Small business litigation presents a variety of challenges, particularly when a claim for breach of fiduciary duties is involved. To the litigants, the stakes are high—and the desire to pursue their claims often motivated by the business duress suffered at the hands of former partners. In Syed v. ZH Technologies, Inc., a 2010 decision of the Virginia Supreme Court, the Court’s analysis stands as a reminder that, notwithstanding the evidence actually adduced at trial, in considering the viability of a party’s claims, the pleadings still count.
Among the various holdings in ZH Technologies, the Virginia Supreme Court reversed the trial court for permitting a litigant’s jury instructions to set up a theory of the case that had not been pleaded. At trial, the trial court had denied the motion to amend the complaint, noting that such an amendment would be “fundamentally unfair.” In reversing the trial court, the Virginia Supreme Court noted that permitting a litigant to espouse a new theory of the case that had not been previously pleaded, by way of jury instructions and closing argument, was likewise “fundamentally unfair” and “prejudicial.” The Virginia Supreme Court reversed and remanded the claim for retrial on the merits. The Court observed, however, that a renewed motion to amend the complaint could be considered in the discretion of the trial court.