A recent decision by the Court of Appeals of Virginia has upheld the dismissal of a lawsuit involving claims for repayment on two promissory notes, highlighting questions about whether financial contributions among members of a spiritual group were intended as gifts or enforceable loans. The ruling clarifies that the court found no binding contract between the parties and determined that mutual assent was lacking.
The appeal was filed by Kirk T. Schroder against Lori Lynn, formerly known as Lori Schelin, following an earlier judgment from the Circuit Court of Goochland County. The opinion, issued on April 14, 2026, details how Schroder sought payment from Lynn based on two promissory notes he claimed represented loans for her legal fees during divorce proceedings.
According to the court’s memorandum opinion, both parties were members of a “Mystery School” operated out of the Aquarian Bookshop in Richmond, Virginia. John Oliver owned the bookshop and led efforts among school members to assist Lynn financially when she separated from her husband in June 2017. As described in testimony, about ten members contributed funds to help pay Lynn’s attorney fees, depositing money into a trust account managed by Schroder.
Schroder, who provided pro bono legal services to several group members including Lynn, wrote checks from this account to cover her legal expenses. He testified that while some funds were considered gifts initially, at some point it was understood that further payments would be treated as loans. Schroder drafted two promissory notes—one dated July 7, 2017 for $2,000 plus interest and another dated March 20, 2018 for $7,154.47 plus interest—and sent them to Lynn for signature.
Lynn signed both notes but did not return them to Schroder. She testified that she interpreted all contributions as gifts and believed she was not required to repay them. According to her statements in court, she only signed the notes because Schroder told her they were needed “for the file,” and later shredded them after being told by Schroder that they could be discarded following unrelated litigation involving her ex-husband.
During trial proceedings in December 2024 at Goochland County Circuit Court, both parties presented differing accounts regarding their intentions with respect to the promissory notes. While Schroder argued that Lynn wanted documentation for use in her divorce case and thus acknowledged an obligation to repay him and other contributors, Lynn maintained that she never asked anyone for money nor agreed to any loan terms.
The circuit court found that evidence referred repeatedly to “fundraising,” “donations,” and “contributions,” implying these were gifts rather than loans. It also noted there was no indication that either party intended at the time for these payments to become enforceable debts; instead, it appeared they were created primarily for appearances during ongoing litigation related to Lynn’s divorce case.
On appeal, Schroder challenged both factual findings regarding mutual assent and several evidentiary rulings made during trial. He contended that his claim should have succeeded unless fraud had been proven by Lynn—a defense she did not raise or rely upon according to both parties’ closing arguments and judicial comments recorded in court transcripts.
The appellate opinion rejected these arguments by emphasizing established standards: “mutuality of assent—the meeting of the minds—is an essential element of all contracts.” The judges found no error in how credibility determinations favored Lynn’s account over Schroder’s assertions about intent or repayment expectations.
Regarding evidentiary issues raised by Schroder—including objections over emails describing him as a benefactor and testimony about group dynamics—the appeals court held that such evidence was relevant under Virginia law because it informed whether there had been an agreement between parties regarding repayment obligations.
Lynn requested attorney fees associated with defending against this appeal; however, citing precedent reserving such awards for cases where arguments are not fairly debatable under reasonable interpretations of law or record facts, the appellate panel denied this request.
The case was heard before Chief Judge Decker and Judges Malveaux and Duffan at Richmond. Timothy K. Sanner presided over earlier circuit court proceedings. Attorneys involved included Bradley P. Marrs (Marrs & Henry) representing appellant Kirk T. Schroder and Scott D. Cardani (Critzer Cardani PC) representing appellee Lori Lynn. The case is identified as Record No. 0326-25-2.
Source: 0326252_Schroder_v_Schelin_Opinion_Virginia_Court_of_Appeals.pdf