Contract – Statute Of Frauds – Equitable Estoppel

On remand from the 4th Circuit, a Richmond U.S. District Court says defendants, a medical practice and a hospital, are not equitably estopped from asserting the statute of frauds against plaintiff’s breach of contract claim, because plaintiff knew he had submitted an improper credentialing application and he cannot claim reasonable reliance.

According to a remand order by the 4th Circuit, the sole issue on remand was a determination of whether defendants should be equitably estopped from asserting the statute of frauds as a defense to defendant’s breach of contract claim.

As noted in the 2009 magistrate report and recommendation, to prevail under equitable estoppel in Virginia, plaintiff must establish the elements of equitable estoppel based on his post-March 28, 2007 conduct, that is, whether he reasonably relied on defendants’ March 28, 2007, assurances that the terms of his employment were agreed upon. However, as the 2009 report finds, plaintiff fails to establish that his reliance on defendants’ March 28, 2007 representation was reasonable. For the same reasons the court found applicable as to the fraud claim, plaintiff could not reasonably have believed that the parties had an agreement knowing that he had made material misrepresentations or omissions on a Credentialing Application that defendants had not yet reviewed, where such misrepresentations or omissions would give defendants cause to terminate negotiations and/or any agreement.

The record, as well as the law of the case doctrine, correctly establishes plaintiff’s multiple misrepresentations and omissions in his Credentialing Application. Plaintiff knew he had submitted an improper Credentialing Application, and he cannot claim reasonable reliance. The 2009 report correctly applies Virginia law, finds that plaintiff cannot establish reasonable reliance and finds he is thus barred from asserting equitable estoppel as a defense to the statute of frauds.

The 2009 report is adopted and the court grants the motion to dismiss this claim.

Gitter v. Cardiac & Thoracic Surgical Associates Ltd. (Williams, J.) No. 3:07cv546, Feb. 19, 2010; USDC at Richmond, Va. VLW 010-3-081, 5 pp.