ENFORCING NON-ENFORCEABLE JURY TRIAL WAIVERS
By Alan J. Cohen*
Tyre Kamins Katz Granof & Menes
On August 4, 2005, in Grafton Partners L.P. v. Superior Court, the Supreme Court of
California held that pre-dispute agreements waiving the right to a jury trial are unenforceable.1
The case involved a dispute over a provision in a retainer agreement between a real party in
interest, PriceWaterhouseCoopers L.L.P. (“real party”) and its client, Grafton Partners L.P., et al.
(“petitioners”) which stated, “In the unlikely event that differences concerning . . . services or
fees should arise that are not resolved by mutual agreement . . . [both parties] agree not to
demand a trial by jury in any action, proceeding or counterclaim arising out of or relating to [the
Pursuant to a dispute under the agreement, petitioners filed a complaint and demanded a
jury trial. The trial court relied upon the waiver contained in the retainer agreement, and granted
real party’s motion to strike. Subsequently, petitioners filed a petition for writ of mandate or
prohibition in the Court of Appeal, which refused to enforce the agreement, granting relief in
petitioners’ favor. Respondent appealed to the California Supreme Court.
Article I, Section 16 of the California Constitution accords parties the right to trial by
jury. This provision specifically states that any waiver of the inviolate right to a jury
determination must occur by the consent of the parties to the cause as provided by statute. The
statute implementing this constitutional provision is Code of Civil Procedure, Section 631. This
statute sets forth six specific ways by which the right to jury trial may be waived.2
The Court began its analysis by acknowledging Trizec Properties, Inc. v. Superior Court3, a 1991 case in which a California Court of Appeal declared jury trial waivers permissible, even without statutory authorization. However, the Court declared Trizec inconsistent with a long and established line of cases holding that under the California Constitution, the rules under which parties to a lawsuit may waive a jury trial must be prescribed by the Legislature.4
The Court supported this assertion with analysis of the Constitutional Convention of 1878-1879 and a 1970 Constitutional Revision Commission. Because the Court concluded that the California Constitution, state legislative history, and case law require jury trial waivers to be prescribed by statute, the Court turned its attention to Code of Civil Procedure, Section 631, California’s jury waiver statute, and whether the statute’s language provides for pre-dispute jury trial waivers. Real party argued that agreeing to a jury trial waiver before the existence of a dispute and subsequently filing that waiver with the court after a dispute arises would fall under Section 631(d)(2), which permits jury trial waiver by “written consent filed with the clerk or judge.” The Court rejected this argument, citing several cases in which it was held that section 631 applies only once litigation has commenced. In addition, the Court stated that legislative intent, and the precise language of the statute support the distinction between section 631(d)(2) and the case at issue.
The next argument set forth was that interpretation of the plain language of Section 631 would serve the “settled expectations of many persons who have entered into waivers in reliance on the Trizec decision.” Real party also suggested that failure to enforce jury trial waivers does not make sense in light of the fact that the right to a jury trial may be forfeited by negligence (section 631(d)(4)) or by failure to deposit fees in a timely manner (section 631(d)(5), (6)), but not by the knowing, voluntary agreement of the parties prior to the dispute. The court dismissed each of these arguments, and again stated that it was the Legislature, not the courts, that created a “considered procedural scheme” when providing for these jury trial waivers. The Court then distinguished between predispute jury trial waivers and predispute arbitration agreements, again citing legislative intent. Specifically, the Legislature expressly has authorized predispute arbitration agreements and stated a strong state policy favoring arbitration. To the contrary, there is no comparable statute favoring court trials as opposed to jury trials. Judicial reference is another predispute alternative espoused by the Court in Grafton.
Under this form of alternative dispute resolution, authorized by Code of Civil Procedure, Section
638, a referee, usually a retired judge, is appointed by the court to hear the dispute, analyze and
rule on issues of fact and law, and ultimately issue a decision that can become an official
judgment of the court at the request of the prevailing party.5
In light of these limited alternatives to jury trial waivers, Justice Chin issued a Concurring Opinion, in which he agreed with the holding and reasoning of the majority, yet specifically urged the Legislature to enact legislation expressly authorizing pre-dispute jury waivers. He pointed out that the California Supreme Court’s decision is not consistent with most of the authority in other state and federal jurisdictions in which predispute jury trial waivers are permitted.
In the future, California Legislature may grant Justice Chin’s request, and provide legislation allowing contracting parties to waive their right to a jury trial before a dispute arises. However, until that time, such provisions are unenforceable, and contracting parties are limited to using alternatives such as arbitration and judicial reference clauses.
* The writer acknowledges associate Garrett J. Brown for his assistance in the research and
preparation of this article.
1 Grafton Partners L.P., et al. v. The Superior Court of Alameda County, 36 Cal.4th 944 (2005).
2 The means by which the right to a jury trial may be waived or forfeited are: (1) failure to appear at trial; (2)failure to demand jury trial within a specified period after the case is set for trial; (3) failure to pay required feesbefore trial; (4) failure to pay required fees during trial; (5) oral consent in open court, and; (6) written consent filed with the clerk or the court.
3 229 Cal.App.3d 1616 (1991).
4 See, e.g., Exline v. Smith, 5 Cal. 112 (1855).
5 For further discussion on judicial reference as an alternative to preduspute jury trial waiver, see Peter E. Perkowski, Alternatives to Predispute Jury Waivers after Grafton Partners, Los Angeles Lawyer, April 2006. Perkowski describes judicial reference as "a bench trial, except that the parties have agreed to litigate 'outside the courthouse' before a private judge."