Present:    All the Justices

LONG, LONG & KELLERMAN, P.C., et al.

                         OPINION BY JUSTICE LEROY R. HASSELL, SR.
v.   Record No. 020033                November 1, 2002

STEVEN L. WHEELER, ET AL.

           FROM THE CIRCUIT COURT OF THE CITY OF HAMPTON
                     Wilford Taylor, Jr., Judge

                                 I.

      In this appeal, we consider whether an assignee of a deed

of trust is subject to the 20-year statute of limitations

contained in Code § 8.01-242 even though the assignor of the

deed of trust is a federal agency which, had it sought to

enforce the deed of trust, would not have been subject to this

statute of limitations.

                                 II.

      The relevant facts are not in dispute.   On September 30,

1980, Steven L. Wheeler and Myrna C. Wheeler conveyed certain

real estate by deed of trust to secure their personal guaranty

of payment of a promissory note between Southern Furniture

Warehouse, Inc., and the Administrator of the Small Business

Administration.   The deed of trust does not contain a maturity

date of the debt that it secures, and paragraph 16 of the deed

of trust states that the "instrument is to be construed and

enforced in accordance with applicable Federal law."    The deed
of trust was recorded in the Clerk's Office of the Circuit

Court for the City of Hampton on that date.

     An event of default occurred regarding payment of the

promissory note.   The Small Business Administration made a

demand upon the Wheelers to honor their guaranty in 1982.     The

agency made a second demand and threatened to foreclose on the

deed of trust in April 2000.   Subsequently, the Small Business

Administration assigned the deed of trust to LPP Mortgage,

Ltd., which substituted Long, Long & Kellerman, P.C., as

trustee of the deed of trust (hereinafter "the trustee").     The

trustee notified the Wheelers by letter dated July 20, 2001,

that it intended to initiate foreclosure proceedings.

Subsequently, the trustee initiated a foreclosure proceeding

in 2001, more than 20 years after the date of the Wheelers'

deed of trust.

     The Wheelers initiated a proceeding to enjoin the sale of

the property under the deed of trust.   The circuit court

entered a decree temporarily enjoining the sale of the

property, and the court ultimately ruled that the trustee's

action to enforce the deed of trust was barred by the statute

of limitations provided in Code § 8.01-242.   The court

subsequently entered a decree that permanently enjoined the

trustee from selling the property.    The trustee appeals.

                               III.


                                2
     Title 28 U.S.C. § 2415 (2002) describes the limitation

period that governs specified causes of action filed by the

United States or its agencies. 1       Section 2415(a) provides that

a contract action for money damages filed by the United States

or its agencies is barred unless the contract action is filed

within six years after the right of action accrues.        Section

2415(b) requires, among other things, that the United States

or its agencies file a tort action for money damages within

three years after the right of action first accrues.        Section

2415(c) states that "[n]othing herein shall be deemed to limit




     1
         Title 28 U.S.C. § 2415 states in part:

          "(a) Subject to the provisions of section 2416
     of this title, and except as otherwise provided by
     Congress, every action for money damages brought by
     the United States or an officer or agency thereof
     which is founded upon any contract express or
     implied in law or fact, shall be barred unless the
     complaint is filed within six years after the right
     of action accrues or within one year after final
     decisions have been rendered in applicable
     administrative proceedings required by contract or
     by law, whichever is later . . . .
          "(b) Subject to the provisions of section 2416
     of this title, and except as otherwise provided by
     Congress, every action for money damages brought by
     the United States or an officer or agency thereof
     which is founded upon a tort shall be barred unless
     the complaint is filed within three years after the
     right of action first accrues . . . .
          "(c) Nothing herein shall be deemed to limit
     the time for bringing an action to establish the
     title to, or right of possession of, real or
     personal property."


                                   3
the time for bringing an action to establish the title to, or

right of possession of, real or personal property."

     In contrast, Code § 8.01-242 enacted by the General

Assembly states in part:

          "No deed of trust or mortgage given to secure
     the payment of money, other than credit line deeds
     of trust described in § 55-58.2, and no lien
     reserved to secure the payment of unpaid purchase
     money, in which no date is fixed for the maturity of
     the debt secured by such deed of trust, mortgage, or
     lien, shall be enforced after twenty years from the
     date of the deed of trust, mortgage, or other lien."

     The trustee contends that the federal government and its

agencies are immune from statutes of limitations unless

Congress has explicitly provided a limitations period.    We

agree.

     We recognize that Code § 8.01-242 cannot bar a federal

agency, such as the Small Business Administration, from

initiating foreclosure proceedings on real property.     The

federal government and its agencies are not bound by statutes

of limitations unless Congress explicitly states otherwise.

The rationale for this doctrine arises from the common law

rule – nullum tempus occurrit regi – that the sovereign is

immune from the operations of statutes of limitations.    This

rule is necessary because it insures that property rights

vested in the government are not vitiated due to the

negligence of the government's agents or employees upon whom

government must rely.   Government should not lose its

                                4
ownership rights in real and personal property simply because

a government employee or agent neglects to take legal action

to protect the government's property interests.   As the

Supreme Court has observed:

     "The true reason [for the rule nullum tempus
     occurrit regi] is to be found in the great public
     policy of preserving the public rights, revenues,
     and property from injury and loss, by the negligence
     of public officers. And though this is sometimes
     called a prerogative right, it is in fact nothing
     more than a reservation, or exception, introduced
     for the public benefit, and equally applicable to
     all governments."

Guaranty Trust Co. v. United States, 304 U.S. 126, 132 (1938)

(quoting United States v. Hoar, 26 F. Cas. 329, 330 (1821)).

See Brock v. Pierce County, 476 U.S. 253, 260 (1986); Stanley

v. Schwalby, 147 U.S. 508, 515 (1893); United States v.

Nashville, Chattanooga & St. Louis Ry. Co., 118 U.S. 120, 125

(1886); see also United States v. Alvarado, 5 F.3d 1425, 1427-

28 (11th Cir. 1993); United States v. City of Palm Beach

Gardens, 635 F.2d 337, 339-40 (5th Cir.), cert. denied, 454

U.S. 1081 (1981).

     The trustee argues that Congress has established a

federal statute of limitations for foreclosures in 28 U.S.C.

§ 2415(c).   The trustee relies upon the following language in

this statute:   "Nothing herein shall be deemed to limit the

time for bringing an action to establish the title to, or




                                5
right of possession of, real or personal property."   We

disagree with the trustee.

       Contrary to the trustee's contention, this language does

not create a statute of limitations for foreclosure

proceedings.   A statute of limitations for a civil case is

commonly defined as a "statute establishing a time limit for

suing in a civil case, based on the date when the claim

accrued."   Black's Law Dictionary 1422 (7th ed. 1999).

Generally, a statute of limitations prescribes a period of

time in which the person with a cause of action must file

pleadings to enforce that cause of action or the right of

action may be defeated if the party against whom the cause of

action has been filed asserts the statute of limitations as a

bar.

       We hold that Title 28 U.S.C. § 2415(c) is not a statute

of limitations for the United States and its agencies.

Rather, the statute makes clear that the United States' and

its agencies' rights to file proceedings to establish title

to, or right of possession of, real or personal property are

not affected by the six- and three-year statutes of

limitations provided in § 2415(a) and (b).   Furthermore,

§ 2415(c) does not establish a time limit within which the

federal government or its agencies must assert any rights

against another entity.   Indeed, federal courts have concluded


                                 6
that Congress has not enacted in § 2415 a statute of

limitations that bars the United States or its agencies from

instituting foreclosure proceedings.    Alvarado, 5 F.3d at

1429-30; United States v. Thornburg, 82 F.3d 886, 894 (9th

Cir. 1996); Farmers Home Admin. v. Muirhead, 42 F.3d 964, 966

(5th Cir. 1995); Westnau Land Corp. v. U.S. Small Bus. Admin.,

1 F.3d 112, 115-17 (2d Cir. 1993); United States v. Ward, 985

F.2d 500, 501 (10th Cir. 1993).

     The trustee argues at length in its brief that "[t]he

federal law of limitations, not state law, controls" the

resolution of this appeal.    However, as we have already

concluded, there is no federal statute of limitations that

prescribes a time period in which the federal government or

its agencies must file a proceeding to foreclose on a deed of

trust. 2   We note that the trustee correctly admitted in his

memorandum filed in the circuit court that "Congress has not

explicitly declared any federal statute of limitations for

cases of this nature."


     2
       The Supreme Court held in United States v. Kimbell
Foods, Inc., 440 U.S. 715, 726-27 (1979), that federal law,
not state law, governs disputes concerning the federal
government's rights arising out of its participation in
nationwide loan programs. In this case, however, the rights
of the federal government are not implicated. Rather, the
issue we consider is whether a private entity that is an
assignee of a deed of trust that was formerly owned by an
agency of the federal government, may be subjected to a state
statute of limitations.


                                  7
     The trustee, relying upon our decision in Union Recovery

Ltd. P'ship v. Horton, 252 Va. 418, 477 S.E.2d 521 (1996),

cert. denied, 520 U.S. 1167 (1997), argues that as an assignee

of a federal agency, the trustee "stands in the shoes of the

federal assignor and is not barred from foreclosing by virtue

of any Virginia statute of limitations."   Therefore, the

trustee argues that the circuit court erred by applying Code

§ 8.01-242, a state statute of limitations, to bar the claim

of an assignee of a federal agency.    We disagree.

     In Union Recovery, we considered whether an assignee of a

promissory note from the Resolution Trust Corporation was

entitled to the benefit of the statute of limitations

available under federal law to the Resolution Trust

Corporation.   The Resolution Trust Corporation was a receiver

of an insured depository institution that originally held the

note, and the assignee argued that it was not required to

comply with the state statute of limitations that was shorter

than the federal statute of limitations.   We held that the

assignee was entitled to rely upon the federal statute of

limitations.   We explained that

          "[t]he extended statute of limitations is
     merely a mechanism for providing the receiver with
     an adequate time to pursue those claims which the
     financial institution could not successfully pursue
     prior to its failure. As such, the receiver's right
     to sue within the statute of limitations period is
     inherent in its possession of the instruments at
     issue and would thus be among the 'rights, remedies

                                   8
     and benefits which are incidental to the thing
     assigned,' and not merely a right 'personal to the
     assignor and for [its] benefit only.' "

252 Va. at 424, 477 S.E.2d at 524 (quoting WAMCO, III, Ltd. v.

First Piedmont Mortgage Corp., 856 F. Supp. 1076, 1086 (E.D.

Va. 1994)).

     Unlike the circumstances in Union Recovery, in which

Congress specifically created a federal statute of

limitations, in the case presently before this Court, Congress

has not created an applicable federal statute of limitations

that governs a foreclosure proceeding initiated by the federal

government or its agencies.   Additionally, in this case, the

rationale underlying the rule that the federal government is

immune to the operation of statutes of limitations would not

be served by permitting a private assignee to enjoy perpetual

immunity from a statute of limitations for a purely private

benefit.   Thus, we hold that the trustee is not entitled to

the immunity afforded to the federal government and its

agencies from statutes of limitations.

     We further hold that the 20-year statute of limitations

contained in Code § 8.01-242 is controlling in this case.    The

deed of trust at issue in this case did not contain a maturity

date and was executed by the Wheelers on September 30, 1980.

The trustee initiated foreclosure proceedings more than 20




                                9
years from the date of the deed of trust and, therefore, the

trustee's action is barred.

                                IV.

     In view of the foregoing, and finding no merit in the

trustee's remaining contentions, we will affirm the decree of

the circuit court.

                                                           Affirmed.


CHIEF JUSTICE CARRICO, with whom JUSTICE KINSER and JUSTICE
LEMONS join, dissenting.

     I would reverse the judgment of the trial court.      The

deed of trust in this case states that it "is to be construed

and enforced in accordance with applicable Federal law."

(Emphasis added.)    The majority opinion notes that the

substituted trustee under the deed of trust correctly stated

the applicable federal law when it said in its memorandum

filed in the circuit court that "'Congress has not explicitly

declared any federal statute of limitations for cases of this

nature, and thus, time does not run against the sovereign, or

its assignees.' "    Slip op. at 7.    (Emphasis added.)   LPP

Mortgage, Ltd., an appellant here, is the assignee of the

Administrator of the Small Business Administration, the

beneficiary under the deed of trust.

     "[A]n assignee obtains his rights from the assignor, and,

thus, he is said to 'stand in the shoes' of the assignor when


                                10
pursuing an action on the contract or instrument assigned."

Union Recovery Ltd. P'ship v. Horton, 252 Va. 418, 423, 477

S.E.2d 521, 523 (1996).   The right to enforce the contract or

instrument is one of the "'rights, remedies and benefits which

are incidental to the thing assigned' . . . and not merely a

right 'personal to the assignor and for [its] benefit only.'"

Id. at 424, 477 S.E.2d at 524 (quoting WAMCO, III, Ltd. v.

First Piedmont Mortgage Corp., 856 F.Supp. 1076, 1086 (E.D.

Va. 1994)).

     In Horton, the assignee of a promissory note in favor of

the Resolution Trust Corporation sought a money judgment

against the makers.    This Court considered whether the

assignee was entitled to the benefit of the longer federal

statute of limitations available to Resolution Trust or was

subject to the shorter state statute of limitations.   This

Court held that the assignee was entitled to the "longer

limitations period."   252 Va. at 424, 477 S.E.2d at 524.

     The majority seeks to distinguish Horton on two grounds.

First, the majority says that in the circumstances reviewed in

Horton, Congress specifically created a federal statute of

limitations in 12 U.S.C. § 1821(d)(14)(A) and (B) on a

contract claim while, here, Congress has not created an

applicable federal statute of limitations that governs a

foreclosure proceeding initiated by the federal government or


                                11
its agencies.   However, Congress has specifically declared

that "[n]othing [in 28 U.S.C. § 2415] shall be deemed to limit

the time for bringing an action to establish the title to, or

right of possession of, real or personal property," § 2415(c),

and the parties to this litigation agree that § 2415(c)

applies to foreclosure proceedings brought by the federal

government or its agencies.

     It cannot make any possible difference legally or

logically that § 2415(c) may not qualify as a statute of

limitations.    The fact that Congress has prescribed no

limitation on the right of a federal agency to foreclose on a

deed of trust but has imposed a limitation upon such an

agency's right to recover a money judgment on a contract claim

should not affect the right of an assignee to step into the

shoes of the assignor in either case.   Just as the assignee in

Horton was entitled to benefit from the longer period

prescribed in 12 U.S.C. § 1821, so too is the assignee in this

case entitled to the benefit of the non-limitation provision

of 28 U.S.C. § 2415(c).

     The majority also seeks to distinguish Horton on the

ground that permitting a private assignee to enjoy perpetual

immunity from a statute of limitations for a purely private

benefit would not serve the rationale underlying the rule that

the federal government is immune to the operation of statutes


                                12
of limitations.   However, this involves a public policy matter

that is solely within the province of Congress, and it has

seen fit to enact § 2415(c) without any restriction upon those

who may benefit from the absence of a limitation period

applicable to federal foreclosures.

     Moreover, we crossed the public policy bridge in Horton.

We said there that, even without reference to the public

policy that might be promoted, application of the common law

permitting an assignee to stand in the shoes of the assignor

"mandates the application of the longer [federal] limitations

period," 252 Va. at 424, 477 S.E.2d at 524, which certainly

benefited the private assignee involved in that case.   While

the benefits to the private parties involved in Horton and

this case might differ, the difference is in degree only, not

in principle, and public policy is not implicated.   And, at

this point, I repeat that this Court said in Horton that the

right to enforce an instrument assigned by a federal agency to

a private party is "among the rights, remedies, and benefits

which are incidental to the thing assigned and not merely a

right personal to the assignor and for [its] benefit only."

Id. (Emphasis added) (internal quotation marks and citation

omitted).

     I find no principled distinction between Horton and the

case at hand.   Accordingly, I would reverse the judgment of


                               13
the trial court and let the assignee stand in the shoes of the

assignor to foreclose the deed of trust in question.




                              14
