Pollack v. Allen , 266 Va. 118 ( 2003 )

Present: All the Justices
BRADLEY G. POLLACK,
SUBSTITUTE TRUSTEE
v. Record No. 022189 OPINION BY JUSTICE CYNTHIA D. KINSER
June 6, 2003
WILLIAM B. ALLEN, III, COMMISSIONER
OF ACCOUNTS FOR THE CIRCUIT COURT OF
SHENANDOAH COUNTY
FROM THE CIRCUIT COURT OF SHENANDOAH COUNTY
Dennis Lee Hupp, Judge
In this appeal, we decide whether the circuit court
erred by requiring a substitute trustee under deeds of
trust to file accounts of sale with the commissioner of
accounts when the advertised sales were not made, and
further erred by assessing fees personally against the
trustee for summonses and reports issued by the
commissioner with regard to those sales that never
occurred. Concluding that, under the provisions of Code
§ 26-15, an account of sale is required only for “a sale
made,” we will reverse the judgment of the circuit court.
Bradley G. Pollack, acting in the capacity of a
substitute trustee, advertised foreclosure sales of
timeshare units under 172 deeds of trust in three separate
advertisements. The advertisements apparently prompted
payment from some of the debtors. Accordingly, Pollack did
not proceed with the foreclosure sales under 104 of the
deeds of trust.
On March 8, 2002, more than six months after the
advertised foreclosure sale dates, William B. Allen, III,
Commissioner of Accounts for the Circuit Court of
Shenandoah County, issued 172 summonses to Pollack
requiring him to file “FORECLOSURE TRUSTEE’S REPORT OF
SALE, as required by [Code] § 26-15” within 30 days after
service of the summonses and advising Pollack that failure
to file accounts of the sales would be reported to the
circuit court for further proceedings under Code §§ 26-13
and –15. Within 30 days after the summonses were served on
Pollack, he filed accounts with regard to the 68
foreclosure sales that were actually made.
The commissioner of accounts then reported to the
circuit court that Pollack had failed to file accounts of
sale for the remaining 104 advertised foreclosure sales.
The commissioner requested the court to issue summonses to
Pollack requiring him to file the accounts and to fine
Pollack for contempt of court for failing to comply with
the summonses previously issued by the commissioner of
accounts.
The circuit court subsequently granted leave to
Pollack permitting him to submit affidavits from the
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holders of the 104 deed of trust notes verifying that no
foreclosure sales were made under those particular deeds of
trust. After Pollack filed the affidavits, the court held
that no further response to the summonses issued by the
commissioner was required. Nevertheless, the court
assessed fees against Pollack personally in the amount of
$750.00 for the summonses and reports issued by the
commissioner of accounts regarding the 104 advertised
foreclosures for which no sales occurred.
Pollack objected to the order on the grounds that he
had “presented good cause to the [c]ourt for failing to
make reports as none were due.” The court stayed its prior
order while considering Pollack’s objections but
subsequently entered an order removing the stay for the
reasons stated in a letter opinion. The court explained
that, although “no accountings were due on 104 of the 172
cases,” it was awarding fees to the commissioner of
accounts “to compensate him for [the] time and effort”
expended as a result of Pollack’s failure to make “[a]
formal response . . . to each summons” issued by the
commissioner.
On appeal, Pollack contends that the circuit court
erred by ordering him to “file reports under Virginia Code
§ 26-15 for sales that were never held” and by assessing
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fees against him personally “for the issuance of summonses
and reports issued by the [c]ommissioner of [a]ccounts on
sales that never occurred.” He argues that any action
authorized by the provisions of Code § 26-15 “presupposes a
sale.” There being no sales under the 104 deeds of trust
at issue, Pollack contends that he was not required to file
any reports and that the assessment of fees against him
was, therefore, improper.
The commissioner of accounts, however, asserts on
brief that Pollack “foreclosed on deeds of trust securing
172 timeshare units by advertising sales” to be conducted
on three dates. Claiming that Pollack failed in his duties
to report on 104 of the advertised sales, the commissioner
asserts that he had no choice but to proceed against
Pollack as directed by the relevant statutes and that the
court did not abuse its discretion in assessing fees
against Pollack. We do not agree with the commissioner’s
position.
To determine whether the circuit court erred, we must
examine the language utilized by the General Assembly in
Code § 26-15. Our interpretation of this statute is guided
by familiar rules of statutory construction.
“While in the construction of statutes the
constant endeavor of the courts is to ascertain
and give effect to the intention of the
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legislature, that intention must be gathered from
the words used, unless a literal construction
would involve a manifest absurdity. Where the
legislature has used words of a plain and
definite import the courts cannot put upon them a
construction which amounts to holding the
legislature did not mean what it has actually
expressed.”
Halifax Corp. v. First Union Nat’l Bank, 262 Va. 91, 99-
100, 546 S.E.2d 696, 702 (2001) (quoting Watkins v. Hall,
161 Va. 924, 930, 172 S.E. 445, 447 (1934)); accord Haislip
v. Southern Heritage Ins. Co., 254 Va. 265, 268, 492 S.E.2d
135, 137 (1997); Weinberg v. Given, 252 Va. 221, 225, 476
S.E.2d 502, 504 (1996); Turner v. Wexler, 244 Va. 124, 127,
418 S.E.2d 886, 887 (1992); Grillo v. Montebello
Condominium Unit Owners Ass’n, 243 Va. 475, 477, 416 S.E.2d
444, 445 (1992).
In relevant part, Code § 26-15 provides that
[w]ithin six months after the date of a sale made
under any recorded deed of trust, mortgage or
assignment for benefit of creditors, otherwise
than under a decree, the trustee shall return an
account of sale to the commissioner of accounts
of the court wherein the instrument was first
recorded. Promptly after recording any trustee’s
deed, the trustee shall deliver to the
commissioner of accounts a copy of the deed. The
date of sale is the date specified in the notice
of sale, or any postponement thereof . . . .
If the commissioner of accounts of the court
wherein an instrument was first recorded becomes
aware that an account as required by this section
has not been filed, the commissioner and the
court shall proceed against the trustee in like
manner and impose like penalties as set forth in
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§ 26-13, unless such trustee is excused for
sufficient reason.
Under the plain terms of Code § 26-15, an account of
sale must be returned to the commissioner of accounts
“[w]ithin six months after the date of a sale made under
any recorded deed of trust.” The phrase “sale made”
clearly contemplates an actual sale. That occurrence, not
the advertisement of a foreclosure sale, triggers a
trustee’s statutory duty to file an account of sale with
the commissioner. The six-month period during which the
account of sale must be filed for a “sale made” commences
to run on the “date specified in the notice of sale, or any
postponement thereof.” Code § 26-15.
If we adopted the interpretation of Code § 26-15 urged
by the commissioner of accounts, we would be altering the
statutory language. Nothing in Code § 26-15 requires a
trustee to file any type of report regarding an advertised
foreclosure sale that does not take place, i.e., when a
sale is not made. Thus, the only accounts of sale that
Pollack was required to return to the commissioner were for
“sales made.” Neither the commissioner of accounts nor the
circuit court had authority under Code § 26-15 to proceed
against Pollack by issuing summonses or assessing a fine or
fees for the 104 advertised sales that were not made. Only
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when “an account as required by this section [Code § 26-15]
has not been filed” is the commissioner or the court
authorized to proceed against a trustee by utilizing the
procedures and penalties allowed under Code § 26-13. ∗ Code
§ 26-15.
For this reason, we conclude that the circuit court
erred by requiring Pollack to file reports for advertised
foreclosure sales that were not made and by assessing fees
against Pollack personally. Accordingly, we will reverse
the judgment of the circuit court and enter final judgment
here in favor of Pollack.
Reversed and final judgment.
∗
When a fiduciary fails to make a required return, the
provisions of Code § 26-13 authorize a commissioner of
accounts to issue a summons calling for the fiduciary to
make the return. If the fiduciary fails to do so within 30
days after service of the summons, the commissioner is
required to report that fact to the court. Then, the court
is authorized to issue a summons for the fiduciary’s
appearance and to impose a fine unless the fiduciary is
“excused for sufficient reason.” Code § 26-13.
Similarly, under Code § 26-23, the assessment of costs
against a fiduciary personally is permitted only when the
fiduciary “fail[s], without good cause, to make the returns
. . . required.”
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