UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

GERALD E. SCEARCE,
Plaintiff-Appellee,

v.                                                                      No. 95-2307

HALIFAX COUNTY, VIRGINIA,
Defendant-Appellant.

GERALD E. SCEARCE,
Plaintiff-Appellant,

v.                                                                      No. 95-2308

HALIFAX COUNTY, VIRGINIA,
Defendant-Appellee.

Appeals from the United States District Court
for the Western District of Virginia, at Danville.
William L. Osteen, Sr., District Judge, sitting by designation.
(CA-94-20-D)

Argued: July 10, 1996

Decided: September 5, 1996

Before WILKINS and LUTTIG, Circuit Judges, and
G. ROSS ANDERSON, JR., United States District Judge for
the District of South Carolina, sitting by designation.

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Affirmed in part, reversed in part, and remanded with instructions by
unpublished opinion. Judge Wilkins wrote the opinion, in which
Judge Luttig and Judge Anderson joined.

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COUNSEL

ARGUED: Elizabeth Kay Dillon, WOODS, ROGERS & HAZLE-
GROVE, Roanoke, Virginia, for Appellant. Alexander Wayne Bell,
Lynchburg, Virginia, for Appellee. ON BRIEF: W. Fain Rutherford,
Thomas M. Winn, III, WOODS, ROGERS & HAZLEGROVE, Roa-
noke, Virginia; W. Carrington Thompson, Chatham, Virginia, for
Appellant.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

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OPINION

WILKINS, Circuit Judge:

A jury returned a verdict in favor of Gerald E. Scearce, finding that
Halifax County, Virginia had terminated his employment in violation
of his rights under the First Amendment, see 42 U.S.C.A. § 1983
(West 1994), and in violation of Virginia law. The County appeals the
judgment awarding actual and punitive damages, as well as attorneys'
fees, and Scearce challenges the amount of the attorneys' fees award.
We affirm the award of actual damages and attorneys' fees, reverse
the award of punitive damages, and remand for entry of an amended
judgment.

I.

Scearce was employed as a truck driver at the County landfill
beginning in 1990. During the course of his employment, he became
aware of a pattern of illegal use of property and resources belonging
to the County by its Director of Public Works, Leroy Farmer. Scearce
ultimately recorded incriminating videotape of missing County prop-
erty that substantiated wrongdoing by Director Farmer. Scearce
brought the improper conduct and the videotape to the attention of his
immediate superior and other County officials, including a member of

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the Board of Supervisors, Richard Abbott. These officials cautioned
Scearce that he might be terminated as a result of his whistleblowing
activities and informed him that others in his situation had been
threatened with discharge.

Soon afterward, in January 1992, Scearce was invited to attend a
meeting with Director Farmer and Administrator Robert Lawler dur-
ing which Scearce was questioned concerning his 1990 employment
application. Scearce acknowledged that he had been employed briefly
by a company that was not listed on his application form. He
explained, however, that he had been unaware of any omission since
his grandmother had completed the application form for him because
he was illiterate. Administrator Lawler thereafter attended a meeting
of the Board of Supervisors and stated that Scearce should be termi-
nated for falsifying his personnel records, an offense under the appli-
cable personnel policy punishable by discharge or suspension for one
to 30 working days. When Administrator Lawler raised the issue,
Supervisor Abbott discussed the existence of the videotape recorded
by Scearce and a heated discussion among the members followed.
The Board finally decided by a vote of six to one to permit Adminis-
trator Lawler to handle the matter as he deemed most appropriate.
Administrator Lawler thereafter terminated Scearce.

Scearce subsequently brought this lawsuit. His first cause of action
alleged a violation of 42 U.S.C.A. § 1983, maintaining that he was
terminated for exercising his First Amendment rights. His second
cause of action alleged that his termination violated Virginia law. The
jury found in Scearce's favor on both causes of action, awarding
$155,417.24 in actual damages and $75,000 in punitive damages.
Thereafter, the district court awarded reasonable attorneys' fees and
costs to Scearce. Although both parties appeal, we conclude that only
the County's claim that it is entitled to sovereign immunity warrants
extended discussion.

II.

The County maintains that the district court erred in failing to grant
its motion for judgment as a matter of law with respect to Scearce's
claim predicated on Virginia law, asserting that it is entitled to sover-
eign immunity. Under Virginia law, counties are entitled to sovereign

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immunity from tort actions unless that immunity has been waived.
See, e.g., Mann v. County Bd. of Arlington County, 98 S.E.2d 515,
519 (Va. 1957); Commonwealth v. Chilton Malting Co., 152 S.E. 336,
338-39 (Va. 1930). And, Virginia law permits the recovery of puni-
tive damages only if an action sounds in tort. See Kamlar Corp. v.
Haley, 299 S.E.2d 514, 516-18 (Va. 1983); see also Cancun Adven-
ture Tours, Inc. v. Underwater Designer Co., 862 F.2d 1044, 1048
(4th Cir. 1988); cf. City of Newport v. Fact Concerts, Inc., 453 U.S.
247, 271 (1981) (local government not liable for punitive damages
under § 1983). Consequently, the punitive damages verdict against
the County must be set aside unless the County has waived its sover-
eign immunity defense.

The Commonwealth has not expressly waived the sovereign immu-
nity traditionally afforded to counties. See Va. Code Ann. § 8.01-
195.3 (Michie Supp. 1996); Messina v. Burden, 321 S.E.2d 657, 660
(Va. 1984). Scearce, however, contends that the County waived this
defense by failing to raise it timely. Our review of the amended
answer submitted by the County convinces us that it failed to specifi-
cally plead the defense of sovereign immunity. See Fed. R. Civ. P.
8(c) (any "matter constituting an avoidance or affirmative defense"
must be affirmatively pled).1 But, waiver does not necessarily result
from a defendant's failure to raise an affirmative defense in the
answer. "Where the matter is raised in the trial court in a manner that
does not result in unfair surprise, . . . technical failure to comply pre-
cisely with Rule 8(c) is not fatal." Allied Chem. Corp. v. Mackay, 695
F.2d 854, 855-56 (5th Cir. 1983) (per curiam); accord Dresser Indus.,
Inc. v. Pyrrhus AG, 936 F.2d 921, 928 (7th Cir. 1991). The County
raised the defense of sovereign immunity from suit in its motion for
judgment at the close of the evidence, and Scearce is unable to dem-
_________________________________________________________________
1 It is questionable whether the defense of sovereign immunity may be
waived by a failure to comply with federal procedural rules. See
Simmons v. City of Philadelphia, 947 F.2d 1042, 1084-86 (3d Cir. 1991)
(indicating that procedural default cannot result in waiver when defense
of sovereign immunity may not be waived under state law), cert. denied,
503 U.S. 985 (1992); Mann, 98 S.E.2d at 519 (holding that defense of
sovereign immunity is jurisdictional and may not be waived under Vir-
ginia law). We need not address that question, however, given our con-
clusion that the County did not waive the defense in this instance.

                   4
onstrate that he would be unfairly prejudiced by an amendment of the
pleadings. We, therefore, deem the County's answer amended to raise
the defense of sovereign immunity. See Fed. R. Civ. P. 15(b). As a
consequence, we conclude that the award of punitive damages against
the County is improper.

III.

We have carefully considered the other issues raised by the parties
and find them to be without merit. The award of compensatory dam-
ages was supported by the finding of wrongful termination under Vir-
ginia law.2 In addition, the jury instructions given by the district court
were proper because Administrator Lawler was a final policymaking
official of the County in this instance, rendering the County liable for
the termination found by the jury to have been based on Scearce's
exercise of rights protected by the First Amendment in violation of
§ 1983. Monell v. Department of Social Servs., 436 U.S. 658, 690-91
(1978); Greensboro Professional Fire Fighters Ass'n v. City of
Greensboro, 64 F.3d 962, 964-66 (4th Cir. 1995). Finally, we reject
Scearce's claim that the district court abused its discretion in estab-
lishing the attorneys' fees award. See City of Burlington v. Dague,
505 U.S. 557, 566 (1992) (noting that "[c]ontingency enhancement is
. . . not consistent with our general rejection of the contingent-fee
model for fee awards, nor is it necessary to the determination of a rea-
sonable fee"). Accordingly, we affirm in part, reverse in part, and
remand for entry of an amended judgment.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED
WITH INSTRUCTIONS
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2 Although sovereign immunity protects counties against tort liability,
it does not protect against liability premised on contractual obligations.
Wiecking v. Allied Medical Supply Corp., 391 S.E.2d 258, 260-61 (Va.
1990). And, the instruction given by the district court permitted the jury
to return a verdict on a theory sounding in contract. Cf. Jenkins v. County
of Shenandoah, 436 S.E.2d 607, 609 (Va. 1993) (recognizing that an
implied contractual right of action exists under Article I, § 11 of the Con-
stitution of Virginia); City of Norfolk v. Kohler, 362 S.E.2d 894, 896 (Va.
1987) (acknowledging that public employees who possess a right to con-
tinued employment in the absence of cause for their termination have an
enforceable right).

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