Rev. 189 (2013).

    OFFICIAL COMMENT

    Section 4 lists seven exclusions from the Statutory Rule Against Perpetuities (Statutory Rule). Some are declaratory of existing law; others are contrary to existing law. Since the Common-law Rule Against Perpetuities is superseded by this Act (or a statutory version or variation thereof is repealed by this Act), a nonvested property interest, power of appointment, or other arrangement excluded from the Statutory Rule by this section is not subject to any rule against perpetuities, statutory or otherwise.

    1. SUBSECTION (1): NONDONATIVE TRANSFERS EXCLUDED   Rationale.  In line with long-standing scholarly commentary, subsection (1) excludes (with certain enumerated exceptions) nonvested property interests and powers of appointment arising out of a nondonative transfer. The rationale for this exclusion is that the Rule Against Perpetuities is a wholly inappropriate instrument of social policy to use as a control over such arrangements. The period of the rule — a life in being plus 21 years — is not suitable for nondonative transfers, and this point applies with equal force to the 90-year allowable waiting period under the wait-and-see element of Section 1 because that period represents an approximation of the period of time that would be produced, on average, by using a statutory list identifying actual measuring lives and adding a 21-year period following the death of the survivor.
    2. SUBSECTIONS (2)-(7): OTHER EXCLUSIONS   Subsection (2) — Administrative Fiduciary Powers.  Fiduciary powers are subject to the Statutory Rule Against Perpetuities, unless specifically excluded. Purely administrative fiduciary powers are excluded by subsections (2) and (3), but distributive fiduciary powers are generally speaking not excluded. The only distributive fiduciary power excluded is the one described in subsection (4).

    No general exclusion from the Common-law Rule Against Perpetuities is recognized for nondonative transfers, and so subsection (1) is contrary to existing common law. (But see Metropolitan Transportation Authority v. Bruken Realty Corp., 67 N.Y.2d 156, 492 N.E.2d 379, 384 (1986), pointing out the inappropriateness of the period of a life in being plus 21 years to cases of commercial and governmental transactions and noting that the Rule Against Perpetuities can invalidate legitimate transactions in such cases.)

    Subsection (1) is therefore inconsistent with decisions holding the Common-law Rule to be applicable to the following types of property interests or arrangements when created in a nondonative, commercial-type transaction, as they almost always are: options (e.g., Milner v. Bivens, 335 S.E.2d 288 (Ga. 1985)); preemptive rights in the nature of a right of first refusal (e.g., Atchison v. City of Englewood, 170 Colo. 295, 463 P.2d 297 (1969); Robroy Land Co., Inc. v. Prather, 24 Wash. App. 511, 601 P.2d 297 (1969)); leases to commence in the future, at a time certain or on the happening of a future event such as the completion of a building (e.g., Southern Airways Co. v. DeKalb County, 101 Ga. App. 689, 115 S.E.2d 207 (1960)); nonvested easements; top leases and top deeds with respect to interests in minerals (e.g., Peveto v. Starkey, 645 S.W.2d 770 (Tex. 1982)); and so on.

    Consideration Does Not Necessarily Make the Transfer Nondonative. A transfer can be supported by consideration and still be donative in character and hence not excluded from the Statutory Rule. A transaction that is essentially gratuitous in nature, accompanied by donative intent on the part of at least one party to the transaction, is not to be regarded as nondonative simply because it is for consideration. Thus, for example, the exclusion would not apply if a parent purchases a parcel of land for full and adequate consideration, and directs the seller to make out the deed in favor of the purchaser’s daughter for life, remainder to such of the daughter’s children as reach 25. The nonvested property interest of the daughter’s children is subject to the Statutory Rule.

    Some Transactions Not Excluded Even if Considered Nondonative. Some types of transactions — although in some sense supported by consideration and hence arguably nondonative — arise out of a domestic situation, and should not be excluded from the Statutory Rule. To avoid uncertainty with respect to such transactions, subsection (1) specifies that nonvested property interests or powers of appointment arising out of any of the following transactions are not excluded by subsection (1)’s nondonative-transfers exclusion: a premarital or postmarital agreement; a separation or divorce settlement; a spouse’s election, such as the “widow’s election” in community property states; an arrangement similar to any of the foregoing arising out of a prospective, existing, or previous marital relationship between the parties; a contract to make or not to revoke a will or trust; a contract to exercise or not to exercise a power of appointment; a transfer in full or partial satisfaction of a duty of support; or a reciprocal transfer. The term “reciprocal transfer” is to be interpreted in accordance with the reciprocal transfer doctrine in the tax law (see United States v. Estate of Grace, 395 U.S. 316 (1969)).

    Other Means of Controlling Some Nondonative Transfers Desirable. Some commercial transactions respecting land or mineral interests, such as options in gross (including rights of first refusal), leases to commence in the future, nonvested easements, and top leases and top deeds in commercial use in the oil and gas industry, directly or indirectly restrain the alienability of property or provide a disincentive to improve the property. Although controlling the duration of such interests is desirable, they are excluded by subsection (1) from the Statutory Rule because, as noted above, the period of a life in being plus 21 years — actual or by the 90-year proxy — is inappropriate for them; that period is appropriate for family-oriented, donative transfers.

    The Committee was aware that a few states have adopted statutes on perpetuities that include special limits on certain commercial transactions (e.g., Fla. Stat. § 689.22(3)(a); Ill. Rev. Stat. ch. 30, § 194(a)), and in fact the Committee itself drafted a comprehensive version of Section 4 that would have imposed a 40-year period-in-gross limitation in specified cases. In the end, however, the Committee did not present that version to the National Conference for approval because it was of the opinion that the control of these interests is better left to other types of statutes, such as marketable title acts (e.g., the Uniform Simplification of Land Transfers Act) and the Uniform Dormant Mineral Interests Act, backed up by the potential application of the common-law rules regarding unreasonable restraints on alienation.

    The application of subsection (2) to fiduciary powers can be illustrated by the following example.

    Example (1). G devised property in trust, directing the trustee (a bank) to pay the income to A for life, then to A’s children for the life of the survivor, and on the death of A’s last surviving child to pay the corpus to B. The trustee is granted the discretionary power to sell and to reinvest the trust assets and to invade the corpus on behalf of the income beneficiary or beneficiaries.

    The trustee’s fiduciary power to sell and reinvest the trust assets is a purely administrative power, and under subsection (2) of this section is not subject to the Statutory Rule.

    The trustee’s fiduciary power to invade corpus, however, is a nongeneral power of appointment that is not excluded from the Statutory Rule. Its validity, and hence its exercisability, is governed by Section 1. Under that section, since the power is not initially valid under Section 1(c)(1), Section 1(c)(2) applies and the power ceases to be exercisable 90 years after G’s death.

    Subsection (3) — Powers to Appoint a Fiduciary. Subsection (3) excludes from the Statutory Rule Against Perpetuities powers to appoint a fiduciary (a trustee, successor trustee, or co-trustee, a personal representative, successor personal representative, or co-personal representative, an executor, successor executor, or co-executor, etc.). Sometimes such a power is held by a fiduciary and sometimes not. In either case, the power is excluded from the Statutory Rule.

    Subsection (4) — Certain Distributive Fiduciary Power. The only distributive fiduciary power excluded from the Statutory Rule Against Perpetuities is the one described in subsection (4); the excluded power is a discretionary power of a trustee to distribute principal before the termination of a trust to a beneficiary who has an indefeasibly vested interest in the income and principal.

    Example (2). G devised property in trust, directing the trustee (a bank) to pay the income to A for life, then to A’s children; each child’s share of principal is to be paid to the child when he or she reaches 40; if any child dies under 40, the child’s share is to be paid to the child’s estate as a property interest owned by such child. The trustee is given the discretionary power to advance all or a portion of a child’s share before the child reaches 40. G was survived by A, who was then childless.

    The trustee’s discretionary power to distribute principal to a child before the child’s 40th birthday is excluded from the Statutory Rule Against Perpetuities. (The trustee’s duty to pay the income to A and after A’s death to A’s children is not subject to the Statutory Rule because it is a duty, not a power.)

    Subsection (5) — Charitable or Governmental Gifts. Subsection (5) codifies the common-law principle that a nonvested property interest held by a charity, a government, or a governmental agency or subdivision is excluded from the Rule Against Perpetuities if the interest was preceded by an interest that is held by another charity, government, or governmental agency or subdivision. See L. Simes & A. Smith, The Law of Future Interests §§ 1278-87 (2d ed. 1956); Restatement (Second) of Property (Donative Transfers) § 1.6 (1983); Restatement of Property § 397 (1944).

    Example (3). G devised real property “to the X School District so long as the premises are used for school purposes, and upon the cessation of such use, to Y City.”

    The nonvested property interest held by Y City (an executory interest) is excluded from the Statutory Rule under subsection (5) because it was preceded by a property interest (a fee simple determinable) held by a governmental subdivision, X School District.

    The exclusion of charitable and governmental gifts applies only in the circumstances described. If a nonvested property interest held by a charity is preceded by a property interest that is held by a noncharity, the exclusion does not apply; rather, the validity of the nonvested property interest held by the charity is governed by the other sections of this Act.

    Example (4). G devised real property “to A for life, then to such of A’s children as reach 25, but if none of A’s children reaches 25, to X Charity.”

    The nonvested property interest held by X Charity is not excluded from the Statutory Rule.

    If a nonvested property interest held by a noncharity is preceded by a property interest that is held by a charity, the exclusion does not apply; rather, the validity of the nonvested property interest in favor of the noncharity is governed by the other sections of this Act.

    Example (5). G devised real property “to the City of Sidney so long as the premises are used for a public park, and upon the cessation of such use, to my brother, B.”

    The nonvested property interest held by B is not excluded from the Statutory Rule by subsection (5).

    Subsection (6) — Trusts for Employees and Others; Trusts for Self-Employed Individuals. Subsection (6) excludes from the Statutory Rule Against Perpetuities nonvested property interests and powers of appointment with respect to a trust or other property arrangement, whether part of a “qualified” or “unqualified” plan under the federal income tax law, forming part of a bona fide benefit plan for employees (including owner- employees), independent contractors, or their beneficiaries or spouses. The exclusion granted by this subsection does not, however, extend to a nonvested property interest or a power of appointment created by an election of a participant or beneficiary or spouse.

    Subsection (7) — Pre-existing Exclusions from the Common-law Rule Against Perpetuities. Subsection (7) assures that all property interests, powers of appointment, or arrangements that were excluded from the Common-law Rule Against Perpetuities or are excluded by another statute of this state are also excluded from the Statutory Rule Against Perpetuities.

    Possibilities of reverter and rights of entry (also known as rights of re-entry, rights of entry for condition broken, and powers of termination) are not subject to the Common-law Rule Against Perpetuities, and so are excluded from the Statutory Rule. By statute in some states, possibilities of reverter and rights of entry expire if they do not vest within a specified period of years (such as 40 years). See Fratcher, A Modest Proposal for Trimming the Claws of Legal Future Interests, 1972 Duke L.J. 517, 527-31. See also Uniform Simplification of Land Transfers Act § 3-409. States adopting the Uniform Statutory Rule Against Perpetuities may wish to consider the enactment of some such limit on these interests, if they have not already done so.

    § 55.1-128. Prospective application.

    Sections 55.1-124 through 55.1-129 apply to a nonvested property interest or a power of appointment that is created on or after July 1, 2000. For purposes of this section, a nonvested property interest or a power of appointment created by the exercise of a power of appointment is created when the power is irrevocably exercised or when a revocable exercise becomes irrevocable.

    History. 2000, c. 714, § 55-12.5; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    OFFICIAL COMMENT

    Subsection (a): Act Not Retroactive. This section provides that, except as provided in subsection (b), the Statutory Rule Against Perpetuities and the other provisions of this Act apply only to nonvested property interests or powers of appointment created on or after the Act’s effective date. With one exception, in determining when a nonvested property interest or a power of appointment is created, the principles of Section 2 are applicable. Thus, for example, a property interest (or a power of appointment) created in a revocable inter vivos trust is created when the power to revoke terminates. See Example (1) in the Comment to Section 2.

    The second sentence of subsection (a) establishes a special rule for nonvested property interests (and powers of appointment) created by the exercise of a power of appointment. For purposes of this section only, a nonvested property interest (or a power of appointment) created by the exercise of a power of appointment is created when the power is irrevocably exercised or when a revocable exercise of the power becomes irrevocable. Consequently, all the provisions of this Act except Section 5(b) apply to a nonvested property interest (or power of appointment) created by a donee’s exercise of a power of appointment where the donee’s exercise, whether revocable or irrevocable, occurs on or after the effective date of this Act. All the provisions of this Act except Section 5(b) also apply where the donee’s exercise occurred before the effective date of this Act if: (i) that pre-effective-date exercise was revocable and (ii) that revocable exercise becomes irrevocable on or after the effective date of this Act. This special rule applies to the exercise of all types of powers of appointment — presently exercisable general powers, general testamentary powers, and nongeneral powers.

    If the application of this special rule determines that the provisions of this Act (except Section 5(b)) apply, then for all such purposes, the time of creation of the appointed nonvested property interest (or appointed power of appointment) is determined by reference to Section 2, without regard to the special rule contained in the second sentence of Section 5(a).

    If the application of this special rule of Section 5(a) determines that the provisions of this Act (except Section 5(b)) do not apply, then Section 5(b) is the only potentially applicable provision of this Act.

    Example (1) — Testamentary Power Created Before but Exercised After the Effective Date of this Act. G was the donee of a general testamentary power of appointment created by the will of his mother, M. M died in 1980. Assume that the effective date of this Act in the jurisdiction is January 1, 1987. G died in 1988, leaving a will that exercised his general testamentary power of appointment.

    Under the special rule in the second sentence of Section 5(a), any nonvested property interest (or power of appointment) created by G in his will in exercising his general testamentary power was created (for purposes of Section 5) at G’s death in 1988, which was after the effective date of this Act.

    Consequently, all the provisions of this Act apply (except Section 5(b)). That point having been settled, the next step is to determine whether the nonvested property interests or powers of appointment created by G’s testamentary appointment are initially valid under Section 1(a)(1), 1(b)(1), or 1(c)(1), or whether the wait-and-see element established in Section 1(a)(2), 1(b)(2), or 1(c)(2) apply. If the wait-and-see element does apply, it must also be determined when the allowable 90-year waiting period starts to run. In making these determinations, the principles of Section 2 control the time of creation of the nonvested property interests (or powers of appointment); under Section 2, since G’s power was a general testamentary power of appointment, the common-law relation-back doctrine applies and the appointed nonvested property interests (and appointed powers of appointment) are created at M’s death in 1980.

    If G’s testamentary power of appointment had been a nongeneral power rather than a general power, the same results as described above would apply.

    Example (2) — Presently Exercisable Nongeneral Power Created Before but Exercised After the Effective Date of this Act. Assume the same facts as in Example (1), except that G’s power of appointment was a presently exercisable nongeneral power. If G exercised the power in 1988, after the effective date of this Act (or, if a pre-effective-date revocable exercise of his power became irrevocable in 1988, after the effective date of this Act), the same results as described above in Example (1) would apply.

    Example (3) — Presently Exercisable General Power Created Before but Exercised After the Effective Date of this Act. Assume the same facts as in Example (1), except that G’s power of appointment was a presently exercisable general power. If G exercised the power in 1988, after the effective date of this Act (or, if a pre-effective-date revocable exercise of his power became irrevocable in 1988, after the effective date of this Act), all the provisions of this Act (except Section 5(b)) apply; for such purposes, Section 2 controls the date of creation of the appointed nonvested property interests (or appointed powers of appointment), without regard to the special rule of the second sentence of Section 5(a). With respect to the exercise of a presently exercisable general power, it is possible — indeed, probable — that the special rule of the second sentence of Section 5(a) and the rules of Section 2 agree on the same date of creation for their respective purposes, that date being the date the power was irrevocably exercised (or a revocable exercise thereof became irrevocable).

    Subsection (b): Reformation of Pre-existing Instruments. Although the Statutory Rule Against Perpetuities and the other provisions of this Act do not apply retroactively, subsection (b) recognizes a court’s authority to exercise its equitable power to reform instruments that contain a violation of the Common-law Rule Against Perpetuities (or of a statutory version or variation thereof) and to which the Statutory Rule does not apply because the offending nonvested property interest or power of appointment in question was created before the effective date of this Act. This equitable power to reform is recognized only where the violation of the former rule against perpetuities is determined in a judicial proceeding that is commenced on or after the effective date of this Act. See below.

    Without legislative authorization or direction, the courts in four states — Hawaii, Mississippi, New Hampshire, and West Virginia — have held that they have the power to reform instruments that contain a violation of the Common-law Rule Against Perpetuities. In re Estate of Chun Quan Yee Hop, 52 Hawaii 40, 469 P.2d 183 (1970); Carter v. Berry, 243 Miss. 321, 140 So.2d 843 (1962); Edgerly v. Barker, 66 N.H. 434, 31 A. 900 (1891); Berry v. Union Natl. Bank, 262 S.E.2d 766 (W.Va. 1980). In four other states — California, Missouri, Oklahoma, and Texas — the legislatures have enacted statutes conferring this power on the courts or directing the courts to reform defective instruments. Cal. Civ. Code § 715.5 (West 1982); Mo. Rev. Stat. § 442.555 (1978); Okla. Stat. tit. 60, §§ 75-78 (1981); Tex. Property Code § 5.043 (Vernon 1984). See also Idaho Code § 55-111 (1948). The California statute is silent as to whether or not it applies to nonvested property interests and powers of appointment created prior to the effective date of the Act; the only significant California appellate decision to apply the statute, Estate of Ghiglia, 42 Cal.App.3d 433, 116 Cal. Rptr. 827 (1974), involved a will where the testator died after the Act’s effective date. The Missouri, Oklahoma, and Texas statutes explicitly do not apply retroactively. The Hawaii, Mississippi, New Hampshire, and West Virginia decisions, however, invoked the court’s equitable power (sometimes called the cy pres power, and sometimes called the doctrine of equitable approximation or equitable modification) to reform pre-existing instruments that contained a violation of the Common-law Rule. Subsection (b) constitutes statutory authority for a court to exercise its equitable reformation power.

    Reformation Experience So Far. The existing judicial opinions and legislative provisions purport to adopt a principle of reformation that is consistent with the theme that the technique of reform should be shaped to grant every appropriate opportunity for the property to go to the intended beneficiaries. The New Hampshire court, for example, said that “where there is a general and a particular intent, and the particular one cannot take effect, the words shall be so construed as to give effect to the general intent.” Edgerly v. Barker, 66 N.H. 434, 467, 31 A. 900, 912 (1891) (citation omitted). The Hawaii court held that “any interest which would violate the Rule Against Perpetuities shall be reformed within the limits of that rule to approximate most closely the intention of the creator of the interest.” In re Estate of Chun Quan Yee Hop, 52 Hawaii 40, 46, 469 P.2d 183, 187 (1970). The Mississippi court described the reformation principle as “a simple rule of judicial construction, designed to aid the court to ascertain and carry out, as nearly as may be, the intention of the donor.” Carter v. Berry, 243 Miss. 321, 370, 140 So.2d 843, 852 (1962). The California statute provides that the authority to reform “shall be liberally construed and applied to validate [the] interest to the fullest extent consistent with [the] ascertained intent.” Cal. Civ. Code § 715.5.

    Unfortunately, all the cases that have arisen so far have been of one general type — contingencies in excess of 21 years — and all of the courts have simply ordered a reduction of the age or period in gross to 21.

    Guidance as to How to Reform. The above reformation efforts are unduly narrow. Subsection (b) is to be understood as authorizing a more appropriate technique — judicial insertion of a saving clause into the instrument. See Browder, Construction, Reformation, and the Rule Against Perpetuities, 62 Mich.L.Rev. 1 (1963); Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718, 1755-1759 (1983); Langbein & Waggoner, Reformation of Wills on the Ground of Mistake: Change of Direction in American Law?, 130 U.Pa.L.Rev. 521, 546-49 (1982). This method of reformation allows reformation to achieve an after-the-fact duplication of a professionally competent product. Such a technique would have been especially suitable in the cases that have already arisen, for it probably would have allowed the dispositions in all of them to have been rendered valid without disturbing the transferor’s intent at all. See Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718, 1756 n. 103 (1983). The insertion of a saving clause grants a more appropriate opportunity for the property to go to the intended beneficiaries. Furthermore, it would also be a suitable technique in fertile octogenarian, unborn widow, and administrative contingency cases. A saving clause is one of the formalistic devices that a professionally competent lawyer would have used before the fact to assure initial validity in these cases. Insofar as other violations are concerned, the saving clause technique also grants every appropriate opportunity for the property to go to the intended beneficiaries.

    In selecting the lives to be used for the perpetuity-period component of the saving clause that in a given case is to be inserted after the fact, the principle to be adopted is the same one that ought to guide lawyers in drafting such a clause before the fact: The group selected should be appropriate to the facts and the disposition. While the exact make-up of the group in each case would be settled by litigation, the individuals designated in Section 1.3(2) of the Restatement (Second) of Property (Donative Transfers) (1983) as the measuring lives would be an appropriate referent for the court to consider. Care should be taken in formulating the gift-over component, so that it is appropriate to the dispositive scheme. Among possible recipients that the court might consider designating are: (i) the persons entitled to the income on the 21st anniversary of the death of the last surviving individual designated by the court for the perpetuity-period component and in the proportions thereof to which they are then so entitled; if no proportions are specified, in equal shares to the permissible recipients of income; or (ii) the grantor’s descendants per stirpes who are living 21 years after the death of the last surviving individual designated by the court for the perpetuity-period component; if none, to the grantor’s heirs at law determined as if the grantor died 21 years after the death of the last surviving individual designated in the perpetuity-period component.

    Violation Must be Determined in a Judicial Proceeding Commenced On or After the Effective Date of this Act. The equitable power to reform is recognized by Section 5(b) only in situations where the violation of the former rule against perpetuities is determined in a judicial proceeding commenced on or after the effective date of this Act. The equitable power to reform would typically be exercised in the same judicial proceeding in which the invalidity is determined.

    § 55.1-129. Uniformity of application and construction.

    Sections 55.1-124 through 55.1-129 shall be applied and construed to effectuate their general purpose to make the law uniform with respect to the rule against perpetuities among states enacting it.

    History. 2000, c. 714, § 55-12.6; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-130. Certain limitations construed.

    Every limitation in any deed or will contingent upon the dying of any person without heirs, heirs of the body, issue, issue of the body, children, offspring or descendants, or other relatives shall be construed a limitation to take effect when such person dies not having such heir, issue, child, offspring, descendant, or other relative, as the case may be, living at the time of his death, or born to him within 10 months after his death, unless the intention of such limitation be otherwise plainly declared on the face of the deed or will creating it.

    History. Code 1919, § 5151; Code 1950, § 55-13; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 7A M.J. Estates, § 12.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Purpose of section. —

    The purpose of this section is to effectuate the intention of the testator by rendering valid a limitation which would have been otherwise invalid as violative of the rule against perpetuities. Since January 1, 1820, words which had previously been construed to mean an indefinite failure of issue are now construed to mean a definite failure of issue, and the limitations founded thereon are no longer void for remoteness. Daniel v. Lipscomb, 110 Va. 563 , 66 S.E. 850 , 1910 Va. LEXIS 95 (1910) (see Elys v. Wynne, 63 Va. (22 Gratt.) 224 (1872); Wine v. Markwood, 72 Va. (31 Gratt.) 43 (1878); Corr v. Porter, 74 Va. (33 Gratt.) 278 (1880); Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982)).

    This section focuses upon contingent limitations to estates. Mullins v. Simmons, 235 Va. 194 , 365 S.E.2d 771, 4 Va. Law Rep. 2141, 1988 Va. LEXIS 33 (1988).

    Rule incorporated in section. —

    A devise to a person with limitation over to another, in the event of the first taker’s death without issue, is a limitation which takes effect when the first devisee dies without heir or issue, and vests in the first devisee a defeasible fee. This rule is incorporated in this section. Rinker v. Trout, 171 Va. 327 , 198 S.E. 913 , 1938 Va. LEXIS 283 (1938).

    It is manifest from reading this section that it was the legislative intent that every limitation in a deed or will contingent upon the dying of any person without heirs, etc., should be construed to be a limitation to take effect when such person shall die not having such heirs, etc. People's Nat'l Bank v. Crickenberger, 159 Va. 264 , 165 S.E. 412 , 1932 Va. LEXIS 190 (1932).

    Section based on proposition that invalid limitation not intended. —

    The statutory rule is based upon the proposition that a testator does not intend to create an invalid limitation, but intends instead to make the limitation effective at a time not violative of the rule against perpetuities. Hence, where a will contains a bare provision that a limitation shall take effect upon the death of a person without issue, this section saves the limitation from a claim of remoteness by arbitrarily fixing the date of the person’s death as the time for determining whether he dies without issue. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795, 1982 Va. LEXIS 265 (1982).

    But plainly intended limitation given effect even if invalidation results. —

    Under this section, if a will declares plainly an intention that the limitation shall be effective at some later time, the intention will be given effect even though the declared time is impermissibly remote and results in the invalidation of the limitation. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795, 1982 Va. LEXIS 265 (1982).

    Purpose served where will fixes time earlier than that fixed by section. —

    If a will displays the testator’s intention that a die-without-issue limitation shall take effect earlier than the time fixed in this section, thus avoiding a possible claim of remoteness, the statutory purpose is served and the intent should be given effect. In these circumstances, an express declaration of intent on the face of the will is not necessary; it suffices if the intention to fix an earlier vesting date can be discerned from the application of conventional rules of construction. A contrary holding would permit use of this section to thwart, rather than effectuate, a testator’s intention. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795, 1982 Va. LEXIS 265 (1982).

    Section does not preempt consideration of all other rules of will construction. Rather, it is designed to complement other rules in the ascertainment of the true intention of the testator. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795, 1982 Va. LEXIS 265 (1982).

    Under the provisions of this section it is immaterial whether the testator meant heirs, or issue, or children; the language employed refers, in any event, to the death of the person not having such heir, issue, or child. The statute is devoid of ambiguity. People's Nat'l Bank v. Crickenberger, 159 Va. 264 , 165 S.E. 412 , 1932 Va. LEXIS 190 (1932).

    This section does not contemplate a limitation wherein an express and unlimited power to the grantee to dispose of the estate during his lifetime is created. The fact that the grantee is limited in the means of making disposition to a conveyance by deed and not given the power to dispose of it by will does not change the rule. Hall v. Hoak, 184 Va. 821 , 36 S.E.2d 567, 1946 Va. LEXIS 145 (1946) (see § 55-7).

    The statute does not effect a limitation expressly created upon an indefinite failure of descendants, as was true in Claiborne v. Wilson, 168 Va. 469 , 192 S.E. 585 (1937).

    Illustrations. —

    In 1833 W. made his will, and died. By clause 6 he gives to his daughter, D., a designated tract of land, to her and the heirs of her body; but should D. “die without heir, as above mentioned, my wish is that said land shall return to my other heirs, and be sold, and the moneys arising from the sale to be equally divided among all my heirs.” It was held that D. took a fee simple estate in the land defeasible upon her dying without a child living at her death. Elys v. Wynne, 63 Va. (22 Gratt.) 224, 1872 Va. LEXIS 15 (1872).

    Testatrix devised real property in fee simple to one N.E.P., if living, or to her issue, and if the said N.E.P. shall die without issue then the property shall pass to W.H.P., if living at the death of the said N.E.P. Bearing in mind the language of this section, and the holdings of the Supreme Court the limitation to W.H.P. was contingent upon N.E.P. dying without issue, and the language of the will had reference to the death of N.E.P. and not to the death of the testatrix. Farrar v. Pemberton, 154 Va. 61 , 152 S.E. 339 , 1930 Va. LEXIS 197 (1930).

    § 55.1-131. Employee trusts.

    Pension, profit sharing, stock bonus, annuity, or other employee trusts established by employers for the purpose of distributing the income and principal of such trust to some or all of their employees, or the beneficiaries of such employees, shall not be invalid as violating any laws or rules against perpetuities or restraints on the power of alienation of title to property; but such trusts may continue for such period of time as may be required by their provisions to accomplish the purposes for which they are established.

    History. 1950, p. 740, § 55-13.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-132. Determination of “lives in being” for purpose of rule against perpetuities.

    1. For the purpose of determining whether the terms of an inter vivos trust provide for a duration in excess of that allowed under the rule against perpetuities, the determination of “lives in being” shall be made as of the death of the settlor, if the settlor has at his death the unrestricted right, acting alone, to revoke the trust or to have transferred to himself the entire legal and beneficial interest in all property, both principal and income, held in the trust. In the event that the settlor surrenders both such rights at any time prior to his death, the determination of “lives in being” shall be made as of the time that the settlor, upon establishment of the trust or otherwise, surrenders the unrestricted right acting alone to revoke the trust and the unrestricted right acting alone to have transferred to himself the entire legal and beneficial interest in all property, both principal and income, held in the trust.
    2. This section shall apply only to a nonvested property interest in an inter vivos trust created before July 1, 2000.

    History. 1966, c. 260, § 55-13.2; 2000, c. 714; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    An option agreement which violates the rule against perpetuities is invalid and unenforceable. United Va. Bank v. Union Oil Co., 214 Va. 48 , 197 S.E.2d 174, 1973 Va. LEXIS 253 (1973).

    A perpetuities problem may not be solved by resort to what occurs after commencement of the period fixed by the rule. United Va. Bank v. Union Oil Co., 214 Va. 48 , 197 S.E.2d 174, 1973 Va. LEXIS 253 (1973).

    Where a trust contained a right of first refusal that was unlimited in duration, that section of the Declaration of Trust violated the rule against perpetuities, and therefore was stricken from the trust agreement. Joseph v. Pollak, 795 F. Supp. 163, 1992 U.S. Dist. LEXIS 8773 (E.D. Va. 1992).

    Vesting in beneficiary upon execution. —

    A trust created by Declaration and Supplemental Declaration of Trust did not violate the rule against perpetuities where the beneficial property interests vested in every beneficiary upon its execution, even though the trust contained no termination date. Joseph v. Pollak, 795 F. Supp. 163, 1992 U.S. Dist. LEXIS 8773 (E.D. Va. 1992).

    § 55.1-133. Application of the rule against perpetuities to nondonative transfers.

    1. Except for the transactions set forth in § 55.1-127 , which are governed by the provisions of §§ 55.1-124 through 55.1-129 , a nondonative transfer of an interest in property fails, if the interest does not vest, if it ever vests, within the period of the common-law rule against perpetuities.
    2. The provisions of this section (i) in force on June 30, 2000, shall apply to all donative interests created on or after July 1, 1982, and before July 1, 2000, and (ii) in force on July 1, 2000, shall apply to all nondonative interests created on or after July 1, 1982.

    History. 1982, c. 249, § 55-13.3; 2000, cc. 658, 714; 2013, c. 323; 2019, c. 712.

    Editor’s note.

    Acts 2013, c. 323, cl. 2 provides: “That the provisions of this act are declarative of existing law.”

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “Wills, Trusts, and Estates,” see 35 U. Rich. L. Rev. 845 (2001).

    For article, “The Future of Future Interests,” see 60 Wash. & Lee L. Rev. 513 (2003).

    For annual survey article, see “Wills, Trusts, and Estates,” 48 U. Rich. L. Rev. 189 (2013).

    Michie’s Jurisprudence.

    For related discussion, see 14B M.J. Perpetuities and Restraints on Alienation, § 4.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Section significantly modified the harsh rule against perpetuities by providing that no transfer of an interest in property will fail unless it does not vest, if at all, within the period of the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    Rule prior to enactment of section. —

    Prior to amendment in 1982 by the enactment of this section, the rule against perpetuities required that interests in property must vest, if at all, within the period fixed by the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    Period where parties are corporate entities. —

    Normally, the period is a life or lives in being plus 21 years and 10 months. However, where the parties are corporate entities and do not contract with reference to a life or lives in being, the determinative period is 21 years from the date of creation of the interest. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    Rule not violated where reasonable time for performance less than 21 years. —

    Where a reasonable time for performance of the contract, as contemplated by the parties, would be well within 21 years, the contract does not violate the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    Reasonable time for development of subdivision lots is less than 21 years. —

    Settled contract law implies a reasonable time limitation for performance of conditions in contracts for the sale of land where no time for performance is fixed by the contract itself. This reasoning is applicable in the context of a contract for sale of residential lots to be developed as a subdivision. Where the sellers agreed to develop any lots for which the purchaser exercised the option, the sellers were obligated to perform this duty within a reasonable time or be subject to remedies the purchaser might pursue for the sellers’ breach of the express terms of the contract. A reasonable time for completion of development would be far less than 21 years. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    Option contracts. —

    The rule against perpetuities is applicable to option contracts. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    This section may not be applied retroactively to save the right of first refusal subject to the rule against perpetuities. Lake of the Woods Ass'n v. McHugh, 238 Va. 1 , 380 S.E.2d 872, 5 Va. Law Rep. 2689, 1989 Va. LEXIS 124 (1989).

    This section may not be retroactively applied to save a right of first refusal of unlimited duration. Joseph v. Pollak, 795 F. Supp. 163, 1992 U.S. Dist. LEXIS 8773 (E.D. Va. 1992).

    Upon exercise of an option to purchase subdivision lots, the purchaser would acquire an equitable interest in the lots it committed itself to purchase, with the right to compel conveyance of legal title and the agreement would become an executory contract for the sale of land with mutuality of obligation and remedy. Such a contract creates an interest in land enforceable in equity and is therefore subject to the rule against perpetuities. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399, 1985 Va. LEXIS 223 (1985).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Validity of right of first refusal. —

    Pursuant to § 8.01-184 , the trial court declared that a right of first refusal in the articles of incorporation of a company was void ab initio, as this limitation on the transfer of stock was an unreasonable restraint, and also violated the rule against perpetuities. Frazer v. Millington, 63 Va. Cir. 458, 2003 Va. Cir. LEXIS 256 (Fairfax County Dec. 15, 2003).

    Rule not violated. —

    Where the contract for the sale of land provided that, if the property was not subdivided by the date of closing, that date was to be extended day-for-day until the sellers’ subdivision and/or adjustment of property lines was approved, the contract did not violate the rule against perpetuities as provided under subsection A of § 55-13.3; that section required a court to examine whether 21 years had passed and whether or not the interest had vested, and although the property was subdivided and the subdivision plat was recorded late, this was done in less than one and one-half years or within the 21-year period provided in subsection A of § 55-13.3.Bel-Aire, Inc. v. RB Trexlertown, LLC, 68 Va. Cir. 108, 2005 Va. Cir. LEXIS 138 (Virginia Beach May 24, 2005).

    Article 3. Joint Ownership of Real or Personal Property.

    § 55.1-134. Survivorship between joint tenants abolished.

    1. When any joint tenant dies, before or after the vesting of the estate, whether the estate is real or personal, or whether partition could have been compelled or not, his part shall descend to his heirs, pass by devise, or go to his personal representative, subject to debts or distribution, as if he had been a tenant in common.
    2. This section shall not apply to any estate that joint tenants have as fiduciaries or to any real or personal property transferred to persons in their own right when it manifestly appears from the tenor of the instrument transferring such property or memorializing the existence of a chose in action that it was intended the part of the one dying should then belong to the others. This section does not affect the mode of proceeding on any joint judgment or order in favor of or on any contract with two or more one of whom dies.

    History. Code 1919, §§ 5159, 5160; Code 1950, §§ 55-20, 55-21; 1990, c. 831; 1999, c. 196; 2001, c. 718; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For note on creditors’ rights and cotenancies, see 48 Va. L. Rev. 405 (1962).

    For comment on extension of entireties doctrine, see 20 Wash. & Lee L. Rev. 260 (1963).

    For comment, “Multiple-Party Accounts: Does Virginia Law Correspond With the Expectations of the Average Depositor?,” see 14 U. Rich. L. Rev. 851 (1980).

    For survey of Virginia law on wills, trusts, and estates for year 1979-80, see 67 Va. L. Rev. 369 (1981).

    Michie’s Jurisprudence.

    For related discussion, see 2C M.J. Bankruptcy, § 81.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.
    A.Notes From Former Section 55-20.

    History and effect of statute. —

    In Virginia, as between joint tenants, survivorship was abolished as early as July 1st, 1787, but this act was held to have no application to tenants by entireties. See Thornton v. Thornton, 24 Va. (3 Rand.) 179, 1825 Va. LEXIS 15 (1825); M'Clanachan v. Siter, Price & Co., 42 Va. 280 (1845); Norman's Ex'x v. Cunningham, 46 Va. (5 Gratt.) 63, 1848 Va. LEXIS 26 (1848); Dooley v. Baynes, 86 Va. 644 , 10 S.E. 974 , 1890 Va. LEXIS 25 (1890).

    It was also held that the statute abolishing survivorship between joint tenants had no application where the estate in joint tenancy had not vested, and, hence, when one joint tenant predeceased the testator the whole estate passed to the survivor. Lockhart v. Vandyke, 97 Va. 356 , 33 S.E. 613 (1899). This doctrine was changed in 1919 by the enactment of the present statute. Gardner v. Gardner, 152 Va. 677 , 148 S.E. 781 , 1929 Va. LEXIS 200 (1929).

    The effect of this section and § 55-21 is to abolish tenancies by the entirety and joint tenancies unless it is manifest from the wording of the conveyance that the grantor intends to establish a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739, 1995 U.S. Dist. LEXIS 9357 (W.D. Va. 1995).

    This section and § 55-21 fall in line with the development that the ancient common-law rule favoring joint tenancies has been reversed, and the presumptions are now almost wholly in favor of tenancies in common by requiring that the desire to create a survivorship interest be manifestly apparent from the tenor of the instrument in order to establish a joint tenancy or a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739, 1995 U.S. Dist. LEXIS 9357 (W.D. Va. 1995).

    This section abolishes survivorship as between joint tenants. Wilkinson v. Witherspoon, 206 Va. 297 , 142 S.E.2d 478, 1965 Va. LEXIS 198 (1965).

    The doctrine of survivorship between joint tenants has been abolished by this section, and the legislature intended to place joint tenants, insofar as dower and curtesy are concerned, in the same situation as tenants in common. Turner v. Turner, 185 Va. 505 , 39 S.E.2d 299, 1946 Va. LEXIS 223 (1946); Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906, 1951 Va. LEXIS 236 (1951).

    Survivorship not created. —

    A deed conveying land to grantees “as joint tenants, and not as tenants in common” does not create an estate with survivorship. Hoover v. Smith, 248 Va. 6 , 444 S.E.2d 546, 10 Va. Law Rep. 1430, 1994 Va. LEXIS 106 (1994).

    Subject to certain statutory exceptions in the section following. Rady v. Staiars, 160 Va. 373 , 168 S.E. 452 , 1933 Va. LEXIS 218 (1933); Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906, 1951 Va. LEXIS 236 (1951).

    This section is not applicable where it is manifest from the tenor of the instrument that it is intended that the part of the one dying should belong to the survivors. Leonard v. Boswell, 197 Va. 713 , 90 S.E.2d 872, 1956 Va. LEXIS 143 (1956).

    Survivorship can be conferred only by the instrument conveying property. —

    Since the enactment of §§ 55-20 and 55-21, survivorship can be conferred only by the instrument conveying the property. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44, 8 Va. Law Rep. 1707, 1992 Va. LEXIS 148 (1992).

    Estates by entireties are abolished except where the deed or will manifests an intent that they shall continue. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , 1929 Va. LEXIS 234 (1929).

    In Virginia, when real property is conveyed to a husband and wife, the deed must specify that a tenancy by the entirety is intended or a tenancy in common results. In re Manicure, 29 Bankr. 248, 1983 Bankr. LEXIS 7098 (Bankr. W.D. Va. 1983).

    And converted into tenancies in common. —

    The effect of this section when an estate is conveyed to a husband and wife, is to convert a tenancy by entirety into a tenancy in common and of course to destroy survivorship, but § 55-21 provides that this section shall not apply when it was manifest from the instrument creating the estate that it was intended that the part of the one dying should then belong to the other. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , 1929 Va. LEXIS 234 (1929).

    The deed in question did in fact create a tenancy by the entireties, notwithstanding the lack of language using those specific words, since the intent was conveyed by the language “with the full common law right of survivorship.” In re Zella, 196 Bankr. 752, 1996 Bankr. LEXIS 657 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712, 1996 U.S. Dist. LEXIS 16968 (E.D. Va. 1996).

    A conveyance to husband and wife creates only a tenancy in common, unless it manifestly appears from the tenor of the instrument that it was intended on the part of the one dying that the property in question should then belong to the other. In re Zella, 196 Bankr. 752, 1996 Bankr. LEXIS 657 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712, 1996 U.S. Dist. LEXIS 16968 (E.D. Va. 1996).

    In Virginia, estates by the entireties are abolished except where the deed or will manifests an intent of survivorship. In re Scialdone, 197 Bankr. 225, 1995 Bankr. LEXIS 1976 (Bankr. E.D. Va. 1995).

    Manifest means “obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident and self-evident.” In re Scialdone, 197 Bankr. 225, 1995 Bankr. LEXIS 1976 (Bankr. E.D. Va. 1995).

    It will be observed that partition is not compellable by statute between tenants by entirety, but that end is reached through this section, which makes tenants by entirety tenants in common. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , 1929 Va. LEXIS 234 (1929).

    Survivor’s interest in personal property unclear. —

    Although this section had effect of abolishing survivorship between husband and wife with respect to both real and personal property unless an intent to create a survivorship interest was clearly expressed, it does not address the question of whether the resulting survivorship interest is held as joint tenants or as tenants by the entirety. With respect to real property, it is clear that an estate by the entirety is created; but whether the same would be true with respect to personal property is far from clear. In re Massey, 225 Bankr. 887, 1998 Bankr. LEXIS 1338 (Bankr. E.D. Va. 1998).

    The deed which purports to establish a tenancy by the entirety between persons who are not married to each other creates a joint tenancy; the words of survivorship expressly manifest the requisite intent that the joint tenancy is clothed with the common-law right of survivorship, and, this express manifestation of survivorship necessarily excludes the wife’s dower interest. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44, 8 Va. Law Rep. 1707, 1992 Va. LEXIS 148 (1992).

    The interest of the surviving joint tenant is superior to the dower interest of the wife of the other joint tenant. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44, 8 Va. Law Rep. 1707, 1992 Va. LEXIS 148 (1992).

    No application to derivatives of property held by entireties. —

    Neither this section nor § 55-21 was intended to apply to derivatives of property held by the entireties. Moore v. Glotzbach, 188 F. Supp. 267, 1960 U.S. Dist. LEXIS 4641 (E.D. Va. 1960).

    Right to hold personalty by entireties. —

    This section and § 55-21, when read together, carry the inference that Virginia recognizes the right to hold personalty as tenants by the entireties. Moore v. Glotzbach, 188 F. Supp. 267, 1960 U.S. Dist. LEXIS 4641 (E.D. Va. 1960).

    A lease to a tenant does not qualify as a conveyance or devise to a husband and wife as provided by this section, and hence the exception stated in § 55-21 would be inapplicable to the lease and rental flowing therefrom. Moore v. Glotzbach, 188 F. Supp. 267, 1960 U.S. Dist. LEXIS 4641 (E.D. Va. 1960).

    Reservation by grantor of estate for himself and wife “during the period of their natural lives.” —

    Since the enactment of this section, changing the common-law doctrine of tenants by entireties, if a husband by his sole deed conveys land excepting from the grant an estate “for and during the period of the natural lives” of himself and wife, each has only a life interest in one moiety of the land. If the exception be treated as a grant, then under the statute they take as tenants in common a moiety each. But in neither event is there any survivorship between them. American Nat'l Bank v. Taylor, 112 Va. 1 , 70 S.E. 534 , 1911 Va. LEXIS 44 (1911).

    Partition. —

    A joint tenancy with right of survivorship, as at common law, is subject to partition by a judgment lien creditor of one of the several joint tenants. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61, 1984 Va. LEXIS 279 (1984).

    The words “joint tenants” as used in § 8.01-81 were intended by the legislature to include joint tenants with right of survivorship and, pursuant to § 8.01-81 , such tenants shall be compellable to make partition at the instance of a judgment lien creditor. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61, 1984 Va. LEXIS 279 (1984).

    Parties formerly married to each other, but thereafter divorced, are as free to hold property jointly under the exception contained in § 55-21 as are any other parties and although they lack one of the essential unities prerequisite to the creation of a tenancy by the entirety, they may become joint tenants, and if the instrument creating the estate manifests the requisite intention, the joint tenancy will be clothed with the common-law right of survivorship, unaffected by this section. Gant v. Gant, 237 Va. 588 , 379 S.E.2d 331, 5 Va. Law Rep. 2322, 1989 Va. LEXIS 65 (1989).

    Section construed with former § 64.1-64. —

    Reading this section and former § 64.1-64, bearing in mind the common-law doctrine governing lapses, the conclusion is irresistible that a devise to a joint tenant who predeceases the testator would lapse, just as a devise to a tenant in common would do, unless the tenant left issue who survived the testator, or unless a different disposition thereof be made or required by the will. Gardner v. Gardner, 152 Va. 677 , 148 S.E. 781 , 1929 Va. LEXIS 200 (1929).

    Tenancy by entirety property is not exempt from process by a joint creditor of the husband and wife. Community Bank v. Costley, 39 Bankr. 585, 1984 Bankr. LEXIS 5662 (Bankr. E.D. Va. 1984).

    Creditors of one spouse may not attach real estate owned by tenants by the entireties; only creditors with joint debts of both spouses may reach the entireties’ realty. Ford v. Poston, 53 Bankr. 444, 1984 U.S. Dist. LEXIS 14804 (W.D. Va. 1984), disapproved, In re Smiley, 864 F.2d 562, 1989 U.S. App. LEXIS 257 (7th Cir. 1989).

    Proceeds of entireties’ realty are immune from creditors whom individual spouse owes. Ford v. Poston, 53 Bankr. 444, 1984 U.S. Dist. LEXIS 14804 (W.D. Va. 1984), disapproved, In re Smiley, 864 F.2d 562, 1989 U.S. App. LEXIS 257 (7th Cir. 1989).

    Application of law of another state. —

    Florida law was applied to determine the creation of an estate by the entireties in certain bonds, and Virginia law was consulted as to the incidents of the estate. Johnson v. McCarty, 202 Va. 49 , 115 S.E.2d 915, 1960 Va. LEXIS 189 (1960).

    B.Notes From Former Section 55-21.

    This section limits the provisions of § 55-20 abolishing survivorship in certain cases. The pertinent exception in this section is that the right of survivorship shall not be abolished “when it manifestly appears from the tenor of the instrument that it was intended the part of the one dying should then belong to the others.” Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906, 1951 Va. LEXIS 236 (1951).

    The effect of § 55-20 and this section is to abolish tenancies by the entirety and joint tenancies unless it is manifest from the wording of the conveyance that the grantor intends to establish a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739, 1995 U.S. Dist. LEXIS 9357 (W.D. Va. 1995).

    There is no contrary public policy or prohibitive legislation affecting the creation of a joint tenancy with right of survivorship. Leonard v. Boswell, 197 Va. 713 , 90 S.E.2d 872, 1956 Va. LEXIS 143 (1956).

    Right of survivorship depends on intention. —

    Where it manifestly appears from the tenor of the will that the share of one dying should then belong to the others, survivorship in such a case is not abolished. Drake v. Blythe, 108 Va. 38 , 60 S.E. 632 , 1908 Va. LEXIS 7 (1908).

    This section was inapplicable where the only “instrument” to which two joint depositors were a party, affecting their interest in treasury bill purchased by bank at the direction of deceased depositor, was a “Security Buy Memo,” which contained no words evidencing an intent to create a right of survivorship. Bennet v. First & Merchants Nat'l Bank, 233 Va. 355 , 355 S.E.2d 888, 3 Va. Law Rep. 2467, 1987 Va. LEXIS 200 (1987).

    In Virginia, estates by the entireties are abolished except where the deed or will manifests an intent of survivorship. In re Scialdone, 197 Bankr. 225, 1995 Bankr. LEXIS 1976 (Bankr. E.D. Va. 1995).

    The deed in question did in fact create a tenancy by the entireties, notwithstanding the lack of language using those specific words, since the intent was conveyed by the language “with the full common law right of survivorship.” In re Zella, 196 Bankr. 752, 1996 Bankr. LEXIS 657 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712, 1996 U.S. Dist. LEXIS 16968 (E.D. Va. 1996).

    This section requires only that the intention to create a survivorship estate be made manifest. To satisfy this requirement, parties need only use language that passes a simple test, one inherent in the meaning of the word “manifest.” Manifest means “obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident, and self-evident.” Hoover v. Smith, 248 Va. 6 , 444 S.E.2d 546, 10 Va. Law Rep. 1430, 1994 Va. LEXIS 106 (1994).

    A joint estate or one to donees, share and share alike, etc., is not enough to give a right of survivorship. The donor or testator must make plain his purpose, but when that purpose has been made plain and it is manifest that he intended survivorship should follow, the court will give effect to this intention, and no particular words are necessary. Wallace v. Wallace, 168 Va. 216 , 190 S.E. 293 , 1937 Va. LEXIS 218 (1937).

    The doctrine of survivorship in the case of executors obtains in Virginia and this is true even though it should be conceded that this section and § 64.1-145 do not apply. Hofheimer v. Seaboard Citizens' Nat'l Bank, 154 Va. 896 , 156 S.E. 581 , 1931 Va. LEXIS 293, cert. denied, 283 U.S. 855, 51 S. Ct. 648, 75 L. Ed. 1462, 1931 U.S. LEXIS 403 (1931).

    In the instant case appellant and a state bank were designated as coexecutors in a will. Before the death of testator the state bank was merged in appellee, a national bank. It was held that the right of survivorship is preserved and appellant was entitled to qualify as the sole surviving executor of the testator. Hofheimer v. Seaboard Citizens' Nat'l Bank, 154 Va. 392 , 153 S.E. 656 , 1930 Va. LEXIS 221 (1930), cert. denied, 283 U.S. 855, 51 S. Ct. 648, 75 L. Ed. 1462, 1931 U.S. LEXIS 403 (1931).

    Conveyances within section. —

    Where land is conveyed to “husband and wife, as tenants by the entireties, with right of survivorship as at common law,” such quoted words are not meaningless, but are placed in the deed for the express purpose of bringing the conveyance within the exception to § 55-20 contained in this section. Vasilion v. Vasilion, 192 Va. 735 , 66 S.E.2d 599, 1951 Va. LEXIS 222 (1951).

    Manifest means “obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident and self-evident.” In re Scialdone, 197 Bankr. 225, 1995 Bankr. LEXIS 1976 (Bankr. E.D. Va. 1995).

    A lease to a tenant does not qualify as a conveyance or devise to a husband and wife as provided by § 55-20, and hence the exception stated in this section would be inapplicable to the lease and rental flowing therefrom. Moore v. Glotzbach, 188 F. Supp. 267, 1960 U.S. Dist. LEXIS 4641 (E.D. Va. 1960).

    Termination of entirety estate. —

    Implicit in the terms under which an entirety estate originates is the proposition that the estate can be terminated only by the voluntary action of both tenants or the death of one as a result of a cause reasonably contemplated at the time the tenancy is created. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787, 1980 Va. LEXIS 240 (1980), cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414, 1981 U.S. LEXIS 2367 (1981).

    Where one entirety tenant murders the other, the “one person” fiction must give way to the reality that, by his murderous act, the killer has destroyed the unitary nature of the entirety estate and, contrary to his implied agreement, for all practical purposes has terminated the tenancy by a cause of death not contemplated at the time of the original conveyance. While this sort of practical termination may not be sufficient to pass legal title to those claiming under the victim, it would justify limiting the killer’s interest for their benefit. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787, 1980 Va. LEXIS 240 (1980), cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414, 1981 U.S. LEXIS 2367 (1981).

    Parties formerly married to each other, but thereafter divorced, are as free to hold property jointly under the exception contained in this section as are any other parties and although they lack one of the essential unities prerequisite to the creation of a tenancy by the entirety, they may become joint tenants, and if the instrument creating the estate manifests the requisite intention, the joint tenancy will be clothed with the common-law right of survivorship, unaffected by § 55-20. Gant v. Gant, 237 Va. 588 , 379 S.E.2d 331, 5 Va. Law Rep. 2322, 1989 Va. LEXIS 65 (1989).

    Joint bank accounts. —

    The provisions of this section apply to bank accounts. Wilkinson v. Witherspoon, 206 Va. 297 , 142 S.E.2d 478, 1965 Va. LEXIS 198 (1965).

    A joint estate in a bank account with right of survivorship was held to have been expressly created in accord with this section. Johnson v. McCarty, 202 Va. 49 , 115 S.E.2d 915, 1960 Va. LEXIS 189 (1960).

    Where a bank deposit by a person is in the name of himself and another, not his wife, the presumption is that it was done for the purpose of convenience only, and this presumption is strengthened by the illness or infirmity of the depositor. King v. Merryman, 196 Va. 844 , 86 S.E.2d 141, 1955 Va. LEXIS 154 (1955); Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869, 1962 Va. LEXIS 195 (1962).

    In the absence of any statutory presumption, the rule is that when a person deposits his money in the bank to the credit of himself and another, payable to the order of either, or to the survivor, the rights and interests of the depositors as between themselves are dependent upon whether the owner of the money intended to make a gift to the other, or whether the account was entered in joint form in accordance with a contract or for other purposes. Wrenn v. Daniels, 200 Va. 419 , 106 S.E.2d 126, 1958 Va. LEXIS 203 (1958); Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869, 1962 Va. LEXIS 195 (1962).

    Parol evidence is admissible to show the intent of a person setting up a joint bank account. Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869, 1962 Va. LEXIS 195 (1962).

    Where deceased had directed a bank to change his account to a joint account of himself and his daughter, but the tenor of his instructions to the bank and the form of deposit did not show that the intention to create a tenancy with survivorship “manifestly appeared,” the daughter did not take the fund by survivorship. King v. Merryman, 196 Va. 844 , 86 S.E.2d 141, 1955 Va. LEXIS 154 (1955).

    This section applies to bank accounts. Colley v. Cox, 209 Va. 811 , 167 S.E.2d 317, 1969 Va. LEXIS 183 (1969).

    Investment accounts. —

    Where, in selecting the type of account to be opened, the depositor and his daughter checked the box for “Joint Tenants with Rights of Survivorship” and the agreement further stated that in the event of the death of either, the entire interest in the account would vest in the survivor, this language was unambiguous and manifestly signified the intent that the entire interest in the account would vest in the surviving tenant upon the death of the joint tenant. Buck v. Jordan, 256 Va. 535 , 508 S.E.2d 880, 1998 Va. LEXIS 130 (1998).

    Partition. —

    A joint tenancy with right of survivorship, as at common law, is subject to partition by a judgment lien creditor of one of the several joint tenants. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61, 1984 Va. LEXIS 279 (1984).

    The words “joint tenants” as used in § 8.01-81 were intended by the legislature to include joint tenants with right of survivorship and, pursuant to § 8.01-81 , such tenants shall be compellable to make partition at the instance of a judgment lien creditor. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61, 1984 Va. LEXIS 279 (1984).

    In the instant case there was a conveyance after marriage to a man and his wife jointly. The intention was manifest that the estate by entirety should not be converted into an estate in common and therefore, as provided by this section, § 55-20 did not apply. The seisin was per tout et non per mie, and there is survivorship upon the death either of husband or wife and neither can dispose of any part of the estate without the consent of the other. Since there is no separate interest in either tenant there can be no partition. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , 1929 Va. LEXIS 234 (1929).

    In a suit to compel a partition, complainant alleged that a certain lot was conveyed to defendant and his wife to be held by them as joint tenants with common-law right of survivorship; that defendant deserted his wife, and the latter conveyed all her interest in the property to complainant, her daughter; that as a result complainant and defendant were tenants in common and that complainant had a right to compel a partition. That the parties to the original deed intended the part of a dying grantee to belong to the survivor was conceded, and a demurrer to the bill was sustained. Burroughs v. Gorman, 166 Va. 58 , 184 S.E. 174 , 1936 Va. LEXIS 162 (1936).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Action to enforce agreement signed by partners. —

    Trial court dismissed an action in which a surviving partner filed action against a deceased partner’s heirs, seeking specific performance of an agreement that gave the deceased partner’s interest in a warehouse to the surviving partner, because the surviving partner sued the heirs as individuals, instead of suing the administratrix of the deceased partner’s estate, but gave the surviving partner leave to amend her bill of complaint to name the administratrix as a party. Quenza v. Baum, 62 Va. Cir. 284, 2003 Va. Cir. LEXIS 295 (Norfolk July 14, 2003).

    Joint bank accounts. —

    Couple’s bank account was not subject to garnishment, as it was owned as tenants by the entirety; the signature card plainly “manifested” an intent of survivorship, as the words “with survivorship” were expressly contained on the card. Sulzman v. Barnick, 62 Va. Cir. 139, 2003 Va. Cir. LEXIS 93 (Spotsylvania County June 9, 2003).

    § 55.1-135. Joint ownership in real and personal property.

    Any persons may own real or personal property as joint tenants with or without a right of survivorship. When any person causes any real or personal property, or any written memorial of a chose in action, to be titled, registered, or endorsed in the name of two or more persons “jointly,” as “joint tenants,” in a “joint tenancy,” or other similar language, such persons shall own the property in a joint tenancy without survivorship as provided in § 55.1-134 . If, in addition, the expression “with survivorship,” or any equivalent language, is employed in such titling, registering, or endorsing, it shall be presumed that such persons are intended to own the property as joint tenants with the right of survivorship as at common law. This section is not applicable to multiple party accounts under Article 2 (§ 6.2-604 et seq.) of Chapter 6 of Title 6.2 or to any other matter specifically governed by another provision of the Code.

    If any real or personal property is conveyed or devised to spouses, they shall take and hold such property by moieties in the same manner as if a distinct moiety had been given to each spouse by a separate conveyance, unless language as provided in this section or in § 55.1-136 is used that designates the tenancy as a joint tenancy or a tenancy by the entirety and all requirements for holding property by such tenancy are met.

    History. Code 1919, § 5160; Code 1950, § 55-21; 1999, c. 196, § 55-20.1; 2000, c. 331; 2001, c. 718; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.Decided Under Current Law.

    Garnishment. —

    In a garnishment action, even if the insureds did have the requisite common-law unities, the insurance policy did not create a contractual right held by them with the common-law right of survivorship, an essential attribute of a tenancy by the entirety, as the policy did not use the expression “tenants by the entireties” or “tenants by the entirety”; and it did not state that the insureds held whatever interest they might have with the “right of survivorship” as at common law. Jones v. Phillips, 299 Va. 285 , 850 S.E.2d 646, 2020 Va. LEXIS 141 (2020).

    II.Decided Under Prior Law.

    In general. —

    Based on the language of a deed, the directives of § 55-20.1, and the rulings of the Virginia Supreme Court and the Fourth Circuit, Chapter 7 debtor and her mother were joint tenants, and not tenants in common. Debtor’s interest as a joint tenant with the right of survivorship became property of her bankruptcy estate. Scott v. Hoole (In re Hoole), No. 17-50262, 2018 Bankr. LEXIS 810 (Bankr. W.D. Va. Mar. 21, 2018).

    In arguing that her joint tenancy with her mother was owned unequally and that extrinsic evidence was necessary to determine the portion owned by each joint tenant, a Chapter 7 debtor’s reliance on § 58.1-3211.1 was misplaced, as that provision confined its applicability to tax relief and nothing in that provision suggested that it negated § 55-20.1.Scott v. Hoole (In re Hoole), No. 17-50262, 2018 Bankr. LEXIS 810 (Bankr. W.D. Va. Mar. 21, 2018).

    § 55.1-136. Tenants by the entirety in real and personal property; certain trusts.

    1. Spouses may own real or personal property as tenants by the entirety for as long as they are married. Personal property may be owned as tenants by the entirety whether or not the personal property represents the proceeds of the sale of real property. An intent that the part of the one dying should belong to the other shall be manifest from a designation of the spouses as “tenants by the entireties” or “tenants by the entirety.”
    2. Except as otherwise provided by statute, no interest in real property held as tenants by the entirety shall be severed by written instrument unless the instrument is a deed signed by both spouses as grantors.
    3. Notwithstanding any contrary provision of § 64.2-747 , any property of spouses that is held by them as tenants by the entirety and conveyed to their joint revocable or irrevocable trusts, or to their separate revocable or irrevocable trusts, and any proceeds of the sale or disposition of such property, shall have the same immunity from the claims of their separate creditors as it would if it had remained a tenancy by the entirety, so long as (i) they remain married to each other, (ii) it continues to be held in the trust or trusts, and (iii) it continues to be their property, including where both spouses are current beneficiaries of one trust that holds the entire property or each spouse is a current beneficiary of a separate trust and the two separate trusts together hold the entire property, whether or not other persons are also current or future beneficiaries of the trust or trusts. The immunity from the claims of separate creditors under this subsection may be waived as to any specific creditor, including any separate creditor of either spouse, or any specifically described property, including any former tenancy by the entirety property conveyed into trust, by the trustee acting under the express provision of a trust instrument or with the written consent of both spouses.

    History. 2001, c. 718, § 55-20.2; 2006, c. 281; 2015, c. 424; 2017, c. 38; 2019, c. 712.

    Editor’s note.

    Acts 2015, c. 424, cl. 2 provides: “That the provisions of this act apply to any property of a husband and wife that is held by them as tenants by the entireties and conveyed to their joint revocable or irrevocable trusts, or to their separate revocable or irrevocable trusts, regardless of whether such conveyance occurred before or after the effective date of this act.”

    Amendment by House Bill 2050 (Acts 2017, c. 38) as introduced, was in response to Evans v. Evans , 290 Va. 176 , 772 S.E.2d 576, 2015 Va. LEXIS 84 (2015), and, was a recommendation of the Boyd-Graves Conference.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For annual survey article, “Bankruptcy Law,” see 44 U. Rich. L. Rev. 201 (2009).

    CASE NOTES

  • Analysis
  • I.Decided Under Current Law.

    Garnishment. —

    Circuit court erred in dismissing the garnishment because there was no disposition of the property as a disposition involved an act of transferring something to another’s care or possession or the relinquishing of property, and the property in the current case was not transferred to the insurer or to anyone else. Jones v. Phillips, 299 Va. 285 , 850 S.E.2d 646, 2020 Va. LEXIS 141 (2020).

    In a garnishment action, even if the insureds did have the requisite common-law unities, the insurance policy did not create a contractual right held by them with the common-law right of survivorship, an essential attribute of a tenancy by the entirety, as the policy did not use the expression “tenants by the entireties” or “tenants by the entirety”; and it did not state that the insureds held whatever interest they might have with the “right of survivorship” as at common law. Jones v. Phillips, 299 Va. 285 , 850 S.E.2d 646, 2020 Va. LEXIS 141 (2020).

    II.Decided Under Prior Law.

    Gift from husband to wife of his interest in the proceeds from the sale of real property that they owned as tenants by the entirety was not fraud as to the rights of the husband’s creditor because the creditor was not prejudiced by a gift of property that was exempt from their claims. The gift was not void under § 55-81. Banc of Am. Leasing & Capital LLC v. Havel, No. 4:05cv90, 2006 U.S. Dist. LEXIS 70828 (E.D. Va. Sept. 29, 2006).

    Ownership of motor vehicles. —

    Section 46.2-622 , which is a specific statute prohibiting motor vehicles from being held as tenants by the entirety, limits subsection A of § 55-20.2, which allows personal property in general to be held as tenants by the entirety. In re Rodriguez, 406 Bankr. 707, 2008 Bankr. LEXIS 2659 (Bankr. E.D. Va. 2008).

    Chapter 7 debtor could not exempt a minivan jointly owned with his non-debtor wife as tenancy by the entireties property because, although § 55-20.2 permitted a husband and wife to own real or personal property as tenants by the entireties, § 46.2-622 precluded holding title to a motor vehicle as tenants by the entirety. In re Cordova, 394 Bankr. 389, 2008 Bankr. LEXIS 2956 (Bankr. E.D. Va. 2008).

    Motor vehicles are not exempt property. —

    Debtors were not entitled to claim their motor vehicles as exempt tenants by the entirety property under 11 U.S.C.S. § 522(b)(3)(B) because § 46.2-622 did not allow them to be held as tenants by the entirety, and the tenants by the entirety estate in the proceeds from an equity line of credit terminated upon the purchase of the vehicles. In re Rodriguez, 406 Bankr. 707, 2008 Bankr. LEXIS 2659 (Bankr. E.D. Va. 2008).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Joint bank account by husband and wife held as tenants by entirety. —

    Judgment creditor was unable to garnish a judgment debtor’s bank account, where it was a joint account held with the debtor’s wife, who was not a debtor to the creditor, as they held the property as tenants by the entirety under § 55-20.2; it was noted that prior to application of § 6.1-125.3 [now see § 6.2-606 ], the threshold issue of whether the funds were garnishable was to be resolved, which, in this case was done against the creditor. Sulzman v. Barnick, 62 Va. Cir. 139, 2003 Va. Cir. LEXIS 94 (Spotsylvania County July 8, 2003).

    Attorney’s liens. —

    In a case in which an attorney, who had represented the ex-husband in his divorce, sought to enforce his attorney’s lien against the property in question, which had been conveyed to the wife and had been held as tenants by the entirety, the attorney unsuccessfully argued that the property converted to a tenancy in common upon the entry of the final decree of divorce and that the lien attached at that time. That argument failed to take into account that notice of the lien was given when the property was still held in tenancy by the entirety so the lien could not attach by the time the recording of the lien took place, and the property was already solely owned by the ex-wife, never having converted to a tenancy in common, and therefore could not be subject to the satisfaction of the attorney’s lien. Borden v. Wilson, 79 Va. Cir. 111, 2009 Va. Cir. LEXIS 50 (Fairfax County June 24, 2009).

    Article 4. Virginia Solar Easements Act.

    § 55.1-137. Creation of solar easements.

    Any easement obtained for the purpose of exposure of solar energy equipment, facilities, or devices shall be created in writing and shall be subject to the same conveyancing and instrument recording requirements as other easements.

    History. 1978, c. 323, § 55-353; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “Guaranteeing Solar Access in Virginia,” see 13 U. Rich. L. Rev. 423 (1979).

    For comment, “My Two Cents Per Kilowatt-Hour: Virginia’s Renewable Energy Portfolio Standard,” see 42 U. Rich. L. Rev. 755 (2007).

    § 55.1-138. Contents of solar easement agreements.

    Any instrument creating a solar easement shall include, at a minimum:

    1. The vertical and horizontal angles, expressed in degrees, at which the solar easement extends over the real property subject to the solar easement;
    2. Any terms or conditions under which the solar easement is granted or will be terminated; and
    3. Any provisions for compensation of the owner of the property subject to the solar easement.

    History. 1978, c. 323, § 55-354; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Chapter 2. Property Rights of Married Persons.

    § 55.1-200. How married persons may acquire and dispose of property.

    Married persons shall have the right to acquire, hold, use, control, and dispose of property as if they were unmarried. Such power of use, control, and disposition shall apply to all property of a married person. The marital rights of persons married to each other shall not entitle either spouse to the possession or use, or to the rents, issues, and profits, of such real estate of the other spouse during the coverture, nor shall the property of either spouse be subject to the debts or liabilities of the other spouse.

    History. Code 1919, § 5134; 1932, p. 21; Code 1950, § 55-35; 1990, c. 831; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article on rights of surviving spouse in Virginia, see 46 Va. L. Rev. 157 (1960).

    For discussion of this section and § 55-36 in relation to actions for loss of consortium, see 46 Va. L. Rev. 184 (1960).

    For comment on statutory consortium in Virginia, see 17 Wash. & Lee L. Rev. 183 (1960).

    For note discussing the decline of intrafamily tort immunity in Virginia, see 21 Wm. & Mary L. Rev. 273 (1979).

    For comment on the legislative abrogation of interspousal immunity in Virginia, see 15 U. Rich. L. Rev. 939 (1981).

    For comment on the constitutionality of the femme sole estate and the Virginia Supreme Court’s creation of an “homme sole” estate, see 19 U. Rich. L. Rev. 163 (1984).

    For comment, “The New Doctrine of Necessaries in Virginia,” see 19 U. Rich. L. Rev. 317 (1985).

    For note, “Wrongs Committed During a Marriage: The Child that No Area of the Law Wants to Adopt,” see 66 Wash. & Lee L. Rev. 465 (2009).

    Michie’s Jurisprudence.

    For related discussion, see 1A M.J. Advancements, § 10.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.
    A.In General.

    Editor’s note.

    The cases cited below were decided under former Title 55 or prior law. Many were also decided prior to the abolition of dower and curtesy. See § 64.2-301 .

    History of section. —

    See Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Right of legislature to remove disabilities. —

    It was entirely competent, for the legislature to remove the disability of married women in whole or in part, and to define her powers with reference to property of all kinds, to ascertain the rights of the husband, if any, therein, and the liability of the property to claims against the wife. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 , 1923 Va. LEXIS 21 (1923).

    The effect of this section is to give the wife as full control over her property during the coverture as her husband has over his. She may sue her husband as if he were a stranger. A husband in Virginia may be a trespasser upon his wife’s lands whenever she is not occupying them, if he goes there against her will or her commands; she may prosecute him for criminal trespass; she may dispossess him if he is in possession; or may hold him to account in connection with any transaction with reference to her lands as if he were a stranger. His right to curtesy and his marital rights give him no more power or authority over his wife’s property than if he were a total stranger. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 , 1924 Va. LEXIS 140 (1924) (see Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955)).

    This section has wiped aside every vestige of control the husband ever had under the common law, and all his rights as husband except as to curtesy. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 , 1924 Va. LEXIS 140 (1924).

    “The revisors of the Code of 1919, when they came to deal with § 5134, (from which this section was taken) in order that there might, thereafter, be no doubt of the total abolition of the husband’s common-law rights, added immediately after ‘but neither his right to curtesy,’ the following significant words, ‘nor his marital rights,’ to language which of itself seemed to have eliminated the husband’s previous rights. The language ‘nor his marital rights’ would seem but to emphasize and clarify, to make certain, the first few lines of the act: ‘A married woman shall have the right to acquire, hold, use, control, and dispose of property as if she were unmarried,’ etc.” Commonwealth v. Rutherfoord, 160 Va. 524 , 169 S.E. 909 , 1933 Va. LEXIS 233 (1933).

    Section gives substantive right to sue husband for tortious damage to property. —

    This section gives to the wife full ownership and control of her property, including her choses in action. Her husband is now a stranger to her property and property rights, and she to his. In the ownership and control of their respective properties, their identities are now wholly separate and distinct. Thus the substantive right to sue her husband for tortious damage to her property (as distinguished from a purely personal tort) is furnished by this section. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Section 55-41 does not prohibit married woman from selling her property. —

    Section 55-41, relating to the effect to be given to certain conveyances made by married women and the covenants therein contained, does not in any way prohibit her from contracting to sell her statutory separate estate, or inhibit or interfere with a court of equity in the enforcement of such contracts. Dunn v. Stowers, 104 Va. 290 , 51 S.E. 366 , 1905 Va. LEXIS 98 (1905).

    This section does not apply to warranty in deed to release dower. —

    This section was not intended to apply to a warranty in a deed in which the wife united for the purpose only of relinquishing her inchoate right of dower in her husband’s property, nor does it repeal by implication § 55-41, declaring the effect of such a warranty. Augusta Nat'l Bank v. Beard, 100 Va. 687 , 42 S.E. 694 , 1902 Va. LEXIS 76 (1902).

    Husband who steals from wife subject to criminal law. —

    The broad provisions of the Married Woman’s Act, giving the wife absolute control over her tangible personal property, must necessarily bring her within the protective shelter of the criminal laws by making any thief, including her husband, who takes and deprives her of possession and use of her property subject to the usual criminal sanctions. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329, 1979 Va. LEXIS 185 (1979).

    The purpose of the Married Woman’s Act would be frustrated if a husband could steal with impunity from his wife. Therefore, he may be prosecuted as any other thief for the larceny of her property. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329, 1979 Va. LEXIS 185 (1979).

    Although a husband could be convicted of larceny of his wife’s separate property under § 55-35, defendant had a good faith belief that he had a claim of right to certain cassette tapes that he took; as a result, the evidence, as found by the trial court, was insufficient to support defendant’s conviction. Ward v. Commonwealth, 2003 Va. App. LEXIS 211 (Va. Ct. App. Apr. 8, 2003).

    Extent of right of husband to use property. —

    It is difficult to see how a husband under this section can have any right of occupancy of the wife’s real estate unless she resides upon it, and he gets the right of joint occupancy with her then, not because he has any interest in her land, or control over it, or the right to use it, but because as her husband he has the right to the enjoyment of her society. The husband’s rights so far as the wife’s property is concerned are determined by this section and his occupancy even as a home or use or control thereof are not only not provided for thereby but they are expressly provided against. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 , 1924 Va. LEXIS 140 (1924).

    The husband no longer has exclusive possession or control over any portion of property held as tenants by the entireties. Logic dictates that the same rule should apply to the rents, issues and profits derived from such entirety property. Moore v. Glotzbach, 188 F. Supp. 267, 1960 U.S. Dist. LEXIS 4641 (E.D. Va. 1960).

    Notwithstanding this section, the presumption prevails that the husband is the owner of all property, real and personal, of which the wife may be in possession during coverture, especially if they are living together as husband and wife; and to overcome this presumption, in a contest between the husband’s creditors and the wife, she must show affirmatively that the property is her own, and that it was derived from a source other than her husband and in good faith, if he be insolvent. Otherwise, a wide door would be opened to fraud. First Nat'l Bank v. House, 145 Va. 149 , 133 S.E. 664 , 1926 Va. LEXIS 381 (1926) (see Childress v. Fidelity & Cas. Co., 194 Va. 191 , 72 S.E.2d 349 (1952)).

    This section does not change the presumption that the husband is the owner of all property of which the wife may be in possession during coverture, but the sources from which a wife may accumulate a separate estate are enlarged by it. Thus, while at common law the husband was absolutely entitled to the wife’s earnings unless she was a sole trader, under this section the wife may accumulate a separate estate through her earnings. Harris v. Carver, 139 Va. 676 , 124 S.E. 206 , 1924 Va. LEXIS 142 (1924).

    In a suit by creditors of an insolvent husband against the wife, the presumption is that every conveyance or transfer of real or personal estate made to the wife, during the coverture, either by her husband or a third person, is founded upon a consideration furnished by the husband, and the burden is upon the wife to show by clear and satisfactory evidence that the consideration was in good faith paid by her out of her own estate, and not by her husband. This presumption is based upon the relationship of the parties and exists notwithstanding the emancipation of married women as to their property rights. Johnson v. Ables, 119 Va. 593 , 89 S.E. 908 , 1916 Va. LEXIS 134 (1916) (see Childress v. Fidelity & Cas. Co., 194 Va. 191 , 72 S.E.2d 349 (1952)).

    B.Curtesy.

    This section destroyed the estate of tenancy by the curtesy initiate, but does not affect the husband’s estate by the curtesy at his wife’s death. The section only protects the wife’s estate during her life, but does not after her death, affect the law of succession as to her real or personal estate. Breeding v. Davis, 77 Va. 639 , 1883 Va. LEXIS 101 (1883) (see Campbell v. McBee, 92 Va. 68 , 22 S.E. 807 (1895)).

    The right of the husband as tenant by marital right and tenant by curtesy initiate have been taken away by the section, and no right by curtesy consummate could accrue after divorce, the latter right being dependent on the death of the wife. Jones v. Kirby, 146 Va. 109 , 135 S.E. 676 , 1926 Va. LEXIS 315 (1926).

    Rights of husband’s creditors. —

    Estate by the curtesy consummate exists in the husband in the wife’s lands unaliened by her during her lifetime, though devised by her will. Such estate is subject to the liens of the husband’s creditors acquired during the coverture, in preference to the general liens of creditors upon her real estate. Browne v. Bockover, 84 Va. 424 , 4 S.E. 745 , 1888 Va. LEXIS 92 (1888) (see Campbell v. McBee, 92 Va. 68 , 22 S.E. 807 (1895)).

    § 55.1-201. Contracts of, and actions by and against, married persons.

    A married person may contract and be contracted with and sue and be sued in the same manner and with the same consequences as if he were unmarried, regardless of the date on which the right or liability asserted by or against him accrued. In an action by a married person to recover for a personal injury inflicted on him, he may recover the entire damage sustained, including the personal injury and expenses arising out of the injury, whether chargeable to him or his spouse, notwithstanding that the spouse may be entitled to the benefit of his services about domestic affairs and consortium, and any sum recovered therein shall be chargeable with expenses arising out of the injury, including hospital, medical, and funeral expenses, and any person, including the spouse, partially or completely discharging such debts shall be reimbursed out of the sum recovered in the action, whensoever paid, to the extent that such payment was justified by services rendered or expenses incurred by the obligee, provided that written notice of such claim for reimbursement, and the amount and items thereof, shall be served on such married person and on the defendant prior to any settlement of the sum recovered by him, and no action for such injury, expenses, or loss of services or consortium shall be maintained by his spouse.

    History. Code 1919, § 5134; 1932, p. 21; Code 1950, § 55-36; 1950, p. 460; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For comment on extension of entireties doctrine, see 20 Wash. & Lee L. Rev. 260 (1963).

    For note, “Tort Law — Interspousal Immunity — Action for Wrongful Death Against Surviving Spouse Held Maintainable When Such Act Terminates Marriage and Neither Child nor Grandchild Survives Decedent — Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195 (1975),” see 10 U. Rich. L. Rev. 434 (1976).

    For note discussing the decline of intrafamily tort immunity in Virginia, see 21 Wm. & Mary L. Rev. 273 (1979).

    For comment on the legislative abrogation of interspousal immunity in Virginia, see 15 U. Rich. L. Rev. 939 (1981).

    For comment, “The New Doctrine of Necessaries in Virginia,” see 19 U. Rich. L. Rev. 317 (1985).

    For note, “Wrongs Committed During a Marriage: The Child that No Area of the Law Wants to Adopt,” see 66 Wash. & Lee L. Rev. 465 (2009).

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Damages, § 26.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.
    A.Contracts of Married Woman.
    1.In General.

    History. —

    For the history of certain acts relating to the power of married women to contract, see Wynn v. Louthan, 86 Va. 946 , 11 S.E. 878 (1890). For history of section, see Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Purpose. —

    The ultimate purpose running through the Married Woman’s Act is to place the wife on an equality with her husband. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    Common law. —

    At common law, no right of consortium was ever vested in the wife. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    A married woman may contract and be contracted with, as if she were unmarried. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 , 1908 Va. LEXIS 14 (1908) (see Young v. Hart, 101 Va. 480 , 44 S.E. 703 (1903)).

    A married woman can legally execute with her husband a joint promissory negotiable note. Poole v. Perkins, 126 Va. 331 , 101 S.E. 240 , 1919 Va. LEXIS 99 (1919).

    2.Transactions With Husband.

    Agreements for separation. —

    Where husband and wife who have already separated enter a contract adjusting property rights and providing a maintenance for the wife, it is not essential to the validity of the contract that the provision for the wife be made through the intervention of a trustee. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 , 1908 Va. LEXIS 14 (1908).

    A paper writing under seal executed by husband and wife, which granted to the survivor the right to all real estate and personal property, was a contract under seal, which, under this section the husband and wife might make as if she were unmarried. Harlan v. Weatherly, 183 Va. 49 , 31 S.E.2d 263, 1944 Va. LEXIS 129 (1944).

    B.Suits By and Against Married Women.
    1.In General.

    This section is in derogation of the common law and is to be strictly construed and read as if the common law remained unchanged unless the purpose to change it appears expressly or by necessary implication. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191, 1952 Va. LEXIS 184 (1952).

    Husband may not recover for loss of services or consortium. This section has abolished causes of action brought by a husband in personal injury cases for his wife’s medical expenses or the loss of his wife’s services or consortium. Bolen v. Bolen, 409 F. Supp. 1374, 1976 U.S. Dist. LEXIS 17131 (W.D. Va. 1976).

    Maryland law allowing for loss of consortium claims does not contravene Virginia public policy because both Maryland and Virginia were similarly interested in preserving equality between spouses when creating their respective laws regarding claims for loss of consortium, and because of these similar ideals, Maryland law is not in contravention of Virginia public policy. Kelley v. United States, 580 F. Supp. 2d 490, 2008 U.S. Dist. LEXIS 84298 (E.D. Va. 2008).

    A married woman may sue and be sued as if she were unmarried. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 , 1908 Va. LEXIS 14 (1908) (see Young v. Hart, 101 Va. 480 , 44 S.E. 703 (1903)).

    It is no longer necessary for an adult married woman to sue by next friend. Lynchburg Cotton Mill v. Rives, 112 Va. 137 , 70 S.E. 542 , 1911 Va. LEXIS 63 (1911).

    Construction of word “unmarried.” —

    The word “unmarried” originally and ordinarily means, it is true, never having been married, but the term is a word of flexible meaning and slight circumstances will be sufficient to give the word its other meaning of not having a husband or wife at the time in question, and as the term is used in this section it has the meaning of “not having a husband” at the time of the suit or action. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 , 1918 Va. LEXIS 13 (1918).

    Right to maintain action for personal injuries is vested exclusively in wife. —

    Under this section the right to maintain an action for personal injuries inflicted upon a married woman is vested exclusively in the wife and that right includes the right to recover the entire damages sustained, both to herself and those sustained by the husband and formerly recoverable only by him. Alsop v. Eastern Air Lines, 171 F. Supp. 180, 1959 U.S. Dist. LEXIS 3564 (D. Va. 1959).

    She may recover entire damages sustained by personal injury to her. —

    The addition to this section in 1919 of the provision giving married women the right to recover the entire damage sustained, in the event of a personal injury, did not affect the rule laid down in Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 (1924), but was intended to change the law as announced in Richmond Ry. & Elec. Co. v. Bowles, 92 Va. 738 , 24 S.E. 388 (1896).

    Including medical bills. —

    Under this section, a married woman may now recover for a personal injury inflicted on her “the entire damage sustained.” This would, of course, embrace medical bills incurred by her, necessary to effect a cure and for which she is liable. United Dentists, Inc. v. Bryan, 158 Va. 880 , 164 S.E. 554 , 1932 Va. LEXIS 303 (1932).

    The right of the husband to recover for loss of domestic services of his wife from one who had tortiously injured her was taken from him and given to the wife by § 5134 of the Code of 1919, but this did not deprive him of the right to recover for medical expenses made necessary by the injury and paid by him. Nor was its language broad enough to take from him and vest in the wife his right to recover for loss of her consortium as distinguished from the loss of her domestic services. However, the amendment of 1932 (Acts 1932, c. 25, p. 21) broadened and enlarged the scope of this section so that it expressly gave to the wife the right to recover every item of damage incident to her injury, and provided that no action for any element of damage incident to such injury could be maintained by the husband. This prevented the husband from recovering for such medical expenses. Floyd v. Miller, 190 Va. 303 , 57 S.E.2d 114, 1950 Va. LEXIS 128 (1950).

    But recovery is chargeable with husband’s claim for reimbursement of expenses. —

    Under this section, the wife’s recovery is chargeable with the husband’s claim for reimbursement of expenses, the evident intention of the 1950 amendment being to constitute the wife the trustee for the benefit of the husband to that extent. Carey v. Foster, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    Husband may not recover for loss of services or consortium. —

    In a joint action brought by husband and wife against a third party for the recovery of damages alleged to have been tortiously inflicted upon the wife, the husband may not recover for the loss of services or consortium of the wife. Alsop v. Eastern Air Lines, 171 F. Supp. 180, 1959 U.S. Dist. LEXIS 3564 (D. Va. 1959).

    This section did not intend to change the common law, other than to deprive the husband of his right of action for loss of consortium. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    Under this section the husband is prohibited from bringing an action for loss of consortium. Carey v. Foster, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    And wife may not recover for loss of husband’s consortium. —

    The Married Woman’s Act, which removed the common-law disability of a wife to sue and be sued in her own name, has not conferred upon the wife a right to maintain an action in her name for the loss of consortium occasioned by injuries to her husband. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    For negligent actions arising in Virginia, there is no existing right of action for loss of consortium which can be maintained by the wife for injuries inflicted upon the husband, or by the husband for injuries inflicted upon the wife. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    When the husband is injured negligently, consideration of equality requires that the wife be allowed no recovery for loss of her husband’s consortium. She cannot claim in the name of equality rights the counterparts of which the husband does not enjoy. Carey v. Foster, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    Nor may she recover for husband’s loss of wife’s consortium. —

    The statute does not mean that the wife may recover for the husband’s loss of the wife’s consortium, but merely means that there may be no recovery as to that element of damage and the wife is entitled to recover as though she were unmarried. Carey v. Foster, 221 F. Supp. 185, 1963 U.S. Dist. LEXIS 6685 (E.D. Va. 1963), aff'd, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    This section cannot be construed to authorize the wife to recover for the husband’s loss of her affection and companionship consequent upon injury negligently inflicted upon her. Carey v. Foster, 345 F.2d 772, 1965 U.S. App. LEXIS 5571 (4th Cir. 1965).

    Constitutional guarantee of due process does not apply. —

    The constitutional guarantee of due process could have no more application to a right of action to recover for loss of service and consortium than would be the situation involving related common-law relationships which have been drastically changed by statute, such as the former curtesy rights of the husband. Alsop v. Eastern Air Lines, 171 F. Supp. 180, 1959 U.S. Dist. LEXIS 3564 (D. Va. 1959).

    Wife may sue for criminal conversation with her husband and alienation of his affections. —

    The common-law rule that a wife had no right of action for criminal conversation with her husband and alienation of his affections has been abrogated by this section. Newsom v. Fleming, 165 Va. 89 , 181 S.E. 393 , 1935 Va. LEXIS 276 (1935).

    Christian name of wife proper. —

    In a proceeding by motion for judgment to recover damages for the negligent killing of plaintiff’s intestate against a husband and wife, the wife should be impleaded by her own baptismal, or Christian name and not by the initial letters of her husband’s name. The former is her legal designation. Ratcliffe v. McDonald's Adm'r, 123 Va. 781 , 97 S.E. 307 , 1918 Va. LEXIS 66 (1918).

    Allegation that contract made with reference to separate estate unnecessary. —

    It is unnecessary since this provision was enacted to allege that the contract sued on was made with reference to the married woman’s separate estate. Young v. Hart, 101 Va. 480 , 44 S.E. 703 , 1903 Va. LEXIS 55 (1903).

    2.By and Against Husband.

    The reason for interspousal immunity is to foster a harmonious and conjugal relationship. Obviously the reason for the rule is lost upon the death of one of the parties for there is no longer a marriage to be saved or a union to be preserved. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195, 1975 Va. LEXIS 253 (1975).

    The modern trend is to abrogate, or at least substantially modify, interspousal immunity doctrine. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195, 1975 Va. LEXIS 253 (1975).

    There is no distinct line of demarcation between what tort actions may or may not be maintained by one spouse against the other. The more logical line of cleavage would seem to place on one side actions for purely personal torts, such as for personal injury, defamation of character, malicious prosecutions, false imprisonment or the like, for which actions should not lie. On the other side, actions by a husband or wife for those torts that may be inflicted upon or committed against the property (or property rights) of the other should lie. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Section does not confer right to sue husband for assault. —

    This statute has not conferred upon a married woman a right of action against her husband for damages for an assault upon her committed by the husband during the coverture. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 , 1918 Va. LEXIS 13 (1918); Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191, 1952 Va. LEXIS 184 (1952) (commented on in 10 Wash. & Lee L. Rev. 128 (1953)).

    This section did not change the common-law rule prohibiting one spouse from suing the other in a tort action. Alexander v. Kuykendall, 192 Va. 8 , 63 S.E.2d 746, 1951 Va. LEXIS 147 (1951).

    This section merely enlarged the remedies of married women with respect to other substantive rights of theirs existing at common law and conferred by the first portion of the statute. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191, 1952 Va. LEXIS 184 (1952) (commented on in 10 Wash. & Lee L. Rev. 128 (1953)).

    The common law, as it existed in 1918, conferred no right in the wife to sue her husband for an assault. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200, 1971 Va. LEXIS 327 (1971).

    Although committed before marriage. —

    A wife cannot under this section maintain a suit against her husband for a tort committed by him against her before their marriage. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191, 1952 Va. LEXIS 184 (1952) (commented on in 10 Wash. & Lee L. Rev. 128 (1953)).

    Nor can such an action be maintained by husband against wife. —

    It has been held that actions for torts against the person brought by the wife, or her personal representatives, will not lie against the husband or his personal representative. Yet upon consideration of the change in the common-law status of husbands and wives wrought by legislation and the historical development of marital rights and liabilities, upon principles of simple justice and public policy, it is plain that no similar action could be maintained by the husband against the wife. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Personal representative of wife may not sue for death caused by husband. —

    The personal representative of a wife who was killed by her husband when the husband and wife were living together in that relationship has no right of action against the husband or his personal representative for the death of the wife. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 , 1918 Va. LEXIS 13 (1918).

    An action for wrongful death may be maintained, predicated upon injuries to one spouse during marriage arising out of a wrongful act by the other spouse, when such an act results in the termination of the marriage by death, and when the deceased spouse is survived by no living child or grandchild. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195, 1975 Va. LEXIS 253 (1975).

    When wife immune from liability for certain personal injuries to husband. —

    Wife is immune from liability in tort for personal injuries intentionally inflicted upon the husband at her direction during the marriage, i.e., and abortive murder-for-hire scheme, when the parties are divorced from the bond of matrimony at the time the action is instituted. Counts v. Counts, 221 Va. 151 , 266 S.E.2d 895, 1980 Va. LEXIS 226 (1980).

    Wife can maintain an action against her husband for personal injuries that result from a motor vehicle accident. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200, 1971 Va. LEXIS 327 (1971).

    The common law, as it exists today, does not cling to the concept that the “one flesh” of husband and wife may not so divide itself as to permit an action by wife against husband for personal injuries sustained in an automobile accident. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200, 1971 Va. LEXIS 327 (1971).

    Each spouse is liable to the other for tortious damage to property. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    From the language of §§ 55-35, 55-36, and 55-37, it appears that as to their property rights the legislature intended wholly to sever the common-law unity of husband and wife and remove all disabilities and impediments preventing one spouse from suing the other for wrongs to their respective properties. When read together, these sections empower each spouse to maintain actions at law for wrongful invasions of their respective property rights as if they had never been married. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Wife may maintain ejectment against husband. —

    As a husband is not entitled to the possession or use of the rents and profits of his wife’s real estate during the coverture, a wife may maintain an action of ejectment against her husband for a house which he had conveyed to her upon consideration of natural love and affection. Humphreys v. Strong, 141 Va. 146 , 126 S.E. 194 , 1925 Va. LEXIS 396 (1925).

    A fire insurance company, as subrogee of insured, was entitled to maintain an action against insured’s wife for her alleged destruction of his property. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    § 55.1-202. Spouse not responsible for other spouse’s contracts, etc.; mutual liability for necessaries; responsibility of personal representative.

    Except as otherwise provided in this section, a spouse shall not be responsible for the other spouse’s contract or tort liability to a third party, whether such liability arose before or after the marriage. The doctrine of necessaries as it existed at common law shall apply equally to both spouses, except where they are permanently living separate and apart, but shall in no event create any liability between such spouses as to each other. No lien arising out of a judgment under this section shall attach to the judgment debtors’ principal residence held by them as tenants by the entirety or that was held by them as tenants by the entirety prior to the death of either spouse where the tenancy terminated as a result of the death of either spouse.

    History. Code 1919, § 5134; 1932, p. 22; Code 1950, § 55-37; 1984, c. 504; 1985, c. 202; 2012, c. 45; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For note discussing the decline of intrafamily tort immunity in Virginia, see 21 Wm. & Mary L. Rev. 273 (1979).

    For a comment on the legislative abrogation of interspousal immunity in Virginia, see 15 U. Rich. L. Rev. 939 (1981).

    For comment, “The New Doctrine of Necessaries in Virginia,” see 19 U. Rich. L. Rev. 317 (1985).

    For annual survey of Virginia law article, “Wills, Trusts, and Estates,” see 47 U. Rich. L. Rev. 343 (2012).

    Michie’s Jurisprudence.

    For related discussion, see 1A M.J. Acknowledgments, § 9.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Necessaries doctrine unconstitutional. —

    Predecessors of this section, which is part of the Married Woman’s Act (Acts 1876-77, c. 329), did not affect the common-law necessaries doctrine, creating an obligation directly between a husband and a third party who provided services to his wife, but the necessaries doctrine is unconstitutional as a gender-based classification not substantially related to governmental interests. Schilling v. Bedford County Mem. Hosp., 225 Va. 539 , 303 S.E.2d 905, 1983 Va. LEXIS 253 (1983).

    By this section the husband’s liability for the wife’s torts has been completely abolished, and no action by him against her need be also against himself. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69, 1955 Va. LEXIS 214 (1955).

    Attachment of lien on principal residence held as tenants by the entirety. —

    Where a creditor filed two claims for medical care provided to Chapter 13 debtor wife, who had cancer surgery performed on her, and objected to confirmation of debtors’ plan because it failed to pay creditor as much as it would have received in a Chapter 7 liquidation, the objection was overruled on the basis that the trustee could not have § 55-37 administered for creditor’s benefit on debtors’ marital residence, held by them as tenants by the entireties, had debtors filed for relief under Chapter 7 because § 55-37 expressly exempted the marital residence from process to enforce the debt. In re Balthrop, No. 05-11000-SSM, 2005 Bankr. LEXIS 2713 (Bankr. E.D. Va. Nov. 28, 2005).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Statute inapplicable. —

    Statute did not bar children’s lawsuit against their deceased father’s second wife because it was not one seeking to impose personal liability against the second wife for her late husband’s contractual obligations; the children sought recovery to the extent that the second wife was unjustly enriched as a result of any amounts distributed to her through an insurance policy, and thus, the cause of action stood separate from the initial breach of contract. Griffin v. Cowser-Griffin, 92 Va. Cir. 282, 2016 Va. Cir. LEXIS 207 (Surry County Jan. 29, 2016).

    Responsibility for funeral expenses of deceased spouse. —

    Decedent’s sister was entitled to recover funeral costs from the decedent’s surviving spouse, pursuant to § 55-37 and the common-law doctrine of necessaries, because the decedent’s sister paid for the decedent’s burial instead of her surviving spouse, and § 64.1-136.1 did not extend liability solely to the decedent’s estate. Shepard v. Moore, 83 Va. Cir. 377, 2011 Va. Cir. LEXIS 216 (Norfolk Sept. 22, 2011).

    § 55.1-203. Spouse’s right of entry into land not barred by certain judgments; when a spouse may defend his right in lands that are his inheritance.

    A spouse shall not be barred of his right of entry into land by a judgment in the other spouse’s lifetime by default or collusion, but after the other spouse’s death may prosecute the same by any proper action; or, in the lifetime of the other spouse, if the other spouse will not appear or, against the spouse’s consent, will render the spouse’s lands during the coverture in an action against both spouses for lands that are the spouse’s inheritance, the spouse may come at any time before judgment and defend his right.

    History. Code 1919, § 5441; Code 1950, § 55-38; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Husband and Wife, § 32.

    § 55.1-204. Rights of spouse not affected by other spouse’s acts only.

    No conveyance or other act by one spouse only of any land that is the inheritance of the other spouse shall be or make any discontinuance thereof, or be prejudicial to the other spouse or his heirs or to any having right or title to the same by his death, but they may respectively enter into such land, according to their right and title in such land, as if no such conveyance or act had been done.

    History. Code 1919, § 5442; Code 1950, § 55-39; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Husband and Wife, § 32.

    § 55.1-205. Conveyance from married persons; effect on right of either spouse.

    When persons married to each other have signed and delivered a writing purporting to convey any estate, real or personal, such writing, whether recorded or not, shall (i) if delivered prior to January 1, 1991, operate to convey from the spouse her right of dower or his right of curtesy in the real estate embraced in such writing and (ii) if delivered after December 31, 1990, operate to manifest the spouse’s written consent or joinder, as contemplated in § 64.2-305 or 64.2-308.9 to the transfer embraced in such writing. In either case, the writing passes from such spouse and his representatives all right, title, and interest of every nature that at the date of such writing he may have in any estate conveyed thereby as effectually as if he were at such date an unmarried person. If, in either case, the writing is a deed conveying a spouse’s land, no covenant or warranty in such land on behalf of the other spouse joining in the deed shall operate to bind him any further than to convey his interest in such land, unless it is expressly stated that such spouse enters into such covenant or warranty for the purpose of binding himself personally.

    History. Code 1919, § 5211; Code 1950, § 55-41; 1977, c. 147; 1990, c. 831; 1991, c. 625; 1992, cc. 617, 647; 2016, cc. 187, 269; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article, “Virginia’s Augmented Estate System: An Overview,” see 24 U. Rich. L. Rev. 513 (1990).

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Husband and Wife, §§ 7, 13.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Purpose. —

    The statute language, “no covenant or warranty [in a deed] shall operate to bind . . . her any further than to convey her . . . interest in such land . . .” makes clear that the writers of the statute understood the phraseology as contained in the instant deed has been, was, and would continue to be found in deeds. The very purpose of the statute was to remove from this much-used language the operative effect of binding the dower- or curtesy-conveying spouse to the burden of defending the purchaser’s good title or guaranteeing him quiet possession and the like. American Dev. Group, Inc. v. Brookes, 587 F. Supp. 992, 1984 U.S. Dist. LEXIS 15192 (E.D. Va. 1984).

    Relationship to other statutes. —

    The contention that § 55-41 specifically provides that when a husband and wife join in a deed of conveyance, the provisions of clause (i) of subsection B of § 64.1-16.1 are satisfied is rejected. Chappell v. Perkins, 266 Va. 413 , 587 S.E.2d 584, 2003 Va. LEXIS 102 (2003).

    Nonland-owning spouse not obligated to warrant title when exception does not apply. —

    Where the exception to the general rule in this section has not been met, the nonland-owning spouse has no obligation to any grantee with respect to a general warranty of title or with respect to the English covenants. American Dev. Group, Inc. v. Brookes, 587 F. Supp. 992, 1984 U.S. Dist. LEXIS 15192 (E.D. Va. 1984).

    § 55.1-206. How infant spouse may release interests in spouse’s property.

    Notwithstanding the disability of infancy, on or after January 1, 1991, an infant spouse, whether married before or after January 1, 1991, may release his marital rights in the other spouse’s real or personal property by uniting in any contract, deed, or other instrument executed by the other spouse or by a commissioner of a court pursuant to an order entered under §§ 8.01-67 through 8.01-77 or any other law with respect to the infant’s property.

    History. 1992, cc. 617, 647, § 55-42.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 8.

    § 55.1-207. Appointment of attorney-in-fact by married person; effect of writing executed by such attorney.

    A married person, whether a resident of the Commonwealth or not, may, by power of attorney duly executed and acknowledged as prescribed in § 55.1-612 or 55.1-613 , appoint an attorney-in-fact to execute and acknowledge, for him and in his name, any deed or other writing that he might execute. Every deed or other writing so executed by such attorney-in-fact in pursuance of such power of attorney while the same remains in force shall be valid and effectual, in all respects, to convey the interest and title of such married person in and to any real estate thereby conveyed or otherwise transferred.

    History. Code 1919, § 5215; 1940, p. 53; Code 1950, § 55-43; 1990, c. 831; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Husband and Wife, § 19.

    § 55.1-208. How estate of a married person to pass at death.

    When a married person, having title to any estate, dies intestate, such estate, or any part of such estate, shall pass according to the provisions of Chapter 2 (§ 64.2-200 et seq.) of Title 64.2, subject to his debts.

    History. Code 1919, § 5138; Code 1950, § 55-46; 1990, c. 831; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Curtesy, § 14.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Section construed distributively. —

    Chapter 1 of Title 64.1 deals with two very distinct subjects, the descent of real estate and the distribution of personal property. The reference then in this section must be construed distributively, that is to say, when the wife’s property consists of real estate it shall pass as real estate passes under that chapter, and when of personal property it passes as personal property passes in that chapter. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 , 1923 Va. LEXIS 21 (1923).

    What property passes. —

    Under this section, what passes is not a surplus but the whole of the estate of which the wife dies intestate. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 , 1923 Va. LEXIS 21 (1923).

    Section prevails over statutes relating to funeral expenses. —

    This section was passed many years after the statutes relating to funeral expenses and, of course, would prevail if there is any conflict between them. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 , 1923 Va. LEXIS 21 (1923).

    § 55.1-209. Equitable separate estates abolished.

    The estate known as the equitable separate estate no longer exists and any language in any writing, whenever executed, that purports to convey real property to a person as an equitable separate estate has no legal or equitable significance after January 1, 1991, except as provided in § 64.2-301 or 64.2-308.2 .

    History. 1992, cc. 617, 647, § 55-47.01; 2016, cc. 187, 269; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 9B M.J. Husband and Wife, §§ 7, 38, 52.

    § 55.1-210. Tangible personal property.

    No presumption of ownership of tangible personal property shall arise by operation of law to prefer one spouse of a marriage over the other if such presumption is based solely on the sex of the spouse.

    History. 1977, c. 76, § 55-47.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Husband who steals from wife subject to criminal law. —

    The broad provisions of the Married Woman’s Act, giving the wife absolute control over her tangible personal property, must necessarily bring her within the protective shelter of the criminal laws by making any thief, including her husband, who takes and deprives her of possession and use of her property subject to the usual criminal sanctions. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329, 1979 Va. LEXIS 185 (1979).

    Chapter 3. Form and Effect of Deeds and Covenants; Liens.

    Article 1. Form and Effect of Deeds; Easements.

    § 55.1-300. Form of a deed.

    Every deed and corrected or amended deed may be made in the following form, or to the same effect: “This deed, made the _______________ day of _______________ , in the year _______________ , between (here insert names of parties as grantors or grantees), witnesseth: that in consideration of (here state the consideration, nominal or actual), the said _______________ does (or do) grant (or grant and convey) unto the said _______________ , all (here describe the property or interest therein to be conveyed, including the name of the city or county in which the property is located, and insert covenants or any other provisions). Witness the following signature (or signatures).”

    No deed recorded on or after July 1, 2020, shall contain a reference to the specific portion of a restrictive covenant purporting to restrict the ownership or use of the property as prohibited by subsection A of § 36-96.6 . The clerk may refuse to accept any deed submitted for recordation that references the specific portion of any such restrictive covenant. The attorney who prepares or submits a deed for recordation has the responsibility of ensuring that the specific portion of such a restrictive covenant is not specifically referenced in the deed prior to such deed being submitted for recordation. A deed may include a general provision that states that such deed is subject to any and all covenants and restrictions of record; however, such provision shall not apply to the specific portion of a restrictive covenant purporting to restrict the ownership or use of the property as prohibited by subsection A of § 36-96.6 . Any deed that is recorded in the land records on or after July 1, 2020, that mistakenly contains such a restrictive covenant shall nevertheless constitute a valid transfer of real property.

    History. Code 1919, § 5162; Code 1950, § 55-48; 1990, cc. 208, 374; 2011, c. 701; 2014, c. 338; 2019, c. 712; 2020, c. 748.

    Cross references.

    As to sealed writing in general see § 11-3 . As to documents to be recorded in deed books, see § 17.1-227 .

    Effective date.

    This section is effective October 1, 2019.

    The 2020 amendments.

    The 2020 amendment by c. 748 added the second paragraph.

    Michie’s Jurisprudence.

    For related discussion, see 3A M.J. Building Restrictions, § 2.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decisions Under Prior Law.

    In Virginia there is no statute fixing an invariable form for deeds of conveyance of land. The form given in this section uses the word “grant,” but that is not an indispensable requisite. To constitute a grant it is not indispensable that technical words be used. Albert v. Holt, 137 Va. 5 , 119 S.E. 120 , 1923 Va. LEXIS 134 (1923).

    Use of technical words or strict compliance with the form in this section is not necessary to effect a transfer, if the language used plainly shows on the face of the document a clear intent to convey title. Lim v. Soo Myung Choi, 256 Va. 167 , 501 S.E.2d 141, 1998 Va. LEXIS 81 (1998).

    Valid deed not found. —

    Where a memorandum was void of any language indicating an intent to transfer property, but rather was replete with contemporaneous statements regarding joint tenant’s belief in property’s current status, the memorandum did not constitute a valid deed. Lim v. Soo Myung Choi, 256 Va. 167 , 501 S.E.2d 141, 1998 Va. LEXIS 81 (1998).

    Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court’s judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner’s two parcels for the benefit of the limited liability company’s parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

    Seal. —

    Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    CIRCUIT COURT OPINIONS

    Statutory formalities. —

    Defendant’s demurrer to a motion for judgment seeking recovery on a commercial lease was overruled, because while there were statutory formalities for a deed, failure to comply with them was not necessarily fatal to an enforcement action between parties to deed under § 55-51. Only the intent to grant needed to be manifest. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County Oct. 12, 2005).

    § 55.1-300.1. Certificate of Release of Certain Prohibited Covenants.

    Any restrictive covenant prohibited by subsection A of § 36-96.6 may be released by the owner of real property subject to such covenant by recording a Certificate of Release of Certain Prohibited Covenants. The real property owner may record such certificate (i) prior to recordation of a deed conveying real property to a purchaser or (ii) when such real property owner discovers that such prohibited covenant exists and chooses to affirmatively release the same. Such certificate may be prepared without assistance of an attorney, but shall conform substantially to the following Certificate of Release of Certain Prohibited Covenants form:

    “CERTIFICATE OF RELEASE OF CERTAIN PROHIBITED COVENANTS

    Place of Record: _______________

    Date of Instrument containing prohibited covenant(s): _______________

    Instrument Type: _______________

    Deed Book _______________ Page _______________ or Plat Book _______________ Page _______________

    Name(s) of Grantor(s): _______________

    Name(s) of Current Owner(s): _______________

    Real Property Description: _______________

    Brief Description of Prohibited Covenant: _______________

    The covenant contained in the above-mentioned instrument is released from the above-described real property to the extent that it contains terms purporting to restrict the ownership or use of the property as prohibited by subsection A of § 36-96.6 .

    The undersigned is/are the legal owner(s) of the property described herein.

    Given under my/our hand(s) this _______________ day of _______________ , 20 _______________ .

    _______________

    _______________

    (Current Owners)

    Commonwealth of Virginia,

    County/City of _______________ to wit:

    Subscribed, sworn to, and acknowledged before me by _______________ this _______________ day of _______________ , 20 _______________ .

    My Commission Expires: _______________

    _______________

    NOTARY PUBLIC

    Notary Registration Number: _______________

    The clerk shall satisfy the requirements of § 17.1-228 .”

    History. 2020, c. 748.

    § 55.1-301. How construed.

    Unless the deed provides otherwise, any deed conveying land shall be construed to include all the estate, right, title, and interest, both at law and in equity, of the grantor in or to such land.

    History. Code 1919, § 5163; Code 1950, § 55-49; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Cotenancy, § 4.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Language admitting of two constructions. —

    In the construction of language contained in a deed the grantor must generally be considered as having intended to convey all that the language he employed is capable of passing to the grantee, and where the description admits of two constructions, it will be construed most favorably to the grantee. Waskey v. Lewis, 224 Va. 206 , 294 S.E.2d 879, 1982 Va. LEXIS 283 (1982).

    Joint devisees with right of survivorship may convey fee simple. —

    Under the provisions of this section and §§ 55-6 and 55-75, the effect of a joint devise to testator’s three sons, with a conditional limitation over that if one or more of them shall die leaving no issue his or their share shall go to his surviving brothers or brother, is to invest the devisees with the authority to convey and relinquish all their rights, title and interest in the land devised, and the grantee of the three of them takes a fee simple estate. Smith v. Smith, 112 Va. 617 , 72 S.E. 119 , 1911 Va. LEXIS 127 (1911).

    Deed of heir conveying land of decedent. —

    A deed made by an heir and conveying land of a decedent, although void as to creditors of the decedent until the expiration of a year from the decedent’s death, was valid between the parties and, under this section, conveyed to the grantee all the estate, right, title and interest of the grantor in the lands. Heeke v. Allan, 127 Va. 65 , 102 S.E. 655 , 1920 Va. LEXIS 32 (1920).

    § 55.1-302. Construction of generic terms.

    In the interpretation of deeds, adopted persons and persons born out of wedlock are included in class gift terminology or terms of relationship in accordance with rules for determining relationships for purposes of intestate succession unless a contrary intent appears on the face of the deed. In determining the intent of a grantor, adopted persons are presumptively included in such terms as “children,” “issue,” “kindred,” “heirs,” “relatives,” “descendants,” or similar words of classification and are presumptively excluded by such terms as “natural children,” “issue of the body,” “blood kindred,” “heirs of the body,” “blood relatives,” “descendants of the body,” or similar words of classification.

    History. 1987, c. 604, § 55-49.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, §§ 66, 70, 86.

    § 55.1-303. Appurtenances, etc., included in deed of land.

    Every deed conveying land shall be construed to include all buildings, privileges, and appurtenances of every kind belonging to such land unless an exception is made in the deed.

    History. Code 1919, § 5168; Code 1950, § 55-50; 1992, c. 373; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section is merely an affirmation of the common law. Whitmore v. Margaret Paxton Mem. for Convalescent Children, 151 Va. 1018 , 145 S.E. 827 , 1928 Va. LEXIS 287 (1928).

    The recording statutes are designed primarily to protect prospective purchasers against encumbrances and only incidentally to memorialize passage of appurtenances. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847, 1982 Va. LEXIS 226 (1982).

    Deed to land embraces underlying minerals. —

    Where land is sold without reservation of any kind it embraces the underlying minerals. Steinman v. Vicars, 99 Va. 595 , 39 S.E. 227 , 1901 Va. LEXIS 84 (1901).

    And may include easement of waterway. —

    Pursuant to this section a grant of all the grantor’s “right, title and claim of whatever kind, in and to” certain property carries with it, as an appurtenance, the easement of a waterway over the lands of the grantor to and for the use of the premises granted, although such easement be not expressly mentioned. Norfolk & W. Ry. v. Obenchain, 107 Va. 596 , 59 S.E. 604 , 1907 Va. LEXIS 77 (1907).

    License vs. Easement. —

    Where the original deed to sellers contained no reference to nearby swimming pool privileges but reference thereto was made in the original contract of sale, sellers enjoyed a license and therefore did not convey an easement or privilege to use the pool to purchasers. Bunn v. Offutt, 216 Va. 681 , 222 S.E.2d 522, 1976 Va. LEXIS 185 (1976).

    No right to apportion easement to third parties. —

    Language allowing a park authority to grant third-party easements “of any nature” subject to approval by a power company demonstrated the exclusivity of the power company’s easement; the deed language unambiguously provided the power company a non-exclusive easement in gross, and thus, the power company did not have the right to apportion the easement to third parties. Va. Elec. & Power Co. v. N. Va. Reg'l Park Auth., 270 Va. 309 , 618 S.E.2d 323, 2005 Va. LEXIS 73 (2005).

    § 55.1-304. Relocation of easement.

    The owner of land that is subject to an easement for the purpose of ingress and egress may relocate the easement, on the servient estate, by recording in the office of the clerk of the circuit court of the county or city in which the easement or any part of such easement is located, a written agreement evidencing the consent of all affected persons and setting forth the new location of the easement. In the absence of such written agreement, the owner of the land that is subject to such easement may seek relocation of the easement on the servient estate upon petition to the circuit court and notice to all parties in interest. The petition shall be granted if, after a hearing held, the court finds that (i) the relocation will not result in economic damage to the parties in interest, (ii) there will be no undue hardship created by the relocation, and (iii) the easement has been in existence for not less than 10 years.

    History. Code 1919, § 5168; Code 1950, § 55-50; 1992, c. 373; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section is merely an affirmation of the common law. Whitmore v. Margaret Paxton Mem. for Convalescent Children, 151 Va. 1018 , 145 S.E. 827 , 1928 Va. LEXIS 287 (1928).

    The recording statutes are designed primarily to protect prospective purchasers against encumbrances and only incidentally to memorialize passage of appurtenances. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847, 1982 Va. LEXIS 226 (1982).

    Deed to land embraces underlying minerals. —

    Where land is sold without reservation of any kind it embraces the underlying minerals. Steinman v. Vicars, 99 Va. 595 , 39 S.E. 227 , 1901 Va. LEXIS 84 (1901).

    And may include easement of waterway. —

    Pursuant to this section a grant of all the grantor’s “right, title and claim of whatever kind, in and to” certain property carries with it, as an appurtenance, the easement of a waterway over the lands of the grantor to and for the use of the premises granted, although such easement be not expressly mentioned. Norfolk & W. Ry. v. Obenchain, 107 Va. 596 , 59 S.E. 604 , 1907 Va. LEXIS 77 (1907).

    An easement continues to adhere to the dominant estate to which it is appurtenant, and passes with it to the grantee thereof, even though not specifically mentioned. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847, 1982 Va. LEXIS 226 (1982).

    Easement extinguished by express agreement. —

    Although an easement remained with the dominant estate to which it was appurtenant and passed to a subsequent grantee even though not specifically mentioned in the deed to that grantee, where an original easement was expressly abandoned by an agreement creating the new easement, any rights to the original easement were extinguished. Taylor v. McConchie, 264 Va. 377 , 569 S.E.2d 35, 2002 Va. LEXIS 96 (2002).

    Easement by implication. —

    Where there are no descriptive words of grant or reservation in the deed, an easement by implication from former use will arise only where the use of the property has been continuous, apparent, reasonably necessary for the enjoyment of the dominant tract, and in existence at the time of the conveyance. Haynie v. Brenner, 216 Va. 722 , 222 S.E.2d 546, 1976 Va. LEXIS 192 (1976).

    License vs. Easement. —

    Where the original deed to sellers contained no reference to nearby swimming pool privileges but reference thereto was made in the original contract of sale, sellers enjoyed a license and therefore did not convey an easement or privilege to use the pool to purchasers. Bunn v. Offutt, 216 Va. 681 , 222 S.E.2d 522, 1976 Va. LEXIS 185 (1976).

    No right to apportion easement to third parties. —

    Language allowing a park authority to grant third-party easements “of any nature” subject to approval by a power company demonstrated the exclusivity of the power company’s easement; the deed language unambiguously provided the power company a non-exclusive easement in gross, and thus, the power company did not have the right to apportion the easement to third parties. Va. Elec. & Power Co. v. N. Va. Reg'l Park Auth., 270 Va. 309 , 618 S.E.2d 323, 2005 Va. LEXIS 73 (2005).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    City’s right of way could not be relocated because one-third of its interest in the right of way was held in fee simple, and the court had no authority to move that interest to another plot of land. City of Fredericksburg v. Yarboro, 57 Va. Cir. 124, 2001 Va. Cir. LEXIS 320 (Spotsylvania County Nov. 6, 2001).

    § 55.1-305. Enjoyment of easement.

    Unless otherwise provided for in the terms of an easement, the owner of a dominant estate shall not use an easement in a way that is not reasonably consistent with the uses contemplated by the grant of the easement, and the owner of the servient estate shall not engage in an activity or cause to be present any objects either upon the burdened land or immediately adjacent to such land that unreasonably interferes with the enjoyment of the easement by the owner of the dominant estate. For the purposes of this section, “object” does not include any fence, electric fence, cattle guard, gate, or division fence adjacent to such easement as those terms are defined in §§ 55.1-2800 through 55.1-2826 . Any violation of this section may be deemed a private nuisance, provided, however, that the remedy for a violation of this section shall not in any manner impair the right to any other relief that may be applicable at law or in equity.

    History. 2003, c. 774, § 55-50.1; 2007, c. 931; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Failure to state claim. —

    Landowners were unable to state a private nuisance claim under § 55-50.1 against a gas company because they failed to allege any direct, physical damages related to certain construction, which breached the parties’ right of way agreement. O'Connor v. Columbia Gas Transmission Corp., 643 F. Supp. 2d 799, 2009 U.S. Dist. LEXIS 65414 (W.D. Va. 2009).

    § 55.1-306. Utility easements.

    1. For the purposes of this section, “utility services” means any products, services, and equipment related to energy, broadband and other communications services, water, and sewerage.
    2. Where an easement, whether appurtenant or gross, is expressly granted by an instrument recorded on or after July 1, 2006, that imposes on a servient tract of land a covenant (i) to provide an easement in the future for the benefit of utility services; (ii) to relocate, construct, or maintain facilities owned by an entity that provides utility services; or (iii) to pay the cost of such relocation, construction, or maintenance, such covenant shall be deemed for all purposes to touch and concern the servient tract, to run with the servient tract, its successors, and assigns for the benefit of the entity providing utility services, its successors, and assigns.

    History. 2006, c. 795, § 55-50.2; 2019, c. 712; 2020, cc. 1131, 1132.

    Effective date.

    This section is effective October 1, 2019.

    The 2020 amendments.

    The 2020 amendments by cc. 1131 and 1132 are identical, and substituted “broadband and other communications services” for “telecommunications” in subsection A.

    § 55.1-306.1. Utility easements; expansion of broadband.

    1. As used in this section, unless the context otherwise requires:“Claim” means, in reference to litigation brought against an indemnified party, any demand, claim, cause or right of action, judgment, settlement, payment, provision of a consent decree or a consent decree, damages, attorneys fees, costs, expenses, and any other losses of any kind whatsoever associated with litigation.“Communications provider” means a broadband or other communications service provider, including a public utility as defined in § 56-265.1, a cable operator as defined in § 15.2-2108.1:1 , a local exchange carrier, competitive or incumbent, or a subsidiary or affiliate of any such entity.“Easement” means an existing or future occupied electric distribution or communications easement with right of apportionment, including a prescriptive easement, except that “easement” does not include (i) easements that contain electric substations or other installations or facilities of a nonlinear character and (ii) electric transmission easements.“Enterprise data center operations” has the same meaning as provided in § 58.1-422.2 .“Evidence of creditworthiness” means commercially reasonable assurance, in a form satisfactory to the incumbent utility, that the communications provider will be able to meet its obligations to indemnify as required by this section. Demonstrating that the communications provider has met the eligibility requirements for the Virginia Telecommunications Initiative (VATI), without regard to receipt of a VATI grant, pursuant to regulations or guidelines adopted by the Department of Housing and Community Development, shall be presumptive evidence of creditworthiness.“Incumbent utility” means the entity that is the owner of the easement.“Indemnified parties” means an incumbent utility, or any subsidiary or affiliate of any such entity, and the employees, attorneys, officers, agents, directors, representatives, or contractors of any such entity.“Occupancy license agreement” means an uncompensated agreement between an incumbent utility and a communications provider, for use when the communications provider wishes to occupy an easement underground, that includes evidence of creditworthiness, nondiscriminatory provisions based on safety, reliability, and generally applicable engineering principles.“Prescriptive easement” means an easement in favor of an incumbent utility or communications provider that is deemed to exist, without any requirement of adverse possession, claim of right, or exclusivity, when physical evidence, records of the incumbent utility, public records, or other evidence indicates that it has existed on the servient estate for a continuous period of 20 years or more, without intervening litigation during such period by any party with a title interest seeking the removal of utility facilities or reformation of the easement. The size of such easement shall be deemed to be the greater of the actual occupancy of the easement in the incumbent utility’s usual course of business or 7.5 feet on each side of the installed facilities’ center-line.“Public utility” has the same meaning as provided in § 56-265.1.“Sensitive site” means an underlying servient estate that is occupied by a railroad or an owner or tenant having operations related to national defense, national security, or law-enforcement purposes.
    2. It is the policy of the Commonwealth that:
      1. Easements for the location and use of electric and communications facilities may be used to provide or expand broadband or other communications services;
      2. The use of easements, appurtenant or gross, to provide or expand broadband or other communications services is in the public interest;
      3. The installation, replacement, or use of public utility conduit, including the costs of installation, replacement, or use of conduit of a sufficient size to accommodate the installation of infrastructure to provide or expand broadband or other communications services, is in the public interest.
      4. The use of easements, appurtenant or gross, to provide or expand broadband or other communications services (i) does not constitute a change in the physical use of the easement, (ii) does not interfere with, impair, or take any vested or other rights of the owner or occupant of the servient estate, (iii) does not place any additional burden on the servient estate other than a de minimis burden, if any; and (iv) has value to the owner or occupant of the servient estate greater than any de minimis impact;
      5. The installation and operation of broadband or other communications services within easements, appurtenant or gross, are merely changes in the manner, purpose, or degree of the granted use as appropriate to accommodate a new technology; and
      6. The statements in this subsection are intended to provide guidance to courts, agencies, and political subdivisions of the Commonwealth. Nothing in this section shall be deemed to make the use of an easement for broadband or other communications services, whether appurtenant, in gross, common, exclusive, or nonexclusive, a public use for the purposes of § 1-219.1 , or other applicable law.
    3. The installation and operation of broadband or other communications services by an incumbent utility for that utility’s own internal use, adjunctive to the operation of the electric system, or for the purposes of electric safety, reliability, energy management, and electric grid modernization, are permitted uses within the scope of every easement.
    4. Absent any express prohibition on the installation and operation of broadband or other communications services in an easement that is contained in a deed or other instrument by which the easement was granted, the installation and operation of broadband or other communications services within any easement shall be deemed, as a matter of law, to be a permitted use within the scope of every easement for the location and use of electric and communications facilities.
    5. Subject to compliance with any express prohibitions in a written easement, any incumbent utility or communications provider may use an easement to install, construct, provide, maintain, modify, lease, operate, repair, replace, or remove its communications equipment, system, or facilities, and provide communications services through the same, without such incumbent utility or communications provider paying additional compensation to the owner or occupant of the servient estate or to the incumbent utility, provided that no additional utility poles are installed.
    6. Nothing in this section shall diminish a landowner’s right to contest, in a court of competent jurisdiction, the nature or existence of a prescriptive easement that has been continuously occupied for less than 20 years.
    7. Any incumbent utility or communications provider may use a prescriptive easement to install, construct, provide, maintain, modify, lease, operate, repair, replace, or remove its communications equipment, system, or facilities, and provide communications services through the same, without such incumbent utility or communications provider paying additional compensation to the owner or occupant of the servient estate or to the incumbent utility, provided that no additional utility poles are installed.
    8. Any incumbent utility may grant or apportion to any communications provider rights to install, construct, provide, maintain, modify, lease, operate, repair, replace, or remove its communications equipment, system, or facilities, and to provide communications services through the incumbent utility’s prescriptive easement, including the right to enter upon such easement without approval of the owner or occupant of the servient estate, such grant and use being in the public interest and within the scope of the property interests acquired by the incumbent utility when the prescriptive easement was established.
    9. Notwithstanding any other provision of law, in any action for trespass, or any claim sounding in trespass or reasonably related thereto, whatever the theory of recovery, relating to real property that is brought after July 1, 2020, against an incumbent utility or a communications provider, in relation to the existence, installation, construction, maintenance, modification, operation, repair, replacement, or removal of any poles, wires, conduit, or other communications infrastructure, including fiber optic or coaxial cabling or the existence of any easement, appurtenant or gross, including a prescriptive easement, if proven, damages recoverable by any claimant bringing such claim shall be limited to actual damages only, and no consequential, special, or punitive damages shall be awarded. Damages shall be based on any reduction in the value of the land as a result of the existence, installation, construction, maintenance, modification, operation, repair, replacement, or removal of communications facilities, as such tract existed at the time that any alleged trespass began giving rise to such claim under this section. The court shall also consider any positive value that access to broadband or other communications services may add to the property’s value when calculating damages. Injunctive relief to require the removal or to enjoin the operation of other communications facilities or infrastructure shall not be available when such line or facilities are placed within an existing electric utility or communications easement, appurtenant or gross, but damages as set forth in this subsection shall be the exclusive remedy.
    10. Nothing in this section shall be deemed to limit any liability for personal injury or damage to tangible personal property of the landowner or occupant caused directly by the activities of the incumbent utility or communications provider while on or adjacent to the landowner’s or occupant’s real property.
    11. Any communications provider making use of an easement pursuant to this section shall:
      1. Enter into an agreement with the incumbent utility authorizing it to use an easement;
      2. Adhere to such restrictions as the incumbent utility may place on the communications provider, provided that such restrictions are reasonably related to safety, reliability, or generally applicable engineering principles and are applied on a nondiscriminatory basis;
      3. For underground facilities, enter into an occupancy license agreement with the incumbent utility;
      4. Agree in writing to indemnify, defend, and hold harmless the indemnified parties as against any third party for any claim, including claims of trespass, arising out of its entry onto, use of, or occupancy of such easement and provide evidence of creditworthiness, as the incumbent utility may prescribe, provided that the communications provider is given timely written notice and full cooperation of the indemnified parties in defending or settling any claim, including access to records and personnel to establish the existence of an easement and its history of use by the incumbent utility, and further provided that every communications provider occupying an easement that is the subject of a claim shall be jointly and severally liable to the indemnified parties, with an obligation of equal contribution, for any claim arising out of entry onto, use of, or occupancy of an easement for communications purposes; and
      5. For underground facilities, abide by the provisions of the Underground Utility Damage Prevention Act (§ 56-265.14 et seq.).
    12. A communications provider, making use of an easement pursuant to this section, shall not:
      1. Locate a telecommunications tower in such easement; or
      2. Install any new underground facilities except pursuant to an occupancy license agreement (i) in an incumbent utility’s conduit pursuant to a joint use agreement; (ii) where incumbent utility facilities are permitted underground, using a clean-cutting direct burial technique beneath the surface soil no more than 24 inches in depth and six inches in width; or (iii) riser or drop lines or equipment connection lines, followed in all cases by reasonable restoration of the surface to substantially its prior condition, provided that the landowner shall not, absent an agreement to the contrary, be responsible for relocating or reimbursing the incumbent utility or a communications provider for the cost of relocating any new underground communications facilities installed pursuant to clause (ii) of this subdivision, which relocation and associated costs shall be addressed in the occupancy license agreement. This limitation on reimbursement or payment of relocation costs incurred as a result of development or redevelopment by the landowner shall not apply to any communications facilities in the public rights of way adjacent to or overlying the real property in question.
    13. As against a communications provider, no incumbent utility shall:
      1. Solely by virtue of the provisions of this section, require any additional compensation for use of an easement, unless such compensation is required expressly in a written easement or other agreement;
      2. Unreasonably refuse to grant an occupancy license agreement to any communications provider;
      3. Include in an occupancy license agreement requirements for title reports, surveys, or engineering drawings; or
      4. Use an occupancy license agreement for dilatory purposes or to create a barrier to the deployment of broadband or other communications services.
    14. Nothing in this section shall apply to those easements located on sensitive sites or housing enterprise data center operations.
    15. Notwithstanding any provision of this section, a public utility or an incumbent utility may assess fees and charges and impose reasonable conditions on the use of its poles, conduits, facilities, and infrastructure, which, as regarding attachments to utility poles, shall be subject to the provisions of 47 U.S.C. § 224 for investor-owned utilities and to § 56-466.1 for electric cooperatives. The statutes of repose, limitation, and notice-of-claim requirements contained in subsections R, S, and T shall not apply as being between a communications provider and an incumbent utility.
    16. Nothing in this section shall be construed to inhibit, diminish, or modify the application of the provisions of Chapter 4 (§ 56-76 et seq.) of Title 56 or § 56-231.34:1 or 56-231.50:1, as applicable.
    17. The provisions of this section shall be liberally construed. An agreement to indemnify pursuant to this section shall not be void as against public policy.
    18. Notwithstanding any other provision of law, every action against an incumbent utility, public utility, or communications provider, or a subsidiary or affiliate of any such entity, in relation to the existence, installation, construction, maintenance, modification, operation, repair, replacement, or removal of any poles, wires, or other communications infrastructure, including fiber optic or coaxial cabling, whatever the theory of recovery, shall be brought within 12 months after the cause of action accrues. The cause of action shall be deemed to accrue when overhead broadband or other communications infrastructure is installed or when such underground infrastructure is discovered.
    19. Notwithstanding any other provision of law, every action against an incumbent utility, public utility, or a communications provider, or a subsidiary or affiliate of any such entity, after actual notice has been given to the landowner or occupant in relation to the existence, installation, construction, maintenance, modification, operation, repair, replacement, or removal of any poles, wires, or other communications infrastructure, including fiber optic or coaxial cabling, overhead or underground, whatever the theory of recovery, shall be brought within six months after the cause of action accrues. The cause of action shall be deemed to accrue when actual notice, including notification of such six-month limitation period, is given to the landowner or occupant by first class mail to the last known mailing address of the landowner or occupant in the incumbent utility’s records, or other actual notice.
    20. Notwithstanding any other provision of law, every claim cognizable against any incumbent utility, public utility, or communications provider for trespass, or any claim sounding in trespass or reasonably related thereto, whatever the theory of recovery, in relation to the overhead or underground existence, installation, construction, maintenance, modification, operation, repair, replacement, or removal of any poles, wires, or other communications infrastructure, including fiber optic or coaxial cabling, shall be forever barred unless the claimant or his agent, attorney, or representative has filed a written statement addressed to the incumbent utility, and, if known, to the communications provider, of the nature of the claim, which includes the time and place at which the claim is alleged to have transpired, within 12 months after such cause of action accrued. The cause of action shall be deemed to accrue when physical overhead broadband or other communications infrastructure is installed, or when the existence of such underground infrastructure is discovered. However, if the claimant was under a disability at the time the cause of action accrued, the tolling provisions of § 8.01-229 shall apply.

    History. 2020, cc. 1131, 1132.

    CASE NOTES

    Constitutionality. —

    Property owners’ 42 U.S.C.S. § 1983 claim was dismissed as they had not alleged that the utility took any action to exercise the rights granted by § 55.1-306.1 ’s enactment, and the statute was permissive in nature. Grano v. Rappahannock Elec. Coop., No. 3:20-cv-65, 2021 U.S. Dist. LEXIS 145371 (W.D. Va. Aug. 4, 2021).

    Property owners’ facial challenge to Va. Code Ann. § 55.1-306.1 (2020) was ripe for review as the court was faced with a purely legal question as to the statute’s constitutionality and validity. The as-applied challenge to the statute was also ripe for review as the owners’ injuries, the stripping of a paramount property right that altered their contractual agreement with a utility, were actual. Grano v. Rappahannock Elec. Coop., No. 3:20-cv-65, 2021 U.S. Dist. LEXIS 145371 (W.D. Va. Aug. 4, 2021).

    § 55.1-307. Public road easements; maintenance and improvements.

    Whenever a public road that has never been abandoned but is no longer publicly maintained serves as access for more than one property owner and operates as the primary source of ingress and egress for that property, any one of the property owners may maintain, repair, or improve the road at his own expense without the express permission of the other property owners but only after administrative review by the local government. All other property owners shall be notified by mail of any pending maintenance, repair, or improvements prior to commencement of the work. Nothing in this section shall be construed as allowing the property owner who is doing the maintenance, repairs, or improvements to the road to interfere with the other property owners’ use of the road for ingress and egress.

    History. 2008, c. 599, § 55-50.3; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-308. Private roads; public use; maintenance and improvements.

    Notwithstanding any provision of a recorded deed or plat to the contrary, a private road serving a subdivision of 50 or fewer lots may be dedicated for public use and may be taken into the secondary state highway system, subject to the provisions and requirements set forth in §§ 33.2-335 and 33.2-336 , if the owner of the fee interest in such private road obtains the written consent of every lot owner in the subdivision whose lot is served by the private road and the holder of any restrictive covenant or easement rights over and concerning the private road prior to making such dedication and before requirements for acceptance of the road into the secondary state highway system are met. Such consent shall be recorded in the land records of the clerk’s office of the circuit court of the county in which the private road is located.

    History. 2015, c. 495, § 55-50.4; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-309. Deeds good between parties.

    Any deed, or a part of a deed, that fails to take effect by virtue of this chapter shall, nevertheless, be as valid and effectual and as binding upon the parties, so far as the rules of law and equity permit, as if this chapter had not been enacted.

    History. Code 1919, § 5169; Code 1950, § 55-51; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, § 55.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Seal. —

    Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Deed valid. —

    Defendant’s demurrer to a motion for judgment seeking recovery on a commercial lease was overruled because while there were statutory formalities for a deed, failure to comply with them was not necessarily fatal to an enforcement action between parties to deed. Only the intent to grant needed to be manifest. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County Oct. 12, 2005).

    § 55.1-310. Conveyance of property not owned but subsequently acquired.

    When a deed purports to convey property, real or personal, describing it with reasonable certainty, that the grantor does not own at the time of the execution of the deed, but subsequently acquires, such deed shall, as between the parties, have the same effect as if the title that the grantor subsequently acquires were vested in him at the time of the execution of such deed and thereby conveyed.

    History. Code 1919, § 5202; Code 1950, § 55-52; 1958, c. 424; 1990, c. 831; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, §§ 23, 24.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Section prevents grantor from denying that title actually passed to grantee. —

    This section, a codification of the equitable doctrine of estoppel by deed, operates to prevent the grantor from denying that title has actually passed to the grantee. Thus, as between the parties, the statute permits the passage of title. It does not prejudice the rights of third parties. Hausman v. Hausman, 233 Va. 1 , 353 S.E.2d 710, 3 Va. Law Rep. 1835, 1987 Va. LEXIS 164 (1987).

    Lien of child support judgment had priority over recorded deed of trust on entirety property. —

    The lien of a child support judgment docketed after couple’s divorce had priority over a recorded deed of trust on entirety property executed solely by the husband prior to the divorce, despite the bank’s argument that the entry of the divorce decree, in conjunction with the application of this section (the after-acquired property doctrine), transformed the bank’s interest into a viable lien, as the bank’s deed of trust with respect to the property was void as to wife and children. Hausman v. Hausman, 233 Va. 1 , 353 S.E.2d 710, 3 Va. Law Rep. 1835, 1987 Va. LEXIS 164 (1987).

    Recording of deed of trust before Chapter 11 debtor acquired title did not affect lien. —

    Chapter 11 debtor was not entitled to summary judgment on her claim that she was to be treated as a bona fide purchaser under 11 U.S.C.S. § 544(a)(3) where she had signed a deed of trust that was recorded before she actually acquired title to the property, under § 55-52, that fact did not affect the deed’s validity, and applicable judicial precedent held that 11 U.S.C.S. § 544(a) barred a debtor-in-possession from avoiding a deed of trust that would have been binding on the debtor herself. Wilson v. Moir (In re Wilson), No. 05-13928-SSM, No. 06-1063, 2006 Bankr. LEXIS 1001 (Bankr. E.D. Va. May 26, 2006).

    Application of estoppel by deed. —

    Appeals court rejected an argument that the circuit court erred in overruling an LLC’s motion in limine that sought to enforce via an estoppel by deed, on grounds that a widow attempted by her evidence to contradict the clear wording of the 1972 deed from which she derived her ownership interest; moreover, the widow was not estopped from claiming that she owned more than a one-half interest in the property and from asserting that she and her decedent husband were not divorced. 1924 Leonard Rd., L.L.C. v. Van Roekel, 272 Va. 543 , 636 S.E.2d 378, 2006 Va. LEXIS 114 (2006).

    Rights of third parties. —

    Case did not deal solely with the rights of the party that first recorded a deed of trust vis-a-vis debtor, but rather with the rights of third parties, including a lender. Consequently, § 55-52 did not insulate the deed of trust from an attack predicated on § 55-105. Wilson v. Moir, 359 Bankr. 123, 2006 Bankr. LEXIS 3635 (Bankr. E.D. Va. 2006).

    Circuit court properly ruled that an ex-wife’s deed of trust had priority over a bank’s deed of trust because, while the bank’s deed of trust was recorded before the ex-wife’s deed of trust, the after-acquired-title statute did not purport to affect the deeds of third parties or influence the relative priority of their interests, the bank’s deed of trust was void against the ex-wife as a judgment lien creditor, and the bank’s deed of trust was not properly recorded in the ex-wife’s chain of title. Deutsche Bank Nat'l Trust Co. v. Arrington, 290 Va. 109 , 772 S.E.2d 571, 2015 Va. LEXIS 83 (2015).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Contingent remainders. —

    Because there was no reason that would prevent a beneficiary from alienating a part of the beneficiary’s interest in a trust, pursuant to §§ 55-6 and 55-52, a commissioner’s determination that a beneficiary’s expectancy went directly to the beneficiary’s surviving children was affirmed. Bowman v. Mericle, 69 Va. Cir. 87, 2005 Va. Cir. LEXIS 259 (Norfolk Aug. 31, 2005).

    OPINIONS OF THE ATTORNEY GENERAL

    Editor’s note. —

    The opinion cited below refers to prior law.

    “Deed.” —

    The term “deed” as used in § 58.1-817 should be construed to include deeds of trust and leases, so long as the instruments are recorded in a jurisdiction in which open-space easements are held by the Virginia Outdoors Foundation. See opinion of Attorney General to Ms. Brett C. Glymph, Executive Director, Virginia Outdoors Foundation, 15-081, (9/1/16).

    § 55.1-311. Vendor’s equitable lien abolished.

    If any person conveys any real estate and the purchase money or any part thereof remains unpaid at the time of the conveyance, he shall not thereby have a lien for such unpaid purchase money, unless such lien is expressly reserved on the face of the conveyance.

    History. Code 1919, § 5183; Code 1950, § 55-53; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Deeds, §§ 98, 103.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Vendor’s implied lien was abolished in 1850. —

    In 1842, the common-law implied vendor’s lien was in existence, it not having been abolished until 1850, and could be enforced against a purchaser for value with notice, either actual or constructive; but, even as between parties, vendors and vendees, it might be waived by taking other securities, or a security of different form. Hunton v. Wood, 101 Va. 54 , 43 S.E. 186 , 1903 Va. LEXIS 2 (1903).

    Object of section was to make lien a matter of record. —

    The object of this section in requiring the lien to be reserved on the face of the deed was to make it a matter of record, and thus furnish to all persons dealing with the property the necessary information of all liens and incumbrances thereon. Patton v. Hoge, 63 Va. (22 Gratt.) 443, 1872 Va. LEXIS 35 (1872); Coles v. Withers, 74 Va. (33 Gratt.) 186, 1880 Va. LEXIS 32 (1880).

    The uncertainty in the state of the law, and the perplexing litigation growing out of it, led to the passage of this section. Coles v. Withers, 74 Va. (33 Gratt.) 186, 1880 Va. LEXIS 32 (1880).

    This section leaves unaffected a lien expressly reserved upon the face of the conveyance, which lien continues to have the same force and effect it always had. The reason for this is obvious. None of the evils growing out of the vendor’s implied lien result from a lien expressly reserved on the face of the conveyance. The lien being set forth in the first link of the vendee’s chain of title, purchasers from him have just as much notice of it as they would have of a lien upon the land by deed of trust or mortgage. Patton v. Hoge, 63 Va. (22 Gratt.) 443, 1872 Va. LEXIS 35 (1872).

    It does not impart any new quality to vendor’s lien. —

    This section provides that the vendor shall have no lien for unpaid purchase money unless a lien is reserved on the face of the deed, thus abolishing the lien by implication of law and substituting in its place a lien by express contract. This provision was not intended to impart any new quality to the vendor’s lien, but to end the vexatious litigation growing out of claims for unpaid purchase money against bona fide purchasers of the legal title. Day v. Hale, 63 Va. (22 Gratt.) 146, 1872 Va. LEXIS 9 (1872); Gordon v. Rixey, 76 Va. 694 , 1882 Va. LEXIS 69 (1882); Stoner v. Harris, 81 Va. 451 , 1886 Va. LEXIS 112 (1886); Roanoke Brick & Lime Co. v. Simmons, 20 S.E. 955 , 1895 Va. LEXIS 149 (Va. 1895).

    Express lien is as valid as implied lien formerly was. —

    A vendor’s lien expressly reserved on the face of a conveyance, as required by this section, is as valid as to the estate or interest in the land conveyed as the implied vendor’s lien formerly was, whether the estate in the land conveyed is an absolute fee simple title or a mere equitable interest therein. Dingus v. Minneapolis Imp. Co., 98 Va. 737 , 37 S.E. 353 , 1900 Va. LEXIS 100 (1900).

    Extent of reserved lien depends upon contract. —

    The extent of the lien reserved on the face of a deed does not depend upon the extent of the vendor’s interest in the land conveyed, but upon the contract of the parties as gathered from the deed itself, in reserving the lien. Patterson v. Grottoes Co., 93 Va. 578 , 25 S.E. 602 , 1896 Va. LEXIS 114 (1896).

    It creates no property in land. —

    Reserving lien for purchase money creates no property in the land. It passes as personalty. Assigning the debt carries the lien. It binds the land for the purchase money, excluding other claims. Gordon v. Rixey, 76 Va. 694 , 1882 Va. LEXIS 69 (1882).

    Statement not constituting reservation of lien. —

    The statement in a deed that it is made “in consideration of five hundred dollars secured to be paid,” without more, does not constitute an express reservation of a lien on the land on the face of the deed to secure its payment within the meaning of this section. Harris v. Shield, 111 Va. 643 , 69 S.E. 933 , 1911 Va. LEXIS 13 (1911).

    Section does not apply where no conveyance made by vendor. —

    The statute abolishing the implied lien has no application, it will be perceived, where no conveyance is made by the vendor. By retaining the legal title the vendor preserves his lien unaffected by this section. Day v. Hale, 63 Va. (22 Gratt.) 146, 1872 Va. LEXIS 9 (1872); Stoner v. Harris, 81 Va. 451 , 1886 Va. LEXIS 112 (1886) (see Stovall v. Hardy, 1 Va. Dec. 342 (1879)).

    And vendor has lien as long as he retains title. —

    In case of a contract to convey, passing equitable title, of course there is a lien, as a vendor has a lien for purchase money as long as he retains title. Yancey v. Mauck, 56 Va. (15 Gratt.) 300, 1859 Va. LEXIS 17 (1859).

    Lien is enforceable against subsequent vendee or lienor. —

    If the vendor has sold the legal title, but not conveyed, the land would be charged with the purchase money in the hands of a subsequent purchaser or encumbrancer, even without notice, and notwithstanding that the vendor had taken personal or other security. Day v. Hale, 63 Va. (22 Gratt.) 146, 1872 Va. LEXIS 9 (1872); Stoner v. Harris, 81 Va. 451 , 1886 Va. LEXIS 112 (1886).

    For a court of equity will never compel a vendor to part with the legal title until the purchase money has been paid, or the lien therefor has been waived or extinguished. Yancey v. Mauck, 56 Va. (15 Gratt.) 300, 1859 Va. LEXIS 17 (1859); Coles v. Withers, 74 Va. (33 Gratt.) 186, 1880 Va. LEXIS 32 (1880).

    § 55.1-312. Certain deeds to county real estate validated.

    All deeds executed prior to January 1, 1920, by a county commissioner, county commissioners, or a board of supervisors that convey any part of the real estate previously acquired by such county for county purposes are hereby validated and declared to have effectually passed the title to the part so conveyed even though the conveyance thereof reduced the real estate of the county to an area less than the county was required by law to own at the time of such conveyance.

    History. 1934, p. 228; Michie Code 1942, § 5183a; Code 1950, § 55-54; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-313. Validation of sales, etc., by county courts prior to 1860.

    All sales or leases made prior to the year 1860 by the county court, or court of monthly session, of any county of any land or building then owned by such county and situated within the limits of land previously acquired by such county as a site for its courthouse and other public buildings, when the consideration therefor has been fully paid and the purchaser, or lessee as the case may be, and those claiming through or under him, shall have held continuous possession of such land or building from January 1, 1860, until January 1, 1934, are hereby validated and declared to be forever binding upon such county.

    History. 1934, p. 311; Michie Code 1942, § 5183b; Code 1950, § 55-55; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-314. Deeds and writings executed for persons in military service, etc., under defective powers.

    All deeds or other writings executed by an agent or attorney-in-fact for a person in the armed forces or military service of the United States, or for a person who after executing a power of attorney or agency agreement entered the armed forces or military service of the United States, or for a person who departed from the United States by permission or direction of any department or official of the United States in connection with work relating to the prosecution of the war, when the power of attorney or agency agreement under which the deed or other instrument was signed was not executed in such a manner as to be valid as a sealed instrument, shall be held, and the same are hereby declared, valid and effective in all respects if otherwise valid according to the law then in force.

    The provisions of this section shall not operate to affect adversely intervening vested rights.

    History. 1946, p. 190; Michie Suppl. 1946, § 5145a; Code 1950, § 55-56; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-315. Effect of option; recording.

    1. Any option to purchase real estate, and any memorandum, renewal, or extension of such option, shall be void as to (i) all purchasers for valuable consideration without notice who are not parties to such instrument and (ii) lien creditors, until such instrument is recorded in the county or city in which the property embraced in the option, memorandum, renewal, or extension is located.
    2. Notwithstanding any rule of law or equity denominated “fettering,” “clogging the equity of redemption” or “claiming a collateral advantage” or any similar rule:
      1. A party secured by a mortgage or deed of trust, without adversely affecting his security interest, may acquire from a borrower any direct or indirect present or future ownership interest in the collateral encumbered thereby, including rights to any income, proceeds, or increase in value derived from such collateral; and
      2. An option to acquire an interest in real estate granted to a party secured by a mortgage or deed of trust, other than an option granted to such party in connection with a mortgage loan as defined in § 6.2-1600 , is effective according to its terms and takes priority as provided in subsection A if the right to exercise the option is not dependent upon the occurrence of a default under the mortgage or deed of trust.

    History. 1989, c. 596, § 55-57.2; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 14A M.J. Options, § 7.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Bound by recorded deed of repurchase. —

    Where debtor purchased her residential real property from Habitat for Humanity subject to a limitation imposed by a recorded deed of repurchase, the court concluded that a hypothetical chapter 7 trustee would be bound by the deed of right to repurchase. The trustee could not avoid the recorded deed of repurchase under Virginia law. In re Plascencia, 354 Bankr. 774, 2006 Bankr. LEXIS 3066 (Bankr. E.D. Va. 2006).

    Article 2. Form and Effect of Deeds of Trust; Sales Thereunder; Assignments; Releases.

    § 55.1-316. Form of deed of trust to secure debts, etc.

    A deed of trust to secure debts or indemnify sureties may be in the following form, or to the same effect: “This deed, made the _______________ , in the year _______________ , between _______________ (the grantor) and _______________ (the trustee), witnesseth: that the said _______________ (the grantor) does (or do) grant (or grant and convey) unto the said _______________ (the trustee), the following property (here describe it): In trust to secure (here describe the debts to be secured or the sureties to be indemnified and insert covenants or any other provisions the parties may agree upon). Witness the following signature (or signatures).”

    History. Code 1919, § 5166; Code 1950, § 55-58; 1990, c. 374; 2014, c. 338; 2019, c. 712.

    Editor’s note.

    Acts 2017, c. 131, cl. 1 provides: Ҥ 1. The City of Danville is hereby authorized to establish a pilot project regarding recordation of deeds subject to liens for unpaid taxes in accordance with the provisions of this act. Such pilot project may only be established by ordinance adopted by the city council after a public hearing.

    Ҥ 2. Such ordinance may provide that no deed conveying a parcel of real property that has an assessed value for taxation of $50,000 or less located in the City of Danville shall be recorded by the clerk unless the city director of finance or his designee has certified on the face of such deed that there are no liens against such real property for unpaid local taxes or for other fines or charges assessed by the city that rank on a parity with liens for unpaid taxes and are enforceable in the same manner.

    “§ 3. The provisions of this act shall not apply to (i) any deeds of trust; (ii) any deeds of easement; (iii) any deeds in which a public service company, railroad, or cable system operator is either a grantor or grantee; (iv) any deeds prepared under the supervision of the Office of the Attorney General of Virginia; (v) any deeds conveying property to the Danville Redevelopment and Housing Authority as grantee; and (vi) any deeds conveying a parcel of real property pursuant to Chapter 39 (§ 58.1-3900 et seq.) of Title 58.1 of the Code of Virginia.

    “§ 4. The clerk shall be immune from suit arising from any acts or omissions relating to the pilot project pursuant to this act unless the clerk was grossly negligent or engaged in willful misconduct.”

    Acts 2017, c. 131, cl. 2 provides: “That if such pilot project is established, the City of Danville shall make a written report to the Virginia Housing Commission on or before May 31, 2020.”

    Acts 2017, c. 131, cl. 3 provides: “That the provisions of this act shall expire on July 1, 2021.”

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For article on the mechanics of an examination of title to real property in Virginia, see 11 U. Rich. L. Rev. 471 (1977).

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, §§ 2, 23, 27, 132.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    The objects of this section are to preserve a general form for deeds of trust, where the parties do not prefer some other form, and to save labor in the preparation of such instruments. Michie v. Jeffries, 62 Va. (21 Gratt.) 334, 1871 Va. LEXIS 57 (1871).

    Deed held deed of trust and not mortgage. —

    A deed substantially in the form prescribed for a deed of trust by this section is a deed of trust, and not a mortgage, and the fact that it does not prescribe any terms of sale is immaterial, where the trustee, making a sale thereunder, complies in all respects with § 55-59. Hopkins v. Givens, 119 Va. 578 , 89 S.E. 871 , 1916 Va. LEXIS 131 (1916).

    Debtor retains equitable right to repay indebtedness secured by the trust and obtain the property upon full payment. The trustee has the right upon default to accelerate the debt secured on behalf of the trust beneficiary, take possession of the property and sell it. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer’s hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Foreclosure sale occurring prior to filing of bankruptcy petition cuts off debtor’s interest in foreclosed property, and a deed of trust conveys legal title to the property to the trustee. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    § 55.1-317. Requirements for trustees.

    1. No person may be named or act, in person or by agent or attorney, as the trustee of a deed of trust conveying property to secure the payment of money or the performance of an obligation, either individually or as one of several trustees, unless such person is a resident of the Commonwealth. No corporation, limited liability company, partnership, or other entity may be named or act as the trustee or as one of the trustees of a deed of trust conveying property to secure the payment of money or the performance of an obligation, unless it is organized under the laws of the Commonwealth or of the United States. However, the foregoing requirements shall not apply to any deed of trust conveying property lying partly in the Commonwealth and partly outside the Commonwealth or to a deed of trust conveying property in the Commonwealth to secure bonds or obligations that are also secured by one or more deeds of trust or mortgages conveying property outside of the Commonwealth.
    2. A deed of trust conveying property to secure the payment of money or the performance of an obligation shall state the full residence or business address of the trustee named in such deed of trust, including street address and zip code, and such address shall be valid for purposes of all notices under the deed of trust to the trustee. Such address of the trustee may be changed by amendment of the deed of trust or by a separate instrument executed by the trustee, or by the beneficiary of such deed of trust, stating the changed address and otherwise in recordable form, and recorded in the office of the clerk of the circuit court where the deed of trust was recorded.
    3. Notwithstanding any other provisions of this section, if any deed of trust is recorded by a clerk, it shall be conclusively presumed that such deed of trust complies with all the requirements of this section, and it shall be deemed to be validly recorded.
    4. All deeds of trusts, mortgages, bonds, or other instruments recorded by a clerk prior to January 1, 1999, without the residence or business address of the trustee named in such deed of trust shall be valid for all purposes as if such address had been named if such recordation is otherwise valid according to the law then in force, provided that this section shall not affect any right or remedy of any third party that accrued after the recordation of such instrument or before July 1, 1960.

    History. 1960, c. 565, § 55-58.1; 1962, c. 156; 1966, c. 398; 1974, c. 424; 1998, c. 202; 2014, c. 338; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 3C M.J. Commercial Law, § 99.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Out-of-state lender. —

    If the lender who initiates foreclosure is an out-of-state entity, a Virginia resident must be appointed to serve as trustee. United States v. Romer, 148 F.3d 359, 1998 U.S. App. LEXIS 13468 (4th Cir. 1998), cert. denied, 525 U.S. 1141, 119 S. Ct. 1032, 143 L. Ed. 2d 41, 1999 U.S. LEXIS 1065 (1999).

    Federal preemption. —

    Because § 55-58.1 granted state banks, but not national banks with no principal office in Virginia, the power to act as a deed of trust trustee and foreclose, a power incidental to a national bank’s real estate lending power, the National Bank Act preempted § 55-58.1; a national bank could act as a deed of trust trustee with power to foreclose against borrowers. Jaldin v. Recontrust Co., N.A., 539 Fed. Appx. 97, 2013 U.S. App. LEXIS 18073 (4th Cir. 2013), cert. denied, 572 U.S. 1115, 134 S. Ct. 2293, 189 L. Ed. 2d 174, 2014 U.S. LEXIS 3494 (2014).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    “Principal office.” —

    Highest bidder at a foreclosure sale was entitled to summary judgment in her action to recover her deposit and the contract and memo of sale were void and unenforceable by either party because the trustee lacked both the capacity and authority to be named or act as substitute trustee where it knew when it was named as substitute trustee and entered into the memo of sale with the bidder that its principal office was not within the Commonwealth of Virginia. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 149 (Westmoreland County Aug. 5, 2013).

    Corporate trustee had to have principal office within Commonwealth. —

    Actions of a corporate trustee that had its principal office outside Virginia rendered the trustee auction and the memo executed pursuant thereto voidable because the statute required that in order for the trustee to be named or to act as trustee, it had to have its principal office within the Commonwealth; the requirements for a corporation serving as a trustee cannot be read as optional. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    Trustee’s capacity and authority. —

    Bidder’s deposit at a foreclosure sale was to be returned to her by a trustee and lender because the memo of sale between the bidder and the trustee was void and unenforceable where the trustee lacked both the capacity and authority to be named or act as substitute trustee, and while the lender was not a party to the memo, it currently held the funds based solely upon its claim to the deposit. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2014 Va. Cir. LEXIS 14 (Westmoreland County Jan. 24, 2014).

    Foreign trustee serving with Virginia trustee. —

    Mere appointment of a foreign corporation, who did not qualify as a trustee, together with a Virginia corporation as co-trustees did not render two foreclosure sales invalid and, therefore, an exception to a commissioner’s report invalidating the sales was sustained since the otherwise qualified co-trustee was a Virginia corporation. In re Trustee's Sale, 67 Va. Cir. 204, 2005 Va. Cir. LEXIS 182 (Norfolk Mar. 25, 2005).

    Conclusive presumption. —

    Purchaser’s claim to set aside the memo by which she bought the property at the trustee sale was not barred by the statute; the conclusive presumption language must be limited to validating the correctness of the residence or business address of the trustee as it appears in the deed of trust. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    Breach of contract action. —

    Corporate trustee’s ground of demurrer that the statute did not create a private cause of action in favor of a defaulting buyer was overruled because although the buyer alleged that the trustee violated the statute, her cause of action was for common-law breach of contract. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    OPINIONS OF THE ATTORNEY GENERAL

    Editor’s note. —

    The opinions cited below refer to prior law.

    A limited liability company has the authority to serve as a trustee in a deed of trust on real property. See opinion of Attorney General to The Honorable Albert Teich Jr., Clerk, Circuit Court of the City of Norfolk, 01-006, 2001 Va. AG LEXIS 36 (6/22/01).

    A registered limited liability partnership organized under the laws of the Commonwealth may serve as a trustee under a deed of trust covered by § 55-58.1. See opinion of Attorney General to The Honorable Gregory D. Habeeb, Member, House of Delegates, 11-131, 2012 Va. AG LEXIS 13 (3/23/12).

    “Principal office.” —

    For purposes of subdivision (2) of § 55-58.1 [now subsection A of § 55-58.1], “principal office” may be defined according to the definition of this term provided in Title 13.1. A corporation’s registered office does not satisfy the requirements of subdivision (2) of § 55-58.1 [now subsection A of § 55-58.1] unless such office also meets the definition of “principal office.” See opinion of Attorney General to The Honorable J. Chapman Petersen, Member, Senate of Virginia, 11-053, 2012 Va. AG LEXIS 34 (9/14/2012).

    § 55.1-318. Credit line deed of trust defined; relative priority of credit line deed of trust and other instruments of judgment.

    1. For the purpose of this section:“Beneficiary” means the noteholder, lender, or other party or parties identified in the credit line deed of trust as secured thereby. In the case of a credit line deed of trust that identifies a party acting as agent for all of the lenders or parties secured by a credit line deed of trust, such agent shall be the beneficiary for purposes of this section.“Credit line deed of trust” means any deed of trust, mortgage, bond, or other instrument entered into after July 1, 1982, in which title to real property located in the Commonwealth is conveyed, transferred, encumbered, or pledged to secure payment of money, including advances or other extensions of credit to be made in the future.
    2. A credit line deed of trust shall set forth on the front page, either in capital letters or in language underscored, the words “THIS IS A CREDIT LINE DEED OF TRUST.” Such phrase shall convey notice to all parties that advances or other extensions of credit are to be made or are contemplated to be made from time to time against the security described in the credit line deed of trust. Such credit line deed of trust shall specify the maximum aggregate amount of principal to be secured at any one time.
    3. From the date and actual time of the recording of a credit line deed of trust, the lien shall have priority (i) as to all other deeds, conveyances, or other instruments, or contracts in writing, that are unrecorded as of such date and time of recording and of which the beneficiary has no knowledge or notice and (ii) as to judgment liens subsequently docketed, except as provided in subsection D. Such priority shall extend to any advances or other extensions of credit made following the recordation of the credit line deed of trust. Amounts outstanding, together with interest, and other items provided by § 55.1-320 , shall continue to have priority until paid or curtailed. Mechanics’ liens created under Title 43 shall continue to enjoy the same priority as created by that title. Purchase money security interests in goods and fixtures shall have the same priority as provided in Subpart 3 (§ 8.9A-317 et seq.) of Part 3 of Title 8.9A.
    4. Notwithstanding the provisions of subsections A, B, and C, if a judgment creditor gives written notice to the beneficiary of record at the address indicated in the credit line deed of trust, such credit line deed of trust shall have no priority as to such judgment for any advances or extensions of credit made under such credit line deed of trust from the day following receipt of that notice except those that have been unconditionally and irrevocably committed prior to such date.
    5. In addition to the language specified in subsection B, the credit line deed of trust shall set forth the name of the beneficiary and the address at which communications may be mailed or delivered to the beneficiary. Such name or address may be changed or modified by duly recorded instrument executed by the beneficiary only. If the note or indebtedness secured by the credit line deed of trust is assigned or transferred, the name and address of the new beneficiary may be set forth in the certificate of transfer provided by § 55.1-336 . Such original name or address, or if changed, such changed name or address, shall be the address for delivery of notices contemplated by this section. Receipt of notice at such address shall be deemed receipt by the beneficiary.
    6. The grantor may require at any time a modification under the credit line deed of trust whereby any priority over subsequently recorded deeds of trust is surrendered as to future advances or other extensions of credit, which advances or extensions of credit are in the discretion of the party secured by the credit line deed of trust.
    7. Notwithstanding the provisions of subsections A, B, and C, if a deed of trust under this section is a subordinate mortgage, as defined in subsection A of § 55.1-319 , upon the recording of a refinance mortgage, as defined in subsection A of § 55.1-319 , the credit line deed of trust shall retain the same subordinate position with respect to the refinance mortgage as it had with the prior mortgage, as defined in subsection A of § 55.1-319, provided that the refinance mortgage complies with the requirements of § 55.1-319.

    History. 1982, c. 230, § 55-58.2; 1983, c. 124; 1984, c. 19; 1989, c. 346; 1997, c. 205; 2000, c. 971; 2014, c. 338; 2019, c. 712.

    Cross references.

    As to loans secured by a subordinate deed of trust or mortgage, see § 6.2-327 . As to limitations of actions on credit line deeds of trust when no maturity date is given, see § 8.01-242 .

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    “Credit line deed of trust.” —

    Notwithstanding that a creditor sued on a note secured by a credit line deed of trust and was awarded a judgment lien, which it properly recorded under § 8.01-458 , the creditor’s credit line deed of trust note remained secured by the debtors’ property. In Virginia, a mortgage remained valid and enforceable until the debt was satisfied or the mortgage was released, and under § 55-58.2, a credit line deed of trust was a general term used to describe a variety of instruments, including a mortgage. Didlake v. Wachovia Bank, 454 Bankr. 349, 2011 Bankr. LEXIS 2928 (Bankr. W.D. Va. 2011).

    Inapplicability of this section to former § 8.9-312(7) (see now § 8.9A-323 ). —

    Language of this section concerning future advances under a line of credit secured by real property would not be applied to a case governed by former § 8.9-312(7) (see now § 8.9A-323 ) by employment of the doctrine of pari materia; this doctrine did not apply, as it requires that the statute being interpreted must be ambiguous, which former § 8.9-312(7) (see now § 8.9A-323 ) was not, and further requires that the statutes being compared relate to the same thing or have a common purpose, which this section and former § 8.9-312(7) (see now § 8.9A-323) do not. In re Enfolinc, Inc., 233 Bankr. 351, 1999 Bankr. LEXIS 862 (Bankr. E.D. Va. 1999).

    § 55.1-318.1. Effect of amendment to loan document on deed of trust.

    A deed of trust that has been recorded and that states that it secures indebtedness or other obligations under a loan document and that it also secures indebtedness or other obligations under such loan document as it may be amended, modified, supplemented, or restated shall secure such loan document as amended, modified, supplemented, or restated from time to time, without the necessity of recording an amendment to such deed of trust and without regard to whether any such amendment, modification, supplement, or restatement may otherwise constitute a novation of the indebtedness or other obligations under the loan document, and shall have the same priority as the priority of the original deed of trust recorded. The foregoing provision shall not apply to any amendment, modification, supplement, or restatement of such loan document if (i) the deed of trust securing such loan document conveys an interest in residential real estate containing not more than one dwelling unit or (ii) such amendment, modification, supplement, or restatement of such loan document (a) increases the aggregate amount of the principal of the indebtedness secured by the original deed of trust, (b) changes or substitutes the noteholder, lender, or agent of any lender named in the original loan document, or (c) extends the maturity date of the indebtedness or obligation secured if such maturity date was set forth in the original deed of trust, and the effect of any such amendment, modification, supplement, or restatement shall be governed by the law that would otherwise apply without regard to this section. For the purposes of this section, “loan document” includes a note, loan agreement, credit agreement, or other document evidencing a loan or other indebtedness.

    History. 2021, Sp. Sess. I, c. 13.

    § 55.1-319. Priority of residential refinance mortgage over subordinate mortgage.

    1. As used in this section:“Prior mortgage” means a mortgage, deed of trust, or other instrument encumbering or conveying an interest in residential real estate containing not more than one dwelling unit to secure a financing.“Refinance mortgage” means a mortgage, deed of trust, or other instrument encumbering or conveying an interest in residential real estate containing not more than one dwelling unit to secure a refinancing.“Refinancing” means the replacement of a loan secured by a prior mortgage with a new loan secured by a refinance mortgage and the payment in full of the debt owed under the original loan secured by the prior mortgage.“Subordinate mortgage” means a mortgage or deed of trust securing an original principal amount not exceeding $150,000, encumbering or conveying an interest in residential real estate containing not more than one dwelling unit that is subordinate in priority (i) under subdivision A 1 of § 55.1-407 or (ii) as a result of a previous refinancing.
    2. Upon the refinancing of a prior mortgage, a subordinate mortgage shall retain the same subordinate position with respect to a refinance mortgage as the subordinate mortgage had with the prior mortgage, provided that:
      1. Such refinance mortgage states on the first page thereof in bold or capitalized letters: “THIS IS A REFINANCE OF A (DEED OF TRUST, MORTGAGE OR OTHER SECURITY INTEREST) RECORDED IN THE CLERK’S OFFICE, CIRCUIT COURT OF (NAME OF COUNTY OR CITY), VIRGINIA, IN DEED BOOK , PAGE , IN THE ORIGINAL PRINCIPAL AMOUNT OF , AND WITH THE OUTSTANDING PRINCIPAL BALANCE WHICH IS WHICH HAD AN INTEREST RATE OF % PER ANNUM.”;

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      2. The principal amount secured by such refinance mortgage does not exceed the outstanding principal balance secured by the prior mortgage plus $5,000; and
      3. The interest rate of the refinance mortgage at the time it is recorded does not exceed the interest rate of the prior mortgage. The interest rate of the prior mortgage shall be stated on the first page of the refinance mortgage.
    3. The priorities among two or more subordinate mortgages shall be governed by subdivision A 1 of § 55.1-407 .
    4. The provisions of subsection B shall not apply to a subordinate mortgage securing a promissory note payable to any locality or any agency, authority, or political subdivision of the Commonwealth if such subordinate mortgage is financed pursuant to an affordable dwelling unit ordinance adopted pursuant to § 15.2-2304 or 15.2-2305 , or pursuant to any program authorized by federal or state law or local ordinance or resolution, for (i) low-income and moderate-income persons or households or (ii) improvements to residential potable water supplies and sanitary sewage disposal systems made to address an existing or potential public health hazard, and which mortgage, if recorded on or after July 1, 2003, states on the first page thereof in bold or capitalized letters: “THIS (DEED OF TRUST, MORTGAGE OR OTHER SECURITY INTEREST) SHALL NOT, WITHOUT THE CONSENT OF THE SECURED PARTY HEREUNDER, BE SUBORDINATED UPON THE REFINANCING OF ANY PRIOR MORTGAGE.”

    History. 2000, c. 971, § 55-58.3; 2002, c. 172; 2003, c. 381; 2011, c. 77; 2014, c. 338; 2019, c. 712; 2021, Sp. Sess. I, c. 13.

    Effective date.

    This section is effective October 1, 2019.

    The 2021 Sp. Sess. I amendments.

    The 2021 amendment by Sp. Sess. I, c. 13, effective July 1, 2021, rewrote subdivision B 3, which read “The interest rate is stated in the refinance mortgage at the time it is recorded and does not exceed the interest rate set forth in the prior mortgage.”

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Application. —

    Where an assignee sought a determination that its deed of trust maintained priority over previously recorded judgment liens, dismissal was appropriate because § 55-58.3, which applied to the deed of trust because the deed of trust paid the debt owned under the original loan secured by the prior mortgage, did not entitle the deed of trust to retain the position of the prior mortgage as to liens that were subordinate to the prior mortgage because the deed of trust did not contain the required language in bold on the front of the document and exceeded the prior mortgage by more than $5,000. Deutsche Nat'l Bank Trust Co. v. Batmanghelidj, No. 1:07cv683, 2007 U.S. Dist. LEXIS 68499 (E.D. Va. Sept. 17, 2007).

    § 55.1-320. How deed of trust construed; duties, rights, etc., of parties.

    Every deed of trust to secure debts or indemnify sureties is in the nature of a contract and shall be construed according to its terms to the extent not in conflict with the requirements of law. Unless the deed of trust provides otherwise, it shall be construed to impose and confer upon the parties and beneficiaries the following duties, rights, and obligations in like manner as if the same were expressly provided for by such deed of trust:

    1. The deed shall be construed as given to secure the performance of each of the covenants entered into by the grantor as well as the payment of the primary obligation.
    2. The grantor shall be deemed to covenant that he will pay all taxes, levies, assessments, and charges upon the property, including the fees and charges of such agents or attorneys as the trustee may deem advisable to employ at any time for the purpose of the trust, so long as any obligation upon the grantor under the deed of trust remains undischarged.
    3. The grantor shall be deemed to covenant that he will keep the improvements on the property in tenantable condition, whether such improvements were on the property when the deed of trust was given or were placed there at a later time.
    4. The grantor shall be deemed to covenant that no waste shall be committed or suffered upon the property.
    5. The grantor shall be deemed to covenant that in the event of his failure to meet any obligations imposed upon him, then the trustee or any beneficiary may, at his option, satisfy such obligations. The money so advanced, with interest as provided in the deed of trust, shall be a part of the debt secured by the deed of trust, in the event of sale to be paid next after the expenses of executing the trust, and shall be otherwise recoverable from the grantor as a debt. In addition, to the extent not otherwise covered, the grantor shall be deemed to covenant that amount advanced or incurred by the trustee or any beneficiary under a deed of trust (i) with respect to an obligation secured by a lien or encumbrance prior to the lien of the deed of trust or (ii) for the protection of the lien secured by the deed of trust, together with interest as provided in the deed of trust, shall be a part of the debt secured by the deed of trust, to be paid next after expenses of executing the trust.
    6. A covenant to pay interest shall be deemed a covenant to pay interest on the principal balance as such rate may vary or be modified from time to time by the parties under the original instruments or agreements or a written agreement of modification, whether or not recorded, and all the interest on the principal secured by the deed of trust shall be on an equal priority with the principal debt secured by the deed of trust, in the event of sale to be paid next after the expenses of executing the trust.Any covenant, otherwise authorized by law, that the lender shall be entitled to share in the gross income or the net income, or the gross rent or revenues, or net rents or revenues of the property, or in any portion of the proceeds or appreciation upon sale or appraisal or similar event, shall be on an equal priority with the principal debt secured by the deed of trust, in the event of sale to be paid next after the expenses of executing the trust, and shall be specified in the recorded deed of trust or other recorded document in order to be notice of record as against subsequent parties.
    7. In the event of default in the payment of the debt secured, or any part thereof, at maturity, or in the payment of interest when due, or of the breach of any of the covenants entered into or imposed upon the grantor, then at the request of any beneficiary the trustee shall forthwith declare all the debts and obligations secured by the deed of trust at once due and payable and may take possession of the property and proceed to sell the same at auction at the premises or in the front of the circuit court building or at such other place in the county or city in which the property or the greater part thereof lies, or in the corporate limits of any city surrounded by or contiguous to such county, or in the case of annexed land, in the county of which the land was formerly a part, as the trustee may select upon such terms and conditions as the trustee may deem best.
    8. If the sale is upon credit terms, the deferred purchase money shall bear interest from the day of sale and shall be secured by a deed of trust upon the property contemporaneous with the trustee’s deed to the purchaser.
    9. The party secured by the deed of trust, or the holders of greater than 50 percent of the monetary obligations secured thereby, shall have the right and power to appoint one or more substitute trustees for any reason and, regardless of whether such right and power is expressly granted in such deed of trust, by executing and acknowledging an instrument designating and appointing a substitute. When the instrument of appointment has been executed, the substitute trustee named therein shall be vested with all the powers, rights, authority, and duties vested in the trustee in the original deed of trust. The instrument of appointment shall be recorded in the office of the clerk in which the original deed of trust is recorded prior to or at the time of recordation of any instrument in which a power, right, authority, or duty conferred by the original deed of trust is exercised.
    10. In the case of a deed of trust conveying owner-occupied residential real estate, the trustee of such deed of trust shall not sell the property secured by the deed of trust without receiving an affidavit signed by the party that provided the notice required by § 55.1-321 confirming the notice was sent to the owner, with a copy of such notice attached to the affidavit. Prior to commencing a foreclosure sale with respect to such real estate, the trustee shall provide copies of such affidavit and notice, with any personal financial information redacted, to each potential bidder.

    History. Code 1919, § 5167; 1922, p. 364; 1926, p. 591; 1940, p. 879; 1944, p. 481; Code 1950, § 55-59; 1952, c. 370; 1954, c. 557; 1956, c. 674; 1960, c. 5; 1964, c. 501; 1968, c. 786; 1970, c. 12; 1973, c. 341; 1976, c. 257; 1977, cc. 151, 314, 660; 1979, c. 12; 1980, c. 709; 1981, c. 591; 1992, cc. 87, 193; 1993, c. 426; 1994, c. 551; 2019, c. 712; 2021, Sp. Sess. I, cc. 91, 92.

    Effective date.

    This section is effective October 1, 2019.

    The 2021 Sp. Sess. I amendments.

    The 2021 amendments by Sp. Sess. I, cc. 91 and 92, effective July 1, 2021, are identical, and added subdivision 10.

    Law Review.

    For article, “Avoidance of Foreclosure Sales as Fraudulent Conveyances: Accommodating State and Federal Objectives,” see 71 Va. L. Rev. 933 (1985).

    For article, “Do Product Bans Help Consumers? Questioning the Economic Foundations of Dodd-Frank Mortgage Regulation,” see 23 Geo. Mason L. Rev. 617 (2016).

    For essay, “Foreclosure of a Deed of Trust in Virginia,” see 51 U. Rich. L. Rev. 147 (2016).

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, §§ 32, 50, 57, 86, 97, 98, 100, 129, 141, 144, 173.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.
    A.General Consideration.

    Section regulates conduct of trustee only so far as deed fails to do so. —

    It will be seen, on examination, that the object of this section is to prescribe the duties and regulate the conduct of the trustee only so far as the deed fails to do so. Clark v. Moore, 76 Va. 262 , 1882 Va. LEXIS 28 (1882).

    Deed is sole source of his authority. —

    The trustee can only do with the trust property what the deed, either in express terms or by necessary implication, authorizes him to do. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 , 1935 Va. LEXIS 307 (1935).

    Deed of trust considered a contract. —

    As a deed of trust was a contract under the law, it was clear that plaintiff’s claim sounded in contract, not tort; thus, the trial court erred in characterizing the claim was a common-law negligence claim. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (2018).

    Only statute that addresses the trustee’s duties with regard to a foreclosure sale expressly indicates that it does not cover the entire field of duties the trustee has in this area; the statute states that in the event of sale under a deed of trust, the trustee shall have the following powers and duties in addition to all others, and this language clearly indicates that the legislature did not intend to limit a trustee’s powers and duties to those enumerated in the statute. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (2018).

    Section controlling unless otherwise provided. —

    The provisions of this section are controlling when the deeds of trust do not otherwise provide. Colonial Inv. Co. v. Cherrydale Cement Block Co., 194 Va. 454 , 73 S.E.2d 419, 1952 Va. LEXIS 251 (1952).

    According to this section, when the deed of trust provides otherwise, the statutory requirements are inapplicable and a trustee thus did not violate subsection (7) by selling the property at auction without having declared the debt immediately payable where the deed of trust provided that the beneficiary could declare the debt immediately payable prior to the auction. Riley v. Robey, 122 F. Supp. 2d 684, 2000 U.S. Dist. LEXIS 17426 (W.D. Va. 2000).

    The validity of an acceleration clause in a deed of trust is recognized. Where it is not otherwise provided by the deed of trust, this section requires such a clause to be read into it. Devany v. Colgin, 163 Va. 848 , 178 S.E. 15 , 1935 Va. LEXIS 245 (1935).

    A due-on-sale acceleration clause in a deed of trust is not an unreasonable restraint on alienation. Lipps v. First Am. Serv. Corp., 223 Va. 131 , 286 S.E.2d 215, 1982 Va. LEXIS 179 (1982); United Va. Bank/National v. Best, 223 Va. 112 , 286 S.E.2d 221, 1982 Va. LEXIS 176, cert. denied, 459 U.S. 879, 103 S. Ct. 175, 74 L. Ed. 2d 144, 1982 U.S. LEXIS 3739 (1982).

    Incorporation of section in deed by reference. —

    Suit was brought to set aside a sale of property under a deed of trust upon the ground that the sale had not been advertised once a week for four successive weeks in a newspaper as required by this section. At the time the deed was made, this section did not require a newspaper advertisement, and the statute, as it existed at that time, was expressly referred to, incorporated in and made a part of the deed of trust. It was held that the provisions of this section, as it existed at the time the deed of trust was made, became a material portion of the contract between the parties. Gloucester Realty Corp. v. Guthrie, 182 Va. 869 , 30 S.E.2d 686, 1944 Va. LEXIS 242 (1944).

    This section and § 55-60 do not affect the determination of lien priorities, but merely define certain language employed in the deed of trust. W.T. Jones & Co. v. Foodco Realty, Inc., 318 F.2d 881, 1963 U.S. App. LEXIS 5236 (4th Cir. 1963).

    Priority of real estate taxes over payment of foreclosure sale proceeds. —

    This section and § 58.1-3340 give real estate taxes a priority over the payment of the proceeds of a foreclosure sale. They direct that the foreclosure trustee must satisfy all outstanding tax deficiencies before distributing the proceeds, and in the event that this section fails, it is provided that the delinquent taxes shall remain a debt outstanding against the purchaser at the sale. In re Polumbo, 271 F. Supp. 640, 1967 U.S. Dist. LEXIS 11470 (W.D. Va. 1967).

    Power of court to enjoin settlement of trustees’ account. —

    A court of equity had jurisdiction to entertain a bill of complaint filed by beneficiaries under a second deed of trust seeking injunction against excessive settlement by the trustees under first deed of trust. Bradley v. Canter, 201 Va. 747 , 113 S.E.2d 878, 1960 Va. LEXIS 156 (1960).

    Equity of redemption. —

    Upon default in payment of the indebtedness secured by the deed of trust, the secured creditor may accelerate the indebtedness and request the trustee under the deed of trust to execute a sale. The creditor or the trustee must notify the debtor in writing of the acceleration and pending sale. At this point, the trustee holds legal title to the property conveyed in trust and the debtor has an “equity of redemption.” This is an equitable right incident to every mortgage which allows the mortgagor to pay the indebtedness and require the secured creditor to reconvey the property free of the deed of trust lien. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260, 1983 Bankr. LEXIS 7002 (Bankr. W.D. Va. 1983).

    Debtor retains equitable right to repay indebtedness secured by trust and obtain property upon full payment. The trustee has the right upon default to accelerate the debt secured on behalf of the trust beneficiary, take possession of the property and sell it. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Foreclosure sale occurring prior to filing of bankruptcy petition cuts off debtor’s interest in foreclosed property, and a deed of trust conveys legal title to the property to the trustee. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer’s hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807, 1988 U.S. Dist. LEXIS 1586 (E.D. Va. 1988).

    Frazier-Lemke Act was invalid as regards this section. —

    The Frazier-Lemke Act, in spite of its amendments, was unconstitutional under the Fourteenth Amendment of the federal Constitution as regards this section. In re Sherman, 12 F. Supp. 297, 1935 U.S. Dist. LEXIS 1359 (D. Va. 1935).

    Bankruptcy court bound by provision stipulating attorney’s fees to creditor. —

    The bankruptcy court was bound by a provision in a secured note awarding stipulated attorney’s fees to the secured creditor in the event he found it necessary to employ counsel for purposes of collection, since, in Virginia, where provision for stipulated attorney’s fees is made in a note secured by a deed of trust, which deed specifies that it is given as security for the note, the attorney’s fees themselves are part of the secured debt, and since the validity in bankruptcy proceedings of a provision in a secured note calling for stipulated attorney’s fees presents a question of state law. In re Crafty Fox, Ltd., 475 F. Supp. 634, 1979 U.S. Dist. LEXIS 10211 (W.D. Va. 1979). But see In re Saunders, 130 Bankr. 208, 1991 Bankr. LEXIS 1527 (Bankr. W.D. Va. 1991).

    Pursuant to 11 U.S.C. § 1322(b)(5), a debtor may cure defaults under a deed of trust and reinstate such obligation if done within a reasonable amount of time. In re Stokes, 39 Bankr. 336, 1984 Bankr. LEXIS 5990 (Bankr. E.D. Va. 1984).

    Action under federal question jurisdiction not permitted. —

    This section did not involve sufficient state action to permit plaintiffs to maintain a cause of action under federal question jurisdiction. Levine v. Stein, 560 F.2d 1175, 1977 U.S. App. LEXIS 11759 (4th Cir. 1977), cert. denied, 434 U.S. 1046, 98 S. Ct. 891, 54 L. Ed. 2d 797, 1978 U.S. LEXIS 560 (1978).

    Beneficiary necessary parties. —

    Both the trustee and the named beneficiary of an antecedent deed of trust are necessary parties in a suit to enforce a mechanic’s lien. Mendenhall v. Douglas L. Cooper, Inc., 239 Va. 71 , 387 S.E.2d 468, 6 Va. Law Rep. 1013, 1990 Va. LEXIS 29 (1990).

    Holder to foreclose on a deed of trust. —

    Virginia law allowed a holder to foreclose on a deed of trust because, inter alia, the mortgage note was a negotiable instrument under § 8.3A-104 , both the note and the deed of trust demonstrated that the parties intended to allow the loan to be freely transferred, the note was endorsed in blank, the note was currently in the holder’s hands, there was no alteration to the note or deed of trust at any time, and the owner was in default on his obligations. Bernardo v. Nat'l City Real Estate Servs., LLC, 435 Fed. Appx. 240, 2011 U.S. App. LEXIS 10812 (4th Cir. 2011).

    B.Foreclosure by Sale.

    Requests by beneficiary. —

    Although the beneficiary did not actually request the trustee to sell, it was clear from the circumstances that his actions were tantamount to a request. Rogers v. Runyon, 201 Va. 814 , 113 S.E.2d 679, 1960 Va. LEXIS 164 (1960).

    Statute determining method of advertising. —

    Under a provision in a deed of trust that in event of default the trustee should sell the real estate pursuant to this section, the method of advertising the sale is to be measured and determined by the language of the statute which was in effect at the date of the execution and delivery of the deed, and not by that which was in effect at the time of the sale. Cromer v. DeJarnette, 188 Va. 680 , 51 S.E.2d 201, 1949 Va. LEXIS 239 (1949).

    Provision as to advertising is not retroactive. —

    The legislature, in providing that sales under deeds of trust shall be advertised once a week for four successive weeks in a newspaper, did not intend that this provision should affect deeds of trust, executed prior to its effective date, which embodied agreed terms of sale and an agreed manner of advertisement in event of foreclosure. Gloucester Realty Corp. v. Guthrie, 182 Va. 869 , 30 S.E.2d 686, 1944 Va. LEXIS 242 (1944).

    Newspaper advertisement not a substitute for mandatory posting. —

    The provisions of the deed of trust providing for posting of notices in three public places as well as advertising in the newspaper were, in effect, conjunctive provisions rather than disjunctive provisions and the newspaper advertisement did not substitute for the mandatory posting under the terms of the instrument since the terms of the deed of trust required such posting as well as the statutory requirement for public advertising in the newspaper and the statute gave the trustee no option and the debtor was entitled to have the deed of trust terms complied with. Burke v. Fleet Fin., Inc., 98 Bankr. 746, 1989 Bankr. LEXIS 644 (Bankr. W.D. Va. 1989).

    Lack of authority in trustee invalidates sale. —

    Lack of authority in the trustee under a deed of trust to foreclose goes to the validity of the sale itself. Willis v. Chesapeake W. Ry., 178 Va. 314 , 16 S.E.2d 649, 1941 Va. LEXIS 166 (1941).

    But misapplication of proceeds does not. —

    Failure of the trustee to apply the proceeds properly does not invalidate the sale. Willis v. Chesapeake W. Ry., 178 Va. 314 , 16 S.E.2d 649, 1941 Va. LEXIS 166 (1941).

    Trustee has power to sell either for cash or on time. —

    Even before the incorporation in this section of the present authority to sell “upon such terms and conditions as the trustee may deem best” such power was usually written in deeds of trust in this State. And from time immemorial such language has been interpreted by the profession to include the power to sell either for cash or on time. Obviously it was the purpose of the legislature to have the language of this section conform to the accepted practice, and thus to broaden and not to restrict the powers of the trustee. Woodhouse v. Harrison, 168 Va. 574 , 191 S.E. 776 , 1937 Va. LEXIS 254 (1937).

    But his discretion is reviewable by the court. —

    The discretion granted by this section to a trustee under a deed of trust, as to the incidents of the sale, is reviewable by the courts. Perdue v. Davis, 176 Va. 102 , 10 S.E.2d 558, 1940 Va. LEXIS 237 (1940).

    Advertisement for cash followed by sale on credit held not an abuse of discretion. Rogers v. Runyon, 201 Va. 814 , 113 S.E.2d 679, 1960 Va. LEXIS 164 (1960).

    The trustee has a fiduciary duty to obtain the highest possible purchase price for the property. United States v. Romer, 148 F.3d 359, 1998 U.S. App. LEXIS 13468 (4th Cir. 1998), cert. denied, 525 U.S. 1141, 119 S. Ct. 1032, 143 L. Ed. 2d 41, 1999 U.S. LEXIS 1065 (1999).

    Trustee should apply to court to remove impediments to fair sale. —

    If there is doubt or uncertainty as to the debts secured, or the amount thereof, or disputes or conflicts among creditors, or any other impediment to a fair sale, the trustee should file a bill to have the matter determined, and he may and should delay the sale until the matter has been adjusted. If he fails or refuses to discharge his duty in this respect, any party interested or who would be injured by his default, may apply to a court of equity to have the necessary steps taken. Muller's Adm'r v. Stone, 84 Va. 834 , 6 S.E. 223 , 1888 Va. LEXIS 152 (1888); Stull v. Harvey, 112 Va. 816 , 72 S.E. 701 , 1911 Va. LEXIS 155 (1911).

    By removal of cloud from title. —

    Where there is a cloud on the title to the trust property, the trustee should apply to a court of equity to have it removed before making the sale, and if he fails or refuses to discharge his duty in this respect any party interested or who would be injured by his default may apply to a court of equity to have it removed. Muller's Adm'r v. Stone, 84 Va. 834 , 6 S.E. 223 , 1888 Va. LEXIS 152 (1888).

    Or account of liens. —

    Where the land conveyed by a deed of trust is subject to various liens, it is essential that the trustee should make application to a court of equity to have an account taken of the liens and of their priorities. Alexander v. Howe, 85 Va. 198 , 7 S.E. 248 , 1888 Va. LEXIS 28 (1888).

    Section provides machinery for collection of taxes. —

    The provisions of this section, in the case of a foreclosure, set up a simple and expeditious machinery for the collection of a city’s taxes. The city has nothing to do in the premises, but it receives the benefit of the services of the trustee. Broun v. City of Roanoke, 172 Va. 227 , 1 S.E.2d 279, 1939 Va. LEXIS 233 (1939).

    And purchaser takes property free of delinquent tax liens. —

    This section and § 8.01-102 assure purchasers, at trustees’ and commissioners’ sales, that they will take the property free of delinquent tax liens, and that the taxes will be paid by the trustee out of the purchase price which he has collected. Broun v. City of Roanoke, 172 Va. 227 , 1 S.E.2d 279, 1939 Va. LEXIS 233 (1939).

    Sale will not be enjoined because of financial depression. —

    A financial depression, or unprecedented scarcity of money for ordinary transactions, or enforced stagnation of the real estate market, is not sufficient to warrant a court of equity in restraining the exercise of the power of sale in a deed of trust. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 , 1935 Va. LEXIS 307 (1935).

    Or because time is unpropitious. —

    Allegations to the effect that the time is unpropitious for a sale, that the land could likely be sold for a better price later, that the large cash payment required would be attended with great, if not irreparable, loss and injury to the debtor, present no grounds for the interposition of equity jurisdiction by injunction or otherwise. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 , 1935 Va. LEXIS 307 (1935).

    Right of bank to bid in property. —

    The bank, as a holder of a note secured by a deed of trust, has a right to bid in the property at a foreclosure sale. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260, 1983 Bankr. LEXIS 7002 (Bankr. W.D. Va. 1983).

    When foreclosure sale is complete. —

    In a sale by a trustee under a deed of trust, the sale is complete when the trustee knocks the land down to the bidder, makes a memorandum of the sale and its terms, and signs the same. The contract is as complete at this time as the contract for sale made by a commissioner is when the court accepts the bid by confirming the sale. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260, 1983 Bankr. LEXIS 7002 (Bankr. W.D. Va. 1983).

    Substitute trustee. —

    Argument by plaintiff homeowners that under subdivision 9 of § 55-59 defendant beneficiary of a Deed to Trust could not appoint a substitute trustee to conduct the foreclosure proceedings failed because the homeowners signed the Deed of Trust and received a copy of the Deed of Trust and other documents, and knew that the beneficiary was also the nominee of the Lender, and that the Deed of Trust authorized the nominee to act on behalf of the Lender to foreclose in the event of a default on the loans. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

    Substitute trustee appointment. —

    Borrower’s claim that the appointment of a substitute trustee was invalid was rejected where there was no authority for her assertion that subdivision 9 of § 55-59 required an instrument of appointment to be completely intact when it was executed. Wolf v. Fannie Mae, 830 F. Supp. 2d 153, 2011 U.S. Dist. LEXIS 135259 (W.D. Va. 2011), aff'd, 512 Fed. Appx. 336, 2013 U.S. App. LEXIS 4300 (4th Cir. 2013).

    Borrowers had not alleged, nor could they, that defendant trustee had any basis for asserting a competing ownership claim to the property; the trustee was properly appointed under the deed of trust, and had authority to act as substitute trustee and to perform the attendant duties authorized by Virginia law. McFadden v. Fannie Mae, 525 Fed. Appx. 223, 2013 U.S. App. LEXIS 10067 (4th Cir. 2013).

    C.Right of Trustee to Compensation and Expenses.

    Compensation is controlled by deed or by this section. —

    The compensation is determined either by the contract in the deed itself, or by this section, which controls where there is no specific agreement. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    In Virginia, if the terms of an indenture trustee’s compensation are not specified in the trust document, his compensation is controlled by statute. In re Manning, 43 Bankr. 712, 1984 Bankr. LEXIS 4692 (Bankr. W.D. Va. 1984).

    Commission may not be fixed by deed of trust without determining reasonableness. —

    An indentured trustee’s commission may not be fixed by a deed of trust without due consideration by the bankruptcy court as to what fee is reasonable under the circumstances where the proposed foreclosure and sale of the property has been stayed by the filing of a Chapter 13 petition. In re Manning, 43 Bankr. 712, 1984 Bankr. LEXIS 4692 (Bankr. W.D. Va. 1984).

    Under this section compensation is conditioned upon sale. —

    In this section provision is made for compensation of the trustee in case he sells the property under the deed of trust. For this service and for no other the statute provides, and that provision controls unless, as allowed by the statute, there are other provisions in the deed for the compensation of the trustee. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924) (see Littleton v. Kincaid, 179 F.2d 848 (4th Cir.), cert. denied, 340 U.S. 809, 71 S. Ct. 38, 95 L. Ed. 595 (1950)).

    But trustee is entitled to be reimbursed for expenses. —

    A trustee who in good faith engages the services of counsel to aid him in the exercise of his duties is entitled to pay them out of the trust fund, or to be reimbursed out of that fund for all expenses which he has incurred, including reasonable fees to attorneys, notwithstanding that he has made no sale so as to be entitled to the compensation provided by this section. Stull v. Harvey, 112 Va. 816 , 72 S.E. 701 , 1911 Va. LEXIS 155 (1911).

    The accepted rule is that the court shall exercise just discretion and make or withhold allowances as the peculiar circumstances require. Littleton v. Kincaid, 179 F.2d 848, 1950 U.S. App. LEXIS 3441 (4th Cir.), cert. denied, 340 U.S. 809, 71 S. Ct. 38, 95 L. Ed. 595 (1950), cert. denied, 340 U.S. 809, 71 S. Ct. 36, 95 L. Ed. 595, 1950 U.S. LEXIS 1601 (1950).

    Effect of sale by debtor. —

    Where a debtor has given a deed of trust to secure the payment of his debt, under ordinary circumstances he always has the right to sell the property himself to pay his debt. Generally, when there has been no sale by the trustee, the trustee has no claim for compensation. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    Compensation to trustee of executory trust. —

    A trustee, chosen to hold a legal title as a mere security for debt, with power to sell in case of default, possession to remain with the grantor and not the trustee, is not entitled to invoke the jurisdiction of a court of equity to adjudicate his compensation, when he has not been and may never be called upon to execute the trust. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    If the trust had been either partly or completely executed, and the trustee had then invoked the jurisdiction of equity for the settlement of his accounts, or its direction as to the distribution of the trust fund, or the court had acquired jurisdiction over the estate upon any equitable ground, then unquestionably the court would consider and determine the amount of the trustee’s compensation for all the services previously rendered. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    Compensation for holding insurance policy. —

    The holding of insurance policies on the property conveyed by the trustee in a deed of trust was a mere incidental service, for which the trustee was not entitled to compensation from the creditors secured or from the property, where the grantor, not the creditors, covenanted to keep the property insured. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924) (see § 55-60, subdivision (8)).

    For countersigning bonds. —

    Where no compensation was provided for the countersigning of bonds for the purpose of identification, such act being expressly required of the trustee, while this service could not be required without compensation, yet when it was rendered without expressed or implied agreement for compensation it must be regarded as voluntary, either as incidental to the acceptance of the trusteeship or as satisfied by the anticipated compensation in case there should be a default and sale. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    For representing beneficiaries in bankruptcy. —

    Where a trustee in a deed of trust appeared for the beneficiaries under the deed in bankrupt proceedings against the grantor, but the grantees failed to file proofs of their claim, choosing to rely upon the security afforded by the deed, the grantees cannot be held personally liable for attorney’s fees, nor was the property pledged liable. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    The trustee is entitled to compensation whether his services were rendered as attorney or as trustee. But a court is only justified in paying attorney’s fees out of the trust fund under its control where parties in interest have stood by without counsel, and reaped benefits by reason of the efforts of counsel with whom they were not in privity. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 , 1924 Va. LEXIS 60 (1924).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Substitute trustee. —

    Corporation’s deed of trust was inferior to the lien of a partnership’s deed of trust because the lien of the partnership deed of trust was not effectively released and was a first lien on a golf course; the partnership had the authority under its deed of trust and subdivision 9 of § 55-59 to substitute trustees. Bristol County Ret. Sys. v. Senior Tour Players Fund I, L.P., 2006 Va. Cir. LEXIS 337 (Loudoun County Mar. 10, 2006).

    Demurrer filed by the beneficiary of a deed of trust was sustained in a mortgagor’s action seeking a declaratory judgment that the foreclosure of her property was unlawful and alleging that the beneficiary did not have authority to appoint a substitute trustee because the deed of trust specifically authorized the beneficiary to appoint a substitute trustee to conduct foreclosure proceedings; when a deed of trust provides otherwise the statutory requirements in § 55-59 are inapplicable. Graves v. Mortg. Elec. Registration Sys., 96 Va. Cir. 457, 2011 Va. Cir. LEXIS 97 (Fairfax County June 29, 2011).

    Deeds of trust permitted a bank to appoint a limited liability company to serve as substitute trustee because there was no language in the deeds of trust indicating that the parties intended otherwise; the statute clearly contemplates that limited liability companies without residences may serve as substitute trustees under deeds of trust. Southern Bank & Trust Co. v. Woodhouse, 92 Va. Cir. 402, 2016 Va. Cir. LEXIS 81 (Norfolk May 26, 2016).

    Deeds of trust permitted a bank to appoint a limited liability company to serve as substitute trustee because there was no language in the deeds of trust indicating that the parties intended otherwise; nothing in the deeds of trust suggested that the parties intended to limit the bank to using individual persons rather than corporate trustees. Southern Bank & Trust Co. v. Woodhouse, 92 Va. Cir. 402, 2016 Va. Cir. LEXIS 81 (Norfolk May 26, 2016).

    No authority to enjoin substitute trustee. —

    County board of supervisors was not entitled to enjoin a substitute trustee from foreclosing on an affordable dwelling unit (ADU) because there was no authority under the deed of trust or § 55-59 to enjoin the substitute trustee from selling the property at public auction to the highest bidder when the buyer of the property defaulted. Moreover, nothing in county ordinances or the ADU covenants at the time the property was transferred altered this requirement, as an added covenant and amendment to the ordinances could not be applied retroactively to the buyer. Loudoun County Bd. of Supervisors v. Jefferson, 83 Va. Cir. 464, 2011 Va. Cir. LEXIS 226 (Loudoun County Oct. 20, 2011).

    Deed interpretation. —

    Deed of trust, which granted the holder of a note the power to appoint a trustee or substitute trustee, but did not grant that appointee the ability to appoint an agent or to not be present at the foreclosure sale, also allowed the holder to render said sale voidable. Wachovia Bank, N.A. v. Van Huyck, 64 Va. Cir. 306, 2004 Va. Cir. LEXIS 180 (Norfolk Apr. 1, 2004).

    Duties arose by virtue of contractual relationship. —

    Property owners failed to assert a valid claim for negligence against a trustee because the duties of impartiality and ordinary care of a fiduciary the trustee allegedly breached arose by virtue of the parties’ contractual relationship under a deed of trust, which constituted a contract under § 55-59, and not the common law; but for the existence of the deed of trust, the trustee would not have owed any fiduciary duties to the owners, and since the trustee had no relationship with the owners absent the deed of trust, any fiduciary duty allegedly breached existed solely because of that contractual relationship. Salazar v. US Bank NA, 82 Va. Cir. 344, 2011 Va. Cir. LEXIS 30 (Fairfax County Mar. 9, 2011).

    Deed of trust did not create duty. —

    Demurrer filed by a law firm and an attorney was sustained in investors’ action alleging legal malpractice because the investors failed to allege any privity between the parties; the deed of trust did not create an attorney-client relationship or a duty to the investors, other than the specific duties set out in the deed of trust and § 55-59. Sellman v. Florance Gordon Brown, P.C., 2010 Va. Cir. LEXIS 319 (Richmond Nov. 18, 2010).

    Judgment was entered in favor of foreclosure trustees on a corporation’s third-party claim alleging that they breached their obligations and duties because neither the deed of trust and guaranty agreement nor § 55-59 listed any of the duties the corporation and guarantors would have imposed on the trustees in foreclosure sales. W. Harold Talley I, L.L.C. v. North Richmond Investments, Inc., 84 Va. Cir. 1, 2011 Va. Cir. LEXIS 268 (Richmond Oct. 20, 2011).

    Bank’s response. —

    Under 12 U.S.C.S. § 2605(e)(2)(C), a bank’s response was adequate to meet its obligation as servicer to the loan, because it sent a timely response, explained the reason for any missing information, and provided contact information to answer any additional questions. Buzbee v. United States Bank, N.A., 84 Va. Cir. 485, 2012 Va. Cir. LEXIS 39 (Fairfax County May 2, 2012).

    Default. —

    Corporation and guarantors were held properly in default, and the amounts due accelerated, triggering foreclosure because both the deed of trust and the guaranty agreement described default as a failure to pay the agreed upon amounts at the agreed upon time on a monthly basis. W. Harold Talley I, L.L.C. v. North Richmond Investments, Inc., 84 Va. Cir. 1, 2011 Va. Cir. LEXIS 268 (Richmond Oct. 20, 2011).

    § 55.1-321. Notices required before sale by trustee to owners, lienors, etc.; if note lost.

    1. In addition to the advertisement required by § 55.1-322 , the trustee or the party secured shall give written notice of the time, date, and place of any proposed sale in execution of a deed of trust, and such notice shall include either (i) the instrument number or deed book and page numbers of the instrument of appointment filed pursuant to § 55.1-320 , or (ii) a copy of the executed and notarized appointment of substitute trustee by personal delivery or by mail to (a) the present owner of the property to be sold at his last known address as such owner and address appear in the records of the party secured; (b) any subordinate lienholder who holds a note against the property secured by a deed of trust recorded at least 75 days, in the case of a deed of trust conveying owner-occupied residential real estate, or 30 days, in the case of all other deeds of trust, prior to the proposed sale and whose address is recorded with the deed of trust; (c) any assignee of such a note secured by a deed of trust, provided that the assignment and address of assignee are likewise recorded at least 75 days, in the case of a deed of trust conveying owner-occupied residential real estate, or 30 days, in the case of all other deeds of trust, prior to the proposed sale; (d) any condominium unit owners’ association that has filed a lien pursuant to § 55.1-1966 ; (e) any property owners’ association that has filed a lien pursuant to § 55.1-1833 ; and (f) any proprietary lessees’ association that has filed a lien pursuant to § 55.1-2148 . Written notice shall be given pursuant to clauses (d), (e), and (f) only if the lien is recorded at least 75 days, in the case of a deed of trust conveying owner-occupied residential real estate, or 30 days, in the case of all other deeds of trust, prior to the proposed sale. If the secured party has received notification that the owner of the property to be sold is deceased, the notice required by clause (a) shall be given to (1) the last known address of such owner as such address appears in the records of the party secured; (2) any personal representative of the deceased’s estate whose appointment is recorded among the records of the circuit court where the property is located, at the address of the personal representative that appears in such records; and (3) any heirs of the deceased who are listed on the list of heirs recorded among the records of the circuit court where the property is located, at the addresses of the heirs that appear in such records. Mailing of a copy of the advertisement or a notice containing the same information to the owner by certified or registered mail no less than 60 days prior to such sale, in the case of a deed of trust conveying owner-occupied residential real estate, or 14 days prior to such sale, in the case of all other deeds of trust, and to lienholders, the property owners’ association or proprietary lessees’ association, their assigns, and the condominium unit owners’ association, at the address noted in the memorandum of lien, by ordinary mail no less than 60 days prior to such sale, in the case of a deed of trust conveying owner-occupied residential real estate, or 14 days prior to such sale, in the case of all other deeds of trust, shall be a sufficient compliance with the requirement of notice. The written notice of proposed sale when given as provided in this subsection shall be deemed an effective exercise of any right of acceleration contained in such deed of trust or otherwise possessed by the party secured relative to the indebtedness secured. The inadvertent failure to give notice as required by this subsection shall not impose liability on either the trustee or the secured party. The foreclosure sale cannot go forward unless the trustee has proof that the notice has been sent.
    2. If a note or other evidence of indebtedness secured by a deed of trust is lost or for any reason cannot be produced and the beneficiary submits to the trustee an affidavit to that effect, the trustee may nonetheless proceed to sale, provided that the beneficiary has given written notice to the person required to pay the instrument that the instrument is unavailable and a request for sale will be made of the trustee upon expiration of 60 days from the date of mailing of the notice, in the case of a deed of trust conveying owner-occupied residential real estate, or 14 days from the date of mailing of the notice, in the case of all other deeds of trust. The notice shall be sent by certified mail, return receipt requested, to the last known address of the person required to pay the instrument as reflected in the records of the beneficiary and shall include the name and mailing address of the trustee. The notice shall further advise the person required to pay the instrument that if he believes he may be subject to a claim by a person other than the beneficiary to enforce the instrument, he may petition the circuit court of the county or city where the property or some part thereof lies for an order requiring the beneficiary to provide adequate protection against any such claim. If deemed appropriate by the court, the court may condition the sale on a finding that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument. Adequate protection may be provided by any reasonable means. If the trustee proceeds to sale, the fact that the instrument is lost or cannot be produced shall not affect the authority of the trustee to sell or the validity of the sale.
    3. When the written notice of proposed sale is given as provided in this section, there is a rebuttable presumption that the lienholder has complied with any requirement to provide notice of default contained in a deed of trust. Failure to comply with the requirements of notice contained in this section shall not affect the validity of the sale, and a purchaser for value at such sale shall be under no duty to ascertain whether such notice was validly given.
    4. In the event of postponement of sale, which may be done in the discretion of the trustee, no new or additional notice is required to be given pursuant to this section.
    5. (Effective October 1, 2021)  In the case of a deed of trust conveying owner-occupied residential real estate, the notice to the owner in subsections A and B shall include the website address of the U.S. Housing and Urban Development’s (HUD) Office of Housing Counseling with a listing of HUD-certified housing counseling agencies, the website address and telephone number of the statewide legal aid center, and the following language, or language that is substantially similar, in at least 12-point type: “This is NOT a notice to vacate the premises. You should consider contacting an attorney or your local legal aid or housing counseling agency.”
    6. In the case of a deed of trust conveying owner-occupied residential real estate, the notice to the owner in subsections A and B shall include the date of the last payment received and the amount received; the total amount of principal, interest, costs, and fees due in arrears; and the remaining total principal balance due on the instrument.

    History. 1979, c. 12, § 55-59.1; 1992, c. 739; 1993, c. 597; 1994, c. 143; 2004, c. 1001; 2009, c. 307; 2018, cc. 34, 204; 2019, c. 712; 2021, Sp. Sess. I, cc. 91, 92.

    Editor’s note.

    Acts 2019, c. 847, cl. 2, effective April 3, 2019, provides: “That the provisions of this act shall not apply in any instance where a separate, signed legal agreement exists between a landlord and tenant or homeowner and mortgage holder to stay legal action or defer the filing of an unlawful detainer motion for nonpayment of rent or foreclosure proceeding on any mortgage or to the execution of or sale under any deed of trust for a term of 30 days or greater.”

    Acts 2019, c. 847, cl. 3, effective April 3, 2019, provides: “That the provisions of this act shall not affect any other terms of a valid rental agreement or note secured by a one-family to four-family residential property, mortgage, or deed of trust.”

    Acts 2019, c. 847, cl. 4, effective April 3, 2019, provides: “That the provisions of this act shall expire on September 30, 2019.”

    Acts 2021, Sp. Sess. I, cc. 91 and 92, cl. 2 provides: “That the Department of Housing and Community Development shall convene a stakeholder group consisting of landlords, property managers, and tenants, as well as attorneys knowledgeable in the Virginia Manufactured Home Lot Rental Act (§ 55.1-1300 et seq. of the Code of Virginia) and other applicable provisions of the Code of Virginia for the purposes of providing input into (i) the development of the form to be developed by the Director of the Department of Housing and Community Development for posting on its website pursuant to § 36-139 of the Code of Virginia, as amended by this act, acknowledging that a tenant has received from the landlord the statement of tenant rights and responsibilities and (ii) any updates to the statement of tenant rights and responsibilities.”

    Acts 2021, Sp. Sess. I, cc. 91 and 92, cl. 3 provides: “That the provisions of subsection E of § 55.1-321 of the Code of Virginia, as amended by this act, shall become effective on October 1, 2021.”

    Effective date.

    This section is effective October 1, 2019.

    The 2021 Sp. Sess. I amendments.

    The 2021 amendments by Sp. Sess. I, cc. 91 and 92, effective July 1, 2021, are identical, and in subsection A, substituted “75 days, in the case of a deed of trust conveying owner-occupied residential real estate, or 30 days, in the case of all other deeds of trust,” for “thirty days” twice in the first sentence and once in the second sentence, substituted “60 days prior to such sale, in the case of a deed of trust conveying owner-occupied residential real estate, or 14 days prior to such sale, in the case of all other deeds of trust” for “14 days prior to such sale” twice in the fourth sentence and added the last sentence; in subsection B, substituted “60 days from the date of mailing of the notice, in the case of a deed of trust conveying owner-occupied residential real estate, or 14 days from the date of mailing of the notice, in the case of all other deeds of trust” for “14 days from the date of mailing of the notice” in the first sentence; and added subsections E and F. For effective date for subsection E, see Editor’s note.

    Law Review.

    For note on the developing law in Virginia on installment land contracts, see 37 Wash. & Lee L. Rev. 1161 (1980).

    For essay, “Foreclosure of a Deed of Trust in Virginia,” see 51 U. Rich. L. Rev. 147 (2016).

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, §§ 50, 82, 104, 105, 130.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Both this section and § 55-59.2 were adopted as part of single enactment, Acts 1979, c. 12. But there is a significant difference between them. After providing for written notice to the debtor, this section provides: “Failure to comply with the requirements of notice contained in this section shall not affect the validity of the sale under the deed of trust . . . .” Section 55-59.2, although a part of the same act, contains no such ameliorative language in case of failure to follow its mandatory time periods. It is apparent that the General Assembly intended that different consequences would flow from violations of these respective sections. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Purchaser’s knowledge of notice to debtor of foreclosure sale. —

    It might be difficult for a purchaser at a foreclosure sale to ascertain whether 14 days’ personal notice had been given to the debtor as required by this section, and the legislature, undoubtedly for that reason, relieved the purchaser of the consequences of the trustee’s failure in that respect. By contrast, a purchaser who has been attracted to a sale by a series of newspaper advertisements has ready means of ascertaining whether the sale falls within the prescribed time period after publication, as required by § 55-59.2. If the sale falls without that period, he need not bid. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Right of acceleration in deed of trust. —

    While a notice of a foreclosure sale may act as the exercise of the “right of acceleration” under a deed of trust, subsection A of § 55-59.1 does not establish a statutory mandate as to whether such “right of acceleration” is in existence and capable of being exercised by the foreclosure notice. Such a determination remains a matter of contract between the parties. Bayview Loan Servicing, LLC v. Simmons, 275 Va. 114 , 654 S.E.2d 898, 2008 Va. LEXIS 20 (2008).

    Where condition precedent for acceleration in deed of trust is not fulfilled, there is no right to accelerate or foreclose. While subsection A of § 55-59.1 allowed a notice of foreclosure sale to act as an exercise of the right of acceleration, as the holder of mortgage failed to fulfill a contractual condition precedent that would have given it such a right, serving the mortgagor or sending her by certified mail a notice of breach and intent to accelerate, its right to accelerate and to foreclose never matured, and it was liable to the mortgagor for the equity she lost in the foreclosure sale. Bayview Loan Servicing, LLC v. Simmons, 275 Va. 114 , 654 S.E.2d 898, 2008 Va. LEXIS 20 (2008).

    Sale held valid. —

    Where holder of mechanic’s lien asserts that third party which had interest in property sold at foreclosure sale did not receive notice of sale, this section provides such a sale is nevertheless valid. Nelson White Constr. Mgt. Corp. v. McConaghy, 15 Bankr. 480, 1981 Bankr. LEXIS 2564 (Bankr. E.D. Va. 1981).

    Requisite notice provided. —

    Defendant did not fail to provide requisite notice of a foreclosure sale because the notice of sale indicated that it was mailed to plaintiff more than fourteen days prior to the sale pursuant to subsection A of § 55-59.1; the notice of sale was published once a week for two successive weeks as required by the deed of trust, and the foreclosure sale was then held more than eight days following the first advertisement and less than thirty days following the last advertisement, as required by subdivision A 2 of § 55-59.2.Gallant v. Deutsche Bank Nat'l Trust Co., 766 F. Supp. 2d 714, 2011 U.S. Dist. LEXIS 10209 (W.D. Va. 2011).

    Defendant’s inability to produce the original note did not render a foreclosure sale invalid because the note was freely transferable without prior notice under Virginia law, and plaintiff’s claim that a secured party was required to prove its authority or standing to foreclose on the secured property was contrary to the Virginia non-judicial foreclosure laws; by signing the deed of trust, plaintiff specifically acknowledged that “the note or a partial interest in the note (together with the security instrument) could be sold one or more times without prior notice to borrower.” Gallant v. Deutsche Bank Nat'l Trust Co., 766 F. Supp. 2d 714, 2011 U.S. Dist. LEXIS 10209 (W.D. Va. 2011).

    Requisite notice not provided. —

    Mortgage lender’s acceleration notice pursuant to § 55-59.1 did not excuse the lender from sending notice as required by the deed of trust, which contained “prior to” acceleration language and provided requirements that went beyond those set out in § 55-59.1.Bennett v. Bank of Am., N.A., No. 3:12CV34-HEH, 2012 U.S. Dist. LEXIS 54725 (E.D. Va. Apr. 18, 2012).

    Although Virginia did not recognize claims for wrongful foreclosure, because defendant failed to provide adequate notice of its foreclosure, plaintiff could cite this statute along with additional facts to plead a tort action related to that failure upon which relief could be granted. Yerion v. Branch Banking & Trust Co., 27 F. Supp. 3d 677, 2014 U.S. Dist. LEXIS 87345 (E.D. Va. 2014).

    “Standing.” —

    Argument by plaintiff homeowners that defendant financial institutions and lender servicers could not demonstrate standing to institute a foreclosure because they could not prove U.S. Const., Art. III injury failed to the extent “standing” was used to refer to the requirement that a secured party first prove in court its right to initiate a foreclosure before the procedure commences, because Virginia, the state in which the foreclosure took place, was a non-judicial foreclosure state with such foreclosures being governed by the procedures and requirements of §§ 55-59.1, 55-59.2, 55-59.3, and 55-59.4, and such non-judicial foreclosures did not require an interested party to prove “standing” in a court of law before initiating the foreclosure process. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Purchaser’s knowledge of notice to debtor of foreclosure sale. —

    Lender, and hence the assignee, were responsible for the misnomer on the deed of trust because their borrower’s name was typed incorrecly on the loan documents. Because lender enjoyed no protection from subsection A of § 55-59.1, bank was granted declaratory judgment and the property, now owned by the assignee, nonetheless remained subject to the bank’s deed of trust. SunTrust Bank v. Wells Fargo Bank, N.A., 79 Va. Cir. 115, 2009 Va. Cir. LEXIS 58 (Fairfax County June 24, 2009).

    Adequate notice. —

    Mortgagors received adequate notice of foreclosures because the substitute trustee was properly appointed when it mailed the foreclosure notices since the appointment of the substitute trustee became effective upon the execution of the deed of appointment. Southern Bank & Trust Co. v. Woodhouse, 92 Va. Cir. 402, 2016 Va. Cir. LEXIS 81 (Norfolk May 26, 2016).

    Bank’s response valid. —

    Under 12 U.S.C.S. § 2605(e)(2)(C), a bank’s response was adequate to meet its obligation as servicer to the loan, because it sent a timely response, explained the reason for any missing information, and provided contact information to answer any additional questions. Buzbee v. United States Bank, N.A., 84 Va. Cir. 485, 2012 Va. Cir. LEXIS 39 (Fairfax County May 2, 2012).

    Violation of § 8.3A-309 has no effect on creditor’s right to foreclosure. —

    Bank was in violation of § 8.3A-309 , which provided that lost negotiable instruments were only enforceable by persons who were in possession of the instrument when it was lost, because the bank conceded that it was not in possession of the promissory note a mortgagor executed and that a prior holder lost the note, but the bank’s violation of § 8.3A-309 did not extinguish the mortgagor’s debt obligation; the deed of trust remained valid and enforceable through foreclosure, and the bank’s violation of § 8.3A-309 had no effect on its right to foreclose under the deed of trust pursuant to § 55-59.1.Benkahla v. White, 82 Va. Cir. 116, 2011 Va. Cir. LEXIS 2 (Fairfax County Jan. 18, 2011).

    Violation of § 8.3A-309 does not extinguish a borrowers debt obligation, it merely precludes the creditor from enforcing a security as a negotiable instrument under the Virginia Uniform Commercial Code, and a violation of § 8.3A-309 , by itself, has no effect on a creditors foreclosure action under Virginia’s foreclosure laws; enforcement of a promissory note and enforcement of a security instrument are separate and distinct remedies governed by different laws, and a creditor’s foreclosure on a security property is governed by Virginia’s foreclosure statutes and not by Virginia’s Uniform Commercial Code. Benkahla v. White, 82 Va. Cir. 116, 2011 Va. Cir. LEXIS 2 (Fairfax County Jan. 18, 2011).

    Sale held valid. —

    When the owner of mortgaged property died, and the mortgagee sent notice of a foreclosure sale to the deceased owner at the property’s address, this notice was sufficient under subsection A of § 55-59.1, because it was sent to the owner’s last known address, as it appeared in the mortgagee’s records, so the foreclosure sale was valid. SunTrust Bank v. Wright, 63 Va. Cir. 396, 2003 Va. Cir. LEXIS 205 (Roanoke Nov. 12, 2003).

    When the owner of mortgaged property died, and the mortgagee sent notice of a foreclosure sale to the deceased owner at the property’s address, if the notice was insufficient, under subsection A of § 55-59.1, the foreclosure sale was still valid, under the provisions of subsection B of § 55-59.1.SunTrust Bank v. Wright, 63 Va. Cir. 396, 2003 Va. Cir. LEXIS 205 (Roanoke Nov. 12, 2003).

    Mere appointment of a foreign corporation, who did not qualify as a trustee, together with a Virginia corporation as co-trustees did not render two foreclosure sales invalid and, therefore, an exception to a commissioner’s report invalidating the sales was sustained since the otherwise qualified co-trustee was a Virginia corporation. In re Trustee's Sale, 67 Va. Cir. 204, 2005 Va. Cir. LEXIS 182 (Norfolk Mar. 25, 2005).

    § 55.1-322. Advertisement required before sale by trustee.

    1. Advertisement of sale by a trustee or trustees in execution of a deed of trust shall be in a newspaper having a general circulation in the county or city in which the property to be sold, or any portion of such property, lies pursuant to the following provisions:
      1. If the deed of trust itself provides for the number of publications of such newspaper advertisement, which may be done by using the words “advertisement required” or similar words followed by the number agreed upon, then no other or different advertisement shall be necessary, provided that, if such advertisement be inserted on a weekly basis, it shall be published not less than once a week for two weeks, and if such advertisement be inserted on a daily basis, it shall be published not less than once a day for three days, which may be consecutive days, and in either case shall be subject to the provisions of § 55.1-330 in the same manner as if the method were set forth in the deed of trust. Should the deed of trust provide for advertising on other than a weekly or daily basis, either of the foregoing provisions shall be complied with in addition to those provided in such deed of trust. Notwithstanding the provisions of the deed of trust, the sale shall be held on any day following the day of the last advertisement that is no earlier than eight days following the first advertisement or more than 30 days following the last advertisement.
      2. If the deed of trust does not provide for the number of publications of such newspaper advertisement, the trustee shall advertise once a week for four successive weeks, provided, however, that if the property or some portion of such property is located in a city or in a county immediately contiguous to a city, publication of the advertisement five different days, which may be consecutive days, shall be deemed adequate. The sale shall be held on any day following the day of the last advertisement that is no earlier than eight days following the first advertisement or more than 30 days following the last advertisement.
    2. Such advertisement shall be placed in that section of the newspaper where legal notices appear or where the type of property being sold is generally advertised for sale.
    3. In addition to the advertisement required by subsection A, the trustee shall give such other further and different advertisement as the deed of trust may require and in addition may give such additional advertisement as he may deem appropriate.
    4. In the event of postponement of sale, which postponement shall be at the discretion of the trustee, advertisement of such postponed sale shall be in the same manner as the original advertisement of sale.
    5. Failure to comply with the requirements for advertisement contained in this section shall, upon petition, render a sale of the property voidable by the court.

    History. 1979, c. 12, § 55-59.2; 1990, c. 749; 1992, c. 550; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Law Review.

    For essay, “Foreclosure of a Deed of Trust in Virginia,” see 51 U. Rich. L. Rev. 147 (2016).

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, §§ 104-106, 130.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section evidences strong legislative concern with the sufficiency of advertisements preceding foreclosure sales, with a purpose to insure a degree of publication that will generate sufficient interest to obtain the highest price available as well as to offer the debtor a reasonable time to redeem the debt. That legislative concern has increased with the passage of time. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Both § 55-59.1 and this section were adopted as part of single enactment, Acts 1979, c. 12. But there is a significant difference between them. After providing for written notice to the debtor, § 55-59.1 provides: “Failure to comply with the requirements of notice contained in this section shall not affect the validity of the sale under the deed of trust . . . .” This section, although a part of the same act, contains no such ameliorative language in case of failure to follow its mandatory time periods. It is apparent that the General Assembly intended that different consequences would flow from violations of these respective sections. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Purchaser’s knowledge of notice to debtor of foreclosure sale. —

    It might be difficult for a purchaser at a foreclosure sale to ascertain whether 14 days’ personal notice had been given to the debtor as required by § 55-59.1, and the legislature, undoubtedly for that reason, relieved the purchaser of the consequences of the trustee’s failure in that respect. By contrast, a purchaser who has been attracted to a sale by a series of newspaper advertisements has ready means of ascertaining whether the sale falls within the prescribed time period after publication, as required by § 55-59.2. If the sale falls without that period, he need not bid. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Duty to give public notice of sale is contractual and statutory. —

    Deed of trust expressly set out the amount of advertising that must precede the foreclosure sale, and the minimum amount of advertising necessary under the deed of trust mirrored the minimum requirements stated in the statute, plus the contents of the advertisements were governed by § 55-59.3; the duty to give public notice of the sale by advertising is both contractual and statutory, and not an implied fiduciary duty. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (2018).

    Minimum and maximum periods between advertisement and sale are mandatory. —

    It is apparent from the language of this section, that the 8-day minimum and 30-day maximum periods between advertisement and sale are intended to be mandatory, overriding both the discretion of the trustee and the contractual terms adopted by the parties to the deed of trust. In this crucial respect, the statute before us differs from all its predecessors. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Sales made in violation of this section’s mandatory time periods are void, not merely voidable. The result is to render the sale ineffectual. No title, legal or equitable, passes to the purchaser. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228, 4 Va. Law Rep. 1601, 1988 Va. LEXIS 1 (1988).

    Compliance with publication requirements. —

    Although the borrower alleged that defendants violated the federal publication requirements for foreclosure sales pursuant to 12 U.S.C.S. § 3758(3)(A), the Single Family Mortgage Foreclosure Act of 1994 (SFMFA), 12 U.S.C.S. § 3751 et seq., was not applicable because the borrower’s loan was not a federal loan or a federally secured loan and even if the SFMFA was applicable, defendants complied with Virginia law when they adhered to publication requirements contained in the deed of trust. Mubeidin v. Homecomings Fin. Network, Inc., No. 7:05CV00794, 2006 U.S. Dist. LEXIS 1112 (W.D. Va. Jan. 9, 2006), aff'd, 183 Fed. Appx. 318, 2006 U.S. App. LEXIS 13367 (4th Cir. 2006).

    Defendant did not fail to provide requisite notice of a foreclosure sale because the notice of sale indicated that it was mailed to plaintiff more than fourteen days prior to the sale pursuant to subsection A of § 55-59.1; the notice of sale was published once a week for two successive weeks as required by the deed of trust, and the foreclosure sale was then held more than eight days following the first advertisement and less than thirty days following the last advertisement, as required by subdivision A 1 of § 55-59.2.Gallant v. Deutsche Bank Nat'l Trust Co., 766 F. Supp. 2d 714, 2011 U.S. Dist. LEXIS 10209 (W.D. Va. 2011).

    “Standing.” —

    Argument by plaintiff homeowners that defendant financial institutions and lender servicers could not demonstrate standing to institute a foreclosure because they could not prove U.S. Const., Art. III injury failed to the extent “standing” was used to refer to the requirement that a secured party first prove in court its right to initiate a foreclosure before the procedure commences, because Virginia, the state in which the foreclosure took place, was a non-judicial foreclosure state with such foreclosures being governed by the procedures and requirements of §§ 55-59.1, 55-59.2, 55-59.3, and 55-59.4, and such non-judicial foreclosures did not require an interested party to prove “standing” in a court of law before initiating the foreclosure process.. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Notice. —

    Creditor’s motion to plea in bar of the statute of limitations was denied because constructive notice could not begin on the date a deed of trust was filed without evidence that would give rise to a duty for the debtor to conduct a records search at the clerk’s office; although notice would have been sufficient when the trustee sale was first advertised, a second advertisement did not run creating a question of valid notice to the creditor. U.S. Bank Nat'l Ass'n v. Clay, 2017 Va. Cir. LEXIS 82 (Newport News May 11, 2017).

    § 55.1-323. Contents of advertisements of sale.

    1. The advertisement of sale under any deed of trust, in addition to such other matters as may be required by such deed of trust or by the trustee, in his discretion, shall set forth a description of the property to be sold. Such description need not be as extensive as that contained in the deed of trust, but it shall identify the property by street address, if any, or, if none, shall give the general location of the property with reference to streets, routes, or known landmarks. Where available, tax map identification may be used but is not required. The advertisement shall also include the time, place, and terms of sale and shall give the name or names of the trustee or trustees. It shall set forth the name, address, and telephone number of a person, either a trustee or the party secured or his agent or attorney who may be able to respond to inquiries concerning the sale.
      1. If the property being sold is a time-share estate, the advertisement of sale required under subsection A of § 55.1-322 shall set forth, in addition to such other matters as the trustee finds appropriate, (i) a description of the specific time-share estate or estates to be sold, and such description shall also include (a) the name of the time-share project and (b) the street address of the time-share project or, if no street address, the general location of the time-share project with reference to streets, routes, or known landmarks; (ii) the date, time, place, and terms of sale; (iii) the name of the trustee; and (iv) the name, address, and telephone number of the representative, agent, or attorney who is authorized to respond to inquiries concerning the sale and shall give additional information concerning the time-share estate or estates to be sold. B. 1. If the property being sold is a time-share estate, the advertisement of sale required under subsection A of § 55.1-322 shall set forth, in addition to such other matters as the trustee finds appropriate, (i) a description of the specific time-share estate or estates to be sold, and such description shall also include (a) the name of the time-share project and (b) the street address of the time-share project or, if no street address, the general location of the time-share project with reference to streets, routes, or known landmarks; (ii) the date, time, place, and terms of sale; (iii) the name of the trustee; and (iv) the name, address, and telephone number of the representative, agent, or attorney who is authorized to respond to inquiries concerning the sale and shall give additional information concerning the time-share estate or estates to be sold.
      2. In lieu of the requirements of subdivision 1, the advertisement shall set forth (i) the name of the time-share project in which the time-share estate or estates to be sold are contained; (ii) the street address of the time-share project in which the time-share estate or estates to be sold are contained or, if no street address, the general location of the time-share project with reference to streets, routes, or known landmarks; (iii) the date, time, place, and terms of sale; (iv) the name of the trustee; and (v) the name, address, and telephone number of the representative, agent, or attorney who is authorized to respond to inquiries concerning the sale and shall give additional information concerning the time-share estate or estates to be sold, including providing, upon request, in either hard copy or electronic form, a schedule of the time-share estate or estates to be sold. In addition, the advertisement shall contain a website address where a description of the specific time-share estate or estates to be sold is displayed.

    History. 1979, c. 12, § 55-59.3; 2015, cc. 23, 401; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Advertisement of sale gave sufficient notice to possible buyers. —

    Trustee’s advertisement of sale under deed of trust gave adequate notice to debtor and any potential 3rd-party bidder that both real and personal property would be sold as part of the foreclosure, where the notes and deed of trust clearly made reference to real and personal property as collateral for the loan and where the advertisement referred to the deed of trust for a description of the property to be sold and expressly stated that the personal property would be conveyed by the bill of sale. Virginia Hous. Dev. Auth. v. Fox Run Ltd. Partnership, 255 Va. 356 , 497 S.E.2d 747, 1998 Va. LEXIS 45 (1998).

    Duty to give public notice of sale is contractual and statutory. —

    Deed of trust expressly set out the amount of advertising that must precede the foreclosure sale, and the minimum amount of advertising necessary under the deed of trust mirrored the minimum requirements stated in the statute, plus the contents of the advertisements were governed by § 55-59.3; the duty to give public notice of the sale by advertising is both contractual and statutory, and not an implied fiduciary duty. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (2018).

    Substantial compliance with this section is sufficient so long as the rights of the parties are not affected in any material way. Riley v. Robey, 122 F. Supp. 2d 684, 2000 U.S. Dist. LEXIS 17426 (W.D. Va. 2000).

    District court did not err in concluding that the advertisement relative to a property substantially complied with § 55-59.3, as defendant mortgage holder’s advertisement of sale included a description of the property, the only address listed in the deed of trust, and a reference to the deed book and page number where the deed of trust could be found, and even assuming error in the advertisement, plaintiff failed to demonstrate material prejudice, as she presented no evidence to support her conclusion that the failure to include both addresses in the sale notice prejudiced the sale against obtaining the best price. Wood v. MorEquity, Inc., 331 Fed. Appx. 243, 2009 U.S. App. LEXIS 10906 (4th Cir. 2009).

    Failure to include street address not fatal. —

    Publication in the notice of sale of a description of the property, combined with the mailing address as listed in the deed of trust and reference to the deed book for further descriptions of the property, constituted substantial compliance with the notice requirements of this section and the failure to include the street address did not affect the owner’s rights in any material way or invalidate the sale. Riley v. Robey, 122 F. Supp. 2d 684, 2000 U.S. Dist. LEXIS 17426 (W.D. Va. 2000).

    “Standing.” —

    Argument by plaintiff homeowners that defendant financial institutions and lender servicers could not demonstrate standing to institute a foreclosure because they could not prove U.S. Const., Art. III injury failed to the extent “standing” was used to refer to the requirement that a secured party first prove in court its right to initiate a foreclosure before the procedure commences, because Virginia, the state in which the foreclosure took place, was a non-judicial foreclosure state with such foreclosures being governed by the procedures and requirements of §§ 55-59.1, 55-59.2, 55-59.3, 55-59.4, and such non-judicial foreclosures did not require an interested party to prove “standing” in a court of law before initiating the foreclosure process. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

    § 55.1-324. Powers and duties of trustee in event of sale under or satisfaction of deed of trust.

    1. In the event of sale under a deed of trust, the trustee shall have the following powers and duties in addition to all others:
      1. Written one-price bids may be made and shall be received by the trustee from the beneficiary or any other person for entry by announcement of the trustee at the sale. Any person other than the trustee may bid at the foreclosure sale, including a person who has submitted a written one-price bid. Upon request to the trustee, any other bidder in attendance at a foreclosure sale shall be permitted to inspect written bids. Whenever the written bid of the beneficiary is the highest bid submitted at the sale, such document shall be filed by the trustee with his account of sale required under § 64.2-1309 . The written bid submitted pursuant to this subsection may be prepared by the beneficiary, its agent, or its attorney.
      2. The trustee may require of any bidder at any sale a cash deposit of as much as 10 percent of the sale price, unless the deed of trust specifies a higher or lower maximum, which may be done by the words “bidder’s deposit of not more than dollars may be required” or similar words, before his bid is received, which shall be refunded to the bidder unless the property is sold to him, otherwise to be applied to his credit in settlement or, should he fail to complete his purchase promptly, to be applied to pay the costs and expense of sale and the balance, if any, to be retained by the trustee as his compensation in connection with that sale. Click to view
      3. The trustee shall receive and receipt for the proceeds of sale, account for the same to the commissioner of accounts pursuant to § 64.2-1309 and apply the same, first, to discharge the expenses of executing the trust, including a reasonable commission to the trustee; secondly, to discharge all taxes, levies, and assessments, with costs and interest if they have priority over the lien of the deed of trust, including the due pro rata thereof for the current year; thirdly, to discharge in the order of their priority, if any, the remaining debts and obligations secured by the deed, and any liens of record inferior to the deed of trust under which sale is made, with lawful interest; and, fourthly, the residue of the proceeds shall be paid to the grantor or his assigns, provided, however, that the trustee as to such residue shall not be bound by any inheritance, devise, conveyance, assignment, or lien of or upon the grantor’s equity, without actual notice thereof prior to distribution, and provided further that such order of priorities shall not be changed or varied by the deed of trust. The trustee’s deed shall show the trustee’s mailing address.
    2. Upon discharge, other than by sale by the trustee, of all debts, duties, and obligations imposed by the deed upon the grantor, including any expenses incurred preparatory to sale, then upon the grantor’s request the trustee shall execute and deliver a good and sufficient deed of release at the grantor’s own proper costs and charges.

    History. 1979, c. 12, § 55-59.4; 1997, c. 842; 1998, c. 610; 2010, c. 417; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 2A M.J. Auctions and Auctioneers, § 6.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Construction. —

    Only statute that addresses the trustee’s duties with regard to a foreclosure sale expressly indicates that it does not cover the entire field of duties the trustee has in this area; the statute states that in the event of sale under a deed of trust, the trustee shall have the following powers and duties in addition to all others, and this language clearly indicates that the legislature did not intend to limit a trustee’s powers and duties to those enumerated in the statute. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (2018).

    This section is permissive, authorizing but not mandating a deposit requirement. Such a requirement is solely for the trustee’s protection, and the trustee had authority to impose it or to waive it at his discretion. Yaffe v. Heritage Sav. & Loan Ass'n, 235 Va. 577 , 369 S.E.2d 404, 4 Va. Law Rep. 3093, 1988 Va. LEXIS 74 (1988).

    Where the deposit requirement was never made a condition precedent to the sale and the trustee waived the deposit requirement by recording the sale without a deposit and demanding settlement, an advertisement which contained the words: “Cash. Bidder’s deposit of 10% of the bid price may be required” did not relieve bidder who failed to make payment at trustee’s sale. Yaffe v. Heritage Sav. & Loan Ass'n, 235 Va. 577 , 369 S.E.2d 404, 4 Va. Law Rep. 3093, 1988 Va. LEXIS 74 (1988).

    Deposit to be paid after bidding. —

    The ten percent deposit this section permits a trustee to demand is not required prior to the bidding on the property at auction but after the sale price is determined. Riley v. Robey, 122 F. Supp. 2d 684, 2000 U.S. Dist. LEXIS 17426 (W.D. Va. 2000).

    Continuation of lien in proceeds of foreclosure sale. —

    Because the debtor’s divorce decree awarded creditor ex-wife $190,000 as an equitable distribution award and it was to be paid from the sale of the marital home, with child support addressed in a separate section under a separate title, the equitable distribution award was not entitled to 11 U.S.C.S. § 507(a)(1)(A) priority, however, since the award was secured by the marital home and the marital home was sold in a foreclosure, the ex-wife’s lien continued in the proceeds of the sale after payment of the mortgage. In re Uzaldin, 418 Bankr. 166, 2009 Bankr. LEXIS 3447 (Bankr. E.D. Va. 2009).

    “Standing.” —

    Argument by plaintiff homeowners that defendant financial institutions and lender servicers could not demonstrate standing to institute a foreclosure because they could not prove U.S. Const., Art. III injury failed to the extent “standing” was used to refer to the requirement that a secured party first prove in court its right to initiate a foreclosure before the procedure commences, because Virginia, the state in which the foreclosure took place, was a non-judicial foreclosure state with such foreclosures being governed by the procedures and requirements of §§ 55-59.1, 55-59.2, 55-59.3, and 55-59.4, and such non-judicial foreclosures did not require an interested party to prove “standing” in a court of law before initiating the foreclosure process. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    “Reasonable commission” to be paid. —

    Reasonable commission for a trustee under a deed of trust conducting a foreclosure sale was $9,180 on a sale price of $409,000 pursuant to § 55-59.4, which allowed a “reasonable commission.” The trustee, who had paid himself five percent of the sale price, was ordered to return $11,270. Exceptions to the Comm'r of Account's Report on Account of Sale of Prop. Located at 401 Princess Anne Rd., 79 Va. Cir. 664, 2009 Va. Cir. LEXIS 137 (Virginia Beach Nov. 8, 2009).

    Buyer’s remedy. —

    Substitute trustee’s demurrer to a buyer’s complaint was sustained because although the memorandum or agreement of sale limited the buyer’s remedy to the refund of her deposit, it allowed the trustee plenary rights or remedies of recovery when the deposit was forfeited; that redirection of payment contra to the statute could mean that the trustee could pursue a claim against the buyer, which it could not have had if the net balance had gone directly to the trustee as compensation. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2012 Va. Cir. LEXIS 211 (Northumberland County June 12, 2012), dismissed in part, 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    Buyer’s premium. —

    Memorandum or agreement of sale could be shown to be void because the trustee exceeded its legal authority at the sale by imposing an unannounced surcharge in the form of a buyer’s premium on the sales price; without factual evidence, the way in which the buyer’s premium was to be applied in the sale was not known, and thus, the trustee’s demurrer to the buyer’s claim that the memo was void was overruled. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2012 Va. Cir. LEXIS 211 (Northumberland County June 12, 2012), dismissed in part, 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    Trustee owed no fiduciary duty to buyer. —

    Substitute trustee owed no fiduciary duty to a buyer because the Trustee was not the agent of the buyer, and no statute embodied as public policy the goal of protecting bidders at a foreclosure sale from trustee fraud;.Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2012 Va. Cir. LEXIS 211 (Northumberland County June 12, 2012), dismissed in part, 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    “Standing.” —

    Purchaser did not have standing to complain about the application of a forfeited deposit because the purchaser failed to allege any detriment or prejudice to herself for signing an agreement that varied the application of her forfeited deposit from that provided in the statute; the purchaser was not a party to the deed of trust but only to the memo seeking the sole remedy to which she was contractually entitled upon default by the trustee, the refund of her deposit. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

    § 55.1-325. Meaning of phrases that may be included in deed of trust.

    The following provisions may be incorporated in any deed of trust to secure debts or indemnify sureties in the respective short forms indicated, namely:

    1. The words “identified by trustee’s signature” or similar words shall be construed as if the deed set forth: “All of which said notes (or other obligations) bear the marginal signature of the trustee for the purpose of identification but for no other purpose whatever.”
    2. The words “deferred purchase money,” “purchase money,” or similar words shall be construed as if the deed set forth: “This deed of trust is a contemporaneous purchase money deed of trust and secures the payment of deferred purchase money due by the grantor upon the property hereby conveyed.” Any deed of trust securing a loan, proceeds of which are used by the borrower to acquire the secured real property, shall be deemed to be a purchase money deed of trust.
    3. The words “exemptions waived” or similar words shall be construed as if the deed set forth: “The grantor hereby waives the benefit of his exemptions as to the debt hereby secured and as to all other obligations that may be imposed upon him by the provisions of this deed of trust.”
    4. The words “subject to call upon default” or similar words shall be construed as if the deed set forth: “Should default be made in the payment of any part of the debt hereby secured, principal or interest, at the maturity of such part, or in the event of the breach of any of the covenants entered into or imposed upon the grantor, then the entire obligation of this deed of trust and the whole debt hereby secured shall, at the option of the beneficiaries, become forthwith due and payable.”
    5. The words “renewal or extension permitted” or similar words shall be construed as if the deed set forth: “The grantor hereby consents and agrees that the debt hereby secured, or any part thereof, may be renewed or extended beyond maturity as often as may be desired by agreement between the creditor and any subsequent owner of the property, and no such renewal or extension shall in any way affect the grantor’s responsibility, whether as surety or otherwise.”
    6. The words “reinstatement permitted” or similar words shall be construed as if the deed set forth: “The grantor and any other party assuming liability hereunder hereby consent and agree that if the property conveyed hereby or a substantial portion thereof is transferred to any subsequent owner, and the creditor exercises the right to accelerate the debts secured hereby, the creditor may accept any delinquent payments or other cure of default giving rise to such acceleration from the then owner of the property or any other person and reinstate the indebtedness in accordance with the schedule of maturity as of the time of acceleration or upon such new schedule as may be agreed if renewal or extension are otherwise permitted and no such reinstatement shall in any way affect the liability of such prior parties, whether as surety or otherwise.”The words “renewal, extension, or reinstatement permitted” or similar words shall have the meaning ascribed to the individual words or phrases in this subdivision and in subdivision 5.
    7. The words “right of anticipation reserved” or similar words shall be construed as if the deed set forth: “The grantor reserves the right to anticipate the payment of the debt hereby secured, or any part thereof which is represented by a separate note (or other obligation) at any interest period by the payment of principal and interest to the date of such anticipated payment only.”
    8. The words “priority in direct order of maturity” or similar words shall be construed as if the deed set forth: “The notes (or other obligations) hereby secured have priority amongst themselves in the direct order of their maturities, each having priority over all others falling due after its maturity.” And the words “priority in inverse order of maturity” or similar words shall be construed as if the deed set forth: “The notes (or other obligations) hereby secured have priority amongst themselves in the inverse order of their maturities, each having priority over all others falling due before its maturity.”
    9. The words “insurance required dollars” or similar words shall be construed as if the deed set forth: “The grantor covenants that he will keep the improvements on the property insured against fire in some solvent insurance company approved by the trustee for the benefit of the beneficiaries hereunder in the sum of at least dollars, and will deposit with the trustee or beneficiary the policies, with standard loss payable clauses with full contribution in favor of the trustee as his interest may appear; and the grantor further covenants that in the event of his failure to keep the property so insured and the policies so deposited, then the trustee or any beneficiary may, at his option, effect such insurance and pay the premium thereon, and the money so paid, with interest thereon, shall become a part of the debt hereby secured, in the event of sale to be paid next after the expenses of executing this trust, and shall be otherwise recoverable from the grantor as a debt, but there shall be no obligation upon the trustee or beneficiary to effect such insurance.”

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    10. The words “substitution of trustee permitted” or similar words shall be construed as if the deed set forth: “Grantor grants unto the beneficiary or beneficiaries or to a majority in amount of the holders of the obligations secured hereunder and to their assigns the right and power, under the provisions of § 55.1-320 , to appoint a substitute trustee or trustees.”
    11. The words “any trustee may act” or similar words shall be construed as if the deed set forth: “The grantors, and all interested in the obligations hereby secured, by accepting the benefits hereof, agree that all authority, power, and discretion hereinabove granted to the trustees may be exercised by any of them, without any other, with the same effect as if exercised jointly by all of them.”
    12. The words “this is a credit line deed of trust” or similar words, if in capital letters or underscored and on the first page of the deed of trust and containing the name and address of the noteholder, shall have the meaning set forth in § 55.1-318 .

    History. Code 1919, § 5167; 1926, p. 593; 1940, p. 881; Code 1950, § 55-60; 1966, c. 93; 1970, c. 39; 1976, c. 155; 1982, c. 230; 2004, c. 253; 2005, c. 935; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 4A M.J. Conflict of Laws, Domicile and Residence, § 19.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section and § 55-59 do not affect the determination of lien priorities, but merely define certain language employed in the deed of trust. W.T. Jones & Co. v. Foodco Realty, Inc., 318 F.2d 881, 1963 U.S. App. LEXIS 5236 (4th Cir. 1963).

    Time price differential as “interest.” —

    Although a time price differential is not interest for purposes of the usury statutes, under any interpretation it represents a charge for credit and this section does not require a construction so narrow as to exclude such charges from the term “interest.” GECC v. Lunsford, 209 Va. 743 , 167 S.E.2d 414, 1969 Va. LEXIS 171 (1969).

    Case applying to subdivision 5. —

    Thompson v. Miller, 195 Va. 513 , 79 S.E.2d 643, 1954 Va. LEXIS 129 (1954).

    § 55.1-326. Evidences of indebtedness placed on equal footing.

    When bonds, notes, or other evidences of indebtedness are secured by a deed of trust, mortgage, vendor’s lien, or other lien, such bonds, notes, or other evidences of indebtedness shall, in the event the lien is executed or foreclosed, be secured on an equal footing and shall be paid ratably out of the proceeds of any sale of property subjected to the lien and shall have no priority, the one over the other, whether by priority of assignment or otherwise, unless the instrument creating the lien expressly provides otherwise.

    History. 1934, p. 516; Michie Code 1942, § 6457a; Code 1950, § 55-60.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-327. Sales under deeds of trust that contain no maturity date or provision authorizing sale.

    When any property, real or personal, is conveyed by deed of trust to a trustee to secure the payment of a debt, money, notes, bonds, stocks, or other evidences of debt and there is no date fixed for the maturity thereof and such deed of trust contains no provision authorizing the trustee to make sale of such property, or any part thereof, and the reinvestment of the proceeds of sale in other property subject to the terms of such deed of trust, the circuit court, or such court having jurisdiction of the subject matter, upon a complaint filed by any one or more of the lien debtors, in which complaint all persons interested in such lien and all holders of the evidences of debt secured by the deed of trust thereon, and all other necessary or proper parties, except the plaintiffs, shall be made defendants, may order a sale of such property, or any part thereof, and may invest the proceeds of sale under order of court subject to the terms of the deed of trust, provided that (i) the complaint sets forth facts that will justify the sale of the property, to be verified by the affidavit of at least one of the plaintiffs, (ii) no order shall be made authorizing such sale unless it is shown to the satisfaction of the court that the interests of the lien debtor or debtors will be promoted and the interests of no person holding the evidences of debt secured by the deed of trust will be violated thereby, and (iii) the plaintiff or the party for whose benefit the action is brought shall bear the cost.

    History. 1932, p. 77; Michie Code 1942, § 5167a; Code 1950, § 55-61; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, § 99.

    § 55.1-328. Validation of conveyances of real property under trust instrument not authorizing sale.

    When any real property is conveyed by deed of trust or other trust instrument to a trustee and there is no provision authorizing the trustee to convey the property that is the subject of the deed of trust, or any part of such property, and the trustee conveys such property or any part of such property, such conveyance shall be valid after a period of 30 years from the date of such conveyance, provided that (i) there have been no adverse claims against the property so conveyed in the interim, and (ii) such conveyances to and from such trustee were properly recorded and indexed at the time of the conveyance, in the appropriate clerk’s office in which deeds are recorded in the county or city in which the property lies.

    History. 1962, c. 350, § 55-61.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, § 137.

    § 55.1-329. Permissible form for notice of sale under deed of trust.

    Notice of sale under any deed of trust regardless of whether it conforms with § 55.1-320 , in the absence of provision in such deed of trust requiring other or additional matter, may be substantially in the following form:

    Trustee’s Sale of (brief description or identification of property) In execution of a deed of trust (name or names of grantor or grantors unless grantor or grantors request in writing that the same be omitted), dated , recorded in the Clerk’s Office of the court of in Deed Book , page , , the undersigned trustee will offer for sale at public auction (a brief description of the property to include street number or, if none, the general location of property and place of sale) on the day of , 20 at (ante meridian)(noon)(post meridian), the property described in such deed. Terms: (Cash)() Trustee(s) FOR INFORMATION CONTACT: (A trustee or the secured party or his agent) Address Telephone number

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    History. 1946, p. 272; Michie Suppl. 1946, § 5167a1; Code 1950, § 55-62; 1977, c. 660; 1979, c. 12; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, § 105.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    This section merely prescribes a permissible form of notice. Bailey v. Pioneer Fed. Sav. & Loan Ass'n, 210 Va. 558 , 172 S.E.2d 730, 1970 Va. LEXIS 162 (1970).

    Notice need not carry names of grantors. —

    There is no statutory requirement that the names of the grantors in a deed of trust be carried in the notice of sale. Bailey v. Pioneer Fed. Sav. & Loan Ass'n, 210 Va. 558 , 172 S.E.2d 730, 1970 Va. LEXIS 162 (1970).

    § 55.1-330. Construction of deeds requiring notice by advertisement in newspaper.

    1. Whenever any deed of trust to secure debts or indemnify sureties contains a provision requiring the giving of notice of sale thereunder for a specified number of days by advertisement in one or more newspapers and such advertisement is published in a newspaper published daily or in a newspaper published daily except Sunday, it shall be deemed a sufficient compliance with such provision if such notice is published in consecutive issues of such newspaper for the number of days specified, counting both the day of the first publication and the day of the last publication and intervening Sundays, whether or not such newspaper is published on Sunday. Both the first publication and the last publication may be on Sunday. The publication shall in all other respects comply with the provisions of §§ 55.1-322 and 55.1-323 .
    2. Whenever such deed of trust requires advertisement once a week for a specified number of weeks, sale may be had on the day after the last advertisement appears or any day thereafter, and all sales made in conformity with this section prior to January 1, 1972, and otherwise valid are hereby validated.

    History. 1934, p. 165; Michie Code 1942, § 5167c; Code 1950, § 55-63; 1962, c. 448; 1975, c. 284; 1977, c. 660; 1979, c. 12; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 13A M.J. Mortgages and Deeds of Trust, § 106.

    § 55.1-331. Disposition of surplus from trustee’s sale after death of grantor.

    Whenever the grantor, or his successor in title, in any deed of trust by which any real property is conveyed in trust to secure debts or indemnify sureties dies prior to a trustee’s sale held pursuant to the deed of trust and the deed of trust contains no definite provision for the distribution of any surplus in the event of the death of the grantor or his successors in title prior to the trustee’s sale held pursuant to the deed of trust, or contains a provision that such surplus shall be paid to the grantor or his heirs or assigns or personal representative, then any surplus of the proceeds of the sale remaining in the possession of the trustee, after discharging the expenses of executing the trust, all tax liens upon the property sold, all debts and obligations secured by the deed of trust, and, in order of their priority, if any, the remaining subsequent debts and obligations secured by the deed, and any liens of record inferior to the deed of trust under which the sale is made, with lawful interest, shall be paid by the trustee to the personal representative of the decedent.

    Any such funds possessed by the personal representative shall constitute assets for the payment by him of any debts and demands against the decedent’s estate remaining unsatisfied after the personal estate has been exhausted. Any surplus of the funds so paid to the personal representative and remaining in his possession after the satisfaction of all debts and demands against the estate shall be paid over by him, if the decedent died intestate as to the real property embraced in the deed of trust, to the heirs at law of the decedent, or their successors in title, and if the decedent died testate as to the real property embraced in the deed of trust, then such surplus shall be paid to the persons entitled to the real property under the terms of the decedent’s will, or to their successors in title.

    History. 1942, p. 94; Michie Code 1942, § 5167d; 1944, p. 389; Code 1950, § 55-64; 1990, c. 831; 2018, cc. 34, 204; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5C M.J. Curtesy, § 13.

    § 55.1-332. Title to real estate sold not affected by nonlisting of secured notes for taxation.

    The title to real estate sold under a deed of trust shall not be drawn in question upon the ground that the holder of the notes secured by such deed of trust did not list the same for taxation.

    History. 1924, p. 469; 1926, p. 978; 1944, p. 630; Tax Code, §§ 69, 69a; Code 1950, § 55-64.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-333. Validation of certain sales made under deeds of trust.

    All sales that have been made prior to January 1, 1972, under deeds of trust to secure debts and indemnify sureties containing a provision requiring the giving of notice of sale thereunder for a specified number of days by advertisement in one or more newspapers and that were made after publishing the advertisement of sale in a newspaper published daily or in a newspaper published daily except Sunday for the number of days specified in the deed of trust, counting both the day of the first publication and the day of the last publication and intervening Sundays, whether or not such paper was published on Sunday and whether or not such sales were held on the day of the last publication, provided that, in cases when the sale was held on the day of the last publication, the publication was in a newspaper the principal daily edition of which was delivered or publicly sold before the time fixed for the sale, and whether or not the first publication or the last publication, or both, appeared on Sunday, shall be held, and the same are hereby declared, to be valid and effective in all respects, if otherwise valid and effective according to the law then in force, provided, however, that nothing contained in this section shall be construed as affecting any final order entered prior to March 24, 1934, by any court of competent jurisdiction or as affecting any action now pending in any court of competent jurisdiction, and provided further, that nothing in this section shall be so construed as to affect intervening vested rights.

    History. 1934, p. 257; Michie Code 1942, § 5167b; Code 1950, § 55-65; 1975, c. 284; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-334. Validation of certain sales made under deeds of trust prior to October 1, 1977.

    All sales that were made prior to October 1, 1977, under deeds of trust to secure debts and indemnify sureties when the notice, advertisement, and conduct of the sale were in accordance with the law of the Commonwealth as it existed on June 30, 1977, are declared to be valid and effective in all respects, provided that nothing in this section shall be construed as affecting any final order entered prior to March 23, 1978, by any court of competent jurisdiction, or any action now pending in a court of competent jurisdiction, or as affecting intervening vested rights, and provided further that no action to vacate or set aside any such sale may be brought after March 23, 1978.

    History. 1978, c. 173, § 55-65.1; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-335. Validation of other sales under deeds of trust.

    All sales that were made prior to January 1, 1972, under deeds of trust to secure debts and indemnify sureties when the notice was not published once a week for four successive weeks or a specified number of successive weeks are declared to be valid and effective in all respects, if other reasonable advertisement of such sale was given and such sale was otherwise valid and effective, provided that nothing herein contained shall be construed as affecting any final order entered prior to March 1, 1944, by any court of competent jurisdiction, or any action now pending in a court of competent jurisdiction, or as affecting intervening vested rights, and provided further that no action may be brought after January 1, 1972, to vacate or set aside any such sale.

    History. 1944, p. 128; Michie Suppl. 1946, § 5167b1; Code 1950, § 55-66; 1975, c. 284; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-336. Protection of assignees or transferees of debts secured by real estate; form of certificate of transfer.

    Whenever a debt or other obligation secured by a deed of trust, mortgage, or vendor’s lien on real estate has been assigned, the assignor or the assignee, at its option, may cause the instrument of assignment to be recorded in the clerk’s office of the circuit court where such deed of trust, mortgage, or vendor’s lien is recorded, provided that such instrument is otherwise in recordable form, or may cause a certificate of transfer signed by the assignor to be recorded in such clerk’s office, and such instrument of assignment or certificate of transfer, upon recordation, shall operate as a notice of such assignment. The instrument of assignment or certificate of transfer shall be indexed in the name of the assignor and in the names of the obligor or maker, and the trustees, as applicable, all of whose names shall be set forth in such instrument or certificate. The certificate of transfer shall conform substantially to the following:

    CERTIFICATE OF TRANSFER Place of Record: Clerk’s Office of the Circuit Court of the of , Virginia Date of [Deed of Trust/Mortgage/Vendor’s Lien]: , Deed Book , Page Name of Obligor or Maker: Names(s) of Trustee(s) [if a Deed of Trust]: Name of Original Payee or Obligee: Original Amount Secured [if applicable]: $ The undersigned, the original payee or obligee [or the subsequent assignee] of the obligation secured by the above-mentioned [Deed of Trust/Mortgage/Vendor’s Lien], hereby certifies that the obligations secured thereby have been assigned to [If a credit line deed of trust, the name and address to which notice may be mailed or delivered to the Noteholder as provided by is as follows: § 55.1-318 ] Given under (my/our) hand(s) as of the day of , . (Assignor) of County/City of , to wit: Subscribed, sworn to, and acknowledged before me by this day of , 20. My Commission Expires: Notary Public Notary Registration Number:

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    For purposes of this section, the word “assigned” includes endorsed, pledged, hypothecated, or otherwise transferred. Nothing in this section shall be deemed to invalidate any other form or notice of assignment that may have been recorded prior to July 1, 1994. Nothing in this section shall imply that recordation of the instrument of assignment or a certificate of transfer is necessary in order to transfer to an assignee the benefit of the security provided by the deed of trust, mortgage, or vendor’s lien.

    History. 1994, c. 806, § 55-66.01; 1995, c. 807; 1997, c. 205; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Motion to reopen. —

    Debtor’s motion to reopen her closed chapter 7 case, pursuant to 11 U.S.C.S. § 350(b), was granted for the court to determine whether creditor, an assignee of debtor’s mortgage, had violated the discharge injunction under 11 U.S.C.S. § 524(a)(2), in commencing foreclosure proceedings, although no recordation was required under § 55-66.01.In re Roberts, No. 10-51861, 2013 Bankr. LEXIS 1859 (Bankr. W.D. Va. Apr. 1, 2013).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Recordation not required. —

    Mortgagee’s demurrer to a mortgagor’s claim that the mortgagee did not hold a deed of trust note when appointing a trustee was sustained because (1) the lack of a recorded document evidencing a transfer of the note to the mortgagee proved nothing, as the transfer did not have to be recorded, and (2) the appointment of substitute trustee showed the mortgagee held the note at the foreclosure sale, so, between an assignment to a prior mortgagee and the foreclosure sale, the mortgagee acquired the note in an unrecorded transaction, and the mortgagor had no basis to claim that acquisition followed, rather than preceded, the appointment of a substitute trustee. Burgest v. HSBC Bank, USA, N.A., 91 Va. Cir. 266, 2016 Va. Cir. LEXIS 16 (Norfolk Feb. 26, 2016).

    § 55.1-337. Required notice of foreclosure or repossession of manufactured home.

    Whenever any assignee of an installment note secured by a security interest on a manufactured home determines that legal action is desirable to enforce the debt resulting in a potential foreclosure or repossession, he shall give prior notice by mail of any action to foreclose or repossess the collateral to any assignor who is liable under a recourse endorsement or by virtue of a reserve account at least 10 business days prior to the enforcement of the security interest or eviction. Assignment by way of pledge of the security interest granted by the assignor shall not be an assignment within the meaning of this section. The failure to so notify the assignor shall not affect any rights of the assignee as against the principal debtor or any party other than the assignor with recourse or a person with rights in a reserve account. Provisions of this section may not be waived by such assignor at the time of the original sale of the installment paper but only after the expiration of at least 30 days from such initial transfer. The assignee shall send such notice to the last known address of the assignor as it appears in the records of the assignee.

    History. 1978, c. 462, § 55-66.1:1; 1999, c. 77; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-338. Release to person dead inures to successors.

    A release of a deed of trust or a conveyance of the property embraced in such deed of trust may in all cases be made to the original grantor, whether living or dead, and any release or reconveyance so made shall inure both in law and in equity to the successors in title of such grantor.

    History. Code 1919, § 6456; 1926, p. 82; 1930, p. 71; 1932, p. 121; 1944, p. 199; Code 1950, § 55-66.2; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-339. Release of deed of trust or other lien.

    1. As used in this section:“Deed of trust” means any mortgage, deed of trust, or vendor’s lien.“Judgment lien” includes a judgment lien prescribed by § 8.01-458 but does not include any lien in favor of the federal, state, or local government, or any political subdivision thereof.“Lien creditor” and “creditor” shall be construed as synonymous and mean the holder, payee, or obligee of a note, bond, or other evidence of debt and shall embrace the lien creditor or his successor in interest as evidenced by proper endorsement or assignment, general or restrictive, upon the note, bond, or other evidence of debt.“Payoff letter” means a written communication from the lien creditor or servicer stating, at a minimum, the amount outstanding and required to be paid to satisfy the obligation.“RESA” means Chapter 10 (§ 55.1-1000 et seq.), Real Estate Settlement Agents.“Satisfactory evidence of the payment of the obligation secured by the deed of trust or judgment lien” means (i) any one of (a) the original canceled check or a copy of the canceled check, showing all endorsements, payable to the lien creditor or servicer, as applicable, (b) confirmation in written or electronic form of a wire transfer to the bank account of the lien creditor or servicer, as applicable, or (c) a bank statement in written or electronic form reflecting completion of the wire transfer or negotiation of the check, as applicable, and (ii) a payoff letter or other reasonable documentary evidence that the payment was to effect satisfaction of the obligation secured or evidenced by the deed of trust or judgment lien.“Satisfied by payment” includes obtaining written confirmation from the lien creditor that the underlying obligation has a zero balance.“Servicer” means a person or entity that collects loan payments on behalf of a lien creditor.“Settlement agent” has the same meaning ascribed to it in § 55.1-1000 , provided that a person shall not be a settlement agent unless he is registered pursuant to § 55.1-1014 and otherwise fully in compliance with the applicable provisions of RESA.“Title insurance company” has the same meaning ascribed to it in § 38.2-4601 , provided that the title insurance company seeking to release a lien by the process described in subsection E issued a policy of title insurance, through a title insurance agency or agent as defined in § 38.2-4601 .1, for a real estate transaction wherein the loan secured by the lien was satisfied by payment made by the title insurance agency or agent also acting as the settlement agent.
      1. Except as provided in Article 3 (§ 55.1-346 et seq.), after full or partial payment or satisfaction has been made of a debt secured by a deed of trust, vendor’s lien, or other lien, or any one or more obligations representing at least 25 percent of the total amount secured by such lien, but less than the total number of the obligations so secured, or the debt secured is evidenced by two or more separate written obligations sufficiently described in the instrument creating the lien, has been fully paid, the lien creditor shall issue a certificate of satisfaction or certificate of partial satisfaction in a form sufficient for recordation reflecting such payment and release of lien. This requirement shall apply to a credit line deed of trust prepared pursuant to § 55.1-318 only when the obligor or the settlement agent has paid the debt in full and requested that the instrument be released.If the lien creditor receives notice from a settlement agent at the address identified in its payoff statement requesting that the certificate be sent to such settlement agent, the lien creditor shall provide the certificate within 90 days after receipt of such notice to the settlement agent at the address specified in the notice received from the settlement agent.If the notice is not received from a settlement agent, the lien creditor shall deliver, within 90 days after such payment, the certificate to the appropriate clerk’s office with the necessary fee for recording by certified mail, return receipt requested, or when there is written proof of receipt from the clerk’s office, by hand delivery, electronic delivery via the clerk’s electronic filing system, or delivery by a commercial overnight delivery service or the United States Postal Service, and a receipt obtained.If the lien creditor has already delivered the certificate to the clerk’s office by the time it receives notice from the settlement agent, the lien creditor shall deliver a copy of the certificate to the settlement agent within 90 days of the receipt of the notice at the address for notification set forth in the payoff statement.Except as provided for judgment lien creditors in § 8.01-454 , if the lien creditor has not, within 90 days after payment, either provided the certificate of satisfaction to the settlement agent or delivered it to the clerk’s office with the necessary fee for filing, the lien creditor shall forfeit $500 to the lien obligor. No settlement agent or attorney may take an assignment of the right to the $500 penalty or facilitate such an assignment to any third party designated by the settlement agent or attorney. Following the 90-day period, if the amount forfeited is not paid within 10 business days after written demand for payment is sent to the lien creditor by certified mail at the address for notification set forth in the payoff statement, the lien creditor shall pay any court costs and reasonable attorney fees incurred by the obligor in collecting the forfeiture. B. 1. Except as provided in Article 3 (§ 55.1-346 et seq.), after full or partial payment or satisfaction has been made of a debt secured by a deed of trust, vendor’s lien, or other lien, or any one or more obligations representing at least 25 percent of the total amount secured by such lien, but less than the total number of the obligations so secured, or the debt secured is evidenced by two or more separate written obligations sufficiently described in the instrument creating the lien, has been fully paid, the lien creditor shall issue a certificate of satisfaction or certificate of partial satisfaction in a form sufficient for recordation reflecting such payment and release of lien. This requirement shall apply to a credit line deed of trust prepared pursuant to § 55.1-318 only when the obligor or the settlement agent has paid the debt in full and requested that the instrument be released.If the lien creditor receives notice from a settlement agent at the address identified in its payoff statement requesting that the certificate be sent to such settlement agent, the lien creditor shall provide the certificate within 90 days after receipt of such notice to the settlement agent at the address specified in the notice received from the settlement agent.If the notice is not received from a settlement agent, the lien creditor shall deliver, within 90 days after such payment, the certificate to the appropriate clerk’s office with the necessary fee for recording by certified mail, return receipt requested, or when there is written proof of receipt from the clerk’s office, by hand delivery, electronic delivery via the clerk’s electronic filing system, or delivery by a commercial overnight delivery service or the United States Postal Service, and a receipt obtained.If the lien creditor has already delivered the certificate to the clerk’s office by the time it receives notice from the settlement agent, the lien creditor shall deliver a copy of the certificate to the settlement agent within 90 days of the receipt of the notice at the address for notification set forth in the payoff statement.Except as provided for judgment lien creditors in § 8.01-454 , if the lien creditor has not, within 90 days after payment, either provided the certificate of satisfaction to the settlement agent or delivered it to the clerk’s office with the necessary fee for filing, the lien creditor shall forfeit $500 to the lien obligor. No settlement agent or attorney may take an assignment of the right to the $500 penalty or facilitate such an assignment to any third party designated by the settlement agent or attorney. Following the 90-day period, if the amount forfeited is not paid within 10 business days after written demand for payment is sent to the lien creditor by certified mail at the address for notification set forth in the payoff statement, the lien creditor shall pay any court costs and reasonable attorney fees incurred by the obligor in collecting the forfeiture.
      2. If the note, bond, or other evidence of debt secured by such deed of trust, vendor’s lien, or other lien referred to in subdivision 1 or any interest therein has been assigned or transferred to a party other than the original lien creditor, the subsequent holder shall be subject to the same requirements as a lien creditor for failure to comply with this subsection, as set forth in subdivision 1.
    2. The certificate of satisfaction shall be signed by the creditor or his duly authorized agent, attorney, or attorney-in-fact or any person to whom the instrument evidencing the indebtedness has been endorsed or assigned for the purpose of effecting such release. An affidavit shall be filed or recorded with the certificate of satisfaction by the creditor, or his duly authorized agent, attorney, or attorney-in-fact, with such clerk, stating that the debt therein secured and intended to be released or discharged has been paid to such creditor or his agent, attorney, or attorney-in-fact, who was entitled and authorized to receive such debt when the debt was satisfied.
    3. When the certificate of satisfaction has been signed and the affidavit required by subsection C has been duly filed or recorded with the certificate of satisfaction with such clerk, the certificate of satisfaction shall operate as a release of the encumbrance as to which such payment or satisfaction is entered and, if the encumbrance is by deed of trust, as a reconveyance of the legal title as fully and effectually as if such certificate of satisfaction were a formal deed of release duly executed and recorded.
    4. Release of lien by settlement agent or title insurance company.A settlement agent or title insurance company may release a deed of trust or judgment lien in accordance with the provisions of this subsection (i) if the obligation secured by the deed of trust or judgment lien has been satisfied by payment made by the settlement agent and (ii) whether or not the settlement agent or title insurance company is named as a trustee under the deed of trust or otherwise has received the authority to release the lien.
      1. Notice to lienholder.
        1. After or accompanying payment in full of the obligation secured by a deed of trust or judgment lien, a settlement agent or title insurance company intending to release a deed of trust or judgment lien pursuant to this subsection shall deliver to the lien creditor by certified mail or commercial overnight delivery service or the United States Postal Service, and a receipt obtained, a notice of intent to release the deed of trust or judgment lien with a copy of the payoff letter and a copy of the release to be recorded as provided in this subsection.
        2. The notice of intent to release shall contain (i) the name of the lien creditor, the name of the servicer if loan payments on the deed of trust or judgment lien are collected by a servicer, or both names; (ii) the name of the settlement agent; (iii) the name of the title insurance company if the title insurance company intends to release the lien; and (iv) the date of the notice. The notice of intent to release shall conform substantially to the following form:

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        3. The procedure authorized by this subsection for the release of a deed of trust or judgment lien shall constitute an optional method of accomplishing a release of a deed of trust or judgment lien secured by property in the Commonwealth. The nonuse of the procedure authorized by this subsection for the release of a deed of trust or judgment lien shall not give rise to any liability or any cause of action whatsoever against a settlement agent or any title insurance company by any obligated party or anyone succeeding to or assuming the interest of the obligated party.

    NOTICE OF INTENT TO RELEASE Notice is hereby given to you concerning the deed of trust or judgment lien described on the certificate of satisfaction, a copy of which is attached to this notice, as follows: 1. The settlement agent identified below has paid the obligation secured by the deed of trust or judgment lien described herein or obtained written confirmation from you that such obligation has a zero balance. 2. The undersigned will release the deed of trust or judgment lien described in this notice unless, within 90 days from the date this notice is mailed by certified mail or commercial overnight delivery service or the United States Postal Service, and a receipt obtained, the undersigned has received by certified mail or commercial overnight delivery service or the United States Postal Service, and a receipt obtained, a notice stating that a release of the deed of trust or judgment lien has been recorded in the clerk’s office or that the obligation secured by the deed of trust or judgment lien described herein has not been paid, or the lien creditor or servicer otherwise objects to the release of the deed of trust or judgment lien. Notice shall be sent to the address stated on this form. (Name of settlement agent) (Signature of settlement agent or title insurance company) (Address of settlement agent or title insurance company) (Telephone number of settlement agent or title insurance company) (Virginia RESA registration number of settlement agent at the time the obligation was paid or confirmed to have a zero balance) 2. Certificate of satisfaction and affidavit of settlement agent or title insurance company. a. If, within 90 days following the day on which the settlement agent or title insurance company mailed or delivered the notice of intent to release in accordance with this subsection, the lien creditor or servicer does not send by certified mail or commercial overnight delivery service or the United States Postal Service, and a receipt obtained, to the settlement agent or title insurance company a notice stating that a release of the deed of trust or judgment lien has been recorded in the clerk’s office or that the obligation secured by the deed of trust or judgment lien has not been paid in full or that the lien creditor or servicer otherwise objects to the release of the deed of trust or judgment lien, the settlement agent or title insurance company may execute, acknowledge, and file with the clerk of court of the jurisdiction in which the deed of trust or judgment lien is recorded a certificate of satisfaction, which shall include (i) the affidavit described in subdivision 2 b and (ii) a copy of the notice of intent to release that was sent to the lien creditor, the servicer, or both. The certificate of satisfaction shall include the settlement agent’s RESA registration number, issued by the Virginia State Bar or the Virginia State Corporation Commission, that was in effect at the time the settlement agent paid the obligation secured by the deed of trust or judgment lien or obtained written confirmation from the lien creditor that such obligation has a zero balance. The certificate of satisfaction shall note that the individual executing the certificate of satisfaction is doing so pursuant to the authority granted by this subsection. After filing or recording the certificate of satisfaction, the settlement agent or title insurance company shall mail a copy of the certificate of satisfaction to the lien creditor or servicer. The validity of a certificate of satisfaction otherwise satisfying the requirements of this subsection shall not be affected by the inaccuracy of the RESA registration number placed thereon or the failure to mail a copy of the recorded certificate of satisfaction to the lien creditor or servicer and shall nevertheless release the deed of trust or judgment lien described therein as provided in this subsection. b. The certificate of satisfaction used by the settlement agent or title insurance company shall include an affidavit certifying (i) that the settlement agent has satisfied the obligation secured by the deed of trust or judgment lien described in the certificate, (ii) that the settlement agent or title insurance company possesses satisfactory evidence of payment of the obligation secured by the deed of trust or judgment lien described in the certificate or written confirmation from the lien creditor that such obligation has a zero balance, (iii) that the lien of the deed of trust or judgment lien may be released, (iv) that the person executing the certificate is the settlement agent or the title insurance company or is duly authorized to act on behalf of the settlement agent or title insurance company, and (v) that the notice of intent to release was delivered to the lien creditor or servicer and the settlement agent or title insurance company received evidence of receipt of such notice by the lien creditor or servicer. The affidavit shall be substantially in the following form: AFFIDAVIT OF SETTLEMENT AGENT OR TITLE INSURANCE COMPANY The undersigned hereby certifies that, in accordance with the provisions of of , as amended and in force on the date hereof (the Code), (a) the undersigned is a settlement agent or title insurance company as defined in subsection A of or a duly authorized officer, director, member, partner, or employee of such settlement agent or title insurance company; (b) the settlement agent has satisfied the obligation secured by the deed of trust or judgment lien; (c) the settlement agent or title insurance company possesses satisfactory evidence of the payment of the obligation secured by the deed of trust or judgment lien described in the certificate recorded herewith or written confirmation from the lien creditor that such obligation has a zero balance; (d) the settlement agent or title insurance company has delivered to the lien creditor or servicer in the manner specified in subdivision E 1 of the notice of intent to release and possesses evidence of receipt of such notice by the lien creditor or servicer; and (e) the lien of the deed of trust or judgment lien is hereby released. § 55.1-339 of the Code of Virginia 1950 § 55.1-339 of the Code § 55.1-339 of the Code (Authorized signer)

    3. Effect of filing.When filed or recorded with the clerk’s office, a certificate of satisfaction that is executed and notarized as provided in this subsection and accompanied by (i) the affidavit described in subdivision 2 b and (ii) a copy of the notice of intent to release that was sent to the lender, lien creditor, or servicer shall operate as a release of the encumbrance described therein and, if the encumbrance is by deed of trust, as a reconveyance of the legal title as fully and effectively as if such certificate of satisfaction were a formal deed of release duly executed and recorded.

    4. Effect of wrongful or erroneous certificate; damages.

    a. The execution and filing or recording of a wrongful or erroneous certificate of satisfaction by a settlement agent or title insurance agent does not relieve the party obligated to repay the debt, or anyone succeeding to or assuming the responsibility of the obligated party as to the debt, from any liability for the debt or other obligations secured by the deed of trust or judgment lien that is the subject of the wrongful or erroneous certificate of satisfaction.

    b. A settlement agent or title insurance agent that wrongfully or erroneously executes and files or records a certificate of satisfaction is liable to the lien creditor for actual damages sustained due to the recording of a wrongful or erroneous certificate of satisfaction.

    5. Applicability.

    a. The procedure authorized by this subsection for the release of a deed of trust may be used to effect the release of a deed of trust after July 1, 2002, regardless of when the deed of trust was created, assigned, or satisfied by payment made by the settlement agent. The procedure authorized by this subsection for the release of a judgment lien may be used to effect the release of such judgment lien after July 1, 2021, regardless of when the judgment lien was created, assigned, or satisfied by payment made by the settlement agent.

    b. This subsection applies only to transactions involving the purchase of or lending on the security of real estate located in the Commonwealth that is either (i) unimproved real estate with a lien to be released of $1 million or less or (ii) real estate containing at least one but not more than four residential dwelling units.

    c. The procedure authorized by this subsection applies only to the full and complete release of a deed of trust or judgment lien. Nothing in this subsection shall be construed to authorize the partial release of property from a deed of trust or judgment lien or otherwise permit the execution or recordation of a certificate of partial satisfaction.

    History. Code 1919, § 6456; 1926, p. 80; 1930, p. 69; 1932, p. 120; 1944, p. 198; Code 1950, § 55-66.3; 1958, c. 14; 1962, c. 39; 1972, c. 280; 1975, c. 469; 1980, c. 116; 1986, c. 462; 1987, c. 673; 1988, c. 546; 1991, c. 414; 1996, cc. 895, 949; 1997, c. 221; 2000, c. 28; 2001, c. 711; 2002, cc. 845, 862; 2003, c. 745; 2004, c. 596; 2006, c. 907; 2009, cc. 254, 421; 2010, c. 236; 2019, c. 712; 2021, Sp. Sess. I, c. 486.

    Editor’s note.

    Acts 2021, Sp. Sess. I, c. 486, cl. 2 provides: “That the provisions of this act, except for the provisions amending subsections B and G of § 8.01-251 of the Code of Virginia, as amended by this act, shall become effective on January 1, 2022.”

    Effective date.

    This section is effective October 1, 2019.

    The 2021 Sp. Sess. I amendments.

    The 2021 amendment by Sp. Sess. I, c. 486, effective January 1, 2022, inserted “or judgment lien” throughout the section; inserted the definition for “Judgment lien” in subsection A; added the exception clause in subdivision B 1 to the beginning of the last paragraph; substituted “lien creditor” for “lender” in subdivision E 2 a, clause (ii); added the second sentence of subdivision E 5 a; and made a stylistic change.

    Michie’s Jurisprudence.

    For related discussion, see 12A M.J. Liens, § 18.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Requisites for release. —

    In order to obtain a release under this section there must be a concurrence of two separate and distinct acts: (1) The lien creditor must cause the payment or satisfaction to be entered on the margin of the page of the book where the encumbrance is recorded, signed by the creditor, or his duly authorized agent or attorney; and (2) the evidence of debt, duly canceled, must be produced before the clerk, or an affidavit filed with the clerk that the debt has been paid and the evidence of debt canceled or lost or destroyed. Waynesboro Nat'l Bank v. Smith, 151 Va. 481 , 145 S.E. 302 , 1928 Va. LEXIS 248 (1928).

    Although a certificate of release of deed of trust executed by a noteholder with respect to a debtor’s property did not literally follow any of the statutory forms in § 55-66.4:1, the court had little difficulty in concluding that the certificate, even though omitting the word “partial” in its title, did not release the deed of trust in its entirety but only as to the debtor’s other property. Bank of N.Y. Mellon Trust Co., N.A. v. Botero-Paramo, 445 Bankr. 530, 2011 Bankr. LEXIS 447 (Bankr. E.D. Va. 2011), aff'd, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    While defendant creditor’s release of a refinancing deed of trust did not comply exactly with either a “Certificate of Satisfaction” or a “Certificate of Partial Satisfaction” under § 55-66.3, its plain language showed it applied only to a lien against one property, and because it was recorded earlier than plaintiff creditor’s lien, it had priority on the other property. Bank of N.Y. Mellon Trust Co., N.A. v. Tysons Fin., LLC, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    Effect of payment by insurance company of debt secured. —

    The fact that an insurance company discharged its liability to a mortgagee by paying off the debt secured and became subrogated to the rights of the mortgagee, but denied liability to the mortgagor, does not show such a discharge under this section as to sustain a cancellation of the deed of trust. Wagner v. Peters, 142 Va. 412 , 128 S.E. 445 , 1925 Va. LEXIS 347 (1925) (see note to this case under § 55-66.5).

    Guarantors not released. —

    Certificate of satisfaction did not release guarantors as a matter of Virginia law in the bank’s action to collect on a deficiency judgment because the guaranties specifically provided that the release of any property connected to the debt was not a release of the guarantors’ obligations. U.S. Bank Nat'l Ass'n v. Zarrabi, 560 Fed. Appx. 181, 2014 U.S. App. LEXIS 4407 (4th Cir. 2014).

    Statute of limitations. —

    Claim based on creditor’s failure to timely release a lien against a consumer’s residence after the underlying debt obligation was satisfied was barred by the statute of limitations, since the limitations period began to run when the creditor failed to file a certificate of satisfaction within the statutory period after payment rather than when the consumer demanded that the creditor record a certificate of satisfaction. Poindexter v. Mercedes-Benz Credit Corp., 792 F.3d 406, 2015 U.S. App. LEXIS 11650 (4th Cir. 2015).

    § 55.1-340. Release by financial institution upon payment of debt placed with it for collection.

    In any case where a note, bond, or other evidence of indebtedness placed by a creditor for collection with a bank, trust company, savings institution, small loan company, or credit union is fully paid at such financial institution, the financial institution, through its authorized agents, may execute all certificates, releases, and affidavits required of a creditor by this chapter to effectuate a release. The financial institution may execute and deliver to the clerk an affidavit to the effect that the financial institution had been acting as collecting agent for the creditor on the debt and that the debt has been paid in full at such institution.

    History. 1983, c. 220, § 55-66.3:1; 1996, c. 77; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-341. Partial satisfaction.

    It is lawful for any lien creditor to record a certificate of partial satisfaction of any one or more of the separate pieces or parcels of property covered by such lien. It shall also be lawful for any such creditor to record a certificate of partial satisfaction of any part of the real estate covered by such lien if a plat of such part or a deed of such part is recorded in the clerk’s office and a cross-reference is made in the certificate of partial satisfaction to the book and page where the plat or deed of such part is recorded. Such certificate of partial satisfaction may be accomplished in manner and form prescribed in this chapter for making certificates of satisfaction, except that the creditor, or his duly authorized agent, shall make an affidavit to the clerk or in such certificate that such creditor is at the time of making such satisfaction the legal holder of the obligation, note, bond, or other evidence of debt, secured by such lien, and when made in conformity with the provisions of this chapter such partial satisfaction shall be as valid and binding as a proper release deed duly executed for the same purpose.

    Any and all partial marginal releases made prior to July 1, 1966, in any county or city of the Commonwealth, in conformity with the provisions of this chapter, either of one or more separate pieces or parcels of real estate or any part of the real estate covered by such lien, or as to one or more of the obligations secured by any such lien, or as to all of the real estate covered by such lien instrument, are hereby validated and declared to be binding upon all parties in interest, but this provision shall not be construed as intended to disturb or impair any vested right.

    History. Code 1919, § 6456; 1930, p. 70; 1932, p. 121; 1944, p. 199; Code 1950, § 55-66.4; 1952, c. 469; 1966, c. 505; 1975, c. 469; 1977, c. 141; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Requisites for release. —

    Although a certificate of release of deed of trust executed by a noteholder with respect to a debtor’s property did not literally follow any of the statutory forms in § 55-66.4:1, the court had little difficulty in concluding that the certificate, even though omitting the word “partial” in its title, did not release the deed of trust in its entirety but only as to the debtor’s other property. Bank of N.Y. Mellon Trust Co., N.A. v. Botero-Paramo, 445 Bankr. 530, 2011 Bankr. LEXIS 447 (Bankr. E.D. Va. 2011), aff'd, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    While defendant creditor’s release of a refinancing deed of trust did not comply exactly with either a “Certificate of Satisfaction” or a “Certificate of Partial Satisfaction,” its plain language showed it applied only to a lien against one property, and because it was recorded earlier than plaintiff creditor’s lien, it had priority on the other property. Bank of N.Y. Mellon Trust Co., N.A. v. Tysons Fin., LLC, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    § 55.1-342. Permissible form for certificate of satisfaction or certificate of partial satisfaction.

    Any release by a certificate of satisfaction or certificate of partial satisfaction shall be in conformity with §§ 55.1-339 , 55.1-340 , and 55.1-341 and shall conform substantially with the following Certificate of Satisfaction or Certificate of Partial Satisfaction forms:

    CERTIFICATE OF SATISFACTION Place of Record Date of Note/Deed of Trust Face Amount Secured/Face Amount of Note: Deed Book Page Name(s) of Grantor(s)/Maker(s); Name(s) of Trustee(s) Face Amount of Note(s) $ I/we, holder(s) of the above-mentioned note(s) secured by the above-mentioned deed of trust, do hereby certify that the same has/have been paid in full, and the lien therein created and retained is hereby released. GIVEN UNDER MY/OUR HAND(S) THIS DAY OF , 20. (NOTE HOLDERS) Commonwealth of Virginia, County/City of to wit: Subscribed, sworn to, and acknowledged before me by this day of , 20. My Commission Expires: NOTARY PUBLIC Notary Registration Number: VIRGINIA; IN THE CLERK’S OFFICE OF THE CIRCUIT COURT This certificate was presented, and with the Certificate annexed, admitted to record on at o’clock .m. Clerk’s fees: $ have been paid. Attest: , Deputy Clerk CERTIFICATE OF PARTIAL SATISFACTION Place of Record Date of Deed of Trust Deed Book Page Name(s) of Grantor(s) Name(s) of Trustee(s) Maker(s) of Note(s) Date of Note(s) Face Amount of Note(s) $ The lien of the above-mentioned deed of trust securing the above-mentioned note is released insofar as the same is applicable to (description of property) recorded in deed book at page in the clerk’s office of this court. The undersigned is/are the legal holder(s) of the obligation, note, bond, or other evidence of debt secured by said deed of trust. Given under my/our hand(s) this day of , 20. (NOTE HOLDERS) Commonwealth of Virginia, County/City of to wit: Subscribed, sworn to, and acknowledged before me by this day of , 20. My Commission Expires: NOTARY PUBLIC Notary Registration Number:

    Click to view

    The clerk shall satisfy the requirements of § 17.1-228 .

    Certificates conforming to this section prior to the amendment effective July 1, 1984, shall be deemed to be in substantial conformity to this section.

    History. 1975, c. 469, § 55-66.4:1; 1977, c. 254; 1982, c. 420; 1983, c. 220; 1984, c. 376; 1990, c. 328; 1994, c. 929; 1995, c. 271; 1996, c. 949; 2014, c. 330; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Requisites for release. —

    Although a certificate of release of deed of trust executed by a noteholder with respect to a debtor’s property did not literally follow any of the statutory forms in § 55-66.4:1, the court had little difficulty in concluding that the certificate, even though omitting the word “partial” in its title, did not release the deed of trust in its entirety but only as to the debtor’s other property. Bank of N.Y. Mellon Trust Co., N.A. v. Botero-Paramo, 445 Bankr. 530, 2011 Bankr. LEXIS 447 (Bankr. E.D. Va. 2011), aff'd, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    While defendant creditor’s release of a refinancing deed of trust did not comply exactly with either a “Certificate of Satisfaction” or a “Certificate of Partial Satisfaction,” its plain language showed it applied only to a lien against one property, and because it was recorded earlier than plaintiff creditor’s lien, it had priority on the other property. Bank of N.Y. Mellon Trust Co., N.A. v. Tysons Fin., LLC, 483 Fed. Appx. 779, 2012 U.S. App. LEXIS 11688 (4th Cir. 2012).

    § 55.1-343. Where certificates of satisfaction are to be indexed.

    The clerk shall record a certificate of partial satisfaction or a certificate of satisfaction on the grantor index, both under the name of each grantor on the underlying deed of trust and under the name of the first-named trustee under which the deed of trust was indexed, all as identified on the certificate of satisfaction. The deed book and page number or the instrument number of the released deed of trust shall also be designated in the index. Any clerk using a separate index book or data file for grantees only shall also record in such book or file the name of each grantor on the underlying deed of trust as identified on the certificate of satisfaction.

    History. 1985, c. 245, § 55-66.4:2; 1986, c. 512; 1997, c. 579; 2002, c. 832; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-344. Releases made by court; costs and attorney fees.

    1. Any person who owns or has any interest in real estate or personal property on which an encumbrance as described in § 55.1-339 exists may, after 20 days’ notice to the person entitled to such encumbrance, apply to the circuit court of the county or city in which such encumbrance is recorded to have the same released or discharged. Upon proof that the encumbrance has been paid or discharged or upon a finding by the court that more than 15 years have elapsed since the maturity of the lien or encumbrance, raising a presumption of payment that is not rebutted at the hearing, such court shall order the clerk to record a certificate of satisfaction or a certificate of partial satisfaction that, when so recorded, shall operate as a release of such encumbrance.All releases made prior to June 24, 1944, by any court under this section upon such presumption of payment so arising and not rebutted shall be validated.
    2. If the court finds that the person entitled to such encumbrance cannot with due diligence be located, and that notice has been given such person in the manner provided by § 8.01-319 or 55.1-348 , or that tender has been made of the sum due thereon but has been refused for any reason by the party to whom due, the court may in its discretion order the sum due to be paid into court, to be there held as provided by law, and to be paid upon demand to the person entitled thereto. The court shall order the same to be recorded as provided in subsection A, and such certificate of satisfaction or certificate of partial satisfaction shall operate as a release of the encumbrance.
    3. Upon a finding by the court that the holder of a mortgage or deed of trust that has been fully paid or discharged has unjustifiably and without good cause failed or refused to release such mortgage or deed of trust, the court may order that costs and reasonable attorney fees be paid to the petitioning party. This subsection shall not preclude a separate action by the petitioning party for actual damages sustained by reason of such failure or refusal to release the encumbrance.

    History. Code 1919, § 6456; 1926, p. 81; 1930, p. 70; 1932, p. 121; 1944, p. 199; Code 1950, § 55-66.5; 1956, c. 426; 1975, c. 469; 1987, c. 604; 1992, c. 532; 1999, c. 66; 2006, c. 907; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 12A M.J. Liens, § 18.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    Section does not confer jurisdiction to litigate collateral issues. —

    Under this section there is only a single fact to be established; that is, the payment or discharge of the debt secured. The section does not confer jurisdiction to litigate other decisive collateral issues. Wagner v. Peters, 142 Va. 412 , 128 S.E. 445 , 1925 Va. LEXIS 347 (1925).

    The court had no jurisdiction under this section to determine the liability of an insurance company to the owner of property destroyed upon which he had given a deed of trust. Wagner v. Peters, 142 Va. 412 , 128 S.E. 445 , 1925 Va. LEXIS 347 (1925).

    Determination of collateral issues are excluded from a proceeding under this section. GECC v. Lunsford, 209 Va. 743 , 167 S.E.2d 414, 1969 Va. LEXIS 171 (1969).

    Presumption of payment is not affected by passage of statute of limitations. —

    The presumption of payment of a debt, secured by deed of trust, arising from the lapse of 20 years, is not affected by the passage of Acts 1897-98, p. 516, providing a statute of limitations for trust deeds. Turnbull v. Mann, 99 Va. 41 , 37 S.E. 288 , 1900 Va. LEXIS 121 (1900) (see § 8.01-241 and the note to this case thereunder.).

    Burden of proof is on party seeking release. —

    In a proceeding under this section the burden of proof is upon one who applies to have a lien or encumbrance released or discharged to prove payment of the debt secured. Hall Bldg. Corp. v. Edwards, 142 Va. 209 , 128 S.E. 521 , 1925 Va. LEXIS 331 (1925).

    Subsection A relates to payment or discharge. GECC v. Lunsford, 209 Va. 743 , 167 S.E.2d 414, 1969 Va. LEXIS 171 (1969).

    Subsection B relates to tender and refusal of the sum due. GECC v. Lunsford, 209 Va. 743 , 167 S.E.2d 414, 1969 Va. LEXIS 171 (1969).

    A determination of what amount constitutes the “sum due” under an exercise of a right of anticipation in a deed of trust is contemplated by this section and is necessary to a determination of whether the “sum due” has been tendered, and cannot be termed a collateral issue. GECC v. Lunsford, 209 Va. 743 , 167 S.E.2d 414, 1969 Va. LEXIS 171 (1969).

    Notice. —

    Where the suit is one in equity under the general equity jurisdiction of the court, and not a summary statutory proceeding, even though some of the relief obtainable under this section is sought (as well as other relief), the giving of the notice in the manner provided for under this section is not mandatory. Bertels v. Sullivan, 312 F. Supp. 63, 1970 U.S. Dist. LEXIS 12869 (E.D. Va. 1970).

    Trial court to be sustained if possible. —

    Upon an application under this section to have a deed of trust released, the finding of a trial court must be sustained unless it is plainly wrong or without supporting evidence. Hall Bldg. Corp. v. Edwards, 142 Va. 209 , 128 S.E. 521 , 1925 Va. LEXIS 331 (1925).

    Incorrect “satisfied in bankruptcy” order. —

    Trial court incorrectly ordered a judgment creditor’s recorded judgment marked “satisfied in bankruptcy”; the trial court could only order the release of judgment creditor’s lien in a § 8.01-455 proceeding upon proof that it had been discharged in bankruptcy; furthermore, debtor had the burden of proof as to his entitlement to relief under § 8.01-455 , and the trial court erred in imposing the burden on judgment creditor to show that debtor had property in the county that was subject to its lien. Leasing Serv. Corp. v. Justice, 243 Va. 441 , 416 S.E.2d 439, 8 Va. Law Rep. 2783, 1992 Va. LEXIS 35 (1992).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Attorney fees denied. —

    Borrowers were not entitled to an award of attorney’s fees because, although a bank ultimately was mistaken about its entitlement to prepayment penalties, the bank did not act both unjustifiably and without good cause in refusing to release encumbrances until it was paid prepayment penalties for the borrowers’ payments on promissory notes. Chick's Marina Props., LLC v. Xenith Bank, 95 Va. Cir. 124, 2017 Va. Cir. LEXIS 32 (Virginia Beach Jan. 27, 2017).

    § 55.1-345. Recordation of certificate of satisfaction, etc., required when release of lien recorded.

    Whenever a release of a deed of trust or other obligation is recorded in the office of the clerk of any circuit court, such clerk shall record a certificate of satisfaction or certificate of partial satisfaction, stating that such deed or other obligation is released. The fee charged by the clerk for recording such release shall be paid by the lien debtor. Such certificate shall be indexed in the name of the grantors and grantees of the instrument being released. If any clerk fails for 10 days to do anything required of him by this section, he shall be liable for any damage that any person may sustain by reason of such failure.

    History. Code 1919, § 3402; Code 1950, § 55-66.6; 1975, c. 469; 1979, c. 648; 1991, c. 414; 1993, c. 39; 2010, c. 352; 2019, c. 712.

    Editor’s note.

    Acts 2003, c. 245, cl. 2, provides: “That the provisions of this act shall expire July 1, 2004.” The section is set out above without the changes by Acts 2003, c. 245, which substituted “30” for “ten” in the last sentence.

    Acts 2020, c. 1289, as amended by Acts 2021, Sp. Sess. I, c. 552, Item § 3-6.01, effective for the biennium ending June 30, 2022, provides: “There is hereby assessed a twenty dollar fee on (i) every deed for which the state recordation tax is collected pursuant to §§ 58.1-801 A and 58.1-803 , Code of Virginia; and (ii) every certificate of satisfaction admitted under § 55.1-345 , Code of Virginia. The revenue generated from fifty percent of such fee shall be deposited to the general fund. The revenue generated from the other fifty percent of such fee shall be deposited to the Virginia Natural Resources Commitment Fund, a subfund of the Virginia Water Quality Improvement Fund, as established in § 10.1-2128.1 , Code of Virginia. The funds deposited to this subfund shall be disbursed for the agricultural best management practices cost share program, pursuant to § 10.1-2128.1 , Code of Virginia.”

    Effective date.

    This section is effective October 1, 2019.

    Article 3. Satisfaction of Security Interest in Real Property.

    § 55.1-346. Applicability.

    The procedure authorized by this article for the release of a security interest in real property using an automated electronic recording system may be used to effect the release of a security interest regardless of when the security interest was created, assigned, or satisfied by payment made by the settlement agent. The procedure authorized by this section for the release of a security interest shall constitute an optional method of accomplishing a release of a security interest secured by property in the Commonwealth.

    History. 2006, c. 907, § 55-66.8; 2019, c. 712.

    Cross references.

    As to electronic filing of land records, see § 17.1-258.3:1 .

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-347. Definitions.

    As used in this article, unless the context requires otherwise:

    “Day” means calendar day.

    “Document” means information that is:

    1. Inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form; and
    2. Eligible to be recorded in the land records maintained by the clerk.“Electronic,” as defined in the Uniform Electronic Transactions Act (§ 59.1-479 et seq.), means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.“Person” means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government, or governmental subdivision, agency, or instrumentality or any other legal or commercial entity.“Real property” means real property that is used for residential or nonresidential purposes.“Recording data” means the date, and deed book and page number or instrument number, that indicates where a document is recorded in the land records of the clerk of the circuit court pursuant to Chapter 6 (§ 55.1-600 et seq.).“Secured creditor” means a person that holds or is the beneficiary of a security interest or that is authorized both to receive payments on behalf of a person that holds a security interest in real property and to record a satisfaction of the security instrument upon receiving full performance of the secured obligation. “Secured creditor” does not include a trustee under a security instrument. “Secured creditor” also includes “lender” as used in Chapter 10 (§ 55.1-1000 et seq.) and “lien creditor” and “servicer” as defined in § 55.1-339 .“Secured obligation” means an obligation the payment or performance of which is secured by a security interest.“Security instrument” means an agreement, however denominated, that creates or provides for a security interest, whether or not it also creates or provides for a lien on personal property.“Security interest” means an interest in real property created by a security instrument, securing payment, or performance of an obligation and includes a mortgage or deed of trust.“Sign” means, with present intent to authenticate, accept, or adopt a document:

    1. To execute or adopt a tangible symbol; or

    2. To attach to or logically associate with the document an electronic sound, symbol, or process. “State” means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. “Submit for recording” means to deliver, with required fees and taxes, a document sufficient to be recorded under this article to the office of the clerk of the circuit court pursuant to Chapter 6 (§ 55.1-600 et seq.).

    History. 2006, c. 907, § 55-66.9; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-348. Document of rescission; effect; liability for wrongful recording.

    1. As used in this section, “document of rescission” means a document stating that an identified satisfaction, certificate of satisfaction, or affidavit of satisfaction of a security instrument was recorded erroneously or fraudulently, the secured obligation remains unsatisfied, and the security instrument remains in force.
    2. If a person records a satisfaction, certificate of satisfaction, or affidavit of satisfaction of a security instrument in error or by fraud, the person may execute and record a document of rescission. Upon recording, the document rescinds an erroneously recorded satisfaction, certificate, or affidavit.
    3. A recorded document of rescission has no effect on the rights of a person who:
      1. Acquired an interest in the real property described in a security instrument after the recording of the satisfaction, certificate of satisfaction, or affidavit of satisfaction of the security instrument and before the recording of the document of rescission; and
      2. Would otherwise have priority over or take free of the lien created by the security instrument under the laws of the Commonwealth.
    4. A person, other than the clerk of the circuit court or any of his employees or other governmental official in the course of the performance of his recordation duties, who erroneously, fraudulently, or wrongfully records a document of rescission is subject to liability under § 55.1-339 .

    History. 2006, c. 907, § 55-66.10; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-349. Secured creditor to submit satisfaction for recording; liability for failure.

    1. A secured creditor shall submit for recording a satisfaction of a security instrument within 90 days after the creditor receives full payment or performance of the secured obligation in accordance with subsection B of § 55.1-339 . If a security instrument secures a line of credit or future advances, the secured obligation is fully performed only if, in addition to full payment, the secured creditor has received a notification requesting the creditor to terminate the line of credit or containing a statement sufficient to terminate the effectiveness of the provision for future advances in the security instrument.
    2. A secured creditor who is required to submit a satisfaction of a security instrument for recording and fails to do so by the end of the period specified in subsection A is subject to liability under § 55.1-339 .

    History. 2006, c. 907, § 55-66.11; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-350. Form and effect of satisfaction.

    1. A document is sufficient to constitute a satisfaction of a security instrument if it conforms substantially in form and content to the requirements of § 55.1-342 and it:
      1. Identifies the security instrument, the original parties to the security instrument, the recording data for the security instrument, and the office in which the security instrument is recorded;
      2. States that the person signing the satisfaction is the secured creditor;
      3. Contains a legal description of the real property identified in the security instrument, but only if a legal description is necessary for a satisfaction to be properly indexed; otherwise, the deed book and page number or instrument number is sufficient;
      4. Contains language terminating the effectiveness of the security instrument; and
      5. Is signed by the secured creditor and acknowledged as required by law for a conveyance of an interest in real property.
    2. The clerk of the circuit court shall accept for recording a satisfaction document, unless:
      1. An amount equal to or greater than the applicable recording fees and taxes is not tendered;
      2. The document is submitted by a method or in a medium not authorized by the laws of the Commonwealth; or
      3. The document is not signed by the secured creditor and acknowledged as required by law for a conveyance of an interest in real property.

    History. 2006, c. 907, § 55-66.12; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-351. Relation to Electronic Signatures in Global and National Commerce Act.

    To the extent permitted by law, this article modifies, limits, and supersedes the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. § 7001 et seq., except that nothing in this article modifies, limits, or supersedes §§ 7001(c) and 7004 of that Act or authorizes electronic delivery of any of the notices described in § 7003(b) of that Act.

    History. 2006, c. 907, § 55-66.13; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    § 55.1-352. Uniform standards.

    In consultation with the circuit court clerks, the Executive Secretary of the Supreme Court, and interested citizens and businesses, the Virginia Information Technologies Agency shall develop standards to implement electronic recording of real property documents. The Virginia Information Technologies Agency shall consider standards and practices of other jurisdictions, the most recent standards promulgated by national standard-setting bodies, such as the Property Records Industry Association, views of interested persons and other governmental entities, and needs of localities of varying sizes, population, and resources.

    History. 2005, c. 749, § 55-66.14; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Article 4. Effect of Certain Expressions in Deeds.

    § 55.1-353. Effect of word “covenants.”

    When a deed uses the words “the said _______________ covenants,” such covenant shall have the same effect as if it were expressed to be by the covenantor, for himself and his heirs, personal representatives, and assigns and shall be deemed to be with the covenantee and his heirs, personal representatives, and assigns.

    History. Code 1919, § 5170; Code 1950, § 55-67; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, § 3.

    § 55.1-354. Effect of covenant of general warranty.

    A covenant by the grantor in a deed “that he will warrant generally the property hereby conveyed” shall have the same effect as if the grantor had covenanted that he and his heirs and personal representatives will forever warrant and defend such property unto the grantee and his heirs, personal representatives, and assigns against the claims and demands of all persons.

    History. Code 1919, § 5171; Code 1950, § 55-68; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, §§ 21 - 23.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    No preclusion to eviction requirement. —

    In a utility’s counterclaim that landowners’ lawsuit breached a covenant to the utility of quiet possession, nothing in § 55-72 or § 55-68 precluded the common-law requirement that some type of eviction, either actual or constructive, needed to occur before the action for the breach of the covenant could be maintained. Fisher v. Va. Elec. & Power Co., 258 F. Supp. 2d 445, 2003 U.S. Dist. LEXIS 6995 (E.D. Va. 2003).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The case cited below was decided under prior law.

    Attorney’s fees awarded. —

    Defendants, who were the heirs of the original grantor in the deed, were liable for attorney’s fees and costs where (1) plaintiff’s request for attorney’s fees stemmed from the covenant of general warranty contained in the deed, (2) the case constituted a defense of title as contemplated by this section, (3) the award of attorney’s fees was authorized by this section, (4) which clearly stated that the obligation ran not only to the grantor, but also to the grantor’s heirs and personal representatives, (5) while it was true that any award of attorney’s fees may have had a “chilling effect” on future litigation, the court could not have used that as a ground to overrule § 55-68, and (6) the General Assembly made the public policy determination when it authorized an award of attorney’s fees in such actions. Green v. Knott, 63 Va. Cir. 18, 2003 Va. Cir. LEXIS 322 (Mecklenburg County Apr. 4, 2003).

    § 55.1-355. Covenant of special warranty.

    A covenant by any such grantor “that he will warrant specially the property hereby conveyed” shall have the same effect as if the grantor has covenanted that he and his heirs and personal representatives will forever warrant and defend such property unto the grantee and his heirs, personal representatives, and assigns against the claims and demands of the grantor and all persons claiming or to claim by, through, or under him.

    History. Code 1919, § 5172; Code 1950, § 55-69; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, § 24.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    An after-acquired title by a grantor who conveys with covenants of special warranty and quiet possession inures to the benefit of his grantee. Hurley v. Charles, 112 Va. 706 , 72 S.E. 689 , 1911 Va. LEXIS 140 (1911).

    CIRCUIT COURT OPINIONS

    Editor’s note. —

    The cases cited below were decided under prior law.

    Statute of limitations. —

    Property buyer’s action for breach of warranty of title under § 55-69 was not barred by the two year statute of limitations under subsection A of § 8.01-243 because the action accrued at the instigation of the neighboring owner’s lawsuit against the buyer’s title to property. Bear Ridge Developers, L.L.C. v. Cooper, 78 Va. Cir. 50, 2008 Va. Cir. LEXIS 182 (Fairfax County Dec. 2, 2008).

    Claims. —

    Because the claims against the parking spaces conveyed by a bank to the buyers by a special warranty deed, pursuant to § 55-69, were not made by persons claiming by, through, or under the bank, and because the buyer’s complaint only made out a cause of action for breach of warranty, not breach of contract, the bank’s demurrer was sustained with prejudice. Shehadeh v. Fountains at McLean Condo. Unit Owners Ass'n, 78 Va. Cir. 357, 2009 Va. Cir. LEXIS 30 (Fairfax County June 1, 2009).

    § 55.1-356. Words “with general warranty,” “with special warranty,” and “with English covenants of title” construed.

    The words “with general warranty” in the granting part of any deed shall be deemed to be a covenant by the grantor “that he will warrant generally the property hereby conveyed.” The words “with special warranty” in the granting part of any deed shall be deemed to be a covenant by the grantor “that he will warrant specially the property hereby conveyed.”

    The words “with English covenants of title” or words of similar import in the granting part of any deed shall be deemed to be an expression by the grantor of those covenants set out in §§ 55.1-359 through 55.1-362 , and in addition thereto the covenant that he is seized in fee simple of the property conveyed.

    History. Code 1919, § 5173; Code 1950, § 55-70; 1968, c. 257; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.

    Michie’s Jurisprudence.

    For related discussion, see 5A M.J. Covenants, §§ 21, 23, 24.

    CASE NOTES

  • Analysis
  • I.[Reserved.].
    II.Decided Under Prior Law.

    A grantor who executes a deed using the words “with general warranty” and “with English covenants of title” covenants that “he is seized in fee simple of the property conveyed”; that he had “the right to convey . . . the land, with all the buildings thereon”; that he had done “no act to encumber the said lands”; that he would execute such “further assurances” as may be required; and that the grantee would have “quiet possession of the said land . . . with all the buildings thereon.” Richmond v. Hall, 251 Va. 151 , 466 S.E.2d 103, 1996 Va. LEXIS 8 (1996).

    § 55.1-357. Implied warranties on new homes.

    1. As used in this section:“New dwelling” means a dwelling or house that has not previously been occupied for a period of more than 60 days by anyone other than the vendor or the vendee or that has not been occupied by the original vendor or subsequent vendor for a cumulative period of more than 12 months, excluding dwellings constructed solely for lease. “New dwelling” does not include a condominium or condominium units created pursuant to the Virginia Condominium Act (§ 55.1-1900 et seq.).“Structural defects” means a defect or defects that reduce the stability or safety of the structure below accepted standards or that restrict the normal use of the structure.
    2. In every contract for the sale of a new dwelling, the vendor shall be held to warrant to the vendee that, at the time of the transfer of record title or the vendee’s taking possession, whichever occurs first, the dwelling with all of its fixtures is, to the best of the actual knowledge of the vendor or his agents, sufficiently (i) free from structural defects, so as to pass without objection in the trade, and (ii) constructed in a workmanlike manner, so as to pass without objection in the trade.
    3. In addition, in every contract for the sale of a new dwelling, the vendor, if he is in the business of building or selling such dwellings, shall be held to warrant to the vendee that, at the time of transfer of record title or the vendee’s taking possession, whichever occurs first, the dwelling together with all of its fixtures is sufficiently (i) free from structural defects, so as to pass without objection in the trade; (ii) constructed in a workmanlike manner, so as to pass without objection in the trade; and (iii) fit for habitation.
    4. The warranties described in subsections B and C implied in the contract for sale shall be held to survive the transfer of title. Such warranties are in addition to, and not in lieu of, any other express or implied warranties pertaining to the dwelling or its materials or fixtures. A contract for sale may waive, modify, or exclude any or all express and implied warranties and sell a new home “as is” only if the words used to waive, modify, or exclude such warranties are conspicuous, as defined by subdivision (b)(10) of § 8.1A-201 , set forth on the face of such contract in capital letters that are at least two points larger than the other type in the contract and only if the words used to waive, modify, or exclude the warranties state with specificity the warranty or warranties that are being waived, modified, or excluded. If all warranties are waived or excluded, a contract shall specifically set forth in capital letters that are at least two points larger than the other type in the contract that the dwelling is being sold “as is.”
    5. If there is a breach of warranty under this section, the vendee, or his heirs or personal representatives in case of his death, shall have a cause of action against his vendor for damages, provided, however, for any defect discovered after July 1, 2002, such vendee shall first provide the vendor, by certified mail at his last known address, or by commercial overnight delivery service or the United States Postal Service, and a receipt obtained, a written notice stating the nature of the warranty claim. Such notice also may be hand delivered to the vendor with the vendee retaining a receipt of such hand-delivered notice to the vendor or its authorized agent. After such notice, the vendor shall have a reasonable period of time, not to exceed six months, to cure the defect that is the subject of the warranty claim.
    6. The warranty shall extend for a period of one year from the date of transfer of record title or the vendee’s taking possession, whichever occurs first, except that the warranty pursuant to clause (i) of subsection C for the foundation of new dwellings shall extend for a period of five years from the date of transfer of record title or the vendee’s taking possession, whichever occurs first. Any action for its breach shall be brought within two years after the breach thereof. For all warranty claims arising on or after January 1, 2009, sending the notice required by subsection E shall toll the limitations period for six months.
    7. In the case of new dwellings where fire-retardant treated plywood sheathing or other roof sheathing materials are used in lieu of fire-retardant treated plywood, the vendor shall be deemed to have assigned the manufacturer’s warranty, at settlement, to the vendee. The vendee shall have a direct cause of action against the manufacturer of such roof sheathing for any breach of such warranty. To the extent any such manufacturer’s warranty purports to limit the right of third parties or prohibit assignment, such provision shall be unenforceable and of no effect.

    History. 1979, c. 282, § 55-70.1; 1988, c. 394; 1992, c. 431; 1994, cc. 483, 766; 2002, c. 795; 2003, c. 353; 2008, c. 392; 2011, c. 803; 2019, c. 712.

    Effective date.

    This section is effective October 1, 2019.