Citing Virginia's "very tight" libel law, a Circuit Court judge yesterday dismissed the $300,000 suit brought by a black University of Virginia graduate over a white student's hoax.

Judge Alex Sands granted a motion by defense attorney Thomas E. Albro that the case be set aside because it did not fit any of four specific categories of damages cited by the state libel stature.

"It's a very tight law in Virginia, probably tighter than in other states," Sands said later in a telephone interview. "I had no alternative," Sands said his ruling was based "entirely on a technicality."

John W. Scott, the lawyer representing plaintiff Kendrix M. Easley, described Easley yesterday as "very surprised" by the decision. "He had very little to say," Scott said.

Easley's suit stemmed from a campus incident in January 1977 in which Edward R. Willcox III, the son of a prominent Norfolk lawyer, wrote and planted a bogus psychiatric report that depicted Easley as mentally unstable.

Willcox later paid a $250 fine after he was charged with a misdemeanor in the case. He subsequently dropped out of the university.

At the time, Easley was the university's first black student government president and was chairman of the school's Honor Committee. He testified his grades plummeted after he became "obsessed" with finding out who had circulated the false report, and said he failed to get into law school as a result.

Sands based his ruling on a 1944 Virginia Supreme Court case that limited damages in libel suits to four categories - accusations of criminal conduct, carrying a loathsome disease, incompetence affecting one's occupation, or words prejudicing one "in his or her trade or profession."

Because Easley was a student when the incident occured, Sands said, he was not involved in either "trade or profession" and cannot collect damages.

It was that category that Scott said he had assumed fit his client, and Scott acknowledged yesterday that he had not expected a serious challenge on the point.

Scott said in a telephone interview that he would decide within 10 days whether he would appeal the decision to the Virginia Supreme Court.

Expect for a $50 donation from the 7th Congressional District Black Caucus, Easley has shouldered the $800 in costs in the case, according to Scott. Scott said an appeal would cost another $1,500.