Lewisburg Way, LLC v. Indus. Dev. Auth. of Town of Front Royal and the Cnty. of Warren, Va., etc.
CourtCourt of Appeals of Virginia
Date FiledNovember 10, 2026
Docket1704254
StatusPublished
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Full Opinion
COURT OF APPEALS OF VIRGINIA
Record No. 1704-25-4
LEWISBURG WAY, LLC
v.
INDUSTRIAL DEVELOPMENT AUTHORITY OF THE TOWN OF FRONT ROYAL AND
THE COUNTY OF WARREN, VIRGINIA, A/K/A ECONOMIC DEVELOPMENT
AUTHORITY OF THE TOWN OF FRONT ROYAL AND THE COUNTY OF WARREN,
VIRGINIA
Present: Judges O’Brien, Friedman and Frucci
Argued at Fredericksburg, Virginia
Opinion Issued November 10, 2026
FROM THE CIRCUIT COURT OF WARREN COUNTY
Daryl L. Funk, Judge
Federico J. Zablah (J. Chapman Petersen; Dylan M. Phillips; David C. Jones, Jr.; Chap Petersen
& Associates, PLC, on briefs), for appellant.
Cullen D. Seltzer (L. Lee Byrd; Karissa T. Kaseorg; Sands Anderson PC, on brief), for appellee.
PUBLISHED OPINION BY
JUDGE FRANK K. FRIEDMAN
This appeal addresses something of a procedural head-scratcher: whether a ruling about
the alleged voidness of an order can carry preclusive effect even if the original, challenged order
was void ab initio.
A jury found Truc “Curt” Tran and ITFederal, LLC (“ITFederal”) liable for various
offenses against the Industrial Development Authority of the Town of Front Royal and the
County of Warren, Virginia a/k/a Economic Development Authority of the Town of Front Royal
and the County of Warren, Virginia (“EDA”). Afterwards, the trial court issued an order
directing Tran and ITFederal to convey to the EDA their “rights, title and interest” in a specific
property. There was just one problem with that: neither Tran nor ITFederal owned the property.
Rather, it was owned by Lewisburg Way, LLC (“Lewisburg Way”), a limited liability company
of which Tran is the sole member.
After Tran argued (unsuccessfully) that the conveyance order was void ab initio,
Lewisburg Way launched a collateral attack against the EDA, arguing the same thing. The EDA
filed a demurrer in which it argued that the order was merely voidable, not void ab initio, and a
plea in bar in which it argued that Lewisburg Way’s lawsuit was barred by res judicata. The
circuit court sustained the EDA’s demurrer, granted its plea in bar, and dismissed the matter with
prejudice. We now review that decision.
BACKGROUND
The appellant, Lewisburg Way, is a Virginia limited liability company. Truc Tran is the
sole member of Lewisburg Way. Lewisburg Way previously owned a property at 934 Happy
Creek Road in Front Royal (the “Happy Creek Property”).
Tran and ITFederal were among the defendants in a prior lawsuit brought by the EDA.
At the conclusion of that trial, the jury found Tran and ITFederal liable for ultra vires actions,
conversion, unjust enrichment, and (as to ITFederal only) breach of contract.1 The jury awarded
the EDA compensatory damages against Tran in the amount of $1,499,986 and against ITFederal
in the amount of $10,419,327.38.2
Approximately one year later, the EDA proceeded with post-judgment collection by
issuing summonses to answer interrogatories to Tran and ITFederal. After a hearing on the
matter, the trial court entered an order on November 17, 2023, directing Tran and ITFederal “to
1
The jury found Tran and ITFederal not liable for fraud and conspiracy.
2
Tran appealed that judgment. This Court affirmed. Truc Tran v. Indus. Dev. Auth. of
the Town of Front Royal, No. 0277-23-4, 2024 Va. App. LEXIS 577 (Oct. 8, 2024).
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convey, assign all of their rights, title and interest” in the Happy Creek Property to the EDA.
The order stated that Tran and ITFederal could be found in contempt if they did not comply.
Tran maintained that this order was void because he did not own the Happy Creek
Property—Lewisburg Way did. Although Tran is the manager and sole member of Lewisburg
Way, Lewisburg Way is still a separate legal entity that was a party to neither the EDA’s original
suit nor its creditor actions. So, Tran reasoned, the trial court had no jurisdiction over Lewisburg
Way and could not order it to convey property. Nor could it order Tran to convey property that
was not his.
Nevertheless, under a threat of contempt, Tran and ITFederal delivered to the EDA a
signed deed conveying the Happy Creek Property on January 3, 2024. In court, though, their
counsel objected that the forced transfer of the property, which was held by neither Tran nor
ITFederal, was unlawful.
On January 16, 2024, Tran and ITFederal filed a motion asking the court to vacate the
conveyance order. In it, they argued that the order was “void when entered” because the court
had “no legal authority to order the transfer of the property.” The court heard argument on the
motion about a month later and denied it, holding that the motion was time-barred because it was
filed more than 21 days after the conveyance order was issued.3
Tran and ITFederal then filed a motion to reconsider the denial of their motion to vacate,
arguing that the motion was not time-barred. They contended that the conveyance order was
void ab initio, so they could challenge it at any time, directly or collaterally. The court denied
that motion on July 23, 2024. Tran and ITFederal did not appeal the court’s conveyance order or
its denials of their subsequent motions seeking to vacate that order.
3
“All final judgments, orders, and decrees, irrespective of terms of court, remain under
the control of the trial court and may be modified, vacated, or suspended for twenty-one days
after the date of entry, and no longer.” Rule 1:1(a).
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On April 7, 2025, Lewisburg Way filed the instant suit against the EDA. Making
essentially the same arguments that Tran and ITFederal made in their final motion to reconsider,
Lewisburg Way sought to quiet title and asked the court for a declaratory judgment stating that
the conveyance order was void ab initio. The EDA filed a demurrer and a plea in bar. In its
demurrer, it argued that even if the conveyance order was erroneous, it was merely voidable, not
void ab initio, so under Rule 1:1, the court no longer had jurisdiction over it. And in its plea in
bar, the EDA argued that Lewisburg Way’s suit was barred by res judicata.
The court sustained the EDA’s demurrer, granted its plea in bar, and dismissed the case
with prejudice. At the hearing, referring to its disposition of the motion to reconsider filed by
Tran and ITFederal in the prior litigation, the court stated that “my ruling then, as my ruling is
today, is that [the conveyance order is] voidable, rather than [a] void order[].” It also found that
there was privity between Tran and Lewisburg Way, so Lewisburg Way’s suit was barred by res
judicata. Lewisburg Way moved to vacate the court’s order sustaining the EDA’s demurrer and
granting its plea in bar; the court denied that motion. Lewisburg Way appealed.
ANALYSIS4
I. Standard of Review
“‘A demurrer tests the legal sufficiency of a [complaint],’ ensuring that the factual
allegations set forth in the pleading are sufficient to state a cause of action.” La Bella Dona Skin
Care, Inc. v. Belle Femme Enters., LLC, 294 Va. 243, 255 (2017) (alteration in original) (quoting
Harris v. Kreutzer, 271 Va. 188, 195 (2006)). “[W]e accept as true all properly pled facts and all
inferences fairly drawn from those facts.” Dunn, McCormack & MacPherson v. Connolly, 281
4
As an initial matter, a number of Lewisburg Way’s assignments of error were not
preserved below and, accordingly, are waived under Rule 5A:18. However, the two surviving
assignments of error present the central issues on appeal: (1) whether the conveyance order was
void ab initio; and (2) whether Lewisburg Way’s collateral attack is barred by res judicata.
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Va. 553, 557 (2011) (quoting Abi-Najm v. Concord Condo., LLC, 280 Va. 350, 356-57 (2010)).
And we review de novo a circuit court’s decision sustaining a demurrer. Id.
Meanwhile, “[a] plea in bar asserts a single issue, which, if proved, creates a bar to a
plaintiff’s recovery.” Massenburg v. City of Petersburg, 298 Va. 212, 216 (2019) (quoting
Hawthorne v. VanMarter, 279 Va. 566, 577 (2010)). Where, as here, “the ‘parties present
evidence on the plea 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 Hawthorne, 279 Va. at 577). Where the circuit court makes
no “specific factual findings,” this Court must “examine the evidence presented at the plea in bar
hearing with the presumption that the circuit court relied on it and any inferences reasonably
drawn from it.” Fines v. Rappahannock Area Cmty. Servs. Bd., 301 Va. 305, 312 (2022).
II. Lewisburg Way’s Collateral Attack is Barred by Res Judicata
Lewisburg Way argues that the conveyance order was void ab initio, rather than merely
voidable. It also argues that the court erred by holding that res judicata bars Lewisburg Way’s
collateral attack on the conveyance order. We assume without deciding that the conveyance
order was void ab initio, and we hold that Lewisburg Way’s suit is nevertheless barred under
principles of res judicata. See Smith v. Larrowe, 86 Va. App. 276, 292 n.9 (2025) (bypassing the
lower court’s decision sustaining defendant’s demurrer and resolving the matter on the “best and
narrowest grounds available” by affirming the court’s order granting his plea in bar).
A. Principles of Res Judicata
Res judicata “is a judicially created doctrine founded upon the ‘considerations of public
policy which favor certainty in the establishment of legal relations, demand an end to litigation,
and seek to prevent harassment of parties.’” Commonwealth ex rel. Gray v. Johnson, 7 Va. App.
614, 617 (1989) (quoting Bates v. Devers, 214 Va. 667, 670 (1974)). “In short, once a matter or
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issue has been adjudicated, it may be relied upon as conclusive between the parties, or their
privies, in any subsequent suit.” Id. at 618. Whether a claim or issue is precluded by a prior
judgment is a question of law this Court reviews de novo. Lane v. Bayview Loan Servicing,
LLC, 297 Va. 645, 653 (2019).
“Res judicata involves both issue and claim preclusion.” Funny Guy, LLC v. Lecego,
LLC, 293 Va. 135, 142 (2017). Issue preclusion, the common law principle relevant here, “bars
‘successive litigation of an issue of fact or law actually litigated and resolved in a valid court
determination essential to the prior judgment,’ even if the issue recurs in the context of a
different claim.”5 Lee v. Spoden, 290 Va. 235, 246 (2015) (quoting Taylor v. Sturgell, 553 U.S.
880, 892 (2008)). The Restatement of Judgments describes the doctrine similarly: “When an
issue of fact or law is actually litigated and determined by a valid and final judgment, and the
determination is essential to the judgment, the determination is conclusive in a subsequent action
between the parties, whether on the same or a different claim.” Restatement (Second) of
Judgments § 27 (A.L.I. 1982). The doctrine of issue preclusion applies not only to the parties in
the first action, but to their privies as well. Lane, 297 Va. at 654.
A party seeking to assert issue preclusion must establish the following: (1) the parties or
their privies to the two proceedings are the same; (2) the relevant issue was actually litigated in
the prior proceeding; (3) the issue was essential to the prior judgment; and (4) the prior
proceeding resulted in a valid, final judgment against the party against whom the doctrine is
sought to be applied. See id. at 654-55; Restatement (Second) of Judgments, supra, § 27.
5
Although the parties appear to view this case through the lens of claim preclusion, we
think that issue preclusion is a better fit, as the purported voidness of the conveyance order was
not strictly a “claim” or “cause of action” below. See Rule 1:6. Rather, it was an issue of law
that was actually litigated and was essential to the court’s final order denying Tran and
ITFederal’s motion to reconsider. See Lee v. Spoden, 290 Va. 235, 246 (2015) (explaining that
issue preclusion applies to “successive litigation of an issue of fact or law” (emphasis added)).
-6-
B. Voidness and Carrithers v. Harrah
Assuming without deciding that the conveyance order was void ab initio, we must
confront the threshold issue of whether res judicata is implicated at all. As opposed to a voidable
order, an order that is void ab initio is “without effect from the moment it c[o]me[s] into
existence.” Kelley v. Stamos, 285 Va. 68, 75 (2013). Abundant case law describes such an order
as “a ‘complete nullity’ that may be ‘impeached directly or collaterally by all persons, anywhere,
at any time, or in any manner.’” Collins v. Shepherd, 274 Va. 390, 402 (2007) (quoting Singh v.
Mooney, 261 Va. 48, 52 (2001)). More recently, though, our Supreme Court has reined in this
sweeping statement. See Bonanno v. Quinn, 299 Va. 722, 736 (2021) (describing the foregoing
language—“by all persons, anywhere, at any time, or in any manner”—as “a rhetorical flourish
that does not accurately state the law”).
Lewisburg Way suggests that because its collateral attack is based on its claim that the
conveyance order was void ab initio, it remains free to challenge the order’s validity
notwithstanding Tran’s previous litigation of the same question. That position, however, runs
headlong into our holding in Carrithers v. Harrah, 63 Va. App. 641 (2014). In that case, this
Court distinguished between a void order and a later judgment deciding whether that order was
voidable or void ab initio. Id. at 648. The Court acknowledged that an order that is void ab
initio has no preclusive effect, itself. Id. at 649 (“No matter how robust the repose policy
underlying res judicata, . . . it does not protect a truly void order from scrutiny.”). But, the Court
said, “that does not mean a litigant can litigate the voidness issue ad infinitum.” Id. If the
question of voidness is fully litigated, decided, and left unappealed, that secondary ruling on
voidness can have preclusive effect on future challenges. See id.
The facts of Carrithers are instructive here. In 2006, a juvenile and domestic relations
district court (“JDR court”) ordered Carrithers to pay about $62,000 in child support arrearage.
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Id. at 645. Four years later, he filed a motion to vacate that judgment in the JDR court, arguing
that he had not been properly served in the 2006 action. Id. He reasoned that the improper
service deprived the JDR court of personal jurisdiction over him and rendered the arrearage order
void. Id. After the JDR court denied that motion, Carrithers appealed to the circuit court for a de
novo review of his motion to vacate. Id. In March 2011, the circuit court held that the JDR
court had personal jurisdiction, so the arrearage order was not void. Id. at 646.
In 2012, after appealing to (and losing in) this Court, Carrithers returned to the JDR court
and filed yet another motion to vacate the 2006 arrearage order. Id. at 647. The parties and the
issues were the same, so the JDR court held that “res judicata barred further relitigation of the
matter.” Id. Carrithers appealed that decision to the circuit court, which held that its prior March
2011 order was final and unaffected by his earlier, unsuccessful appeal to this Court. Id.
Back on appeal to this Court, Carrithers argued that because, in his view, the JDR court’s
arrearage order was void ab initio, he could challenge it at any time, in any court, in any manner.
Id. at 647-48. This Court disagreed. It first pointed out that “[w]hether the 2006 JDR court
arrearage order is void ha[d] already been decided” by the circuit court’s March 2011 order. Id.
at 648. For that reason, the only issue on appeal was “whether a final judicial order on the
merits—otherwise entitled to res judicata effect—loses that status merely because it declares
(allegedly in error) an earlier order not to be void.” Id. The answer, the Court said, was no. Id.
The Court acknowledged that “a litigant who believes he is subject to a void order may
seek judicial relief either on direct appeal or in a collateral attack.” Id. But, it said, “[o]nce a
court of competent jurisdiction declares a prior order to be either void or valid, that declaration—
if it becomes final and subject to no further appeals—is itself entitled to the protection of res
judicata.” Id. at 649-50. “[A] final ruling by a court of competent jurisdiction ends all litigation
over the validity or invalidity of a prior order.” Id. at 650. “If that were not the case,” the Court
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reasoned, a litigant could file “an endless seriatim of unsuccessful collateral attacks in hopes of
finding a judge who agrees with him.” Id. at 648. The Court observed that in this way, res
judicata “protects not only the individual litigant from the weariness of trying the same case
twice, but also society from having to pay for it.” Id. at 649.
Thus, because in Carrithers the circuit court’s “March 2011 order ‘finally and
conclusively resolved’ the ‘issue of personal jurisdiction’ arising out of the 2006 JDR court
arrearage order,” Carrithers’ subsequent attempts to relitigate the same question “violated
traditional res judicata law.” Id. at 651-52.
Carrithers controls here. Tran and ITFederal asked the court to vacate the conveyance
order in January 2024. The court denied that motion, holding that it was time-barred because it
was filed more than 21 days after the conveyance order was issued. Because Rule 1:1’s 21-day
limit on the court’s jurisdiction “does not apply to an order which is void ab initio,” Singh, 261
Va. at 52, the court, by applying that rule, implicitly held that the conveyance order was not void
ab initio. Then, in their motion to reconsider, Tran and ITFederal explicitly argued that Rule 1:1
should not apply because the conveyance order was void ab initio; the court denied that motion
too.6 Tran and ITFederal did not appeal that decision, so the order became final.
In short, a “court of competent jurisdiction” ruled against Tran and “declare[d] the
challenged order to be valid.”7 Carrithers, 63 Va. App. at 648. That declaration then became
6
And at a hearing in this case, the court made clear that its “ruling then” was that the
conveyance order was “voidable, rather than [a] void order[].” Counsel for Lewisburg Way also
confirmed at oral argument that Tran and ITFederal argued that the conveyance order was void
ab initio, lost, and did not appeal that judgment.
7
There is a potential wrinkle here that we wish to preemptively iron out. A circuit
court’s retention of jurisdiction over a matter is generally governed by Rule 1:1. Once again,
that rule provides that “[a]ll final judgments, orders, and decrees, irrespective of terms of court,
shall remain under the control of the trial court and subject to be modified, vacated, or suspended
for twenty-one days after the date of entry, and no longer.” Rule 1:1(a). “Unless a court vacates
or suspends a final order during the twenty-one-day period or some other exception to the
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“final and subject to no further appeals.” Id. at 649-50. Accordingly, even assuming that the
original conveyance order was void ab initio, the trial court’s order determining that it was not
void ab initio “is itself entitled to the protection of res judicata.” Id. at 650. The only remaining
question is whether the elements of res judicata were established here.
C. Lewisburg Way’s Voidness Argument Is Precluded
To review, a party seeking to assert issue preclusion must establish that (1) the parties or
their privies to the two proceedings are the same; (2) the relevant issue was actually litigated in
the prior proceeding; (3) the issue was essential to the prior judgment; and (4) the prior
proceeding resulted in a valid, final judgment against the party against whom the doctrine is
sought to be applied. The EDA has established all four elements here.
Beginning with the first element, the EDA must demonstrate that privity exists between
Lewisburg Way and Tran because, unlike in Carrithers, where the same party brought the same
claim multiple times, Lewisburg Way, as an LLC, “is a ‘legal entity entirely separate and distinct
from’” its sole member, Tran. Erie Ins. Exch. v. EPC MD 15, LLC, 297 Va. 21, 30 (2019)
(quoting Mission Residential, LLC v. Triple Net Props., LLC, 275 Va. 157, 161 (2008)). “[A]ny
general rule applies, the court loses jurisdiction over the case and any action taken by the trial
court after the twenty-one-day period has run is a nullity.” Minor v. Commonwealth, 66
Va. App. 728, 739-40 (2016).
Tran and ITFederal filed both their motion to vacate and motion to reconsider more than
21 days after the circuit court entered the November conveyance order, so the court no longer
had jurisdiction over the matter. (Indeed, that was precisely why the court denied both motions.)
So, one might argue, the court’s final order—in which it ruled that the conveyance order was
merely voidable—is a “nullity” with no preclusive effect. Not so. The Supreme Court has
“recognized that the 21-day period provided by Rule 1:1 does not apply to a motion to vacate or
set aside a judgment on the ground that it was void ab initio when the motion was filed by a party
to the proceeding in which the putative judgment was entered.” Bonanno, 299 Va. at 737. And
more broadly, “a court always has jurisdiction to determine whether it has subject matter
jurisdiction.” Morrison v. Bestler, 239 Va. 166, 170 (1990). Here, in denying Tran and
ITFederal’s motions to vacate and reconsider, the circuit court simply determined that it lacked
subject matter jurisdiction. That decision—based on the court’s conclusion that the conveyance
order was not void ab initio—is not a nullity and is still entitled to preclusive effect.
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claim regarding its assets must be pursued by, and in the name of, the LLC.” Id. (alteration in
original) (quoting 10 William R. Waddell & Lee A. Handford, Virginia Practice Series: Business
Entities § 1:15, at 29 (2018 ed.)). “And this rule applies with equal force even though the LLC
has only a single member.” Id. (quoting 10 Waddell & Handford, supra, § 1:15, at 29 n.3).
Even so, this legal distinction does not necessarily defeat privity.
“Whether privity exists is determined on a case by case examination of the relationship
and interests of the parties.” State Water Control Bd. v. Smithfield Foods, Inc., 261 Va. 209, 214
(2001). “The touchstone of privity for purposes of res judicata is that a party’s interest is so
identical with another that representation by one party is representation of the other’s legal
right.” Lee, 290 Va. at 248 (quoting Smithfield Foods, Inc., 261 Va. at 214). “Privity as used in
the context of res judicata or collateral estoppel, does not embrace relationships between persons
or entities, but rather it deals with a person’s relationship to the subject matter of the litigation.”
Lane, 297 Va. at 656 (emphases omitted) (quoting Manning v. S.C. Dep’t of Highway & Pub.
Transp., 914 F.2d 44, 48 (4th Cir. 1990)). “Virginia courts typically find privity when the parties
share a contractual relationship, owe some kind of legal duty to each other, or have another legal
relationship such as co-ownership.” Raley v. Haider, 286 Va. 164, 172 (2013) (quoting
Columbia Gas Transmission, LLC v. David N. Martin Revocable Tr., 833 F. Supp. 2d 552, 558
(E.D. Va. 2011)).
In Lee, the Supreme Court found that privity existed between the appellant and his
company, SHC. 290 Va. at 248. The Court said that it was “readily apparent that SHC’s
interests are identical with Lee’s. Notably, Lee is the sole shareholder of SHC. Thus, for the
purposes of determining the interests of SHC, we look solely to Lee.” Id. The Restatement
confirms this precept: if a “corporation is closely held, in that one or a few persons hold
substantially the entire ownership in it,” the general rule is that “[t]he judgment in an action by or
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against the holder of ownership in the corporation is conclusive upon the corporation.”
Restatement (Second) of Judgments, supra, § 59(3)(b). The only exception is “when relitigation
of the issue is justified in order to protect the interest of another owner or a creditor of the
corporation.” Id. And importantly here, the same rule applies to an unincorporated association
that is—like a Virginia LLC—treated by the applicable law as a separate entity. Id. at § 61(2).
Here, Tran is both the manager and the sole member of Lewisburg Way. See Raley, 286
Va. at 172 (“[P]rivity centers on the closeness of the relationship in question.”). To be sure, Lee
creates no per se rule about single-member LLCs. But see Camara v. Gold Coast IT Sols., LLC,
No. 1:17-cv-00070, 2017 U.S. Dist. LEXIS 200311, at *6 (E.D. Va. Dec. 5, 2017) (relying on
Lee when finding that one of the defendants was in privity with the LLC in question “by virtue of
being the sole member of the LLC”).8 Still, Lee indicates that, absent some exception, a sole
shareholder or member will often share the interests of their corporation or LLC. See Lee, 290
Va. at 248 (looking “solely to Lee” to determine the interests of the company of which he was
the sole shareholder). And the Restatement’s exception to the basic rule of preclusion outlined
above (the existence of other interested parties or creditors) is inapplicable here: on the record
8
Precedent from other jurisdictions supports the idea that privity generally exists between
an LLC and its sole member. See, e.g., Sagicor Enters., LLC v. Coleman, 932 S.E.2d 698,
701-02 (Ga. Ct. App. 2026) (finding no error in trial court’s determination that LLC was in
privity with its sole owner); Boone River, LLC v. Miles, 994 N.W.2d 35, 45 (holding that parent
company’s sole membership in plaintiff LLC “raise[d] the specter that those two entities were in
privity”), modified on other grounds, 996 N.W.2d 629 (Neb. 2023); Daz Mgmt., LLC v. Honnen
Equip. Co., 508 P.3d 84, 94-96 (Utah 2022) (relying on the sections of the Restatement cited
above and concluding that the owner and manager of the plaintiff LLC was in privity with the
LLC); Price v. Indep. Fed. Sav. Bank, 110 A.3d 567, 573 (D.C. 2015) (holding that “an owner or
member who holds himself out as an LLC’s representative in connection with litigation is in
privity with the LLC with respect to that litigation”); Remy Enter. Grp., LLC v. Davis, 37
F. Supp. 3d 30, 38 n.8 (D.D.C. 2014) (holding that plaintiff LLC was “properly considered a
‘privy’” of its sole member); Kramer v. Stelter, 588 F. Supp. 2d 862, 867 (N.D. Ill. 2008)
(“[LLCs] are in privity with their individual owners, particularly, as is the case here, when the
owner has exclusive control over the LLC.”).
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before us, Lewisburg Way has no jilted creditors or other members—no one else whose interests
must be protected through relitigation of the voidness issue.
Most importantly, Lewisburg Way and Tran have identical interests when it comes to
“the subject matter of the litigation.” Lane, 297 Va. at 656. Indeed, many of Lewisburg Way’s
arguments on appeal mirror Tran’s arguments from the prior litigation. Lewisburg Way, like
Tran, claims that under Code § 13.1-1041.1, the court could only charge Tran’s transferable
interest in Lewisburg Way to satisfy the judgment; it could not order the transfer of Lewisburg
Way’s property. And Lewisburg Way, like Tran, argues that the conveyance order was void ab
initio because it exceeded the court’s statutory authority. These arguments were made, rejected,
and left unappealed in the previous litigation.
Lewisburg Way disagrees, of course, and appears to contend that the threat of contempt
in the conveyance order severed Tran’s interests from those of Lewisburg Way. In other words,
Tran’s primary goal at the time he signed the conveyance order was to avoid contempt, not to
preserve his LLC’s property interests. So, the argument goes, Lewisburg Way’s interests were
not adequately protected in the underlying proceedings.
The problem is that when Tran authorized the conveyance of the Happy Creek Property,
he did so not as an individual, wary of being held in contempt, but in his capacity as Lewisburg
Way’s manager.9 In that role, Tran was statutorily required to discharge his duties “in
accordance with [his] good faith business judgment of the best interests of the limited liability
9
Notwithstanding the threat of contempt, Tran’s decision to convey the Happy Creek
Property arguably brings this case within the ambit of the voluntary-payment doctrine. See
Sheehy v. Williams, 299 Va. 274, 278-79 (2020) (explaining that under the voluntary-payment
doctrine, a claimant cannot, in the absence of fraud or other misconduct, “demand that a court
return money to him that he had voluntarily paid to another”). Neither party raised this issue,
however, and the circuit court made no factual findings about voluntariness. So rather than
attempt to make our own factual findings, we opt to resolve this case on the better and narrower
ground of res judicata. See Smith, 86 Va. App. at 292 n.9.
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company.” Code § 13.1-1024.1. And based on the evidence presented at the plea hearing—
which reveals no other members, creditors, or interested parties—we agree with the circuit court
that Tran and Lewisburg Way are in privity. See Lee, 290 Va. at 248 (asking whether
“representation by one party is representation of the other’s legal right”).
The remaining elements of issue preclusion are more straightforwardly satisfied. The
voidness issue was actually litigated and determined in the prior proceeding. Tran’s motion to
reconsider is devoted entirely to voidness. The EDA filed an opposition to that motion and Tran
filed a rebuttal memorandum before the court ultimately denied the motion to reconsider. The
court also reiterated at the hearing in the instant case that it had, in the prior litigation, decided
that the conveyance order was merely voidable, not void ab initio. The issue was also plainly
essential to the prior judgment: had the court determined that its earlier conveyance order was
void ab initio, as opposed to merely voidable, it would have had no choice but to grant the
motion to reconsider and vacate the conveyance order. It did neither. Lastly, the prior
proceeding resulted in a valid, final (and unappealed) judgment against Tran and his privies.
Notwithstanding the conveyance order’s alleged voidness, Lewisburg Way’s collateral
attack is barred by res judicata.
CONCLUSION
“The law should afford one full, fair hearing relating to a particular problem—but not
two.” Funny Guy, LLC, 293 Va. at 143 (quoting Kent Sinclair, Guide to Virginia Law & Equity
Reform and Other Landmark Changes § 11.01, at 246 (2006)). Lewisburg Way, via its sole
member and manager, already had a full, fair hearing about the voidness of the conveyance
order. It is not entitled to a second one. For that reason, we affirm the circuit court’s judgment.
Affirmed.
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