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MASSIE, ET AL. v. BLUE CROSS AND BLUE SHIELD OF VIRGINIA


MASSIE, ET AL. v. BLUE
CROSS AND BLUE SHIELD OF VIRGINIA


June 5, 1998

Record No. 971835

LARRY MASSIE, ET AL.

v.

BLUE CROSS AND BLUE SHIELD OF VIRGINIA

OPINION BY JUSTICE CYNTHIA D. KINSER

FROM THE CIRCUIT COURT OF RUSSELL COUNTY

Donald A. McGlothlin, Jr., Judge

Present: All the Justices


In this appeal, we decide whether the tolling provision in
Code Sec.8.01-229(E)(3), which allows a plaintiff to
recommence a cause of action within six months of the date of an
order of nonsuit or within the original period of limitation,
whichever is longer, applies to a limitation period fixed by
contract rather than by statute. Because we conclude that the
tolling provision applies only to a statute of limitations, we
will affirm the judgment of the circuit court.

I.

The pertinent facts are not disputed. Larry Massie and Sondra
Massie (the Massies), as employees of the Russell County School
System, are subscribers to a group health and hospitalization
insurance contract (the Contract) issued by Blue Cross and Blue
Shield of Virginia (Blue Cross). Sondra underwent oral surgery on
May 10, 1989. Following the surgery, Blue Cross paid only a
portion of Sondra’s medical bills.

On February 12, 1991, the Massies filed a warrant in debt in
the General District Court of Russell County against Blue Cross
seeking recovery of the remaining amount allegedly owed on
Sondra’s medical bills. Upon application by Blue Cross, the
action was removed to the circuit court. On February 21, 1992,
the circuit court granted the Massies’ motion for a nonsuit
and dismissed the action without prejudice.

The Massies recommenced their action by filing a motion for
judgment on August 14, 1992 in the circuit court. In response,
Blue Cross filed a special plea in bar arguing that the
twelve-month limitation period contained in the Contract bars the
action. That contractual provision provides the following
regarding the period of limitations:

I. LIMITATION OF ACTIONS

No action at law or suit in equity may be brought
against the Plan more than twelve (12) months after the
date on which the cause of action accrued with respect to
any matter relating to:

this Contract;

the Plan’s performance under this Contract;
or

any statement made by employees, officers, or
directors of the Plan concerning the Contract or the
benefits available to a Member. [1]

After considering the parties’ respective arguments and
memoranda, the circuit court held that the twelve-month
contractual limitation bars the instant action. In a letter
opinion, the court stated the following reasons for its decision:

The parties to this suit have agreed that no action at
law may be brought against [Blue Cross] more than 12
months after the date on which the cause of action
accrued with respect to any matter relating to the
contract between them. For this Court to superimpose upon
that very plain statement of the parties’ agreement,
the statutory exemption in cases of nonsuit would be to
eviscerate the contractual provision. Moreover, Virginia
Code Sec.8.01-229(E)(3), by its own terms, operates
only to toll the applicable statute of limitations
and not to [toll] limitation periods established by
contract.

 

On June 4, 1997, the court issued an order sustaining Blue
Cross’ special plea in bar and dismissing the present action
with prejudice. The Massies appeal.

II.

In Virginia, parties to a contract may agree that any action
to enforce the contract must be filed within a shorter period of
time than that established by an otherwise applicable statute of
limitations. Board of Supervisors of Fairfax County v. Sampson,
235 Va. 516, 520, 369 S.E.2d 178, 180 (1988). A contractual
period of limitations must not be unreasonably short, id.,
and in an insurance contract, the period of limitations cannot be
"less than one year after the loss occurs or the cause of
action accrues." Code Sec.38.2-314.

The Massies do not challenge the validity of the twelve-month
limitation period in the Contract. [2] Nor do they assert that they
filed the present action within the twelve-month period after
their cause of action accrued. Rather, the Massies contend that
they timely filed the present action because they recommenced
their suit within six months after entry of the nonsuit order on
February 21, 1992. They assert that, even though they are bound
by the twelve-month limitation period in the Contract, they are
entitled to the benefit of the tolling provision in Code
Sec.8.01-229(E)(3). In other words, the Massies argue that
the filing of the first suit in general district court tolled the
twelve-month contractual limitation period, and that, following
the nonsuit of the first action, they had six months within which
to refile their action.

The Massies premise their argument on the current version of
Code Sec.8.01-229(E)(3). This section states the following:

If a plaintiff suffers a voluntary nonsuit as
prescribed in Sec.8.01-380, the statute of
limitations with respect to such action shall be tolled
by the commencement of the nonsuited action, and the
plaintiff may recommence his action within six months
from the date of the order entered by the court, or
within the original period of limitation, or within the
limitation period as provided by subdivision B 1,
whichever period is longer. This tolling provision shall
apply irrespective of whether the action is originally
filed in a federal or a state court and recommenced in
any other court, and shall apply to all actions
irrespective of whether they arise under common law or
statute.

 

The Massies specifically argue that the last phrase,
"shall apply to all actions irrespective of whether they
arise under common law or statute," means that the six-month
tolling provision applies to all cases that are nonsuited,
including the present one. However, Blue Cross argues that the
prior version of Code Sec.8.01-229(E)(3), which is identical
to the current version except that it does not contain the last
phrase, governs the disposition of this case because the
Massies’ cause of action accrued before the 1991 amendment
adding that phrase went into effect.

We do not need to decide which version of Code
Sec.8.01-229(E)(3) applies in this case because the operative
language, "the statute of limitations with respect to
such action shall be tolled by the commencement of the nonsuited
action," has not changed. (Emphasis added). The plain
meaning of this phrase is that, after a voluntary nonsuit, the statute
of limitations, not a contractual period of limitations,
is tolled, and the plaintiff may recommence the suit within six
months or within the original period of limitations, whichever is
longer. "[W]hen a statute is clear and unambiguous, a court
must accept its plain meaning and not resort to rules of
construction or extrinsic evidence." Wall v. Fairfax
County School Bd.
, 252 Va. 156, 159, 475 S.E.2d 803, 805
(1996). Thus, we conclude that Code Sec.8.01-229(E)(3) does
not apply to a contractual period of limitations and that the
instant action is, therefore, time-barred. See Riddlesbarger
v. Hartford Ins. Co.
, 74 U.S. 386, 391 (1868); Chichester
v. New Hampshire Fire Ins. Co.
, 51 A. 545, 547 (Conn. 1902); Davenport
v. Gulf Life Ins. Co.
, 50 S.E.2d 134, 135 (Ga. Ct. App.
1948); Lewis v. Metro. Life Ins. Co., 62 N.E. 369 (Mass.
1902); Howard Ins. Co. v. Hocking, 18 A. 614, 615 (Pa.
1889).

Our decisions in Ward v. Ins. Co. of N. Am., 253 Va.
232, 482 S.E.2d 795 (1997), and Clark v. Butler
Aviation—Washington Nat’l, Inc.
, 238 Va. 506, 385
S.E.2d 847, (1989), cited by the Massies, do not compel a
different result. While both of those cases involved the tolling
provision in Code Sec.8.01-229(E)(3), neither case dealt with
a contractual period of limitations. Thus, those decisions have
no relevance to the present case.

Finally, the Contract itself did not include a provision
tolling the twelve-month limitation period after a nonsuit or
incorporate the six-month tolling provision contained in Code
Sec.8.01-229(E)(3). "A court must give effect to the
intention of the parties as expressed in the language of their
contract, and the rights of the parties must be determined
accordingly." Foti v. Cook, 220 Va. 800, 805, 263
S.E.2d 430, 433 (1980). By agreeing to a period of limitations
different from the statutory period, the parties chose to exclude
the operation of the statute of limitations and, in doing so,
also excluded its exceptions. [3]

For these reasons, we will affirm the judgment of the circuit
court.

Affirmed.

 

FOOTNOTES:

[1] The Contract defines
"Plan" as Blue Cross and "Member" as
"the Subscriber, and if Family Coverage is in force, the
Subscriber’s Dependents . . . ."

[2] If the Contract did not contain
a period of limitations, the five-year statute of limitations for
written contracts under Code Sec.8.01-246(2) would be
applicable.

[3] Neither party advanced any
argument regarding the applicability of the general tolling
provision of Code Sec.8.01-229(E)(1) to the present case, and
hence we express no opinion on the matter.

 

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