In January 1977, Kendrix M. Easley, then 21, had applied to Harvard Law School and was looking forward to finishing his senior year at the University of Virginia in style.

Easley, from rural Henry County, Va., was an A-minus student, the first black president of Virginia's student government, and chairman of the school's Honor Committee. There had been an incident during which students charged he was incompetent to chair the honor panel, but Easley refused to resign and seemingly had ridden out the storm.

That was before a white sophomore, the son of a prominent Norfolk lawyer, anonymously gave the campus newspaper a forged letter on university hospital stationery purporting to be a psychiatrist's report on Easley's unstable mental condition. A copy of the document, laced with racial epithets, also was left on a library copying machine.

Yesterday, details of the letter's impact emerged in Charlottesville Circuit Court as testimony began in trial of Easley's $300,000 libel suit against the white student.

By the end of Easley's senior year, according to court statements, students gathered below his window at night were calling him "psycho," his grades plummeted, he was rejected at every law school he applied to and he became a recluse obsessed with finding out who had drawn up the bogus psychiatric report.

Easley scored 352 on his law school entrance examination the following April, far below the national average.

Edward R. Willcox III, who has already paid a $250 fine for "forgery for publication" in the incident, admitted in court that he had written the fraudulent report. But Willcox said he had done so to expose the university newspaper's gullibility and not to injure Easley.

Willcox's actions began as "a college prank, a hoax intended to hurt no one," his lawyer, Thomas E. Albro of Charlottesville, said yesterday in an opening statement. "The plaintiff (Easley) was the instrument of his own undoing."

Albro challenged the contention of Easley's laywer, John W. Scott Jr., that the forged document caused Easley's precipitant decline in academic and community standing, calling it "pure speculation and guesswork."

He also denied that there was any racial motivation behind the incident.

According to testimony, Willcox wrote the report on the night of Jan. 26, 1977, on university hospital stationary he had received from a friend. In it he described Easely as suffering from "hyperactive anxiety," noting "perspiration around the hairline," and irregular eye movement. He signed the report Dr. Robert Brown. Brown is a psychiatrist on the Virginia faculty.

Wilcox then placed the report under a park bench in front of his fraternity house and placed an anonymous call to a reporter of the university newspaper. He waited on the roof of the fraternity until the report was picked up, he told the jury.

After word of the report spread around the campus, Easley testified he "seldom went to class, and couldn't concentrate on studies. I was just present on the ground. I was obsessed with who forged this letter."

Easley told the jury he had first learned of the forged report a few weeks before he was to take his semester tests and his law school entrance examinations. "I was completely shocked," Easley said, recalling when he was first confronted with the letter by a university newspaper reporter.

The reporter refused to show Easley the letter or to make a copy for him and it took Easley several days to secure a copy of the falsified record for himself, according to Easley.

Initially, he said, he believed the report to be genuine, thinking that Brown had been requested to evaluate Easley's mental state by fellow Honor Committee Students.

Although committee members did consult with a faculty psychology professor about Easley, no evaluation was carried out and Easley denounced the move at the time as a "political tactic" to make him look bad.

The student newspaper did not publish the text of the bogus report. At Easley's urging, Brown gave the paper a letter dated Feb. 7, 1977, denying he had examined Easley and declaring the report false.

Easley subsequently stepped down as Honor Committee chairman in March 1977.

Easley, who also was a member of the University Debate Society, the Big Brother Committee, the Dramatics Club and the Martial Arts Club, graduated in spring of 1977. He now works as a program director for minority programs with the National Business Committee in Richmond.

Wilcox, who later dropped out of Virginia, is living at home in Norfolk and is employed at $90 a week in a Portsmouth, Va. fiber glass plant.