Virginia Common Law Refusal to Adopt the Adequate Assurance Doctrine

Introduction

Under Wild Skies, Inc. v. National Rifle Association of America, 304 Va. ___ (2025), presented to the Supreme Court of Virginia on May 29, 2025, Petitioner Under Wild Skies, Inc. (“UWS”) sued the National Rifle Association (“NRA”) for breach of contract and anticipatory breach under sponsorship agreements effective through 2025. After the NRA failed to make a scheduled payment and declined to respond to a letter (the “Dycio Letter”) demanding assurances, UWS sought a jury instruction based on the “adequate assurance” doctrine of Restatement (Second) of Contracts § 251. The trial court refused, the Court of Appeals affirmed, and the Supreme Court of Virginia likewise affirmed—holding that Virginia common law does not recognize a freestanding doctrine of “adequate assurance” outside the Uniform Commercial Code or explicit legislative adoption.

Summary of the Judgment

The Supreme Court of Virginia unanimously affirmed the lower courts. It held:

1. Virginia common law recognizes repudiation and anticipatory breach, but has never adopted an independent “adequate assurance” doctrine rooted in Restatement § 251.
2. UWS’s proffered Jury Instruction 21—allowing suspension of performance and treating a failure to give assurances as repudiation—was not an accurate statement of Virginia law.
3. Absent legislative adoption or controlling Virginia precedent, the trial court properly refused the instruction.

Analysis

Precedents Cited

• Bennett v. Sage Payment Solutions, Inc. (282 Va. 49 (2011))—Defined repudiation as a clear, absolute, unequivocal statement or conduct indicating unwillingness to perform the contract in its entirety.
• Board of Supervisors v. Ecology One, Inc. (219 Va. 29 (1978))—Applied anticipatory breach principles to continuous‐performance contracts and explained that intent to abandon may be shown by conduct inconsistent with performance.
• Vahabzadah v. Mooney (241 Va. 47 (1991))—Reiterated that repudiation must cover the entire performance of the contract.
• Simpson v. Scott (189 Va. 392 (1949))—Outlined the remedies available to a non-breaching party after repudiation: rescission, immediate suit, or suit upon performance date.
• Uniform Commercial Code § 2-609—Gives buyers and sellers in the sale of goods context the right to demand “adequate assurance” and to suspend performance pending receipt of assurances.
• Restatement (Second) of Contracts § 251—A model‐law provision extending the adequate assurance doctrine beyond goods to all contracts; not adopted by Virginia courts.
• Out-of-state decisions (Conference Center Ltd. v. TRC, Norcon Power Partners L.P. v. Niagara Mohawk, McNeal v. Lebel)—Demonstrate selective adoption of § 251 by other jurisdictions, but not by Virginia.

Legal Reasoning

The Court’s reasoning proceeded in three steps:

1. Confirm existing Virginia doctrines: Virginia recognizes repudiation—a clear, unequivocal refusal to perform—and anticipatory breach, giving the non-breaching party options to sue or wait.
2. Distinguish “adequate assurance”: That doctrine was born in U.C.C. § 2-609 to solve the “dilemma” of equivocal conduct in goods contracts and later restated in § 251 of the Restatement (Second). Because it is a modern American Law Institute innovation, it is not part of pre-existing Virginia common law.
3. Emphasize role of the legislature: The General Assembly has enacted limited adequate‐assurance rules for goods (§ 8.2-609) and certain leases (§ 8.2A-401) but has not extended § 251’s principles to all contracts. Expanding common law is a policy decision for the legislature, not the courts.

Impact

This decision clarifies that Virginia courts will not unilaterally graft Restatement § 251’s umbrella “adequate assurance” remedy onto general contract law. Practitioners in Virginia should:

• Continue relying on established anticipatory breach and repudiation doctrines when a party unequivocally refuses performance.
• Draft contracts with express “assurance” or “security” provisions if they wish to require pre‐performance assurances or to suspend performance.
• Monitor legislative developments: any statewide adoption of a broad adequate‐assurance principle must come from the General Assembly.

Complex Concepts Simplified

• Repudiation: A clear and absolute refusal to perform the entire contract before performance is due.
• Anticipatory Breach: When one party repudiates, the other may sue immediately, rescind, or wait until the performance date and then sue.
• Adequate Assurance (Restatement § 251): A right—originally in U.C.C. goods contracts—to demand written proof that a party will perform; if no assurance in 30 days, deemed repudiation. Virginia has not adopted this for general contracts.
• Scintilla of Evidence Standard: A party must present at least minimal evidence supporting a legal theory before requesting a jury instruction on that theory.

Conclusion

Under Wild Skies v. NRA reaffirms that Virginia’s contract law continues to rely on traditional repudiation and anticipatory breach principles. The Supreme Court of Virginia declined to create a new “adequate assurance” remedy from Restatement § 251, underscoring that such modern innovations are for the legislature to enact. Going forward, parties wanting “adequate assurance” protections must negotiate them into their agreements or advocate for legislative change.