Demurrer not proper to allege missing party

Where defendant demurred to plaintiff’s contract claim on the basis that plaintiff did not name a necessary party, the demurrer is overruled. A demurrer tests the legal sufficiency of factual claims. A motion for joinder is the “proper” vehicle to add a necessary party.

Overview

Defendant and his now ex-wife contracted with plaintiff, Loudoun Country Day School, to pay for tuition and other services for their two children. After an initial deposit was paid, no further payments were made. LCDS alleges defendant owes more than $56,500 in unpaid services and fees.

When defendant and his wife divorced, the debt to LCDS became defendant’s sole responsibility under the divorce decree. LCSD sued defendant to collect the debt, alleging breach of contract or, in the alternative for unjust enrichment and quatum meruit.

Defendant demurred, arguing that his ex-wife is a necessary party to this case.

Necessary party

“Defendant asserts that the Complaint lacks a necessary party in the form of Laura Ridenour, Defendant’s ex-wife, who was a party to the original contract with LCDS. In opposition, LCDS argues that Ms. Ridenour is not a necessary party because another order of this court, the divorce decree, assigns this debt to Defendant.

“‘All persons interested in the subject matter of a suit and to be affected by its results are necessary parties.’ Siska Trust v. Milestone Dev., 282 Va. 169, 173 (2011). They are parties ‘whose interests in the subject matter of the suit, and the relief sought, are so bound up with that of the other parties, that their legal presence as parties to the proceeding is an absolute necessity, without which the court cannot proceed.’ …

“However, this is not cause for dismissal of the case. In the Siska case, the Virginia Supreme Court noted that the available relief is to remand  the case back  to the trial  court  for further  proceedings so that the missing party may be added, not a dismissal of the action. … Further, Virginia Code  §  8.02-5(A)  provides that ‘no action or suit shall abate or be defeated by the nonjoinder or misjoinder  of parties, plaintiff or defendant, but … new parties may be added … by order of the court at any time as the ends of justice may require.. Rule 3:12 of the Rules of the Supreme Court of Virginia similarly allows for joinder of additional parties by motion.

“The province of a demurrer is to test the legal sufficiency of the factual allegations. The Rules of the Virginia Supreme Court make clear that the proper procedure when a necessary party is absent is to allow joinder of the party by motion. Further, the Virginia Supreme Court has held that the alleged nonjoinder of parties is not a proper ground for dismissal. … The court finds that a demurrer is not the proper vehicle for alleging a failure to join necessary parties, and the demurrer is overruled as to this argument. The Court notes that nothing in this ruling prohibits either party from filing a motion to add Ms. Ridenour to these proceedings.”

Alternate claim

“Defendant contends that LCDS has pleaded a theory of recovery under the terms of an express contract, so cannot be permitted to move forward on the alternative theory of unjust enrichment. However, in both his Answer and Demurrer, Defendant denies that he agreed to the terms of the re-enrollment contract. By doing so, Defendant has brought into question the validity of the contract, which opens the door to a claim for unjust enrichment [.] …  James G. Davis Constr. Corp. v. FTJ, Inc., 841 S.E. 2d 642, 648 (Va. 2020).”

Further, a federal court has recognized that “‘under Virginia … law, a plaintiff is permitted to plead equitable theories of relief such as unjust enrichment and quantum meruit as alternatives to contract recovery.’ …

“If, as Defendant asserts, the re-enrollment contract is unenforceable, then LCDS is able to assert a claim for unjust enrichment in order to recover its damages. Accordingly, the demurrer as to these claims is overruled.”

Loudoun Country Day School v. Ridenour, Case No. CL20-3961, Jan. 5, 2021, 20th Cir. Ct. (Irby). Loughran Potter, Grant Nelson for the parties. VLW 021-8-006, 4 pp.