Gebrezgi Kahsai, d/b/a Soli Trucking v. FAM Construction, LLC

COURT OF APPEALS OF VIRGINIA Record No. 1710-25-4 GEBREZGI KAHSAI, d/b/a SOLI TRUCKING v. FAM CONSTRUCTION, LLC, ET AL. Present: Judges O’Brien, Friedman and Frucci Argued by videoconference Opinion Issued November 10, 2026* FROM THE CIRCUIT COURT OF FAIRFAX COUNTY Michael F. Devine, Judge Michael Hadeed Jr. (Hadeed Law Group, P.C., on briefs), for appellant. Jesse S. Keene (Cozen O’Connor PC, on brief), for appellees. MEMORANDUM OPINION BY JUDGE STEVEN C. FRUCCI After a dispute arose over payments for work done to expand I-66 west of the I-495 Capital Beltway, the circuit court granted the pleas in bar of FAM Construction, LLC (“FAM”) and Zurich American Insurance Company (“Zurich”) that argued Gebrezgi Kahsai, d/b/a Soli Trucking (“Soli Trucking”) had waived its right to the disputed payments. On appeal, Soli Trucking contends that its execution of partial lien waivers did not bar its final payment, so the circuit court erred in granting the pleas in bar. It argues that the circuit court misconstrued the waiver forms and should have applied equitable principles to preserve lien rights. For the following reasons, we affirm the circuit court’s judgment. * This opinion is not designated for publication. See Code § 17.1-413(A).  BACKGROUND1 FAM was the design-builder for the Transform 66 Outside the Beltway Project (the “project”), which significantly expanded I-66 west of the I-495 Capital Beltway.2 In conjunction with the project, FAM secured payment bonds for the benefit of its subcontractors and suppliers. Zurich was “the lead co-surety on the payment bond for the project.” In July 2018, FAM subcontracted with Soli Trucking for trucking services on the project (the “subcontract”). The subcontract acknowledged “indefinite quantities” of required trucking services. It priced services based on unit prices, multiplied by the number of hours per truck.3 At the end of each month Soli Trucking provided FAM with a list of tickets containing truck start times, end times, number of hours, and signatures. Then FAM “validate[d] or reject[ed]” the tickets and informed Soli Trucking.4 FAM did not withhold any retention from Soli Trucking during the project. The subcontract’s Article 9 governed payment on the project. It authorized monthly applications for payment covering undisputed work from the preceding month.5 As a condition of applying for payment, the subcontract required Soli Trucking to submit “[w]aiver and release forms, acceptable to [FAM].” The subcontract attached four acceptable forms as Attachments 1 We review the evidence in the light most favorable to the prevailing party at trial. Exxon Mobil Corp. v. Minton, 285 Va. 115, 127 (2013). 2 The project was massive, and FAM used approximately 200 subcontractors. 3 Specified unit prices were “in effect until December 31, 2022.” 4 For tickets that FAM determined were invalid, FAM informed Soli Trucking, which could then submit additional information. 5 Section 9.3 of the subcontract provides: “Between the 20th and 25th calendar day of each month, Trucker will furnish Contractor an Application for Payment for undisputed Work performed between the 16th of the previous month and the 15th of the current month, meeting the requirements in this Article 9 (Payment).” -2- D-G, two of which referenced progress payments and two of which referenced final payment. The subcontract deemed the attachments to be “Agreement Documents.” Attachment D—Conditional Waiver and Release on Progress Payment—provides that after payment, this document becomes effective to release: any (1) lien right by virtue of law, (2) state or federal statutory payment bond right, (3) common law payment bond right, (4) private bond right, (5) claims or demand for payment, and (6) other rights under equity or any ordinance, rule, or statute related to claim or payment rights for persons in the signer’s position that the signer has with respect to FAM Construction, LLC, I-66 Express Mobility Partners LLC, the Virginia Department of Transportation and/or the Transform 66 P3 Project . . . . The scope of the waiver covered “the attached statement(s) or progress payment request(s) and all labor, services, equipment, or materials furnished to the property or [t]o [FAM] through the end of the pay period indicated in the attached statement(s) or progress payment(s), except for unpaid retention, pending change orders for which written notice has been timely given to Contractor prior to the invoice date,” or future work.6 (Emphasis added). Attachment E—Unconditional Waiver and Release on Progress Payment—substantially mirrored Attachment D, with a few differences. First, it represented that Soli Trucking already had received the requested payment. Second, it contained a caption at the top stating: “This document waives rights unconditionally and states that you have been paid for giving up those rights.” Third, it excepted from coverage “pending modifications and changes,” as opposed to Attachment D’s “pending change orders for which written notice” had been given language. 6 Under the subcontract, “Change” means “a change (including additions, deletions or other revisions) in the Work, Agreement Price or Schedule.” “Change Order” meant “an agreement in writing (using Attachment A (Change Order (CO)) entered into after the execution of this Agreement and pursuant to the Agreement Documents, signed by Contractor and Trucker, authorizing and approving a Change.” Change orders could be requested if the unit prices had changed, such as to accommodate higher fuel prices. -3-  Attachment F—Conditional Waiver and Release on Final Payment—and Attachment G— Unconditional Waiver and Release on Final Payment—both referenced final payment. These final waivers contained substantially the same waiver language as Attachments D and E, except they did not contain the carveouts for retainage, pending change orders, or future work. The final waivers covered “all labor, services, equipment, or materials furnished to the property or to FAM.” In October 2023, FAM requested that Soli Trucking sign a final lien waiver—Attachment G. Soli Trucking declined to sign a final lien waiver (Attachments F or G) because FAM had not paid certain submitted and disputed tickets. Before October 2023, Soli Trucking had submitted tickets and payment requests for roughly $400,000 in disputed tickets. In October 2023, Soli Trucking sent FAM a summary of unpaid tickets, including detailed information and amounts totaling $396,178.20. The list identified unpaid tickets in categories including “price different,” “toll violation,” and “overweight.” By November 2023, Soli Trucking had finished working on the project. In January 2024, Soli Trucking submitted two additional undisputed pay applications. The two new requests were: (1) No. S3-RR0B-1023 (“Pay App. 1023”); and (2) No. S3-RR0B-1123 (“Pay App. 1123”). Pay App. 1023 requested $3,269 for work performed between September 16, 2023, and October 15, 2023. Pay App. 1123 requested $616 for a single day of work performed during the period October 16, 2023, and November 2, 2023—the last day of Soli Trucking’s work. Attached to both pay applications, Soli Trucking submitted signed waivers on Attachment D and E forms. When Soli Trucking executed the waivers associated with Pay Apps. 1023 and 1123, it knew it had more claims for roughly an additional $400,000. But it signed the Attachment D and E forms because they were conditions precedent to payment. In April 2024, FAM paid $3,885, the sum of Pay Apps. 1023 and 1123, and Soli Trucking cashed FAM’s check. FAM understood then that this was the last payment to Soli Trucking. -4-  In July 2024, Soli Trucking sued FAM for an additional $401,571.28 for claimed work and costs predating October 2023, including for “rate adjustment” charges. FAM and Zurich responded by filing pleas in bar, based on the waivers. Soli Trucking opposed the pleas in bar, arguing that (1) it had not executed a final waiver of payment rights; (2) partial waivers did not extinguish remaining claims; (3) FAM’s practice of paying old invoices constituted a waiver of its contractual rights; and (4) equity favored preserving lien rights. Soli Trucking identified one example of where FAM paid invoice amounts despite a signed waiver. Soli Trucking also argued that the waivers contained “conflicting language.” At a hearing on the pleas in bar, each party presented one witness. Soli Trucking’s witness testified that he knew before October 2023 that there were about $400,000 in additional claims, but he signed the conditional releases (Attachments D and E) believing he would not have been paid for those applications otherwise. He thought that Attachments D and E pertained only to the progress payments checks. Soli Trucking introduced emails showing that it had requested payment for the additional invoices, and it attached a summary chart identifying previously-invoiced categories including “price different,” “overweight status,” and “toll violations.”7 Soli Trucking’s witness testified that, when asked to validate tickets that FAM deemed invalid, he gave “more evidence” including “the email coming from [FAM’s] employee and the ticket of copy that was signed with [FAM’s] employee.” He claimed that FAM promised to pay. He testified that FAM a “lot of time[s]” paid past invoices despite signed “progress payment waivers.” FAM’s witness testified that, given the large number of tickets, it was possible that FAM paid some tickets 7 Soli Trucking did not introduce any change-order forms. -5- that otherwise would have been covered by a previous payment application and waiver. But FAM did not intend to waive any contractual rights.8 After considering all evidence, the circuit court sustained the pleas in bar. The circuit court found that the plain language of the waivers meant that Soli Trucking waived “any claims or demands for payment for all labor, services, equipment, [and] material furnished to FAM [C]onstruction through the end of the pay period indicated in the attached statements.” This waiver was enforceable “because there’s no dispute that he submitted pay requests and was paid and negotiated the check that he received after work had been done.” The circuit court found no clear and convincing evidence that FAM intended to relinquish its right to Soli Trucking’s signed waivers, despite acknowledging that FAM paid certain disputed invoices after receiving signed waivers. Soli Trucking appeals. ANALYSIS “A plea in bar asserts a single issue, which, if proved, creates a bar to a plaintiff’s recovery.” Cornell v. Benedict, 301 Va. 342, 349 (2022) (quoting Massenburg v. City of Petersburg, 298 Va. 212, 216 (2019)). “The movant bears the burden of proof on such a plea, and if evidence is presented ore tenus, the circuit court’s factual findings ‘are accorded the weight of a jury finding and will not be disturbed on appeal unless they are plainly wrong or without evidentiary support.’” Id. (quoting Massenburg, 298 Va. at 216). “When the plea in bar depends on pure legal questions, including questions of statutory construction, we review the circuit court’s holding de novo.” Id. 8 Section 14.6 of the subcontract provided that the “failure of either Party to insist, in any one or more instances, upon the performance of any of the terms, covenants or conditions of this Agreement, or to exercise any right herein, is not a waiver of the term, covenant or right as to further performance.” -6-  “Interpretation of a contract is a question of law that is reviewed de novo.” Palmer & Palmer Co., LLC v. Waterfront Marine Constr., Inc., 276 Va. 285, 289 (2008). “When a contract is clear and unambiguous, it is the court’s duty to interpret the contract, as written.” Id. The “guiding light” in interpreting a contract “is the intention of the parties as expressed by them in the words they have used, and courts are bound to say that the parties intended what the written instrument plainly declares.” Id. Courts “will not rewrite contracts; parties to a contract will be held to the terms upon which they agreed.” City of Chesapeake v. Dominion SecurityPlus Self Storage, L.L.C., 291 Va. 327, 335 (2016) (quoting Dewberry & Davis, Inc. v. C3NS, Inc., 284 Va. 485, 496 (2012)). Like the terms of any contract, “the scope and meaning of a release agreement ordinarily is governed by the intention of the parties as expressed in the document they have executed.” Berczek v. Erie Ins. Grp., 259 Va. 795, 799 (2000). “No word or clause in the contract will be treated as meaningless if a reasonable meaning can be given to it, and there is a presumption that the parties have not used words needlessly.” D.C. McClain, Inc. v. Arlington County, 249 Va. 131, 135-36 (1995). Contractual “ambiguity exists when language is of doubtful import, admits of being understood in more than one way, admits of two or more meanings, or refers to two or more things at the same time.”9 Cascades N. Venture Ltd. P’ship v. PRC Inc., 249 Va. 574, 579 (1995) (citation omitted). If there is ambiguity, “the acts of the parties in relation to a contract establish a practical construction of it,” and this construction “‘is entitled to great weight in determining its proper interpretation.’” Robinson-Huntley v. George Wash. Carver Mut. Homes 9 Doubt “about a provision in a contract is to be resolved against the person for whose benefit the language was intended.” McMerit Constr. Co. v. Knightsbridge Dev. Co., 235 Va. 368, 374 (1988). -7- Ass’n, 287 Va. 425, 431 (2014) (quoting Coal Operators Cas. Co. v. C.L. Smith & Son Coal Co., 192 Va. 619, 626 (1951)). I. Soli Trucking signed enforceable waivers. Here, the subcontract attached four pre-approved waiver forms as “Agreement Documents”: Attachment D (Conditional Waiver and Release on Progress Payment); Attachment E (Unconditional Waiver and Release on Progress Payment); Attachment F (Conditional Waiver and Release on Final Payment); and Attachment G (Unconditional Waiver and Release on Final Payment). The subcontract required Soli Trucking to submit waiver forms with each application for payment after performing the work. Soli Trucking signed Attachments D and E after working, but it refused to sign Attachments F and G, citing outstanding disputed invoices. Looking at each of the waivers’ meaning and scope, Attachment D was a “[c]onditional [w]aiver and [r]elease on [p]rogress [p]ayment” that covered: the attached statement(s) or progress payment request(s) and all labor, services, equipment, or materials furnished to the property or To FAM Construction, LLC (. . . ) through the end of the pay period indicated in the attached statement(s) or progress payment request(s), except for unpaid retention, pending change orders for which written notice has been timely given to the Contractor prior to the invoice date, or other items furnished after end of the pay period indicated in the attached statement(s) of progress payment request(s). Attachment E, titled “Unconditional Waiver and Release on Progress Payment,” covered: the attached statement(s) or progress payment request(s) and all labor, services, equipment, or materials furnished to the property or to FAM Construction, LLC (. . . ) through the end of the pay period indicated in the attached statement(s) or progress payment request(s), except for unpaid retention, pending modifications and changes, or other items -8-  furnished after the end of the pay period indicated in the attached statement(s) or progress payment request(s). The subcontract also included two additional final waivers. Soli Trucking contends that the subcontract’s inclusion of final waivers reflected a mutual understanding that final waiver of payment rights would occur only upon execution of the final waivers. It argues that the circuit court erred by concluding that a progress payment lien waiver operated as a final payment lien waiver. According to Soli Trucking, the circuit court erroneously treated the final payment waiver as serving no purpose, violating contract-interpretation principles. It also found “conflicting language” within the waivers and recounted a course of dealings whereby FAM paid certain old invoices despite signed waivers. The express language of Attachments D and E provides that Soli Trucking waived claims on “all labor, services, equipment, or materials furnished to the property” up to a specified date, except for the waivers’ carve-outs.10 Like the circuit court found, this language is clear. The language does not become ambiguous just because Soli Trucking disputes the meaning. See Erie Ins. Exch. v. Jones, 301 Va. 61, 66 (2022). Considering that the language is clear and unambiguous, the release agreement is controlling. Berczek, 259 Va. at 799; Richfood, Inc. v. Jennings, 255 Va. 588, 591 (1998). Soli Trucking contends that its execution of partial lien waivers should not have barred it from final payment rights. But it does not reconcile this argument with the express language of Attachments D and E, which do not say “partial lien waivers.” Unlike some waivers in the construction industry, Attachments D and E were not expressly limited to the extent of payment. Rather, they covered “all” work up to a specified date, with a few exceptions. This express 10 Attachment D carved out retention, future work, and “pending change orders for which written notice has been timely given to the Contractor prior to the invoice date.” Attachment E excluded retention, future work, and “pending modifications and changes.” -9- meaning does not render Attachments F and G meaningless because final payment waivers still would apply to amounts from unreleased periods or amounts carved out by Attachments D and E, if any. Soli Trucking also argues that the waivers should not be enforced for equitable reasons. But it cites no controlling authority on point. And although Code § 11-4.1:1 suggests a public policy favoring protecting subcontractor payments, Soli Trucking cites no controlling precedent suggesting that subcontractors may not sign waivers after performing the work.11 Rather, once work is complete, lien rights generally may be expressly waived. First Am. Bank v. J.S.C. Concrete Constr. Inc., 259 Va. 60, 68 (2000); McMerit Constr. Co. v. Knightsbridge Dev. Co., 235 Va. 368, 374 (1988); VNB Mortg. Corp. v. Lone Star Indus., Inc., 215 Va. 366, 371-72 (1974); Code § 11-4.1:1. Finally, Soli Trucking contends that the waivers excluded payments for change orders that it requested, while FAM argues that Soli Trucking never preserved this contention. The waivers’ express language excluded “pending change orders for which written notice has been timely given to the Contractor prior to the invoice date” and “pending modifications and 11 We note that, under Code § 11-4.1:1, a subcontractor “may not waive or diminish his right to assert payment bond claims or his right to assert claims for demonstrated additional costs in a contract in advance of furnishing any labor, services, or materials.” A “provision that waives or diminishes a subcontractor’s, lower-tier subcontractor’s, or material supplier’s right to assert payment bond claims or his right to assert claims for demonstrated additional costs in a contract executed prior to providing any labor, services, or materials is null and void.” Id. Here, the subcontract required Soli Trucking to submit waiver forms with each application for payment, after performing the work. Soli Trucking signed Attachments D and E after working, but it refused to sign Attachments F and G, citing outstanding disputed invoices. Soli Trucking did not argue that Code § 11-4.1:1 precluded enforcement before the circuit court, nor does it do so now. Considering that Soli Trucking signed waivers after performing work, it did not sign them “in advance of furnishing any labor, services, or materials.” Code § 11-4.1:1. But as Soli Trucking does not present the argument, this Court will not consider whether the subcontract’s requirement that Soli Trucking submit Attachments D and E with all pay applications, regardless of disputed amounts, violated Code § 11-4.1:1. See Rule 5A:18 (requiring timely objections for argument preservation). - 10 - changes.” However, Soli Trucking introduced no change-order forms nor other evidence that it timely identified unpaid amounts in line with the requirements of the subcontract. As such, Soli Trucking’s argument that the waivers excluded at least certain disputed amounts relating to modifications and changes is not preserved.12 II. No clear and convincing evidence suggested FAM’s waiver of contract rights or modification of terms. Waiver “is an intentional relinquishment of a known right.” Orthopaedic & Spine Ctr. v. Muller Martini Mfg. Corp., 61 Va. App. 482, 492 (2013). This Court may decline to enforce otherwise clear and unambiguous terms if a party waives its right to enforce express terms through its conduct. Stockbridge v. Gemini Air Cargo, Inc., 269 Va. 609, 620 (2005). When “one party claims that the other party has surrendered a right guaranteed by the contract, the party asserting such modification must prove either passage of valuable consideration, estoppel in pais, or waiver of the right.” Cardinal Dev. Co. v. Stanley Constr. Co., 255 Va. 300, 305 (1998). It must do so by clear and convincing evidence. Baumann v. Capozio, 269 Va. 356, 361 (2005). A “course of dealing by contracting parties, considered in light of all the circumstances, may evince mutual intent to modify the terms in their contract.” Gov’t Emps. Ins. Co. v. Hall, 260 Va. 349, 356 (2000). But such a mutual intention must be shown by “clear, unequivocal, and convincing evidence, direct or implied.” Reid v. Boyle, 259 Va. 356, 370 (2000). Here, the record does not show clear and convincing evidence that FAM waived its right to rely on the releases or modified the subcontract by paying certain invoices despite operative releases. Soli Trucking’s witness testified that FAM paid many invoices covered by releases. But other than attaching an example to its opposition brief, Soli Trucking did not back up its testimony with evidence of the number or frequency of those payments. And FAM’s witness testified that it 12 We deny the pending motion to strike the reply brief or dismiss the appeal, finding the reply arguments to be sufficiently preserved and responsive to FAM’s opposition brief. - 11 - may have sometimes paid such invoices, but he identified no common practice. FAM’s witness also testified that it never intended to relinquish its contractual rights, and Section 14.6 of the subcontract allowed FAM to refrain from exercising a right without waiving it. Overall, viewing the evidence most favorable to the prevailing party at trial, we cannot say that the circuit court erred in finding no clear and convincing evidence that the course of conduct waived or modified the effectiveness of the releases. CONCLUSION For the reasons stated above, this Court affirms the circuit court’s judgment. Affirmed. - 12 -